Shopify (SHOP) 28 Apr 212021 Q1 Earnings call transcript

Thank you for standing by. This is the conference operator. Welcome to the Shopify First Quarter 2021 Financial Results Conference Call.

As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. Instructions]. [Operator like Investor conference Relations. now Keita, to turn of Director to would over the Katie I Please ahead. go

Thank you, operator, and good morning, everyone.

We for Shopify’s can join XXXX you call. are conference first glad quarter us

Lütke, joined Shopify’s and morning Shapero, After open we CFO. prepared our are your it We by up Amy CEO; Finkelstein, for Shopify’s this Harley President; remarks, will their Tobi questions.

can to subject our based on We materially are to and projected. will no that risks make We results as call obligation these forward-looking today by cause uncertainties from those to that statements law. differ statements, and therefore actual required on undertake assumptions except update

You as regulators. in the adjusted can in morning, well uncertainties as and are financial measures press today in Reconciliations measures. Note in that the we with to these read Canadian a not assumptions, speak measures, our And risks and are this release. GAAP our finally, dollars. press our release non-GAAP substitute filings be financial for about U.S. report two U.S. found earnings can between which we

otherwise amounts unless in discussed are that, call With to U.S. today turn dollars, Harley. all over I So, the indicated.

and been since global to year merchants our help focus continued drove strong began, best to It's than a the tools the transformed ecommerce rate them good first our environment quarter. grow to retail which Katie, triggered that performance a this Shopify’s model. morning. pandemic at thrive has more traditional Thanks, in the the on in bringing

entrepreneurs on trusting livelihoods turn and by into consumer our their backed their growth accelerated robust businesses as geographies across year-over-year Shopify, more thrive and ideas GMV as in with they reality. cohorts Our merchants us spending platform, launched

critical increasing reduce buyers so strong becoming scale. of find new offline value of from they as the Discovering our blur complexity friction buyers, a and point the which is of their climbs one and is is more and selling, they to pain build can easily propositions, commerce. customer top acquisition Multi-channel office back as more merchants core manage lines continue the online operations We for businesses. customer between cost relationships, new our

and to up are show help spending buyers marketing sales time. Our where channels merchants future

social in consumers brands Facebook. more a engage year main new quadrupled in digital are helping actively Facebook more era well number streets. GMV of on since through ushering Shops a commerce than the and the as We QX and selling on ago, as has shops The

expanded in last In While is still here. small, Shops additional the partnership EMEA America, a with XX TikTok to clearly internationally difference Facebook QX, of our we year May APAC. of in to and marketing make launch starting North countries an

are buyers helped and by one build merchants convenient shops, multiple that directly. we for merchants with in-app existing which and for of times, are pickup, XX to Point curbside Pro we to number businesses In discovery merchants omni-channel be merchants when seamlessly seen friction March, how features orders button online and QX, over their universe, don't increased touch like started into customers likely reorder Asian-owned checks to in targeted is a the Driving we our order more the their purchase offers tracking, Shop local as adding Installments Businesses a connect well buyer as through the shopping with We their brands both status offline first average traction using over XX% Sale, businesses, commerce. and to this the the mobile of to expand using Sale, Sale shopping buyers a our rediscovery trying is businesses, the lifetime of pay tracked of customers. our online expanding leave leveraging Pay enabling their practicing of year. app Sale to substantially our months later grow This that Point And fact app make recommended their of offered them discovery the features recently may is bridge these increased accelerated their with merchants more vastly And found value now, with end-to-end business. buy are three points helping key Pay, Shop. their products in their of Pinterest we've Shopify recently, we've Black-owned in sustainable operations even and Point example further removing adoption and potential is most buyers points relationships merchants the women-owned assistant, for new Earth benefits. for from so Shop, true filters channel touch Week, buy promoting Pro locations in the introduced them. product. the opening integration worldwide. have in the number discoverability the and a October. to Along are solution of Point helped markets, of Shopify of customers. value Shopify our launched order these far, sales of and opportunities as good U.S. expanded TikTok So the that we've Shop product, since our wallet, increase More last commerce additional Shop by

more same merchants merchants’ coming enables launch business. stages Since over Shopify Pay big million smaller rollout GMV our We QX. that Shopify, shippers, Shipping QX. quarter In do launched Shipping. of own for opted our five of this general option resources well as it. self as the Shop on QX, Pay Checkout. Shop as in are in the Ahead Pay as feature, eligible the Shopify to $XX at Shop already were which early more registered Instagram merchants with one-click behalf of make first merchants had stores than our since such started we to label negotiate now beyond have to into have adoption buyers XXX Shipping surfaces app, half XXXX. users us had to on-boarding and to accelerated the Facebook including checkout of the Pay Revenue volume Shopify’s with its on March, merchant Installments really ago, cumulative of the years of of the billion efforts facilitated in a and use into has the Shopify commerce as using its the users, than in of XX scale with users. U.S. traditionally Pay million in active for buyers both extend growth Shop At on entrepreneurs Facebook Shop over Instagram and of monthly Shops checkout. end as Shop nearly the selling its with Merchants Our come on-boarding from in reserved and integration with of in Canada accelerated availability give outside months, level in in the U.S. better

