Shopify stock 16% on Thursday after the Canadian tech giant’s weak forecast for first-quarter revenue and higher cost projections amplified investor concerns over aggressive investments in an economy facing slowing growth. As the company’s forecast for revenue for the March quarter fell short of expectations, Shopify’s stock fell sharply on Thursday. As compared to its previous closing price of $53.39 per share, it traded on Thursday between $44.31 and $46.92.
Pandemic-related disruptions propelled the company to briefly become Canada’s most valuable firm before online demand eased as economies reopened and forced it to launch new products, boost investments and focus on social media integration.
Such investments and Wednesday’s warning on macro-challenges have spooked investors concerned about profitability.
Oppenheimer analyst Ken Wong said he was worried about Shopify’s “noncommittal spend” and an operating loss projection of about $85 million that could dampen investors’ expectations for profitable growth this year.
Shopify Stock: ‘High Teens’ Revenue Growth
For the first quarter of 2023, the company predicted revenue growth in the “high teens.” Analysts had projected more than 20% revenue growth.
“We believe that the revenue guide implies that Q1 gross merchandise volume will be weaker than expected,” Jefferies analyst Samad Samana said in a note to clients. “Management did note the uncertain macro (economy) was factored into the outlook.”
Shopify Revenue
Shopify ( NYSE:SHOP ) reported rev...
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