Share count
1.3Bpeak FY2025
← All companies ← SHOO Manual SHW → ← SAP Software SIFY →
SHOP, Shopify Inc.
Software asset-light
Shopify's business is designed to empower our merchants by offering a comprehensive, multi-channel commerce platform that supports their business as it grows.
Shopify's all-in-one platform makes it easier to start, run and grow a business, powering sales online, in store, and everywhere in between.
As owners and operators, merchants set their course, while Shopify offers them the tools to seamlessly manage, market and sell their products across various sales channels, including online storefronts, physical retail spaces, AI platforms, social media and more.
The business
What it sells, where the money comes from, the kind of company it is.
Revenue · FY2025
$11.6B
+30.1% YoY · 27% 3-yr CAGR
Vital signs · TTM, with 4-yr average
Revenue $12.4B 4-yr avg $8.3B
Revenue $3.2B +34.3% vs yr-ago qtr
Operating margin 12.1% yr-ago 8.6%
Net income ($581M) yr-ago ($682M)
Net margin −18.3% yr-ago −28.9%
The business in brief
read the 10-K →What this business is and what moves its needle, from its own SEC filings.
- What moves the needle
- Operating margin has reached 13% at its best but run negative through the cycle (median −15%) on a 49% gross margin — so the question is which reading is truer: whether the median was pulled below zero by one-off charges, by the cycle, or by spending it is still growing into, and whether it settles back at a profit. The cash cycle has run negative through the cycle (a median of −18 days): the operation is paid before it pays, so working capital releases cash as the business grows rather than tying it up. Read this kind of business on retention and the cost of growth. On its own account, the filing leans hardest on cyclicality & demand, set against the numbers in what the filing emphasizes, below.
- Is it a good business?
- Return on capital has rarely cleared the cost of capital (median −0%, above 15% in 0 of 4 years). The steadier read is owner earnings: roughly 15% of revenue reaches owners as cash, consistently, and customers and suppliers fund the business through negative working capital. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.
Every line is arithmetic on the company's filings, shown in full in the sections below.
The record
Ten years of arithmetic, read across the cycle.
The record, 2022–2025
realized figures from each filing · older years to the left| 2022’22 | 2023’23 | 2024’24 | 2025’25 | TTMTTMMar 2026 | |
|---|---|---|---|---|---|
| Income statement | |||||
| $5.6B | $7.1B | $8.9B | $11.6B | $12.4B | RevenueRevenue |
| 49% | 50% | 50% | 48% | 48% | Gross marginGross mgn |
| 13% | 7% | 5% | 4% | 4% | SG&A / revenueSG&A/rev |
| 27% | 25% | 15% | 13% | 13% | R&D / revenueR&D/rev |
| ($822M) | ($1.4B) | $1.1B | $1.5B | $1.6B | Operating incomeOp. inc. |
| −14.7% | −20.1% | 12.1% | 12.7% | 13.3% | Operating marginOp. mgn |
| ($3.5B) | $132M | $2.0B | $1.2B | $1.3B | Net incomeNet inc. |
| — | 29% | 9% | 18% | 19% | Effective tax rateTax rate |
| Cash flow & returns | |||||
| ($136M) | $944M | $1.6B | $2.0B | $2.1B | Operating cash flowOp. cash |
| $93M | $70M | $36M | $31M | $30M | DepreciationDeprec. |
| $3.2B | $742M | ($439M) | $771M | $785M | Working capital & otherWC & other |
| $50M | $39M | $19M | $26M | $27M | CapexCapex |
| 0.9% | 0.6% | 0.2% | 0.2% | 0.2% | Capex / revenueCapex/rev |
| ($186M) | $905M | $1.6B | $2.0B | $2.1B | Owner earningsOwner earn. |
| −3.3% | 12.8% | 18.0% | 17.4% | 17.1% | Owner earnings marginOE mgn |