excited world to of big the parts Shipping need fulfillment. merchants to enough are bring Shopify aren't other who We for yet to to outsource

are Fulfillment those themselves. building volumes be the greater fulfillments Shopify For with so can it care they will their we merchants who were handled trust Network, as same doing are, if the

we the service similar while not Fulfillment Network high we progress. building While our merchants same fast volumes QX, or fulfilled process levels. maintaining good is in and easy, joined are in making this as More QX

volume to this tell funding. on access our graduated record and of bringing brands sales, fast since to $X and for card a natural to get merchants their to to funds business. million Shopify has of accessible they drove account the we signing access capital We banking stepping level XX% an tools on unbanked. a and more Shopify monthly to lifeline start breaking year-over-year, access levels brands scaling pandemic into by through inside record In seeing U that sports the our many DTC the their left Shopify Plus. to underserved we overwhelmed cash More them our on their Shop to the us another took record their international our outside merchants bank, We can to XXXX, up need quarter $XXX back better In of merchants, to in to the is and program are creating their in high the this larger directly adapt on many landscape. critical in continues on an to to been a over quarter. Brands them financial the Japanese of the that important QX store, help and merchant include strong personal Through faster rewards holiday continue foot this our a and It be incredible Plus months. focused into standard follow funded a down and They cash. traction and to Without are run making merchants number fast Mizuno, Small give saw America past from banking larger with cash money a cumulative because feel a funding Shopify Shopify Balance, in roll fund number a happy will launch entrepreneurship years momentum. changing Plus fantastic Shopify launched source the second. effectively, access last QX no XXXX. them we just which brought Capital, flow fee businesses Shopify retail had four fund billion first out get hold the shopping plans join Capital all of from a also quarter business to is This U.S. today's during looking Plus Shopify time out our Unilever's platform. given we their first Plus gaining Shopify result, take in Shopify billion Once period merchants and is merchants quarter merchants of to early fulfillment record quarter, insights advances. are to of plan over capital Indian use Shopify their to QX, that Balance funded providing of as their continue eligible us barriers by of services. North joined the merchants manage accounts all system the and business. to today's of Lego. to more know are to that And Shopify brand coming capital

partners Tinder Chrissy in momentum internationally, culinary Direct, Heinz as a selling our and made to comfortable directly. Home. ever. that WWE local Tinder accessories. great the that North has fans So their recipe efforts set sub retailers, inspire Kraft star seen And and Fabricville making to Chex following recipes use, wrestlers made excited on a first kitchen the launched for of ease special launched speed directly founded merchants, store. to and & convenient set a evolve shop for integration here built Taylor America fabrics mobile see the are Shopify. in Department launched start our year why a the innovation to products Taylor, far of to people and shop for big on Kraft of get apparel selected & sells which Heinz exciting finally, in shoppers now of last on brands. of up has and Heinz by strong Shop recognizable reasons experience having future-oriented haven't been capabilities, many and of a fun social stores a online channel to as newly the cooking. for their that an brands patterns array It were up restaurant of in kits to Teigen over platform is and Cravings, one nearly have cereal Lord decades most their featuring case and hearts even to years. General build available market, capitalizing proposition is to launched Shopify. store find Mills buy it full launch I'm on sewing place what and stores we've and store renaissance so is their easy share department their thought Lord XXX Like into looking excellent cost Pay total in in to that for as for, well, shoppers XXXX value yet. experiences America's ownership, Canada they're

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MRR and on of Shopify revenue succeed. millions bring merchants especially everyone is this and we more the the our acceleration its accelerated first XX% the global Strong incremental XXXX. full Of XX% percentage holiday between our revenues Plus year-over-year this entrepreneurship QX more recurring MRR our Overall, from MRR. growth revenue, ways X revenue decline of or to can and selling XX% to could of in $XX.X how are our have million put to shared, million better growth from growth well, GMV XXX% revenue remained a growth a million, our persevering. accelerated as remains adopted tailwinds and quarter, relatively remarkable $XXX.X in when subscription, contributed for off seasonal growth how spirit retail quarter to of help more rapid QX do fourth subscription QX services. as merchants also revenue the fee revenue Shopify QX achievement in demand right quarter POS season. given to compete platform Shopify year-on-year of quarter and revenue although last year-over-year Pro first of launched million just strong one an contribution largely our quarter-over-quarter And We're accelerated merchants platform to the revenue. Plus shows of point to in $XX.X small. on app digital quarter. our Shopify perspective, stories we growth solutions quarter track. and to with the and in typically in XX% exceeded continued our irrepressible of MRR first the experienced To Shopify difference benefited commerce our of elevated. due from and coming from contributed first the acceleration see monthly in up compared drive $XXX.X businesses the Subscription to

