David Moadel
5 min read
Quick Read
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Shopify plunged 15% after GMV of $119B and subscription revenue of $836M both missed estimates, despite beating on EPS and operating income.
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Wix slid 3% and Etsy fell just 1%, while Amazon and MercadoLibre edged higher, confirming the sell-off is concentrated in Shopify.
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Bears cite slowing subscription growth, gross profit lagging revenue, and a 155x P/E as reasons to stay cautious through the holiday quarter.
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Two soft spots in an otherwise strong quarter are costing Shopify (NASDAQ:SHOP) heavily. Shopify stock is at $130.01, down 17% in morning trading. The prior session closed at $156.22. With the slide, Shopify stock is now down 18% year to date.
The company reported its Q3 2026 results before the open on November 3, and two closely watched growth metrics fell short. Gross merchandise volume (GMV) at Shopify came in at $119.15 billion, up 29% year over year, missing the $120.08 billion analysts expected. On the subscription side, Shopify’s Subscription Solutions revenue rose 20% to $836 million, short of the $850.2 million estimate.
Shopify Beat on Profits as Growth Metrics Cooled
Profit lines in Shopify’s November 3 earnings release looked much healthier. Adjusted earnings per share (EPS) at Shopify came in at $0.49, ahead of analyst estimates, while revenue of $3.74 billion rose 32% and met consensus. Merchant Solutions, which houses payments, brought Shopify $2.91 billion in revenue, slightly above the $2.9 billion estimate.
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Operating income at Shopify reached $568 million, exceeding the $523.9 million analysts projected. Cash generation was another bright spot, with Shopify producing $816 million in free cash flow. That raised Shopify’s free cash flow margin to 22% from 18% a year earlier. On a GAAP basis, Shopify earned $0.36 per diluted share, weighed by a $117 million net loss on equity and other investments.
