E-commerce Software Q2 Earnings: Squarespace (NYSE:SQSP) Simply the Best
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 take a look at how e-commerce software stocks fared in Q2, starting with Squarespace (NYSE:SQSP).
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 6 e-commerce software stocks we track reported a decent Q2. As a group, revenues beat analysts’ consensus estimates by 0.9% while next quarter’s revenue guidance was in line.
Stocks--especially those trading at higher multiples--had a strong end of 2023, but this year has seen periods of volatility. Mixed signals about inflation have led to uncertainty around rate cuts. Thankfully, e-commerce software stocks have been resilient with share prices up 5.6% on average since the latest earnings results.
Best Q2: Squarespace (NYSE:SQSP)
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 $296.8 million, up 19.9% year on year. This print exceeded analysts’ expectations by 1.2%. Overall, it was a strong quarter for the company with an impressive beat of analysts’ billings estimates and a decent beat of analysts’ ARR (annual recurring revenue) estimates.
Interestingly, the stock is up 2.9% since reporting and currently trades at $45.34.
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 $2.05 billion, up 20.7% year on year, outperforming analysts’ expectations by 1.7%. It was a strong quarter for the company with a solid beat of analysts’ total payment volume estimates and a decent beat of analysts’ GMV (gross merchandise value) estimates.
Shopify scored the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 35.5% since reporting. It currently trades at $73.50.
Is now the time to buy Shopify? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: VeriSign (NASDAQ:VRSN)
While the company is not a domain registrar and does not directly sell domain names to end users, Verisign (NASDAQ:VRSN) operates and maintains the infrastructure to support domain names such as .com and .net.
VeriSign reported revenues of $387.1 million, up 4.1% year on year, in line with analysts’ expectations. It was an ok quarter for the company with a narrow beat of analysts' revenue estimates.
VeriSign had the weakest performance against analyst estimates and slowest revenue growth in the group. Interestingly, the stock is up 3.1% since the results and currently trades at $182.
Read our full analysis of VeriSign’s results here.
GoDaddy (NYSE:GDDY)
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 $1.12 billion, up 7.3% year on year, in line with analysts’ expectations. Taking a step back, it was a good quarter for the company with a decent beat of analysts’ bookings estimates.
GoDaddy pulled off the highest full-year guidance raise among its peers. The stock is up 16.8% since reporting and currently trades at $164.99.
Read our full, actionable report on GoDaddy here, it’s free.
Wix (NASDAQ:WIX)
Founded in 2006 in Tel Aviv, Wix.com (NASDAQ:WIX) offers a free and easy to operate website building platform.
Wix reported revenues of $435.7 million, up 11.7% year on year, in line with analysts’ expectations. More broadly, it was a decent quarter for the company with a solid beat of analysts’ billings estimates but full-year revenue guidance missing analysts’ expectations.
The stock is up 3.9% since reporting and currently trades at $163.33.
Read our full, actionable report on Wix here, it’s free.
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