Shopify (NASDAQ: $SHOP) is one of the biggest e-commerce platforms, used by businesses of all sizes to build, manage, and grow their online stores. The platform makes it possible to sell products in-store, online, and on social media by handling the backend, which includes inventory, payments, marketing, and shipping, inside a user-friendly system.
On Wednesday, February 11, 2026, Shopify released its Q4 results to a positive market reception. Here is a deep dive into those results.
Shopify Q4 Results
For the quarter of fiscal 2025, Shopify reported revenue of $3.67 billion, besting estimates of $3.60 billion, and up 30.6% YoY. It reported Gross Merchandise Volume of $123.8 billion, a 31% YoY increase, and above estimates of $121.4 billion.
The company reported a GAAP ESP of $0.57, beating estimates of $0.43 by 33.9% but below the $0.99 reported last year. Its adjusted EBITDA came in at $753 million, beating estimates of $709.3 million, for an adjusted EBITDA margin of 20.5%. The company reported an operating margin of 17.2%, in line with last year.
Shopify reported a free cash flow margin of 19%, compared to the 22% reported for the same period last year. This was on free cash flow of $715 million, compared to $611 million last year. For the full year, revenue was up 30% YoY to $11.56 billion, while the free cash flow margin was 17% compared to 18% last year. It ended the year with $2 billion in free cash flow compared to $1.6 billion last year. The company’s board has authorized a share buyback program of up to $2 billion with no quarterly minimum, and executed via pre-arranged algorithmic instructions.
Q1 2026 Outlook
Shopify forecasts revenue will grow in the low-thirties percentage YoY for Q1 fiscal 2026. It expects gross profit dollars to grow in the high-twenties percentage YoY, while operating expenses as a percentage of revenue is forecast to be 37% to 38%. It expects stock-based compensation of $140 million, and a free cash flow margin in the low to mid-teens, slightly below last year.
AI Strategy And International Expansion
Shopify president Harley Finkelstein stated that the company’s merchant customers had experienced nearly 100 million conversations using Sidekick, their AI assistant. According to the president, eight million of the chats happened in October alone. He noted that AI was “quickly becoming the default way merchants get things done.”
The company’s effort towards international expansion has paid off so far, as have its renewed partnerships with major retailers.
Market Performance
Shopify shares fell 12.95% following the huge decline in net income in Q4, despite the earnings beat. As of 11:49 AM in New York, the shares were trading at $110.76. Year to date, the stock is down 31.08%, while over the past six months, the stock is down 24.79%. Over the past 52 weeks, SHOP shares have dipped 10.24%.
Analysts remain moderately optimistic about the future of $SHOP, giving the stock a moderate buy rating. They forecast an average price of $173.44, which is a 46.49% upside based on the last closing price. The analysts forecast a wide range of prices, with a high of $222 and a low of $140.
Is Shopify A Buy in 2026?
Shopify has continued to demonstrate strong growth and profitability, with revenue growth rising. For instance, it reported 30.6% growth in revenue in Q4. Free cash flow is also over $2 billion for the full year. The company also has the benefit of brand recognition and remains the go-to e-commerce software for small and medium-sized businesses.
Its AI efforts have paid off, and so has its push for international expansion. These factors are likely to drive sustained growth. Additionally, the platform is deeply integrated, which means it would represent high costs for merchants to exit.
However, the stock has a high valuation, with a trailing P/E ratio of 93.56 and a price-to-sales ratio of 15.57. Its wild market swings have also caused caution amongst some investors. Despite this, Shopify is clearly a stock in its growth phase, and there could potentially be room for expansion.
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