Core Insights - The company experienced a total revenue decline attributed to a challenging year-over-year comparison, specifically due to a non-recurring $4.5 million product deal in the previous year [1] Revenue Performance - The company is focusing on prioritizing service revenue and expanding its Monthly Recurring Revenue (MRR) base to enhance overall margin profiles [1] - Service revenue grew by 14.6%, driven by momentum in technology solutions and managed cloud practices, particularly benefiting from complex enterprise migrations to Azure [1] Managed Service Practice (MSP) - The Managed Service Practice is beginning to see early returns from recent infrastructure investments, with new customer signings expected to generate nearly six figures in monthly revenue [1] Cybersecurity Growth - AZT Protect's cybersecurity traction is expanding through a 'seed and grow' strategy, now serving 46 unique customers across various industrial sectors such as steel, energy, and pharmaceuticals [1] - The sales cycle for cybersecurity is often delayed due to unique customer procurement processes, but the use of industry-specific case studies is starting to accelerate the education phase [1]

Core Insights - Shopify reported fourth-quarter 2025 non-GAAP earnings of 38 cents per share, missing the Zacks Consensus Estimate by 7.32%, while revenues of $3.67 billion surpassed estimates by 2.55%, marking a year-over-year increase of 30.6% [1][9] Revenue Performance - Gross Merchandise Volume (GMV) in Q4 was $123.84 billion, up 31.1% year over year, with offline GMV increasing by 29% and B2B GMV surging 84%. International GMV grew by 50%, with Europe’s GMV rising 45% year over year [2] - Merchant solutions revenues reached $2.89 billion, accounting for 78.8% of total revenues, with a year-over-year increase of 34.9% driven by strong GMV and increased penetration of Shopify payments [3] - Subscription solutions revenues were $777 million, making up 21.2% of total revenues, with a year-over-year increase of 16.7% [4] Profitability Metrics - Gross profit for Q4 was $1.69 billion, reflecting a 25.2% year-over-year increase, although gross margin contracted by 200 basis points to 46.1% due to a mix shift from higher-margin Subscription Solutions to lower-margin Merchant Solutions [5] - Merchant Solutions' gross profit increased by 30%, while Subscription Solutions' gross profit grew by 18%, with respective gross margins of 36.8% and 81% [6] Operating Expenses - Total operating expenses were $1.06 billion, up 19.7% year over year, with Sales & Marketing expenses increasing by 24.4% to $433 million, R&D expenses rising by 11.1% to $390 million, and G&A expenses surging by 11.6% to $125 million [7] - Despite the increase in operating expenses, as a percentage of revenues, total operating expenses declined by 260 basis points to 28.9% [8] Future Guidance - For Q1 2026, Shopify expects revenues to grow at a low-30% rate year over year and gross profit to grow at a high-20% rate year over year, with GAAP operating expenses as a percentage of revenues projected to be in the 37-38% range [11]

Core Insights - Shopify (SHOP) reported strong second-quarter 2025 results with non-GAAP earnings of 35 cents per share, exceeding the Zacks Consensus Estimate by 25% and reflecting a 34.6% year-over-year increase [1][9] - Revenues reached $2.68 billion, surpassing the Zacks Consensus Estimate by 5.47% and showing a 31.1% year-over-year growth [1][9] - Following the earnings report, Shopify shares rose 22%, with a year-to-date increase of 45.7%, significantly outperforming the Zacks Computer and Technology sector's return of 10.9% [2] Revenue and Growth Metrics - Gross Merchandise Volume (GMV) for Q2 was $87.84 billion, a 30.6% year-over-year increase, driven by a growing merchant base and strong international performance [3][9] - Merchant solutions revenues were $2.02 billion, accounting for 75.5% of total revenues, with a year-over-year increase of 36.6% [4][9] - Subscription solutions revenues reached $656 million, representing 24.5% of total revenues and a 16.5% year-over-year increase [5] Operating Performance - Gross profit for the quarter was $1.3 billion, up 24.6% year over year, with Merchant Solutions' gross profit growing by 32% [7][9] - Total operating expenses were $1.01 billion, a 25.7% year-over-year increase, but as a percentage of revenues, they declined by 160 basis points to 37.7% [7] - Adjusted operating income was $291 million, reflecting a 20.7% year-over-year increase, while operating margin contracted by 90 basis points to 10.9% [10] Cash Flow and Balance Sheet - As of June 30, 2025, cash and cash equivalents totaled $5.82 billion, up from $5.51 billion at the end of Q1 [11] - Free cash flow increased by 26.7% year over year to $422 million, with a free cash flow margin of 15.7% [11] Future Guidance - For Q3 2025, Shopify anticipates revenue growth in the mid-to-high twenties percentage range year over year, with a consensus estimate of $2.63 billion [12] - Gross profit is expected to grow at a low-twenties percentage rate year over year, while GAAP operating expenses as a percentage of revenues are projected to be in the 38-39% range [13]