• For the second quarter, Shopify forecast growth in the “high-twenties percentage range.” 
• For the first quarter, revenue came in at $3.17 billion, up 34% and ahead of the average analyst estimate.
• Gross Merchandise Volume rose to $100.74 billion from $74.75 billion for the same period last year.

Shares of Shopify (SHOP) tumbled in Tuesday’s premarket trade following the company’s first-quarter results, as a conservative forecast by the e-commerce solutions provider overshadowed its stellar quarterly performance.

At the time of writing, SHOP stock was down more than 6%.

SHOP Guides Conservatively For Q2

For the second quarter (Q2), the company forecast growth in the “high-twenties percentage range” compared with last year. However, it is notable that, including the latest results, the company has seen revenue growth above 30% for at least four consecutive quarters.

Prior to the report, Bloomberg Intelligence analyst Anurag Rana said second-quarter growth was expected to slow due to softer spending amid rising fuel prices.

The conservative forecast also stole the spotlight from the management’s optimistic forward-looking commentary, where it said it has “a clear edge” in the artificial intelligence era, supported by its “strong, durable growth and two decades of commerce intelligence.”

Additionally, gross profit dollars are forecast to grow at “a mid-twenties percentage rate” from last year.

SHOP Q1 Results At A Glance

For the first quarter (Q1), revenue came in at $3.17 billion, up 34% and ahead of the average analyst estimate of $3.09 billion, according to Fiscal AI.

Gross Merchandise Volume rose to $100.74 billion from $74.75 billion for the same period last year.

SHOP Stock: How Did Retail Traders React?

On Stocktwits, retail sentiment about SHOP turned ‘bullish’ from ‘bearish,’ while messaging volumes more than quadrupled over the last 24 hours.

One user on the platform expressed skepticism given the current market conditions.

Another user called the current decline in the stock price “weird.”

SHOP stock has fallen nearly 21% so far this year, but has risen about 30% in the last 12 months.

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