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Shopify Blasts Q2 Earnings Forecast Amid COVID-19 Spending Shift: Shares Hit Record High

Shopify said gross volumes on its platform more than doubled to $30.1 billion over the second quarter, thanks to what could be the start of a permanent shift in retail spending to online platforms.

Shopify Inc.  (SHOP) - Get Free Report posted stronger-than-expected second quarter earnings Wednesday, thanks in part to a surge in volumes on its e-commerce platform triggered by the global coronavirus pandemic. 

Shopify said earnings for the three months ending in June came in at 29 cents per share per share, compared to a loss of 26 cents per share over the same period last year and a Street consensus forecast of 1 penny per share. Total revenues surged 97% to $714.3 million, the company said, while gross merchandise volumes more than doubled to $30.1 billion.

Monthly recurring revenues, Shopify said, was $57 million as of June 30, a 21% increase from the same period last year.   

The Ottawa, Ontario-based group said it expects a larger share of retail sales to shift to online commerce, but noted that the "magnitude and duration" of the COVID-19 impact creates greater near-term uncertainty for the group, which declined to provide a current quarter or full-year financial forecast. 

“With the rapid shift to online commerce, massive disruption to conventional employment, and growing conviction that opportunity needs to be more evenly distributed, entrepreneurship has never been more important," said CEO Tobi Lütke. "With all of these changes, our core principles remain the same: everything we ship is designed to lower barriers to entrepreneurship and reduce friction wherever we can.”

Shopify shares were marked 11% higher in early trading immediately following the earnings release to change hands at $1,094.00 each, an all-time high and a move that extends the stock's year-to-date gain to around 176% and values the group at around $128 billion.