(Reuters) -Shopify projected strong fourth-quarter revenue growth on Tuesday, signaling resilient demand at the e-commerce company as retailers gear up for the all-important holiday shopping season.
However, U.S.-listed shares of the Ontario, Canada-based company were down more than 4% in premarket trading, after having surged nearly 63% so far this year.
Although U.S. tariffs have strained retailers heading into the holiday season, merchants are still spending on Shopify’s e-commerce tools thanks to the company’s efforts to integrate AI features and roll out upgrades that make it easier for sellers to manage their businesses.
That has been especially helpful for the small- and medium-sized businesses that make up a large portion of Shopify’s client base, as they can save on costs by turning to artificial intelligence for tasks such as setting up discounts or creating sales reports.
Shopify had said in August it was yet to see any slowdown in consumer demand, even in the face of tariffs and subsequent higher prices.
The company expects revenue to rise in the mid-to-high-twenties percentage range in the current quarter, compared with analysts’ average estimate for a 23.4% increase, according to data compiled by LSEG.
It reported total revenue of $2.84 billion for the third quarter ended September, compared with estimates of $2.76 billion.
(Reporting by Deborah Sophia in Bengaluru; Editing by Devika Syamnath)
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