| ($186M) | $905M | $1.6B | $2.0B | $2.1B | Free cash flowFCF |
| −3.3% | 12.8% | 18.0% | 17.4% | 17.1% | Free cash flow marginFCF mgn |
| $1.8B | $31M | $30M | $56M | $0 | AcquisitionsAcquis. |
| -10% | -12% | 10% | 10% | 13% | ROICROIC |
| -42% | 1% | 17% | 9% | 11% | Return on equityROE |
| −42% | 1% | 17% | 9% | 11% | Retained to equityRetained/eq |
| Balance sheet | |||||
| $1.6B | $5.1B | $6.2B | $6.8B | $6.5B | Cash & investmentsCash+inv |
| $273M | $282M | $342M | $500M | $449M | ReceivablesReceiv. |
| — | $19M | $26M | $21M | $21M | InventoryInvent. |
| — | $364M | $360M | $570M | $1.0B | Accounts payablePayables |
| $273M | ($63M) | $8M | ($49M) | ($564M) | Operating working capitalOper. WC |
| — | $6.3B | $7.3B | $8.3B | $8.5B | Current assetsCur. assets |
| — | $898M | $2.0B | $1.4B | $1.4B | Current liabilitiesCur. liab. |
| — | 7.0× | 3.7× | 6.0× | 6.2× | Current ratioCurr. ratio |
| $1.8B | $427M | $452M | $491M | $491M | GoodwillGoodwill |
| — | $11.3B | $13.9B | $15.2B | $14.1B | Total assetsAssets |
| — | $916M | $0 | — | $0 | Total debtDebt |
| — | ($4.2B) | ($6.2B) | — | ($6.5B) | Net debt / (cash)Net debt |
| $8.2B | $9.1B | $11.6B | $13.5B | $12.5B | Shareholders’ equityEquity |
| Per share | |||||
| 1.27B | 1.30B | 1.30B | 1.30B | 1.30B | Shares out (diluted)Shares |
| $4.42 | $5.45 | $6.82 | $8.86 | $9.49 | Revenue / shareRev/sh |
| $-2.73 | $0.10 | $1.55 | $0.94 | $1.02 | EPS (diluted)EPS |
| $-0.15 | $0.70 | $1.23 | $1.54 | $1.63 | Owner earnings / shareOE/sh |
| $-0.15 | $0.70 | $1.23 | $1.54 | $1.63 | Free cash flow / shareFCF/sh |
| $0.04 | $0.03 | $0.01 | $0.02 | $0.02 | Cap. spending / shareCapex/sh |
| $6.51 | $7.00 | $8.88 | $10.32 | $9.59 | Book value / shareBVPS |
Per-share growththe realized rate an owner's share compounded
| 3-yr | 5-yr | |
|---|---|---|
| Revenue / share | +26.0%/yr | +26.0%/yr (3-yr) |
| Capital spending / share | −20.4%/yr | −20.4%/yr (3-yr) |
| Book value / share | +16.6%/yr | +16.6%/yr (3-yr) |
The record, charted
FY2022–2025Each measure over its full record; the current point and the worst year marked.
ROIC
10%low FY2023
Gross margin
48%low FY2025
Owner earnings vs. net income
Owner earningsNet incomeThe accountant's number, and the cash an owner can take; the gap is the tell.
$2.0Bowner earningsvs.$1.2Bnet incomelow FY2022
Where the cash went
ReinvestBuybacksDividendsAcquisitionsRetainedEach year's operating cash, by what management did with it: the mix, and how it drifts.
FY2023FY2025
Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.
In fiscal 2025 the business turned $1.2B of profit into $2.0B of owner earnings: more cash than the profit line showed, after the non-cash charges and the capital it put back in.
| FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|
| Reported net income | $1.2B | $2.0B | $132M | ($3.5B) |
| Depreciation & amortizationnon-cash charge added back | +$31M | +$36M | +$70M | +$93M |
| Working capital & othertiming of cash in and out, other non-cash items | +$771M | −$439M | +$742M | +$3.2B |
| Cash from operations | $2.0B | $1.6B | $944M | ($136M) |
| Capital expenditurecash put back in to keep running and to grow | −$26M | −$19M | −$39M | −$50M |
| Owner earnings | $2.0B | $1.6B | $905M | ($186M) |
| Owner-earnings marginowner earnings ÷ revenue | 17% | 18% | 13% | -3% |
Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position .
Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.
Quality & stewardship
Returns, the balance sheet, capital allocation, and pay.
Owner’s Scorecard
FY2025 10-K · source on SEC EDGAR →
Will it survive?
