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For the to-be-reported quarter, Shopify expects revenue growth in the low-30% range.
The Zacks Consensus Estimate for revenues is currently pegged at $3.74 billion, suggesting growth of 31.4% from the year-ago quarter’s reported figure.
The consensus mark for earnings is pegged at 45 cents per share, up by a penny over the past 30 days and indicating 32.4% growth from the figure reported in the year-ago quarter.
Consensus Estimate Trend
Image Source: Zacks Investment Research
SHOP’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, matched once and missed once, with the earnings surprise being 3.05%, on average.
Let’s see how things have shaped up prior to this announcement.
Key Factors to Note for SHOP’s Q3
Shopify’s third-quarter 2026 performance is likely to have benefited from sustained growth in gross merchandise volume (GMV), supported by increasing merchant adoption, higher transaction volumes and expanding penetration across sales channels. In the second quarter, GMV increased 32% year over year to $115.6 billion. Merchant Solutions revenues surged 37% year over year to $2.78 billion, reflecting the growing contribution from payment processing and other merchant services. Continued momentum across businesses of different sizes, geographies and sales channels is expected to have supported transaction-driven revenues in the to-be-reported quarter.
Increasing adoption of Shopify Payments and Shop Pay is expected to have boosted Shopify’s third-quarter performance. Shop Pay GMV grew 53% year over year in the second quarter, supported by expanding payment options, financing capabilities and improved checkout experiences. The integration of additional local payment methods into Shopify Payments and Shop Pay is likely to have improved payment conversion and supported transaction growth. Moreover, expanding adoption of Shop Pay Installments and Shopify’s merchant financing solutions is expected to have strengthened its ability to monetize growing merchant transaction volumes.
Shopify’s accelerating investments in AI-enabled commerce are expected to have supported merchant engagement and platform adoption during the third quarter. In the second quarter, AI-driven traffic and orders originating from AI searches tripled year over year. Daily active merchants using Sidekick increased 3.6 times, while the platform handled nearly 34 million conversations and helped create more than 36,000 custom applications. Shopify Catalog, which structures data for more than 1 billion products and the Universal Commerce Protocol are strengthening product discovery across AI platforms. These capabilities are likely to have enhanced merchant productivity, customer acquisition and conversion opportunities in the to-be-reported quarter. However, direct revenue contributions from agentic commerce remain at an early stage.
However, Shopify's increasing dependence on Merchant Solutions revenues is likely to have pressured its gross margin in the third quarter of 2026. Shopify Payments carries structurally lower gross margins than Subscription Solutions because of third-party payment processing expenses. Although greater payment penetration supports revenue growth and operating leverage, the increasing contribution from transaction-based services creates an unfavorable revenue mix. Shopify expects gross profit dollars to grow at a mid-to-high twenties percentage rate in the third quarter, below its projected revenue growth in the low thirties, reflecting this continuing mix shift.
Shopify’s continued investments in AI infrastructure, product development and merchant acquisition are likely to have kept operating expenses elevated during the to-be-reported quarter. Although operating leverage has improved, the company continues to invest in Sidekick, agentic commerce capabilities and its broader platform. These initiatives may have limited near-term margin expansion despite strong revenue growth.
SHOP Shares Lag Sector
SHOP shares have dropped 2.1% year to date (YTD), underperforming the Zacks Computer & Technology sector’s rise of 9.7%.
Shopify has outperformed peers, including Wix.com (WIX - Free Report) and Commerce.com (CMRC - Free Report) , but lagged Amazon (AMZN - Free Report) . YTD, Amazon shares have returned 4.1% while Wix.com and Commerce.com shares have dropped 25.8% and 20.2%, respectively.
SHOP Stock’s Price Performance
Image Source: Zacks Investment Research
Moreover, the Value Score of F suggests a stretched valuation for Shopify at this moment.
SHOP stock is trading at a premium with a forward 12-month price/sales of 11.06X compared with the sector’s 5.17X, Amazon’s 2.77X, Wix.com’s 1.82X and Commerce.com’s 0.82X.
