Shopify reported better-than-expected growth in the second quarter and raised its outlook for the next quarter and 2019 as the company's retail operating system continues to gain traction with merchants.
The company reported a second quarter net loss of $28.7 million, or 26 cents a share, on revenue of $362 million, up 48% from a year ago. Adjusted earnings for the second quarter were 14 cents a share.
Wall Street was expecting Shopify to report second quarter revenue of $350.5 million with non-GAAP earnings of 3 cents a share.
Shopify said its subscription revenue was up 38% as more merchants joined the platform. In addition, merchant solutions revenue was up 56% due to growth in Shopify Capital and Shopify Shipping.
The company recently concluded its Unite user conference where it launched the Shopify Fulfillment Network as well as a next-gen point-of-sale application. Shopify aims to enable smaller retailers compete with much larger competitors.
- Shopify creates AI-powered fulfillment network for SMB merchants
- How Shopify is working to expand internationally
- Why the Shopify, Mailchimp integration battle is just a sign of what's to come
- How Shopify uses its developer ecosystem to fuel international expansion
Shopify's success may also make it a target for larger tech giants such as Microsoft. See: Microsoft may be targeting the e-commerce store hosting space
As for the outlook, Shopify projected third quarter revenue of $377 million to $382 million and 2019 sales of $1.51 billion to $1.53 billion. Those projections were well ahead of Wall Street's estimates.