Shopify(US:SHOP) ZACKS·2025-10-20 15:06Core Insights - Shopify's Merchant Solutions revenues increased by 37% year over year in Q2 2025, indicating strong monetization of platform activity [1][10] - Gross Merchandise Volume (GMV) rose by 31% to $87.84 billion, driven by higher sales from existing merchants and new additions [1][10] - The adoption of Shopify Payments reached a 64% penetration rate, significantly contributing to revenue growth [2] Revenue and Growth - Shop Pay processed $27 billion in GMV, reflecting a 65% year-over-year increase [2][10] - Merchant Solutions revenues were bolstered by a 29% growth in offline commerce and a remarkable 101% rise in the B2B segment [2] - Shopify anticipates mid-to-high 20% revenue growth for Q3 2025, supported by ongoing strength in Merchant Solutions and international expansion [3] Competitive Landscape - Shopify faces intense competition from eBay and Amazon in the e-commerce sector [5] - eBay reported 134 million active buyers and $19.5 billion in GMV for Q2 2025, leveraging generative AI to enhance advertising revenues [6] - Amazon's "Buy with Prime" service and extensive logistics capabilities position it as a formidable competitor in the U.S. e-commerce market [7] Stock Performance and Valuation - Shopify shares have increased by 48.4% year to date, outperforming the broader Zacks Computer and Technology sector and the Zacks Internet Services industry [8] - The stock is considered overvalued with a forward 12-month price/sales ratio of 15.58X compared to the sector's 6.9X [12] - The Zacks Consensus Estimate for 2025 earnings is $1.45 per share, indicating an 11.5% year-over-year growth [14]