# Shopify Inc. (SHOP)

> Shopify sells tools for businesses to build stores, take payments and manage sales online and in person.

- Exchange: Nasdaq · Sector: Technology · Industry: Software Application
- Headquarters: Ottawa, Ontario, Canada
- Founded: 2006
- Employees: approximately 7,600 (December 31, 2025)
- SEC CIK: 0001594805 ([filings on EDGAR](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0001594805))
- Full page: https://inspectstocks.com/stocks/shop
- Data as of: price 2026-09-28; newest filing used 2026-08-05; latest fiscal period ended 2026-06-30

## Grade

**A** on the growth-and-cash rubric, 5 of 5 checks passed.

| Check | Result | Now | Before |
| --- | --- | --- | --- |
| Revenue growing overall | passed | $13.3B | $5.6B |
| Revenue growing recently | passed | $13.3B | $11.6B |
| Free cash flow positive | passed | $2.4B |  |
| Free cash flow growing overall | passed | $2.4B | -$186M |
| Free cash flow growing recently | passed | $2.4B | $2B |

Business quality (the + / − mark): 4 of 6 checks passed.

| Check | Result | Now | Before |
| --- | --- | --- | --- |
| Profitable | passed | 14.5% |  |
| Healthy profit margin | passed | 14.5% |  |
| Strong operating margin | failed | 13.9% |  |
| Good return on equity | failed | 14.3% |  |
| Debt under control | passed | 0.01 |  |
| Turns sales into cash | passed | 17.7% |  |

How the grade works: the letter counts failed checks (none → A, one → B, two → C, three → D, four or more → F). It is built from SEC filings only — the share price never enters it — and describes the business, not whether the stock is worth buying.

## Key figures

In US dollars, as filed.

| Measure | Value |
| --- | --- |
| Revenue, trailing twelve months | $13.3B |
| Net income, trailing twelve months | $1.9B |
| Free cash flow, trailing twelve months | $2.4B |
| Net margin | 14.5% |
| Operating margin | 13.9% |
| Return on equity | 14.3% |
| Debt to equity | 0.01 |
| Diluted EPS, trailing twelve months | $1.48 |
| Share price | $144.02 |
| Market value | $187.6B |
| Price / earnings | 97.3x |
| Price / sales | 14.1x |

## What the business does

Shopify gives businesses software to create online stores, sell in physical shops and manage products, orders and customers. It also provides payment processing, financing, shipping services and sales tools for social media and artificial intelligence (AI) shopping channels.

### How it makes money

- **Subscription solutions** (23% (six months ended June 30, 2026)) — Merchants pay recurring fees for Shopify plans, including higher-priced Shopify Plus plans, and for Point of Sale Pro subscriptions. Shopify also earns fees from apps, themes, domain registrations and variable platform fees.
- **Merchant solutions** (77% (six months ended June 30, 2026)) — Shopify mainly earns payment-processing and currency-conversion fees when merchants use Shopify Payments. Other revenue comes from lending services, partner referrals, shipping labels, point-of-sale hardware, and advertising and buyer-acquisition services.

### Products

- **Shopify commerce software** — Software for setting up an online store and handling day-to-day tasks such as product listings, inventory, orders and customer relationships.
- **Shopify Plus** — A higher-priced plan for businesses with more complex needs, including selling in multiple countries and selling wholesale to other businesses.
- **Shopify Payments** — A built-in service that lets merchants accept payments and pay processing and currency-conversion fees.
- **Point of Sale Pro and hardware** — A paid service and equipment for taking in-person sales and connecting them with a merchant's online store and inventory.
- **Shopify Capital** — Financing for merchants, including loans and merchant cash advances.
- **Sidekick and Catalog** — Sidekick is an AI assistant that helps merchants with store tasks and business information. Catalog organizes product details so AI shopping services can find and describe merchants' products.

### Customers

- Entrepreneurs and small businesses pay for monthly Shopify plans to set up and run online shops.
- Larger retail brands, including businesses selling directly to consumers or to other businesses, pay for plans and services suited to more complex operations.
- Retailers with physical locations can pay for Point of Sale Pro by location and buy point-of-sale equipment.
- Merchants using Shopify Payments pay processing and currency-conversion fees as shoppers make purchases; merchants can also use Shopify's financing and shipping services.

### Competitors

- Wix.com (WIX) — Website and online-store creation tools for businesses.
- Adobe Commerce (ADBE) — Adobe division competing in software for building and running online shops; Adobe Inc. is the listed parent.
- Salesforce Commerce Cloud (CRM) — Salesforce division competing in software for managing online shopping and retail commerce; Salesforce Inc. is the listed parent.
- Square (XYZ) — Block's point-of-sale equipment and payment services compete for in-person retail sales; Block Inc. is the listed parent.
- WooCommerce — An online-store product for WordPress websites; it is operated by private company Automattic.

### What it depends on

- Shopify uses third-party cloud providers to run its services; the annual report says Google Cloud is used for most platform operations.
- Shopify says it relies on two suppliers for technology used in Shopify Payments.
- Much of merchant-solutions revenue is tied to the amount of merchandise merchants sell through Shopify, particularly sales processed through Shopify Payments.
- Payments, lending, privacy and data handling are subject to laws and regulations in the countries where Shopify operates.

### What could go wrong

- A security breach or other unauthorized access to merchant, buyer or company data could interrupt services, lead to liability and damage trust in Shopify.
- Shopify Payments depends on technology from two suppliers, and interruptions or changes in financial-services rules could affect its payments and other financial products.
- Shopify must attract merchants, keep them using its services and get existing merchants to use more of them while competing with other commerce and payments providers.

## More on this company

- [Overview](https://inspectstocks.com/stocks/shop)
- [Financial statements](https://inspectstocks.com/stocks/shop/financials)
- [Competitors](https://inspectstocks.com/stocks/shop/peers)
- [Earnings](https://inspectstocks.com/stocks/shop/earnings)

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Source: InspectStocks, built from the company’s own SEC filings. This describes a business — it is not investment advice and not a recommendation to buy or sell anything.