Shopify Inc. Q1 FY2026 earnings call

• GMV was $101 billion, up 35%, second consecutive quarter over $100 billion. Revenue $3.2 billion, up 34%, free cash flow $476 million, 15% margin. - AI is embedded in everything, becomes exoskeleton for team. Sidekick weekly active shops up 4x YOY, over 12,000 custom apps created in Q1, nearly half of Shopify flows built with Sidekick. - Demand conversion flywheel: online GMV growth accelerated, AI-driven traffic to Shopify stores up 8x YOY, orders from AI-powered searches up nearly 13x. Campaigns had 3x YOY growth in merchants with live campaigns. Shop App GMV up 70% YOY, monthly active users up over 40% YOY, unique buyers purchasing directly on Shop up over 50% YOY. - Invisible complexity: Shopify handles hard parts of commerce, co-developed UCP with Google, Shopify Payments processed $67 billion GMV, Shop Pay processed $35 billion GMV, international GMV grew 45%, enterprise growth with more large merchants doing $100M+ GMV on Shopify.

Q1 GMV was $101 billion, up 35%. Revenue was $3.2 billion, up 34%. Free cash flow was $476 million, 15% free cash flow margin. GMV by merchant size: $2 million to $25 million GMV band added most incremental revenue, >$25 million band growing fastest. Regionally: Europe GMV up 48% (35% constant currency), North America accelerated. Channels: Offline GMV up 33%, B2B GMV up 80%. Shopify Payments processed $67 billion GMV in Q1, up 41% from last year, 67% penetration. Shop Pay processed $35 billion GMV in Q1, up 59% year-over-year, outside U.S. grew over 70%. International GMV grew 45% in Q1, cross-border GMV 16% of total. Subscription Solutions revenue grew 21%, Merchant Solutions revenue grew 39%.

• Expect Q2 revenue growth in high 20s YOY, ~0.5 point FX tailwinds vs over 2 points in Q1. - Gross profit dollars expected to grow in mid-20s. - Operating expenses in Q2 expected to be 35%-36% of revenue, improvement from Q1's 37% and Q2 2025's 38%. - Free cash flow margins expected in mid-teens for Q2.

Q: How to think about the flywheel between AI supercharging product velocity and Sidekick driving uptake of new features and what it means for KPIs?

A: Sidekick is like a merchant's co-founder, weekly active shops using Sidekick up 385% YOY, 12,000 custom apps built in Q1, nearly half of Shopify flows built with Sidekick.

Q: How to balance benefits of AI versus rising token costs?

A: AI extensively used in all departments, Shopify's native language, AI writes over 50% of code, and efficiency from AI usage is impactful.

Q: How to approach building versus partnering more broadly?

A: Partner where get massive leverage and there's great company to plug in, build when nothing 10x better than can do ourselves.

Q: Are you seeing acceleration in SMB merchant sign-ups as AI lowers barriers to entrepreneurship?

A: Think there will be tailwinds, growth in Q1 was exceptional with even split between same-store sales growth and new merchant acquisitions.

Q: Does AI risk pushing Shopify back from a merchant's UX perspective?

A: Agents write right into Shopify, merchant store fronts matter, and Shopify is in pull position in agenetic entrepreneurial evolution.

Q: How to approach building versus partnering for expanding product capabilities?

A: Partner where can get leverage, build when no better option, app ecosystem growing with more apps built.

Q: Learnings with go-to-market strategy for enterprise and OpEx growth?

A: Enterprise go-to-market has dedicated team, product is major driver, growth of merchants doing >$100M GMV on Shopify nearly doubled. OpEx disciplined, headcount stable, marketing spend effective with performance marketing increasing in Europe.

Q: Compare Shopify's demand creation to non-Shopify merchants?

A: Shopify is only platform powering selling inside ChatGPT, Copilot, and Google from one system, orders from AI searches up nearly 13x, AI-driven traffic up 8x YOY.

Q: Monetization economics as surface area expands?

A: UCP is industry standard, agentic services introduce new consumers to Shopify merchants, economic perspective same as buying on Shopify store.

Q: Shopify taking more share and role of App Store?

A: E-commerce in U.S. still sub-20% retail, AI drives new buyers to merchants, Sidekick supplements App Store not replaces it.

Q: Consideration of moving deeper into financial services?

A: Financial services like capital and balance are embedded in platform, continue to add value to merchants, and will go where add most value.