stock slid in premarket trading Wednesday after the e-commerce company posted a wider-than-expected second-quarter loss and indicated losses will increase in the third quarter.
) reported a second-quarter adjusted net loss of $38.5 million, or 3 cents a share, missing estimates calling for $30 million in adjusted net income, or 2 cents a share. Revenue was $1.3 billion, up 16% year-over-year and slightly under estimates for $1.33 billion. Yearly revenue growth was negatively impacted by about 1.5 percentage points tied to foreign exchange headwinds.
Gross merchandise volume, or the total amount of merchandise sold on the platform, was $46.9 billion, below projections for $48.8 billion.
The company said it expects higher inflation to persist “for the foreseeable future,” which, combined with rising interest rates “will pressure consumers’ wallets for purchases of goods.” It is now expecting to generate an adjusted operating loss for the second half of 2022, with the third-quarter adjusted operating loss set to “materially increase” from the second quarter. Shopify also forecast an adjusted operating loss in the fourth quarter that will be narrower than in the third quarter, but larger than in the second quarter.
Shares of Shopify were down 7.7% to $29.12 in premarket trading on Wednesday, extending Tuesday’s 14% loss. The stock tumbled on Tuesday after the company said it was laying off about 10% of its workforce in response to slowing e-commerce trends.
“We have recalibrated our team to build for long-term success, and will continue to operate with rigorous discipline, investing thoughtfully into the enormous opportunity ahead of us,” said chief financial officer Amy Shapero in a press release.
The changes will take a while to show up on the bottom line, however. Shopify closed its acquisition of e-commerce fulfillment company Deliverr in July, which will drive up integration costs in the third quarter, the company said.
The company is holding a conference call with investors at 8:30 a.m. Eastern time.
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