Shares of e-commerce company Shopify were down 17 percent after reporting its results for the first quarter on Thursday. The company reported results that fell below the expectations of analysts. Shopify also announced plans to acquire Deliverr, a logistics startup, for $2.1 billion in cash and stock.
For the first quarter, the e-commerce company reported earnings per share of 20 cents, adjusted, compared to the expectation of 63 cents that analysts had envisaged, according to Refinitiv. Revenue for the quarter was up 22 percent from a year ago at $1.2 billion. It, however, fell short of analysts’ expectations of $1.24 billion.
Shopify is acquiring San Francisco-based logistics startup Deliverr for $2.1 billion. The startup provides logistics services to merchants on e-commerce platforms such as Walmart, eBay, and even Amazon. The startup boasts of an average of one million shipping orders per month for thousands of US merchants. “Our goal is to not only level the playing field for independent businesses but tilt it in their favor — turning their size and agility into their superpower. Together with Deliverr, SFN will give millions of growing businesses access to a simple, powerful logistics platform that will allow them to make their customers happy over and over again,” Shopify’s founder and CEO Tobi Lütke said in a blog post detailing the acquisition.
The company’s CFO Amy Shapero added that “Being able to offer a delivery promise and fast fulfillment across all these channels boosts conversion. We are confident Deliverr’s ability to simplify the process, and arm merchants with visibility and control from the display of a delivery promise across multiple channels through its completion, will be a huge benefit to our merchants.”
Shopify said it expects revenue growth to be lower for the first half of 2022 as it tries to deal with challenges aroused by the pandemic. “While we’ve experienced massive macro shifts since the start of the pandemic, the one mainstay has been that Shopify is the commerce platform of choice for merchants in any environment, with the ability to support commerce on any surface,” Shopify president Harley Finkelstein said in a statement.