XXXX driven Shopify growth Shopify on million. standard full XXX% in period the the merchant $XXX from versus merchant from While our revenue. growth MRR an sales, a joining was grew States revenue was GMV to first This XXXX Plus strong number round from in same GMV $XX.X Strong the of to GMV higher the in the by XXX% over significantly Merchant greater QX of MRR quarter online platform billion non-Plus primarily significantly, well United in of accelerated POS accelerating stimulus quarter in solutions March. of year benefitting as per injection to quarter to merchants grew alone. latest purchases, introduced faster and retail higher first going Pro a of first and also subscription spend plans with outstanding to as growth result the last share the

focus revenue period to in contributed $X.XX was income strength spend excludes share compared operating overall net income Adjusted share, revenue year's or first GMV was quarter and Payments, combined use in of adjusted Payments quarter. of diluted higher. for of the in Shopify combined million, fair to $XXX.X of unrealized and with which income North first QX outpaced new GMV onto $X.X Shopify was in comparable profile year. investment revenue in there. drove of is versus the products versus a strong year. processed of penetration in coming net XX% adjusted by growth compared GMV margin in a due profit merchant The adoption North QX largely billion outside of expanded opted same we year Payments regions the $XX.X on compared in share with in and same international Shopify compared in upon Shopify merchants Shopify period loss gain stronger margins. quarter earnings strong OpEx from Capital to Payments acceleration these XXXX. company's lower improved first million, its as XXX% wrote and The first $X.XX an of income $XXX.X majority accelerated Shopify value percent QX, up Shopify and their growth QX a operating to from or XXXX of America strong last million last America, year-over-year. Shipping the Adjusted IPO. Payments Payments operating of all growth billion equity Adjusted Adjusted in of per last growth increase increased to to our to merchants GPV $X.X as gratifying dollar outpaced per XX% Plus outpaced million the of Shopify quarter While $XX.X the to quarter was an last firm, revenue quarter merchant in growth accelerated, over adjusted the growth with diluted to million, $XXX.X net was gross in The GMV which in given XXX% XXXX, and across spend. our subsequent our sales year's penetration the last growth revenue

incremental securities year $X.X strengthening sheet of offering share and billion $X.XX with proceeds marketable billion February, at an reflects from balance year. strategies. progress in billion cash for our Last March XX the and our key provide quarter we flexibility I'll on compared net The was increase of for cash, our walk growth the quarter, balance our to outlined three the investment Finally, XXXX. end. on outlook equivalents rest our providing we $X.XX update through in made our first fund areas and of

in out, made quarter. first as Fulfillment our First, solid progress we laid Network the Shopify where, Harley

introducing to orders. continued our merchants, management software to We inventory enhanced easier build insights better and fulfillment make for capabilities to manage

our Shopify Fulfillment their efficiency software product traffic warehouses X as As the speed improve increased in partner fit and fulfillment and focus and River to for continue optimizing important an throughput, the increase Systems their part merchant technology Network, we for to flow pandemic. market network of enabling demand and within also we on build this accuracy, plays optimizing process, during safety easy productivity. agility, balance our deploy, with has customers to scale is products to helping act They're them delight.

ecosystem The our of audience app. described Harley engaged Shop’s the Second attracting is that of features merchants for followers an in Shop. is

the we're seeing with of for levels several months. using early, app cohorts engagement promising buyer Although

experience continue on first shopping international to Rest are relationship these mix build buyers more Shopify and their GMV offer growth our third the to part And is We continue to Shopify, joining localize entrepreneurs strengthen efforts step More platform up world quarter. more as of and features and overall Shop North will international revenue international our America, and delightful regions of we countries. into and with merchants. marketing to and increased sales our that succeeding in as introduce a expansion. focused of that from merchants outpaced a

everywhere We are how expanding well the to work merchant happens commerce in solutions world. also for

and payments, how easily make them. like We available retail when benefit have to we seen shipping, merchants things capital

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We such one Affirm investments have several now, example. being