Shopify’s Current Valuation
Image Source: Zacks Investment Research
AI Push, Expanding International Footprint to Aid SHOP
Shopify’s growing presence in AI-enabled commerce represents one of its most significant long-term growth opportunities. Partnerships with OpenAI, Google, Meta and Microsoft are expanding product discovery opportunities beyond traditional online storefronts. Shopify Catalog provides structured product information, including availability and product attributes, while the Universal Commerce Protocol enables AI agents to interact with merchant inventories and checkout infrastructure. Shopify's ability to position itself as the underlying transaction infrastructure for agentic commerce could strengthen its competitive moat and support long-term GMV growth as AI-powered shopping gains traction.
Shopify’s investments in Sidekick and AI-powered development tools are expected to strengthen its merchant acquisition and retention capabilities over the long term. Sidekick simplifies store creation, marketing, analytics, inventory management and application development, lowering the technical barriers to starting and scaling a business. Greater adoption of AI tools could improve merchant productivity, accelerate successful business launches and strengthen Shopify's platform engagement.
Shopify’s growing international presence offers considerable long-term growth potential as the company expands localized payment capabilities and cross-border commerce solutions. The company’s presence across more than 175 countries, combined with continued investments in Shopify Payments, Shop Pay and Managed Markets, positions it to benefit from increasing global e-commerce adoption. International GMV growth of 37% in the second quarter highlights the opportunity to deepen penetration beyond North America.
Conclusion
Shopify’s strong GMV growth, increasing adoption of Shopify Payments and accelerating AI-driven commerce initiatives position it well for the upcoming earnings release. The company’s expanding international footprint, growing merchant ecosystem and investments in Sidekick and Shopify Catalog strengthen its long-term growth prospects. Although premium valuation and margin pressures remain concerns, Shopify's robust growth momentum and expanding opportunities in agentic commerce make the stock an attractive investment proposition for long-term investors.
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Should Shopify Stock Be in Your Portfolio Pre-Q3 Earnings?
Key Takeaways
Shopify (SHOP - Free Report) is set to report third-quarter 2026 results on Nov. 3.
For the to-be-reported quarter, Shopify expects revenue growth in the low-30% range.
The Zacks Consensus Estimate for revenues is currently pegged at $3.74 billion, suggesting growth of 31.4% from the year-ago quarter’s reported figure.
The consensus mark for earnings is pegged at 45 cents per share, up by a penny over the past 30 days and indicating 32.4% growth from the figure reported in the year-ago quarter.
Consensus Estimate Trend
Image Source: Zacks Investment Research
SHOP’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, matched once and missed once, with the earnings surprise being 3.05%, on average.
Shopify Inc. Price and EPS Surprise
Shopify Inc. price-eps-surprise | Shopify Inc. Quote
Let’s see how things have shaped up prior to this announcement.
Key Factors to Note for SHOP’s Q3
Shopify’s third-quarter 2026 performance is likely to have benefited from sustained growth in gross merchandise volume (GMV), supported by increasing merchant adoption, higher transaction volumes and expanding penetration across sales channels. In the second quarter, GMV increased 32% year over year to $115.6 billion. Merchant Solutions revenues surged 37% year over year to $2.78 billion, reflecting the growing contribution from payment processing and other merchant services. Continued momentum across businesses of different sizes, geographies and sales channels is expected to have supported transaction-driven revenues in the to-be-reported quarter.
Increasing adoption of Shopify Payments and Shop Pay is expected to have boosted Shopify’s third-quarter performance. Shop Pay GMV grew 53% year over year in the second quarter, supported by expanding payment options, financing capabilities and improved checkout experiences. The integration of additional local payment methods into Shopify Payments and Shop Pay is likely to have improved payment conversion and supported transaction growth. Moreover, expanding adoption of Shop Pay Installments and Shopify’s merchant financing solutions is expected to have strengthened its ability to monetize growing merchant transaction volumes.