- No meaningful interest burdenLittle or no interest expense reported
What this means
Little or no interest expense reported, the business isn't leaning on lenders to operate.
- Net cash, debt-freeCash $1.5B + ST investments $4.2B − debt $0
What this means
Cash and short-term investments exceed every dollar of debt by $5.8B, on net the company owes nothing, and can act from strength when others can't. It also holds $975M in longer-dated marketable securities; counting those, it sits at net cash of $6.8B. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
- Negative, funded by othersDSO 16 + DIO 1 − DPO 35 days
What this means
Days cash is tied up between paying suppliers and collecting from customers. A negative cycle is a quiet moat: suppliers and customers fund the operation (Buffett's “float”), the company grows on other people's money.
Is it a good business?
- Below average through the cycle4-yr median, range -12%–10%; 10% latest = NOPAT $1.2B ÷ invested capital $11.9BIndustry peers: median 18%
What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 4 years (it ran 10% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
- Solid through the cycle4-yr median margin, range -3%–18%; latest $2.0B = operating cash $2.0B − maintenance capex $26MIndustry peers: median 29%
What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 17% of revenue this year, a 13% median across 4 years.
- Cash-backedCash from ops $2.0B ÷ net income $1.2B
What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.
How is the cash used?
- Not enough data
What this means
The filing data didn't include the inputs for this check.
- Investing or harvesting? 0.84×MaintainingCapex $26M ÷ depreciation $31M
What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.
Graham’s defensive tests · 3 of 3 met
Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.
- Adequate size PassRevenue ≥ $2B · $11.6B
What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
- Strong liquidity PassCurrent ratio ≥ 2× · 5.96×
What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
- Conservative debt PassDebt ≤ working capital · $0 vs $6.9B WC
What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
- Moderate price —P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $0.86/share (latest year $0.94), the averaged base the calculator's gate runs on, and book value is $10.34/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.
Durability & moat, 2022–2025
Whether the record’s returns held, and what the capital reinvested earned.
- Profitable years 3 of 4
What this means
Lost money in 1 year(s), look at what happened there before trusting the average.
- Operating margin −17% → 12% (2-yr avg ends)
What this means
Through the cycle the operating margin widened — about −17% early to 12% lately, median −15% — pricing power intact or improving.
- Reinvestment, incremental ROIC returns capital
What this means
The capital base barely grew: this business returns cash through dividends and buybacks rather than reinvesting. Judge it on the cash returned, not on compounding.
- Owner earnings growth +71%/yr
What this means
Owner earnings grew about 71% a year over the record.
- Worst year 2023 · −20.1% op. margin
What this means
Operations went underwater in 2023, understand why before trusting the good years.
- Share count +1.0%/yr
What this means
The share count is rising, dilution works against you on a per-share basis.
Does AI threaten the moat?
Elevated contestabilityThe product is software or information, the very thing capable AI now produces more cheaply, so the moat is more contestable than the record alone implies.
In its own filing A competitive risk, new this year
Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.
“If we fail to effectively integrate AI tools into our products, the utility of our platform could diminish relative to our competitors.”
AI has collapsed the cost of building a capable substitute for the very thing this business sells. When a credible alternative can be assembled for a fraction of the incumbent's price, it is pricing power that erodes first, not revenue tomorrow. The live question is whether the moat survives that, not whether it held in the past. Whether that question is answerable at all is yours to decide, against your own circle of competence.
Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.
All figures as filed; the source filing is linked above.
Current Position
as of the latest quarter, Mar 31, 2026Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.
Current assets$8.5B
- Cash & short-term investments$5.7B
- Receivables$449M
- Inventory$21M
- Other current assets$2.3B
Current liabilities$1.4B
- Accounts payable$1.0B
- Other current liabilities$337M
Current ratio6.20×all current assets ÷ what's due · Graham looked for 2×
Quick ratio6.18×stricter: inventory excluded
Cash ratio4.19×strictest: cash alone against what's due
Working capital$7.1Bthe cushion left after near-term bills
Revenue, latest quarter vs. a year ago+34.3%the freshest read on whether the business is still growing
Current ratio, recent quarters3.7× → 6.2×
Deeper floors
Tangible book value$12.0Bequity stripped of goodwill & intangibles
Debt incl. operating leases$179M$179M of it operating leases
Deferred revenue$407Mcustomer cash collected before delivery; operating float
From the company's latest filing.