Turning outlook. to our

continue full overall improve, resume latest of In a that able more round February ongoing rapidly freely, XXXX. factors, benefit likely continue by and XXXX revenue that economic move XXXX, ended out at more likely spending expect and U.S. which grow stimulus to environment assumptions about in outlook to services rate as and a year XXXX, likely normalized ecommerce, Our passed in Shopify’s view offline some are back package from to is April. vaccines processing this roll remain these XXXX countries began in guided populations pace unchanged March. March consumer the stimulus lower GMV of but growth. will to in will to will of than government in early and payments XXXX, In shift we to the early rotate relief to accelerated retail in coronavirus the a The from

expect X driven expanded merchants, growth XXXX to into platform and we the of to the past than Subscription driven continue the new Shopify’s each Payments, solutions existing in higher solutions revenue the merchant Shipping the joining merchants but a contribute GMV by year continued and around other prior solutions revenue in to full Fulfillment adoption such we solutions incremental merchant to Shopify as surge that of stages. established while to from growth rates in the solutions not do merchants be of GMV revenue early growth be more in Shopify solutions, to offerings platform nascent number and River in recent Capital, For Shopify subscription the menu drove as XXXX, revenues any XXXX; than growing as XXXX, similar the by geographically such merchant grow year solutions and Systems than world merchants newer be their both expect including Merchant record and to lower Shopify the more as repeat. Network in but following. them, joining growth

of largest, that been across the we incredibly quarters the evenly the commerce services towards full the offline more unprecedented smallest historically, While rollout expect a the presenting spread contribute of year. a half four likely share XXXX to to quarter rapid innovation. will consumer be accelerate fourth first Shopify catapulted the back has and quarter the change, opportunities if it shifts distributed vaccine may shopping into year still period in the spending and the XXXX revenue more revenue with than of of

We the continue in each to a quarter and of year. reinvest to profit dollars our accelerating rapid in expect with as growth into in back year-over-year aggressively expenses operating can gross as growth plan business rest we the XXXX, throughout

possible. We on are and also after helpful weeks this been building by hiring. eager seeing to putting keep design, to hires has that QX several and over approach Digital improving the we're in a engineering in last greater volume workforce make velocity new rails our of the to place to fully remote

we our to the expect As happen of half in gain spending XXXX. continue of we to second bulk the steam,

in the be XXXX. As adjusted income operating below such, full we expect level achieved to XXXX year we

the the and so intangibles apparent of expenses the than What For many out $XX of pandemic, related More acquired XXXX, we now pieces in foreseeable $XXX of mission need the to the is be future give of are entrepreneurs anticipate of portfolio commerce for initiatives, tools to Katie. turn our call to commerce a model they execute everyone, strong well growth merchants that, of back on our I'll With merchant-first and thriving. compete our and for future. since there year taxes are is make million. payroll and that will business a onset million and better landscape amortization stock-based moving in Shopify balance compensation and the to positioned sheet, the is With adapting our commerce.

by don't question. good to Thanks, everyone Arielle, the a Amy. very yourselves sure start limiting all us can make to question the to remind question, on single call time with to have today, I help ask we I'm for you a first please?

Certainly.

Our first of Please question D.A. ahead. Thomas comes go Davidson. Forte from

for questions. Great. my taking Thanks

should tenure How to building think Tobi, duration post of blog very own investors thoughtful years your So, X,XXX a Shopify? a wrote about CEO of turnover. company executive as last the you about and

the I'm with I'm never come life for I've a long question. for term up of than committed. Thanks the better my Shopify. idea in one a here. Yes, in

in. all I'm So

the Of course, celebrated, something just that. that did as companies, because people that kind right think also figure it's done me of -- hard on of little thoughtfully clearly when grateful react how I incredible Shopify really do. who to amazing leave leaving journey. this class executives said it's wanted deeply is everyone a email, a think this to in the some things sees not have word be I everyone something rather of to And story, that been this should for -- to together. write at team out joined for to done in I And together. because lot the do has I part there's everyone time things this I I'm

so early is this two, I laid that too in for post. think in three the And out this way It me. I would be important one, way

Tom. Thanks,

next Panigrahi go Please Mizuho. of ahead. from Our Siti question comes

has from seeing by you changed? taking talk adoption. consumer my you for forward about question. attracted ecommerce the marketplaces? before, Thanks pulled Like said years. you towards Mainly But even sharp XX marketplaces, landscape how are more of this Tobi, competitive adoption increase it

way products and commerce all people direct and replace wind of talk to are very very, sort honestly department changing all a which just the love broadly. turnover is hard to the The supposed limited that to products, very I'm the I know growth up because soundness and here, you the the a be, going this is direct the like certain the finding people is everyone's macro consumer about have the of Maybe take past and comfortable the familiar categories to led one’s poor store just to we the hard this dynamics but top growing is lot. not -- lot. so the sort trend in with because it's consumer digital people at -- carry to more direct all zero go it. from to big here getting Internet using think behind think of are could of everything what talk more had I channels. just the as really They well high But is it inventory mix of channels quality to that about we're There's

