By Adriano Marchese

Shopify nearly doubled its profit in the fourth quarter thanks to strong results in subscription solutions and merchant solutions that drove revenue higher than expected.

The Ottawa-based ecommerce platform on Tuesday posted net income of $1.29 billion, climbing from $657 million in the same quarter last year.

Revenues rose to $2.81 billion from $2.14 billion. Analysts expected revenue to rise to $2.72 billion, according to FactSet.

Subscription solutions rose nearly 27% and merchant solutions, its largest segment, saw revenue grow 33%.

Gross merchandise volume, a key metric that tallies the total value of orders on Shopify, rose almost 26% in the quarter, reaching $94.46 billion.

Looking ahead to the first quarter, Shopify said it expects revenue to rise at a mid-twenties percentage rate, with gross profit dollars increasing at a low-twenties percentage rate. Analysts expect revenue to grow by 24.2%, according to FactSet.

In addition, first-quarter operating expenses are expected to be about 41% to 42% of revenue, while free cash flow margin is forecasted to be in the mid-teens. In the fourth quarter, free cash flow margin was 22%.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

February 11, 2025 07:42 ET (12:42 GMT)

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