In the three months to September, merchants sold $119.1 billion of goods through Shopify, up 29% from a year earlier. Shopify's revenue rose 32%. Its profit and cash flow rose faster still. By almost any ordinary measure, it was a very good quarter.
By one measure, it fell just short. Analysts had expected those sales to reach $120.08 billion, Investing.com reported. Shopify's shares fell 8.74% on Tuesday, the day of the results, while the S&P 500 fund rose 0.3%.
This story is about what that number measures, why it matters so much to this company, and what the 10-Q Shopify filed on Tuesday morning says about where the money comes from.
A good quarter on most lines
Revenue was $3.74 billion, Investing.com reported. It said that matched what analysts expected, while Lapaas Voice said Shopify "narrowly missed the analyst consensus of approximately $3.77 billion," so reports differ on that point. Operating income rose 66% to $568 million, above the $523.9 million estimate. Crypto Briefing reported that "net income climbed 75% to $462 million."
Free cash flow, the cash left after running the business and paying for equipment, was $816 million. That is 22% of revenue, against 18% a year earlier. "We extended our track record of consistent execution," said finance chief Jeff Hoffmeister. Over nine months, revenue was $10.5 billion, up 33%. For scale, all of 2025 brought in $11.6 billion, its annual report shows.
Source: SEC EDGAR XBRL data
The number that fell short
That number is gross merchandise volume, or GMV: the total value of orders placed through Shopify's platform. It isn't Shopify's own money. "GMV does not represent revenue earned by us," the 10-Q says. But it is the base on which much of the business rests: "Our merchant solutions revenues are also directionally correlated with the level of GMV facilitated through our platform."
A year earlier GMV was $92.0 billion. The 29% rise in the third quarter compares with 32% in the second, according to Shopify's filing for that quarter. News reports described that as a slowdown. But Shopify's filings point to exchange rates: converted at the previous year's rates, growth was 30% in the second quarter and 30% in the third.
Subscription revenue was the other soft spot, rising about 20% to $836 million, below the $850.2 million estimate, Investing.com reported. Monthly recurring revenue, the value of the subscription plans in force at the end of the quarter, grew 19% to $230 million, in line with forecasts. The 10-Q credits "a higher number of merchants using our platform and by a larger percentage of subscriptions coming from higher priced plans, such as Plus."
Payments is the engine
Most of Shopify's money now comes from taking a share of what its merchants sell, not from what they pay to use its software. Over nine months, "merchant solutions revenues accounted for 77% of total revenues." That segment rose about 35% to $2.91 billion in the quarter.
The largest part of the increase was "an increase in Shopify Payments revenue of $619 million." The share of GMV running through Shopify's own payments service rose to 68% from 65% a year earlier, or $81.4 billion of orders against $60.2 billion. That is why GMV gets so much attention: when merchants sell more, Shopify collects more, and when the growth in what they sell slows, so does one of its main sources of revenue, unless it takes a bigger share of each sale.
Source: SEC EDGAR XBRL data
What AI is costing
Shopify's president, Harley Finkelstein, put AI at the center of the release: "We powered $119 billion in GMV, while continuing to build commerce into every surface, every agent, and increasingly, everywhere." Agents here means AI software that shops on a person's behalf. Neither the earnings release nor the 10-Q gives a figure for sales made that way.
The cost side is easier to see. In the 10-Q, subscription costs rose on "a $40 million increase in our infrastructure costs, including cloud hosting platforms, infrastructure software and LLM usage costs." LLM means large language model, the technology behind AI chatbots. Research and development rose in part on "$40 million in computer hardware and software costs, which includes AI-related usage."
The holiday quarter
The next three months are the ones that count most. "Our merchants typically process additional GMV during the fourth quarter holiday season," the 10-Q says. Shopify expects "Revenue to grow at a low-thirties percentage rate on a year-over-year basis" and "Gross profit dollars to grow at a high-twenties percentage rate." It also expects operating expenses of 29% to 30% of revenue, down from about 32%, Investing.com reported.
What it adds up to
This is analysis, not advice. Shopify lost $1.4 billion at the operating level in 2023 and earned $1.5 billion in 2025, so the business has changed a great deal in two years. Nothing in this filing suggests that has reversed.
What the quarter does show is how closely Shopify's results now track what its merchants sell. Its revenue is growing faster than GMV partly because more orders run through its payments service, and that share can't rise forever. If GMV growth slows while the payments share levels off, revenue growth should follow it down. So far the filings don't show that happening: at constant exchange rates, GMV growth held at 30%. The holiday quarter is the next test. Growth near that rate would make this quarter's miss look small. A clear drop below it would suggest something more lasting.
The figures here come from the earnings release and the 10-Q; Shopify's call with analysts began after they were published, and this story doesn't draw on it. More figures are on its company page. When a business is measured on what millions of other businesses sell, a miss this small can still be the number everyone reads first. Updated November 5: added how the shares closed on Tuesday.