The end of the earnings season is always a good time to take a step back and see who shined (and who not so much). Let’s have a look at how the e-commerce software stocks have fared in Q2, starting with BigCommerce (NASDAQ:BIGC).
While e-commerce has been around for over two decades and enjoyed meaningful growth, its overall penetration of retail still remains low. Only around $1 in every $5 spent on retail purchases comes from digital orders, leaving over 80% of the retail market still ripe for online disruption. It is these large swathes of the retail where e-commerce has not yet taken hold that drives the demand for various e-commerce software solutions.
The 5 e-commerce software stocks we track reported a weak Q2; on average, revenues were in line with analyst consensus estimates, while on average next quarter revenue guidance was 2.41% under consensus. There has been a stampede out of high valuation technology stocks as raising interest encourage investors to value profits over growth again and while some of the e-commerce software stocks have fared somewhat better that others, they have not been spared, with share prices declining 5% since the previous earnings results, on average.
Best Q2: BigCommerce (NASDAQ:BIGC)
Founded in Sydney, Australia in 2009 by Mitchell Harper and Eddie Machaalani, BigCommerce (NASDAQ:BIGC) provides software for businesses to easily create online stores.
BigCommerce reported revenues of $68.2 million, up 39.1% year on year, beating analyst expectations by 3.08%. It was a mixed quarter for the company, with an exceptional revenue growth but an underwhelming revenue guidance for the next quarter.
“Our overall growth continued at a strong pace in the second quarter, and equally encouraging is the external recognition we are gaining as the world’s most modern enterprise ecommerce platform,” said Brent Bellm, CEO at BigCommerce.
BigCommerce scored the strongest analyst estimates beat, fastest revenue growth, and highest full year guidance raise of the whole group. The stock is down 26.9% since the results and currently trades at $13.42.
Founded by Bob Parsons after selling his first company to Intuit, GoDaddy (NYSE:GDDY) provides small and mid-sized businesses with the ability to buy a web domain and tools to create and manage a website.
GoDaddy reported revenues of $1.01 billion, up 9.04% year on year, in line analyst expectations. It was a weak quarter for the company, with revenue guidance for both the next quarter and full year missing analysts' expectations.
The stock is down 2.4% since the results and currently trades at $73.75.
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Weakest Q2: Shopify (NYSE:SHOP)
Originally created as an internal tool for a snowboarding company, Shopify (NYSE:SHOP) provides a software platform for building and operating e-commerce businesses.
Shopify reported revenues of $1.29 billion, up 15.6% year on year, missing analyst expectations by 2.67%. It was a weak quarter for the company, with a miss of the top line analyst estimates and a slow revenue growth.
Shopify had the weakest performance against analyst estimates in the group. The stock is down 7.77% since the results and currently trades at $26.06.
Founded in 2006 in Tel Aviv, Wix.com (NASDAQ:WIX) offers a free and easy to operate website building platform.
Wix reported revenues of $345.2 million, up 9.1% year on year, in line with analyst expectations. It was a weak quarter for the company, with an underwhelming revenue guidance for the next quarter and a slow revenue growth.
The stock is up 5.51% since the results and currently trades at $72.56.
Founded in New York City in 2003, Squarespace (NYSE:SQSP) is a platform for small businesses and creators to build their digital presences online.
Squarespace reported revenues of $212.7 million, up 8.51% year on year, in line with analyst expectations. It was a weak quarter for the company, with guidance for both the next quarter and full year missing analysts' expectations.
Squarespace had the slowest revenue growth and weakest full year guidance update among the peers. The stock is up 6.62% since the results and currently trades at $21.24.
The author has no position in any of the stocks mentioned