Shopify sinks after shortfall, buys Deliverr for $2.1 billion

Shopify sinks after shortfall, buys Deliverr for $2.1 billion

An employee works at Shopify’s head office in Ottawa, Ontario, Canada.

Chris Wattie | Reuters

Shopify shares plunged more than 17% after markets opened on Thursday after the company reported first-quarter results that missed analysts’ estimates, and announced it would acquire logistics startup Deliverr for $2.1 billion in cash and stock.

Shopify posted adjusted earnings of 20 cents per share, while Wall Street expected 63 cents per share, according to a Refinitiv survey of analysts. Revenue rose 22% year-over-year to $1.2 billion, but that was still below the $1.24 billion forecast by Wall Street.

The Canadian company, which makes tools for businesses to sell products online, has also announced plans to acquire Deliverr, a San Francisco-based startup that provides fulfillment services to merchants selling their goods on Amazon. , Walmart, eBay and other online marketplaces. Deliverr ships more than one million orders per month for thousands of merchants in the United States, Shopify said.

“Being able to deliver a promise of delivery and fast execution across all of these channels drives conversion,” Shopify CFO Amy Shapero said in a statement. “We believe that Deliverr’s ability to simplify the process and give merchants visibility and control from posting a delivery promise across multiple channels to completion will be a huge benefit. for our merchants.

Shopify also forecast weaker revenue growth in the first half of the year as it navigates tough comparisons in the pandemic era.

“While we have seen massive macro shifts since the start of the pandemic, the one pillar has been that Shopify is the commerce platform of choice for merchants in any environment, with the ability to support commerce on any surface,” said Shopify President Harley Finkelstein. said in a statement.

Shopify and other companies in the e-commerce space are facing growing concerns about their inability to sustain the meteoric growth they have enjoyed during the coronavirus pandemic. Shoppers have flocked to online retailers during the pandemic, but e-commerce activity has cooled as the economy reopens and consumers return to stores. Amazon, Etsy and eBay all forecast slowdowns.

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