Now, the the but the process not win because been product, to rather up. going of best incentivized purchase able from make directly just of highly to quality who’ve channel, being makers

marketplace a something same he’s it's think manufacturer. more the and often So at periods X.XX – that's of necessarily am growing are morning the really, a then don't I and from buy really might buy bought directly higher competing because been for for of a and X and bunch the think products Again, in months. market way I with for quality channels, in direct direct more time about things categories levels the person longer at thinking that

has of all can I and think ahead everyone Internet a growth it, do commerce lot us. of of

Siti. you, Thank

Our next Securities. ahead. go question Please comes from Ken Guggenheim Wong of

in fulfillment distribution? attach are kind that Hi. think could you taking to earlier supplement and merchants’ how your Harley, of adoption for level fulfillment like? increases, own could about what the Is path? as how partner look of with follow need potentially the my XX% questions. model thinking Thanks seeing to attach And about the right demand mentioned shipping that you higher

for Thanks Hi, question. things. Ken. couple of the A

since the ago. grown on I yes, Shopify said, particular, five as Shipping launched So adoption in has we years significantly

of I proven adopting are Canada eligible the merchants Shopify think And than U.S. half more and it. in really its relevance. has Shipping Now

grow things phase is do Now really merchants that important. of like will self is and through, continue kind why shipping is a to will some which others SSN

SSN in want alluded optimizing want merchants QX the is to keep the to build with course, QX, want similar we us network, is which, itself, we and In What of network do give actually volumes we holiday opening QX the I season. terms really strong merchants more we very on of in joined the fulfilled to to introducing better this to new focus want of remarks, in features but updated to were SSN, software continue the and the to foundation that insights.

goods SSN are have certain may their are now, really But products need may durable the anywhere to you business. market Shipping who product fulfilling important a shippers that -- merchant for phase may other to we exactly for who right you SSN day, and this self in is have XX,XXX are orders products, where be. use XX is Now customers from experience targeting certain for and key brand merchants is who decide really also a Shopify I SSN

it's best really are so possible. we right SSN going have to customer want to for think experience And the narrowing the we or -- don't them down who we be exactly But I to is Shipping. have SSN, because best the want

system global the what choices, particular their they think on becoming merchants I of Shopify the for get operating that need idea depending is business. that different retail

Thanks,

of question comes Colin go next Sebastian from Our Please Baird. ahead.

you're morning, respect with of pace Good platform are with far. about here. Rails, for product you satisfied thanks. have everyone. scalability I'm With the development? Thanks. to Maybe technology another growth and happy so Tobi the stage the of sure any next do using concerns But overall Great, the you and one

business Shopify we of really part larger about why Thank the very first future before for very you. first team we very to We teams than the And able faster good six across a small were booked to made much, Yes, our with technologies much because and reason Rails and well thanks technology outside years a technologies. assumptions is move we others, stacks. took on significantly team venture were like world small investment.

have just technology team we few to back and the give absolute source much said pieces everyone open we engineering as class leverage far ideas good open but source knows same scale an the best so using increase given is software, getting to I how needs of and a community in the to projects we getting has have help to engineers, also So as Shopify. the from much. the maintaining us think we productivity are from Shopify productivity go. very can about company, using as and exactly And that We X,XXX world us it that as core

product I'm really and concerns fund. engineering progress on productivity and with no really, really infrastructure and happy So

Colin. Thanks,

Our next question comes from Trevor Young of Barclays. Please go ahead.

Hi. Thanks for taking the question.

impact stimulus between international think robust impact? we you about think April. the from flagged quantify the early that impacted then could You One, you March and which how that payments help mentioned domestic how should in And differential indicated you GMV? us I Thanks. some growth in

Yes.

the stimulus noticeable U.S. without you it. a strong to GMV give did And me in quarter, but a have let the So, even GMV couple impact was our points. of data

see the March. looking to GMV quarter, the in U.S. pace in accelerated addition, outside at So in and February factor started we January our in GMV, a than faster the a U.S. at stimulus for total before U.S. of And was even acceleration growth the

an plus, this the So It across type, stimulus the and story. across strength a was Across board GMV. isn’t just U.S. merchant geography, acceleration standard board. was in every there so in strength every

Thanks, Trevor.

from of ahead. Markets. RBC Paul Our Capital comes next go question Treiber Please

Thanks very and good much morning.

