Shopify (SHOP) on Tuesday reported fourth-quarter earnings and revenue that topped analyst estimates as its merchant business turned in a strong quarter. SHOP stock fell sharply on the news as analysts mulled the e-commerce firm’s 2024 revenue guidance.

X

Released before the market open, Shopify earnings for the quarter ending Dec. 31 were 34 cents, excluding one-time items. Also, the Canada-based company’s revenue rose 24% to $2.1 billion.

Analysts polled by Visible Alpha expected Shopify to report a profit of 30 cents a share on revenue of $2.07 billion.

SHOP stock plunged 10.4% to 79.88 on the stock market today. Heading into the Shopify earnings report, shares were up 15% in 2024, including a 9.4% jump last week.

Shopify Stock: 2024 Outlook

Shopify said Q4 gross merchandise volume from merchant transactions rose 23% to $75.1 billion vs. estimates of $71.53 billion. Merchant solutions revenue rose 21% to $1.6 billion vs. estimates of $1.57 billion.

For full-year 2024, the company expects “revenue to grow at a low-twenties percentage rate on a year-over-year basis, which translates into a year-over-year growth rate in the mid-to-high-twenties when adjusting for the 500 to 600 basis points impact from the sale of our logistics businesses.” Analysts forecast revenue of $8.38 billion, up 19%.

The company in 2023 sold its delivery and logistics business to Flexport, easing Wall Street worries over rising capital spending.

Shopify sets up e-commerce websites for small businesses, and partners with others to handle digital payments and shipping.

Meanwhile, Shopify stock holds a Relative Strength Rating of 95 out of a best-possible 99, according to IBD Stock Check-up.

Follow Reinhardt Krause on X, formerly called Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.

YOU MAY ALSO LIKE:

IBD Digital: Unlock IBD’s Premium Stock Lists, Tools And Analysis Today

Learn How To Time The Market With IBD’s ETF Market Strategy

Get Free IBD Newsletters: Market Prep | Tech Report | How To Invest