(Bloomberg)—Shopify Inc. posted much higher-than-expected revenue for its first fiscal quarter ended March 31, and it reiterated that it expects continued strong sales growth in 2021 but at a slower pace. Shopify is the No. 5 ecommerce platform provider in the Leading Vendors to the Top 1000.
“Shopify’s momentum continued into 2021 as digital commerce tailwinds remained strong and merchants took advantage of the range of capabilities offered by our platform,” said Amy Shapero, Shopify’s chief financial officer, in a written statement.
Revenue was $988.6 million in the quarter, compared with $470.0 million a year earlier, a 110.3% increase. Gross merchandise volume, or the value of goods sold on Shopify-powered sites, increased 114.4% to $37.3 billion from $17.4 billion during the same period last year.
While Shopify still expects the first quarter to contribute the smallest share of full-year revenue and the fourth quarter the largest, the revenue spread “may be more evenly distributed across the four quarters than it has been historically if the rollout of a vaccine shifts more consumer spending to services and offline shopping towards the back half of the year,” its earnings statement read.
Meanwhile, Google parent Alphabet (No. 82 in the 2021 Digital Commerce 360 Top 1000) reported a 32.3% increase in advertising revenue. Google is the top provider of marketing and advertising services among Top 1000 retailers, according to the Leading Vendors report.
Google’s results, showing a surge in ad sales related to travel and retail, offered a glimpse of online spending in a post-pandemic world: Businesses are boosting digital marketing to capture a public eager to resume something resembling normal life again.
“Searches for local and businesses are up 80% versus last year. Omnichannel is here to stay,” said chief business officer Philipp Schindler in a call with analysts transcribed by Seeking Alpha. He cited both Dick’s Sporting Goods (No. 29) and The Michaels Companies (No. 106) as retailers using Google products to boost omnichannel offerings.
Dick’s used ads in search results to raise awareness of its successful curbside program and is now using YouTube to tout new store layouts. Dick’s ecommerce sales double in 2020 to $2.8 billion. Michaels took advantage of growing arts and crafts YouTube searches to build up its curbside offering on the video platform, helping it grow ecommerce by 184.4% to $689.6 million in 2020.
In other vendor news:
- Installment payment platform Affirm announced plans last month to acquire return vendor Returnly, which helps direct-to-consumer brands more easily offer store credit for returns and exchanges. Returnly clients can offer customers instant store credit for returns rather than waiting for the item to get back to the retailer. That allows shoppers to get the right size or color of an item more quickly, while Returnly takes on the risk of items not yet returned. Returnly also offers software to manage traditional returns, making exchanges and returns a unified experience for customers.
- Glovo, the Spanish delivery app, has raised 450 million euros ($528 million) in April in a fundraising round that will help it expand its quick-delivery service and grocery operations in Europe. Glovo will use the funds to expand its Q-Commerce unit, which is responsible for grocery and retail deliveries as well as “dark stores,” which are small warehouses that let Glovo quickly fill orders for goods from retailers. It’s a similar strategy to dark kitchens, which can produce food for take-out in neighborhoods where a restaurant wouldn’t be viable. In the biggest cities where Glovo operates, the company said it can make deliveries within 10 minutes using the Q-Commerce network.
- Payment security and fraud prevention vendor Signifyd raised $205 million in a Series E in April, bringing its total funding to $390 million. The funding round, led by Owl Rock Capital, will allow the company to improve its payment optimization options that let clients combat fraud from things like customer credit card disputes and return abuse. Signifyd doubled its revenue last year and is expecting $200 million in sales this year. Signifyd is No. 10 in the Payment Security/Fraud Prevention category of the Leading Vendors to the Top 1000.
- Ecommerce platform startup Cart.com raised $25 million in a Series A funding round announced earlier in April. The company, less than a year old, had already raised $20 million in a seed round. Venture capital firms Mercury Fund and Arsenal Growth led this round of funding, which will allow the company to make new hires and continue its expansion.
Percentage changes may not align exactly with dollar figures due to rounding.