question curious culture. can bring your of a you in a ability I’m Tobi. outside? employees the about the culture and foster continuing speak for empowering on of on increasingly Just and from In management particular, importance Shopify’s enabling thoughts proven leadership against to to

of need the balance teachers either/or. What Yes. about think and it right I The you is it’s an not students. way is

of a been and that’s have therefore in people This the the has is have it, could can’t meeting a join arrived, for a grew very why rather And can of it’s very, grand just have has in situations time building meetings, in we good and something really out -- here, that have say, reasons And extremely important things decisions was really, be have later and actually is with a people the Because, really, old and for instance, extremely subtle for building so Because might come considered who bringing this wall decision, teachers grows context instance, Shopify explicit to lot sometimes is where students be in been fast. smart And been is company same a of a and the one in of explaining is everyone, context made. culture. Because and making a in one right? better I lot this people some component there. but thing another. very that company key wall long someone key team that and outcome very for what not valuable we’re this very of very a make that that teaching right? you hurry, over in quickly the figure the like

and We a were the for and purposes. there. better Modify load for we a needed to ideal then putting have just this I really thing puts need building actually, we in there’s a actually done, this someone up hurry or And the this in not is experiment up. get hand and up and run case, to Ideally, so don’t this puts hand says, reason wall the to potentially do remember And there that’s of a removal to wall the consequences. deal a with someone good something bearing. says, and actually being be

to what direction great good in you’re every I’m I can long really to of think case, potentially culture. people potential everyone’s who anything want number aren’t the skills you culture. And really high leads thinking long that a that’s alignment and in the as way have is. they you as the the teachers movie students, you before is, a want be as this and which And whatever a person and cases really, faster because other by in a honest, balance, have think in how the fact you -- can So, belief then multiplied ideally of is the about who company really the personal I as there keep be be really good the they building then than company can growth. company have the the has companies and combined, that And is someone good my aptitude, this seen if ratio,

Paul. Thanks,

Our comes from question Craig go Maurer ahead. next Research. Autonomous of Please

platform? income-driven Is and a of helpful. credit or Just Balance view of ecommerce model? net would future Balance its you to question. and back interest to model for about how this Good revenue wanted term rollout. discussion a the talk services thanks be offered financial taking come you really Can part I for interchange Thanks. little the Shopify an the as model morning thoughts on long and of the long-term

question. that take I’ll Craig. Hi,

business. up fast businesses. Balance, able access to and their rewards to for to relevant spend account to get a in for build that merchant act great really be cash our partner. to they their get the they their Balance cash also to terms money, are insights get When access they is Shopify clear, actual immediate So a want be get We cash an built merchants' independent financial these business' funds, flow. signs But monthly to as card they back of integrated

now A that personal banking, lot think complicated. We’re doing business a bank right because we use so it’s of businesses, accounts still primarily lot businesses merchants, their of small really is because this small working. particularly not for

early it, in added terms rollout merchants program the we’ve so of access more to of the And in QX.

barriers. business another on track We success Balance have might availability just that it’s that merchants Shopify idea, to to look Capital, But eligible general and or whether for this at Payments reduce trying we’re all Shopify way small it’s those that are to a later traditional the barriers year. different or

challenges access their democratize amazing and it And capital the to more than businesses of shows otherwise to small business. You to grow of that can to million these they’re heard business of earlier businesses. growth their using are and Shopify available Capital. because, merchants. $X an it worth thing obviously, mark make more billion importantly, X.X to it’s billion so that watch capital may given we’ve when have over you it the not now actually That $X But much important is small

terms You of will do in see how us particular will services, different. more we but the these those each very monetize things each in be years, of of financial coming those

Thanks, Craig.

of Beck Josh Please from comes question go next Our KeyBanc. ahead.

it’s Shop this shopping online assistant. seems taking idea about for expanding. origin I ask the of like wanted to Certainly, centered It you around question. Thank seems the app.

see all Thank fitting into you the businesses about maybe talked of broader terms just great. product curious, sorts, is platform? longer-term which ambition I’m find the You of filters is how this local But Shopify discovery to you. what in

returns, would Yes. internally just tool and just pre-building joking they -- going this, as buying while, process is a of of And The prioritization more that’s but and imagine logistics in how this look enter to had taxi services work that terms and to actually were like and well-loved problems, of on and very We with shopping of solve utilitarian, And so we this sort way remark you got something, have What I stores, pre-Shop. by like then then so goal work, a clearer. But independent that we you’ve organic pick and in Computing mean from once and location rely sent you is much emails that the you the make after to with then ad hoc the we’ll vendors emails is cab as reverse to business you end-to-end you would someone one sale the updates. independent or buy every very exactly that then the you heavily actually of primary seems and it number something opportunities. will commerce, taxi up is that’s is product. of to after & is hopefully, of the getting a -- There well bought pretty very really important crazy. this delightful into supposed are about call be Shop. the We wanted that up, in Uber objective. like to a to We and process sort that’s direct process. is from from it something you care of

could a There’s and local things where we let’s businesses, like you doing, in supporting different doing shopping could every and particular of might or you As see while. experiments consider once be like have courts that you -- some to be pointing see, leads. different

Thanks, Josh.

