Shopify stock tumbles despite 32% revenue growth and stronger cash flow

The Ottawa-based company processed $119.2 billion in GMV, below the $120.1 billion consensus estimate. Shopify delivered another quarter of strong financial growth, reporting a 32% year-over-year increase in revenue and a 61% jump in free cash flow. However, its shares fell about 16% in early trading after the company’s gross merchandise volume came in slightly below Wall Street estimates. Revenue reached $3.7 billion in the third quarter ended September 30, compared with $2.8 billion a year earlier. Free cash flow increased to $816 million, representing a 22% margin against 18% in the prior-year period. Operating income rose 66% to $568 million, while net income climbed 75% to $462 million. The company’s GMV, which represents the total value of goods and services sold through its platform, reached $119.2 billion. That was marginally below the approximately $120.1 billion analysts had expected. By segment, merchant solutions remained the largest revenue contributor, generating $2.9 billion, up 35% year-over-year. The segment includes services such as payment processing, shipping and merchant financing. Subscription solutions revenue grew 20% to $836 million, reflecting recurring fe...