Shopify Inc.‘s executives say even though businesses are shaking up their operations to cope with a global trade war, their company has yet to notice the unrest putting a damper on commerce.
The Ottawa-based technology firm has been monitoring for potential slowdowns stemming from tariffs but numbers for April “show little evidence of that,” president Harley Finkelstein said Thursday.
Despite the comfort in the numbers, businesses using the e-commerce software his company sells aren’t leaving anything to chance.
“Merchants are considering when to change sourcing countries, when to buy inventory, or even adjusting product mix in their catalogues,” chief financial officer Jeff Hoffmeister told a conference call with analysts to discuss the company’s latest results.
Hiking what they charge customers has figured into some merchants’ strategies, but Hoffmeister said, “we haven’t seen broad-based price increases yet.”
The myriad of coping mechanisms have been prompted by U.S. President Donald Trump who’s spent much of the year threatening tariffs, only for some to be walked back and others to by applied with no warning or at rates that are different from what he promised.
His unpredictable nature has become a scourge for business owners scrambling to keep up with duties that could upend or kill their business.
Shopify is seen as a barometer of how companies are faring because its software powers a wide swath of the world’s businesses, including footwear brand Birkenstock, handbag makers Kate Spade and Coach and fashion houses like Lilly Pulitzer.
Finkelstein said his company’s quarterly growth is showing promising signs, even if the overall business posted a net loss.
Shopify reported a first-quarter net loss of US$682 million compared with a loss of US$273 million in the same quarter last year as its revenue rose 27 per cent.
The e-commerce technology firm, which keeps its books in U.S. dollars, said the loss amounted to 53 cents US per diluted share for the quarter ended March 31 compared with a loss of 21 cents US per diluted share a year earlier.
Its net income excluding the impact of its equity investments amounted to US$226 million for its latest quarter, up from US$144 million a year ago.
Revenue totalled US$2.36 billion for the quarter, up from US$1.86 billion in the same quarter last year.
Subscription solutions revenue amounted to US$620 million, up from US$511 million a year ago, while merchant solutions revenue amounted to US$1.74 billion, up from US$1.35 billion.
In its outlook for its second quarter, Shopify said it expects revenue to grow at a mid-twenties percentage rate on a year-over-year basis. Operating expenses as a percentage of revenue are expected to be 39 to 40 per cent.
Shopify spent much of the quarter tweaking its product offerings to help merchants navigate trade tensions.
Some of the changes help merchants comply with new tariffs within hours of them being announced and then make it easier to calculate what international customers will pay.
“We’ve shipped a lot and we’ve focused on areas that we can have a more immediate impact, cross-border trade, making it easier to buy local, do these calculations, and shipping,” Finkelstein said.
He teased that “this is just the beginning.”
Later this month, the company will introduce duty inclusive pricing, helping customers avoid surprise fees at checkout.
This report by The Canadian Press was first published May 8, 2025.
Companies in this story: (TSX:SHOP)