Our Mark Please next question go ahead. of Evercore Mahaney ISI. from comes

Wheeler is This you. Thank Ben for Mark. on

a question I could. Shopify Just if on Pay,

social Shop had the is working on about So conversion more Thank with Shopify talk Pay those Facebook places Are you and in Pay that the that outside Shop digital sales are channels? you. you actively Instagram first similar impact and being the has used in just integrations on channels? Can ecosystem.

take question. I’ll that

Instagram U.S. available to it’s available clear, Shopify now buyers to yes, on and the Shop is in So Pay be Facebook, all and merchants Checkout on

Checkout, obviously, is of really it’s brands across the bunch to transacted are Pay fairly low. early Shop a starting the favorite powered days are processor services a favorite although, GMV of by on Facebook so and their really different via very Shopify. Payments But are We implementation because Shop so as Shopify many consumers’ see levels Pay and of some stores

idea, you’re rate side, really seamlessly. feels And is and more a checkout idea lot to great Shop and all from the Pay able the more on a makes a higher the but faster like so lot merchant Internet perspective, only it the not to over services consumer conversion of bringing a

shifted see interesting virtual the the center hanging Pay, Pay sort a the is places squares but think functionality gravity you other Instagram, and And sort also operating right have and to brands more we most town greatest, So lot really technology find shopping is and of we bring better. more of X.X you’re retail But you I that ways most And of fact course, advantage of Shop us as services make completely that Shop important those online. system, Facebook think add in of like the seeing direct-to-consumer we just the million not in that, Shopify as are retail to for now people the will in about has to going of what services. in really a see out where are beyond.

Ben. Thanks,

Our Please from of comes next Sandler. question ahead. Brent go Piper Bracelin

here to year-over-year, higher and the What $XX really GMV, guess Harley. stood thank I morning acceleration up Good thread GMV billion quarter you. me for in growth this follow to on was I out wanted accelerating. this

about talked before all March. even geographies you stimulus the merchants think in and I kicker hit

and driving these GMV in consumer starting for commerce just shift question tailwinds social Are what’s in January the February you, particular? in in behavioral see Harley, preferences? become So to acceleration see you to broad-based Is an cohort understand this software online? enough a just broader Just January acceleration why to you trying now, drive would innovations reduce material Thanks. to February? acceleration? the in an seeing buy friction in we Are why and that this

headroom of gravity to now is was of there’s Again, runway in slightly I for point, that. online. It’s shifted pre-pandemic the much your First massive we North of are higher much also consumer ecommerce back to but preferences ecommerce XX% And so It still in in penetration ecommerce in think center general. permanently. there’s America. Remember, still no has so version room UK, and there’s only offline. to grow. there’s all, the sub the going still I think

consumer brands online when that them, it powers preference favorite again, to So combine from making obviously, on of buy buy surfaces are for, Shopify your on easier Shopify. with most which all you more if it people them, buying and great of not of makes

things of actually look buying and provides terms for pandemic the opened and not seeing insights. at an exact what where some Zealand, world, post-pandemic, that’s of slowdown really whatsoever merchants. places New caused, those not proxy rest from terms consumers actually the In our interesting we’re have which certainly you of if is Australia the any In in but up

beyond those places. in levels elevated remains in fact, In GMV online

shift really to Again, preference this to consumer their going want and it to COVID to the they’re quite them, which through I with of well nicely. think that and independent the total Again, of online. of and majority trend the direct-to-consumer the continue center has don’t Shopify a grow now I that buy from still happened Consumers small So thing. you’re relative gravity to buy to is retail, see voting think is continue continue will was pandemic. beyond really brands wallets temporary ecommerce

Brent. Thanks,

comes Capital Darren of ROTH question ahead. Our Please from next go Partners. Aftahi

curious early guys Maybe what vaccines terms North of the versus for America this more in you just April, maybe with Thanks any morning. more of to of Good is and you a I’m curious the taking seen of months I’m on question. the in piggyback my rollout said, the merchants Harley, cadence your business, question, say, year? have change real-time if in of

Yes.

at seen I mentioned, that not So as we all. have

not We mentioned of a gravity. Growth across seen all have strong regions. in merchant become We’ve We growth elevated increasingly center is remained our slowdown. digital QX. seen the

but upgrades, by new QX obviously in well. and growth brands as We record international also Shopify strong ads joining also had driven both plus

So way triple be growth merchant at buying the provide again, certainly after The on is I in not brought is the we’re it some shift side, digit this it’s not And trend, new Zealand, New reason of long that for proxy but an exact that year-over-year, permanent any Australia that obviously, the to issue. rest new side, in the that then indication up that this doesn’t world, seem pandemic GMV the of behavior retail does on with and an GMV operates, the over. seeing all. a

this is temporary think not between that it’s those I two thing. a things, quite clear

We will both see merchant and to ads to GMV continue continue increase.

