Shares of Canadian e-commerce company Shopify (NYSE: SHOP) shot up by more than 15% at the time of writing in pre-market trading on Thursday after strong sales growth in Q1 as the company’s sales surged by 25% year-over-year to $1.5 billion and above consensus estimates of $1.43 billion. SHOP’s Gross Merchandise Volume (GMV) increased 15% year-over-year to $49.6 billion in the first quarter.
Shopify’s adjusted earnings in Q1 came in at $0.01 per share versus $0.02 in the same period last year while analysts were expecting SHOP to swing to a loss in Q1 of $0.04 per share.
The company also announced the sale of a majority of its logistics business to Flexport, a tech-driven global logistics platform. As a part of this agreement, Shopify will have a 13% equity interest in Flexport, on top of its existing equity interest.
Looking forward, management now expects its fiscal Q2 revenues to “grow at a similar rate to the first quarter growth rate on a year-over-year basis.”
Overall, Wall Street analysts are cautiously optimistic about SHOP stock with a Moderate Buy consensus rating based on 10 Buys, 18 Holds, and one Sell.