How the cash was used, 2022–2025
Over the record, the business generated $4.5B of operating cash; how management split it reads as a cash builder, a large share of cash simply built up on the balance sheet.
- Reinvested$134M · 3%
- Retained (debt / cash)$4.3B · 97%
- Source of fundingOperating cash
Operating cash covered reinvestment and returns; over the span cash and short-term investments rose $4.1B.
- Net change in share count2.9%
The diluted count rose from 1266M to 1303M: issuance (stock pay, deals) outran any buybacks, so owners were diluted on net.
- Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.
Acquisitions & goodwill
from the balance sheet & the 4-year cash-flow recordGoodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.
Goodwill & intangibles$521M3% of all assets; the premium carried on the balance sheet for businesses acquired
Against book equity4%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital
Cash spent acquiring$1.9Bover 4 years buying other businesses, against $134M of capital spent building
$1.4B written down across 1 year (2023): goodwill the company has already conceded it overpaid for, charged against earnings. That is roughly 77% of the cash it put into acquisitions over the span. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.
Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 4-year record, from the company's own filings.
Inverting the record
Invert: instead of why Shopify Inc. is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2022–2025.
None of the 4 tests turned up a mark; each came back clean. A clean panel says only that these particular ways of being wrong are not written into the record.
Each test came back clean
- Is it less profitable than it was?
- Did the share count rise anyway?
- Did receivables and inventory outpace sales?
- Are "one-time" charges a yearly habit?
Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.
What an owner would ask, FY2025
read the 10-K →- Which reported numbers are a judgment call?Management names Revenue recognition, Income taxes, Contingencies as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →
The questions the record and the charts do not answer on their own; each carries the figure and the place to look.
Peers, Software
The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.
| Company | Revenue | Gross margin | Op. margin | ROIC | Owner earn. margin |
|---|---|---|---|---|---|
| INTUIntuit Inc. | $18.8B | 99% | 26.0% | 35% | 32% |
| NOWServiceNow Inc. | $13.3B | 77% | 4.4% | 6% | 30% |
| SHOPShopify Inc. | $11.6B | 49% | -1.3% | -0% | 15% |
| EAElectronic Arts | $7.5B | 75% | 20.1% | 19% | 29% |
| ADSKAutodesk Inc. | $7.2B | 90% | 15.3% | 33% | 29% |
| SNPSSynopsys Inc. | $7.1B | 78% | 16.2% | 15% | 21% |
| TTWOTake-Two Interactive | $6.7B | 50% | 6.3% | 18% | 14% |
| SSNCSS&C Technologies | $6.3B | 47% | 21.8% | 7% | 25% |
| Group median | — | 76% | 15.7% | 17% | 27% |
The price
What a price has to assume.
What the price implies
reverse-DCFType today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Shopify Inc. has delivered.
Shopify Inc.’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.
$
Through the cycle, Shopify Inc. earns about $1.7B on its 15.1% median owner-earnings margin. This year’s 17.4% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.
Base
—
The assumptions
9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.
Enter a price above to run it.
A dated snapshot of the price you typed, the assumptions you set, and what the page showed for them. A snapshot is never edited after it is saved. Your notebook is yours alone — the commitment states what is stored and what we will never do.
Implied by the price—
Owner-earnings growth · ’22→’25+71%/yr
Owner-earnings growth · ’22→’25+71%/yr
Owner-earnings yield—
What a growth belief costs, in multiples
The growth each return requires, at your price
P/E (3-yr earnings ’23–’25)—
P/B—
Graham’s price gate—
Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.
Against a high-grade bond: Graham’s yardstick bond yield%
Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.
Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.
Owner-earnings yield—
High-grade bond yield—
Margin over the bond—
Owner earnings $2.1B on 1303M shares outstanding (a weighted basic average, the only count this filer tags); net cash $6.5B. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.
Cite: Owner Scorecard, "Shopify Inc. (SHOP), the owner's record," https://ownerscorecard.com/c/SHOP, data as of 2026-07-09.
Manual order: ← SHOO its page in the Manual SHW →
Industry order: ← SAP the Software chapter SIFY →