Shopify Has Smaller Loss Than Expected in First Post-IPO Results

OTTAWA, Canada — Shopify Inc. beat analysts' estimates in its first quarter as a public company as it signed up more users and increased revenue from processing payments.

The Canadian maker of software for online retailers reported a loss of 3 cents a share, excluding some items. Analysts projected a loss of 8 cents, the average of estimates compiled by Bloomberg. Revenue was $44.9 million, compared with $23.7 million a year earlier, the Ottawa-based company said Thursday in a statement. Analysts predicted $37.2 million.

Shopify went public in May and is working to increase its revenue and customer base in the face of competition from other e-commerce software providers like Bigcommerce Inc. and large marketplaces like Etsy Inc.

Even with the crowded field, the e-commerce market is so big that Shopify has plenty of room to keep growing, Richard Davis Jr., an analyst at Canaccord Genuity Group Inc., said in a June 30 note to clients.

“Even if you take a conservative cut at market sizing, Shopify has years to go before it slams into any logically rational glass ceiling,” Davis said.

Shopify had more than 175,000 merchants at the end of the quarter. The shares rose 12 percent to $38.20 in trading before U.S. markets opened. The stock has doubled in price since its first day of trading May 21.

By Gerrit De Vynck; editors: Cecile Daurat, Paul Barbagallo.