Before the open, the company delivered a top- and bottom-line earnings beat, crushing Wall Street estimates.
Earnings of $1.05 a share beat estimates by $1.03. Revenue of $713.3 million almost doubled year over year and blew past consensus estimates of $511.5 million.
In fact, these results smoked the highest estimates on Wall Street too, which called for earnings of 27 cents a share on revenue of $608.3 million.
Further, gross merchandising volume (GMV) grew 119% year on year to $30.1 billion and came in far ahead of estimates looking for $19.9 billion. Subscription revenue topped estimates too.
In other words, this was a beat across the board and that’s why Shopify shares - which were up 222% from the March lows heading into the print - are jumping to fresh all-time highs now.
Trading Shopify Stock
Through this multi-month rally, Shopify stock has paused to consolidate, held support, then burst to new highs.
In May and June, $700 support held after a long rally, before breaking out to the $900s. Afterward, support came into play between $900 and the two-times range extension at $882. That was support just a few sessions ago.
A day ahead of earnings, Shopify unconvincingly broke out that nice consolidating bull flag setup (blue lines) and reclaimed the 20-day moving average. Those that took the risk and bought are being rewarded.
Now clearing the 261.8% extension at $1,060 and the prior all-time high near $1,075, I am looking for this area to become support on future pullbacks. If that’s the case, it will represent both healthy and bullish price action.
A close below the 261.8% extension could fill the gap back toward $1,000.
On the upside, my attention is shifting to the three-times range extension up at $1,171.