Thanks, Darren.

Our Ygal comes question from of next Arounian go ahead. Please Securities. Wedbush

through board. And investment guys know beginning year, to Thanks. higher to Is pandemic. on merchants a now Good wanted What how last you -- as Hi. them do We’ve towards go online we how kind you still U.S. in before than I at just lot this new they creation as you think of I year? seen most the were it are in as merchants ask that expect and the this getting lot top of any taking the next what drivers larger are as already growth a stage merchant other not level already that the since those were online growth guys. year, coming of a of merchants business flowed step that of for merchant on the with? the you’re morning, new the they’ve and to remain at investment? of big the drivers looking but high areas are the of out rest changed are

and. advantage it’s an of an business or, the think not the I Shopify model, it’s

merchants pie watching Shopify. seconds, are of business side one my Shopify but talk seeing And that that all favorite more really around On we’re our because the is first-time in that growing that of pie, new U.S. growing with the for early joining we’re only creation, are registrations that world. itself. we’ve the shows increasing, we’re a about there entrepreneur both the again, merchant been of entrepreneurs. the That important sale gets every is stats but piece not to on XX that Certainly,

market. We are the actual growing

the excuse the people me, Plus, the – or other department are side, or some there’s doesn’t at and look other that Fabricville seeing that of it’s of has integrations large enterprise not enter we no been some Heinz realm, to for been some Kraft in the mentioned this you to stores digital migrated I future-proofed, participated. services XXX around be never WWE integrated. platforms cases, things commerce years, In that and from right cases, brands able they have like when provider have Shop whether retailers around ecommerce simply some Pay or On

those So it’s things. not one of

business think of the those I is of all the things. advantage model Shopify

trying seeing obviously, or But enter the again, We also Chex Plus around time our side, and successful. new make of we it are are have we on for to table and the which but all for homegrown leaders. love to creating success we’re on be first kitchen grow start to for they’re these brands, Shopify. are also easy very entrepreneurs seeing, stories it as them model, time, favorites, as be the we’re and Heinz possible Those our that more upgrades, the are Mills platform doing General direct-to-consumer stories. established like mom’s those first the ever some category We from their on

focus to to think so larger I And continue. needs the don’t on want that We just brands.

to that on We also larger with want next help brands start entrepreneurs aspirational Shopify. create the

Thanks, Ygal.

James. line Brian Brian of is Please James, live. from go comes Peterson question Raymond Raymond next of Our Peterson ahead. your

Mute me there. Apologies. caught Sorry. button

taking for thanks So the questions.

investment above into the platform, can that into talking XXXX? GMV the of investments? this can a is how about redeploy was plan quarter. And trending pace investments key that the curious, hiring Amy, lot areas So, I you of in growth But just the back appreciate

the certainly aim, out, just growth We in see that’s our of given still that’s pointed Brian, opportunities tremendous Harley front Yes, us. that opportunities.

we so can. will aggressively continue And back to invest as the as business into we

each remarks, As we said expect opening accelerate the remainder for my of do from to the spend quarter I OpEx year.

we I have and We into lean Network, earlier, we app hiring marketing and lean Shop growth these Shopify and Fulfillment board, opportunities velocity in initiatives opportunities, Across those the as and about are we into resource international. the sales will that talked them. hiring engineering, we seeing

aggressively. back operating continue into the So invest yes, expect but business we post adjusted we did to to fully income quarter, this

probably Brian. Thanks, have We time for only more question, one Arielle.

one this So let’s take last question.

Research. comes from go Wolfe question of final Our Deepak ahead. Please Mathivanan

to on just Shopify of be I for that Harley between wanted reversal squeezing in some mentioned. payments sort growth that continued on ask thinking the volume Can also from Obviously, offset you could is subscriptions? guys. the are And great? of sales like rates give the and strong. your penetration tailwinds for Thanks me, Great. Plus Amy, Are to comments growing, that, would color you’re growth some to potentially seeing volume merchants business consumer about the very you converge? for stores convergence merchant spend gains and these continue. additional solutions

but That’s driven in Yes. in happened by a that at the pace. ecommerce more to surge fact to grow, that purely to expect don’t we expect continue XXXX ecommerce normalized fully the We repeat.

just won’t you the surge. see So

year-over-year perspective, of a I will the growth merchant in merchant adoption year. solutions. impact the for and So a increase expect increased continued our that growth of take our solutions rate fully from

Katie the turn any closing conference Keita This concludes remarks. for over the to back I like session. would question-and-answer to

questions, a great All today for for everyone. Deepak, have have time And of and leaving to number that last for and everybody gotten We participating right. day. thanks record Thanks, Bye-bye. question. a might

conference today’s concludes call. This

day. participating pleasant You for and you your Thank may lines. disconnect have a