Shopify Slides 12% Despite Q4 Beat on $2B Buyback, 31% Revenue Growth
Shopify delivered Q4 adjusted EPS of $0.57 vs $0.51 expected and revenue rose 31% to $3.67B, with free cash flow of $715M (19% margin). The company launched a $2B share buyback, guided for low-30s percent revenue growth in Q1, yet shares slid 12% intraday.
1. Q4 Earnings Exceed Estimates
In the quarter ended December 31, 2025, Shopify delivered adjusted earnings per share of $0.57, surpassing the $0.51 consensus, while revenue climbed 31% year-over-year to $3.67 billion, driven by strong holiday sales. Free cash flow reached $715 million, representing a 19% margin on disciplined cash generation.
2. $2B Share Buyback and Q1 Guidance
Shopify’s board approved a $2 billion share repurchase program and issued guidance for low-30s percent revenue growth in Q1 2026, with free cash flow margins expected in the low-to-mid teens, reflecting confidence in sustained merchant demand and capital efficiency.
3. Market Reaction
Despite the robust earnings beat and aggressive capital return plan, Shopify’s shares fell approximately 12% intraday, as investors weighed near-term margin pressure and valuation concerns against the company’s growth outlook.