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Shopify vs. Amazon: Which E-Commerce Stock Has The Edge Now?
SHOPShopify(SHOP) ZACKS· ZACKS·2025-06-09 17:11

E-commerce Industry Overview - The e-commerce market is projected to reach 10.19trillionby2025and10.19 trillion by 2025 and 21.22 trillion by 2030, with a compound annual growth rate of 15.8% from 2025 to 2030, presenting significant growth opportunities for companies like Shopify and Amazon [2] Shopify (SHOP) Analysis - Shopify's Merchant Solutions generated 1.74billioninrevenueinQ12025,accountingfor73.71.74 billion in revenue in Q1 2025, accounting for 73.7% of total revenues, driven by user-friendly tools [3] - Shop Pay processed 22 billion in Gross Merchandise Value in Q1 2025, reflecting a 57% year-over-year increase, with notable brands adopting the service [4] - Shopify is investing in AI-driven tools to enhance customer engagement and streamline operations, expanding its partner base with major companies [5] Amazon (AMZN) Analysis - Amazon is diversifying its product offerings and expanding its global presence, with significant growth in grocery, pharmacy, and healthcare sectors [6][9] - In Q1 2025, Amazon introduced luxury shopping experiences and welcomed brands like Oura Rings and Michael Kors, enhancing its product range [7] - Amazon's focus on everyday essentials has led to substantial growth, with grocery sales exceeding 100billion,solidifyingitspositioninthegrocerymarket[9]FinancialPerformanceComparisonYeartodate,Shopifyshareshaveincreasedby4.8100 billion, solidifying its position in the grocery market [9] Financial Performance Comparison - Year-to-date, Shopify shares have increased by 4.8%, while Amazon shares have decreased by 2.7%, attributed to Shopify's growth in its merchant base and Amazon's struggles in a challenging macroeconomic environment [11] - Shopify's shares are trading at a forward Price/Sales ratio of 12.28X, while Amazon's is at 3.14X, indicating that both companies are currently overvalued [14] - The Zacks Consensus Estimate for Shopify's 2025 earnings is 1.40 per share, reflecting a 10.77% year-over-year increase, while Amazon's estimate is $6.31 per share, indicating a 7.69% increase [17] Earnings Surprise Performance - Shopify has beaten earnings estimates in three of the last four quarters with an average surprise of 14.87%, while Amazon has beaten estimates in all four quarters with an average surprise of 20.68% [18] Conclusion - Shopify is experiencing strong growth in its merchant base but faces challenges from macroeconomic conditions and tariffs, while Amazon's diverse offerings and strong earnings surprises position it favorably for long-term success [20]