Why Shopify Investors Shouldn't Get Overly Excited by the Company's Q1 Profit
Canadian multinational e-commerce platform operator (NYSE: SHOP) recently put added focus on cutting costs and improving its bottom line and last quarter, the company turned a surprise profit. While that's great news, the danger is in assuming that the company may have turned the tide, that the worst is over, and that profitability will now be the norm.
Here's a closer look at the Q1 performance of this proprietary platform for online stores and retail point-of-sale systems and why the positive net income figure it reported may be a little misleading.
In its latest quarter, Shopify's operating loss totaled $193 million -- nearly twice the size of the $98 million loss it reported in the same period last year. While the company's quarterly revenue of $1.5 billion did rise by 25% year over year, the company's operating expenses also rose at a rate of 24%, keeping pace with sales growth.
Source Fool.com