Shopify’s accelerating investments in AI-enabled commerce are expected to have supported merchant engagement and platform adoption during the third quarter. In the second quarter, AI-driven traffic and orders originating from AI searches tripled year over year. Daily active merchants using Sidekick increased 3.6 times, while the platform handled nearly 34 million conversations and helped create more than 36,000 custom applications. Shopify Catalog, which structures data for more than 1 billion products and the Universal Commerce Protocol are strengthening product discovery across AI platforms. These capabilities are likely to have enhanced merchant productivity, customer acquisition and conversion opportunities in the to-be-reported quarter. However, direct revenue contributions from agentic commerce remain at an early stage.
However, Shopify's increasing dependence on Merchant Solutions revenues is likely to have pressured its gross margin in the third quarter of 2026. Shopify Payments carries structurally lower gross margins than Subscription Solutions because of third-party payment processing expenses. Although greater payment penetration supports revenue growth and operating leverage, the increasing contribution from transaction-based services creates an unfavorable revenue mix. Shopify expects gross profit dollars to grow at a mid-to-high twenties percentage rate in the third quarter, below its projected revenue growth in the low thirties, reflecting this continuing mix shift.
Shopify’s continued investments in AI infrastructure, product development and merchant acquisition are likely to have kept operating expenses elevated during the to-be-reported quarter. Although operating leverage has improved, the company continues to invest in Sidekick, agentic commerce capabilities and its broader platform. These initiatives may have limited near-term margin expansion despite strong revenue growth.
SHOP Shares Lag Sector
SHOP shares have dropped 2.1% year to date (YTD), underperforming the Zacks Computer & Technology sector’s rise of 9.7%.
Shopify has outperformed peers, including Wix.com (WIX - Free Report) and Commerce.com (CMRC - Free Report) , but lagged Amazon (AMZN - Free Report) . YTD, Amazon shares have returned 4.1% while Wix.com and Commerce.com shares have dropped 25.8% and 20.2%, respectively.
SHOP Stock’s Price Performance
Image Source: Zacks Investment Research
Moreover, the Value Score of F suggests a stretched valuation for Shopify at this moment.
SHOP stock is trading at a premium with a forward 12-month price/sales of 11.06X compared with the sector’s 5.17X, Amazon’s 2.77X, Wix.com’s 1.82X and Commerce.com’s 0.82X.
Shopify’s Current Valuation
Image Source: Zacks Investment Research
AI Push, Expanding International Footprint to Aid SHOP
Shopify’s growing presence in AI-enabled commerce represents one of its most significant long-term growth opportunities. Partnerships with OpenAI, Google, Meta and Microsoft are expanding product discovery opportunities beyond traditional online storefronts. Shopify Catalog provides structured product information, including availability and product attributes, while the Universal Commerce Protocol enables AI agents to interact with merchant inventories and checkout infrastructure. Shopify's ability to position itself as the underlying transaction infrastructure for agentic commerce could strengthen its competitive moat and support long-term GMV growth as AI-powered shopping gains traction.
Shopify’s investments in Sidekick and AI-powered development tools are expected to strengthen its merchant acquisition and retention capabilities over the long term. Sidekick simplifies store creation, marketing, analytics, inventory management and application development, lowering the technical barriers to starting and scaling a business. Greater adoption of AI tools could improve merchant productivity, accelerate successful business launches and strengthen Shopify's platform engagement.
Shopify’s growing international presence offers considerable long-term growth potential as the company expands localized payment capabilities and cross-border commerce solutions. The company’s presence across more than 175 countries, combined with continued investments in Shopify Payments, Shop Pay and Managed Markets, positions it to benefit from increasing global e-commerce adoption. International GMV growth of 37% in the second quarter highlights the opportunity to deepen penetration beyond North America.
Conclusion
Shopify’s strong GMV growth, increasing adoption of Shopify Payments and accelerating AI-driven commerce initiatives position it well for the upcoming earnings release. The company’s expanding international footprint, growing merchant ecosystem and investments in Sidekick and Shopify Catalog strengthen its long-term growth prospects. Although premium valuation and margin pressures remain concerns, Shopify's robust growth momentum and expanding opportunities in agentic commerce make the stock an attractive investment proposition for long-term investors.
Shopify currently has a Zacks Rank #2 (Buy), which implies that investors should start accumulating the stock ahead of the third-quarter earnings. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.