SHOP SHOPIFY INC.

Overview and Growth

Fiscal 2025 results for SHOPIFY INC. combined $11.56B of revenue with net income of $1.23B and an operating cash inflow of $2.03B. The $11.56B revenue base provides substantial context for the company’s earnings, cash generation, and capital requirements. Compared with $8.88B in fiscal 2024, revenue recorded a 30.1% year-over-year increase. On a per-share basis, diluted EPS was $0.94, which connects the reported earnings outcome with the company’s diluted share count. Against diluted EPS of $1.55 in fiscal 2024, the current result was 39.4% lower. Asset turnover was 0.76x, relating the company’s annual revenue directly to the total assets reported at the period end.

Profitability

After reported cost of revenue, the company retained $5.55B as gross profit before recognizing operating expenses and other items. Gross margin was 48.1%, so that share of each revenue unit remained after the cost of revenue reported for the period. Operations produced $1.47B of income after the reported operating expense base, before the remaining non-operating and tax effects. Operating margin measured 12.7%, showing the portion of revenue preserved after the full set of operating costs. The bottom-line result was net income of $1.23B, after the operating, financing, tax, and other items recognized for the period. The final earnings result represented 10.7% of revenue, connecting the absolute net income figure with the company’s top-line scale. Before income taxes, the company reported $1.51B of earnings, providing a bridge between the operating result and final net income. Pretax income represented 13.1% of revenue, placing earnings before tax in the context of the company’s operating scale. The company recognized $278.00M of income tax for the period, completing the transition from pretax income to net income. The effective relationship between income tax and positive pretax income was 18.4%, without assuming a statutory-rate comparison. Return on period-end equity was 9.1%, relating annual net income to the equity capital on the balance sheet. The net-income-to-assets relationship measured 8.1%, showing earnings relative to the full balance sheet.

Liquidity and Capital Structure

At period end, the $15.19B asset base was financed through $1.72B of liabilities and $13.47B of equity. The near-term balance sheet paired $8.30B of current assets with $1.39B of current liabilities at the reporting date. Current assets covered current liabilities by 5.96x, leaving a positive buffer for near-term obligations. Cash and equivalents totaled $1.54B, identifying the most liquid reported component available within the broader current-asset balance. The cash balance equaled 111.0% of current liabilities, showing how much near-term coverage came from cash alone. Liabilities represented 11.3% of total assets, quantifying the liability-funded share of the company’s resource base. The cash-to-assets relationship was 10.2%, comparing reported cash and equivalents with the full positive asset balance. Compared with $13.92B in fiscal 2024, the current asset base moved 9.1% and finished higher.

Cash Flow and Earnings Quality

Operating activities produced a cash inflow of $2.03B, giving the cash-flow counterpart to the accrual-based profit measures reported for the year. The operating-cash-flow-to-net-income relationship was 1.65x, comparing cash generated by operations with the bottom-line earnings result. Capital spending was $26.00M, absorbing part of the cash generated from operations before free cash flow. Capital expenditures represented 1.3% of operating cash flow, leaving the remainder available as free cash flow. After capital spending, free cash flow was $2.01B, leaving cash available for debt reduction, shareholder returns, or further investment. Free cash flow represented 17.4% of revenue, linking post-investment cash generation with the company’s operating scale. Free cash flow equaled 13.2% of total assets, relating post-investment cash generation to the company’s resource base.

Based on the annual report for the fiscal year ending Dec 31, 2025. Analysis generated Oct 21, 2026.