Shopify Free Cash Flow Margin Reaches 22% in Third Quarter

The Tip Desk · November 10, 2026 · 2 min read

Revenue was $3.742 billion, up 32% from a year earlier, as the commerce platform posted a 22% free cash flow margin and $816 million of free cash flow.

Shopify (SHOP) posted a 22% free cash flow margin in the quarter ended September 30, 2026, up from 18% in the prior quarter, as revenue growth slowed to 32% from 34% in the second quarter.

The commerce platform reported revenue of $3.742 billion, matching 32% growth in constant currency. Free cash flow was $816 million. Operating income was $568 million, versus $343 million a year earlier. Gross profit was $1.781 billion.

Gross merchandise volume was $119.145 billion, up from $92.013 billion a year earlier. Monthly recurring revenue was $230 million. President Harley Finkelstein said the company powered $119 billion in GMV while continuing to build commerce into “every surface, every agent, and increasingly, everywhere.” Chief Financial Officer Jeff Hoffmeister said the results extended a track record of consistent execution.

Merchant solutions revenue was $2.906 billion. Subscription solutions revenue was $836 million. Merchant solutions rose 35% from a year earlier; subscription solutions rose 20%. Constant-currency merchant solutions growth was 36%.

GAAP net income was $462 million, or $0.36 a share, versus $264 million, or $0.20 a share, a year earlier. Non-GAAP net income was $638 million, or $0.49 a share, versus $441 million, or $0.34 a share. Diluted weighted-average shares were 1.29 billion.

Operating expenses were $1.213 billion. Sales and marketing was $466 million, research and development $497 million, and general and administrative $130 million. Transaction and loan losses were $120 million. Stock-based compensation was $140 million.

Cash and cash equivalents were $1.868 billion at September 30, 2026. Marketable securities were $2.859 billion. Loans and merchant cash advances, net, were $2.350 billion. The company repurchased $562 million of common stock in the quarter, versus no repurchases a year earlier. Net cash from operations was $818 million. Capital expenditures were $2 million.

For the fourth quarter of 2026, Shopify expects revenue to grow at a low-thirties percentage rate year over year, matching the low-thirties guide it issued for the third quarter. Gross profit dollars are expected to grow at a high-twenties percentage rate. Operating expenses are expected at 29% to 30% of revenue, versus a 33% to 34% guide for the third quarter. Stock-based compensation is expected to be $155 million. Free cash flow margin is expected to be consistent with the fourth quarter of 2025.

The company said the outlook supersedes all prior financial outlook statements and is subject to risks including consumer spending, trade measures, and adoption of emerging technologies.