Shopify’s 32% Revenue Growth Missed Expectations; Analysts Say It's Poised For Agentic AI Benefits

Shares of Shopify Inc (NASDAQ:SHOP) rallied in early trading on Wednesday, after the company Tuesdayreported its third-quarter results.

Here are some key analyst takeaways:

• DA Davidson analyst Gil Luria reiterated a Buy rating, while reducing the price target from $200 to $180.
• Rosenblatt Securities analyst Scott Devitt reaffirmed a Buy rating, while cutting the price target from $186 to $180.
• RBC Capital Markets analyst Paul Treiber maintained an Outperform rating and price target of $200.
• Wedbush analyst Ygal Arounian reaffirmed an Outperform rating and price target of $176.

Check out other analyst stock ratings.

DA Davidson: Shopify reported revenue growth of 32% year-on-year in constant currency terms and gross profit growth of 28%. Luria said that the results were still "below what investors were looking for to justify the premium valuation."

Management guided to low-thirties total revenue growth for the fourth quarter, versus a consensus of around 30%, the analyst stated.

"While agentic commerce benefits will take time to materialize, we continue to view Shopify as a LT winner providing the infrastructure for merchants," he further wrote.

Rosenblatt Securities: Shopify’s healthy volume growth and improving profitability were offset by lower-than-expected revenue growth, Devitt said. The company reported the sixth consecutive quarter of revenue growth in the low-30s%, on its GMV (gross merchandise value) base that is now approaching $500 billion annually, he added.

Management’s fourth-quarter guidance implies disappointing operating income, even with Shopify relying on marketing ahead of the holiday season, the analyst stated.

"AI-attributed traffic and orders grew 2.6x and 3.3x Y/Y, respectively, and we continue to view Shopify as an AI winner," he further wrote.

RBC Capital Markets: Shopify’s shares came under pressure as third-quarter revenue came just in-line with consensus, Treiber said. He added, however, that the company’s fundamentals remain strong, particularly as the fourth-quarter revenue guidance does not shows any signs of deceleration.

"Shopify remains one of the most compelling long-term organic growth stories in our coverage," the analyst further wrote.

Wedbush: Shopify saw AI-driven traffic and order volumes grow, with AI channels showing significantly higher conversion rates and product page visits than organic search, Arounian said.

Tools like Shop Pay and the Shop app leverage buyer history and saved payment details across millions of shoppers to seamlessly facilitate agentic transactions, the analyst stated. Shopify is attracting both enterprise and SMB (small and medium business) merchants by offering tools that help them prepare for and capitalize on the growing shift toward AI-driven shopping, he added.

"We see a long runway for strong GMV growth given this (agentic commerce) positioning," the analyst further wrote.

SHOP Price Action: Shares of Shopify had risen by 6.68% to $152.09 at the time of publication on Wednesday.