Shopify Inc. · Q2 2026 call

GMV was up 32% to $116 billion, with broad growth across our merchant sizes, geographies, and sales channels. Our revenue was up 34% to $3.6 billion, and our free cash flow margin was 18%. That's a growth rate of 30% or more across every metric. This marks our fifth straight quarter of GMV growth above 30%.

We're seeing that AI searches powered by Catalog converted twice the rate of those using scraped data. That is because with Catalog, merchants' products show up complete, accurate, and with the right context when someone is ready to buy. Put simply, Catalog is the discovery engine for the future, Shopify built it and owns it.

While the volume from agentic commerce is still small relative to our massive GMV, the growth trends are impressive. Both AI-driven traffic and also orders to Shopify stores tripled year-over-year in the second quarter. New buyer orders are coming in at nearly twice the rate of other channels. This is not just AI taking share of search. Search remains one of our largest sources of buyer traffic to our merchants, and it's still growing.

In the second quarter, daily active merchants using Sidekick were up 3.6x year-on-year, and daily sessions were up 4.8x. It handled nearly 34 million conversations, and it was used to create more than 36,000 custom apps, up from 12,000 in Q1. […] Sidekick's personalized guidance for new merchants during onboarding led to an 8% increase in merchants reaching five orders within 15 days.

We saw that AI search was starting to disproportionately benefit the long tail in 2025, and that trend has continued, with 75% of AI-attributed orders in the second quarter coming from outside our top 100 categories in Q2.

Q2 marks the fifth consecutive quarter with constant currency GMV growth of 29%-30%. A tight band, and importantly, even as our scale has grown and the year-over-year comps have gotten tougher, we have consistently delivered these growth rates.

For example, our Q1 2015 cohort now has a quarterly GMV that's 5x its initial size, implying a compound annual growth rate three times that of the overall commerce market's growth rate over the same period.

Over the last five years, merchants who reach one million in annual GMV had a 92% retention. That jumps to 97% at a 10 million annual GMV.

Merchant solutions revenue grew 37%, driven primarily by the strength in GMV and increased payments penetration, which grew 3 points year-over-year, reaching 68% of our global GMV. We see clear runway on payments penetration both domestically and abroad.

our revenue beat in the second quarter stemmed from three key areas where we outperformed: broad-based GMV outperformance, higher-than-expected payments penetration, and strength in other merchant solutions, primarily from our partner rev shares and financial services.

As a reminder, the vast majority of AI costs related to merchant use of Sidekick appear in subscription solutions gross profit. We were able to hold gross margins at a relatively consistent level quarter-over-quarter while Sidekick usage scaled

We expect Q3 revenue growth in the low 30s year-over-year. […] We expect our gross profit dollars to grow in the mid to high 20s. […] We expect operating expenses in Q3 to be 33%-34% of revenue, reflecting continued leverage and meaningful improvement compared to the 37% we delivered in Q3 of last year. We expect our Q3 free cash flow margin to be in the high teens to low 20s

Even though Shopify represents over 14% of the U.S. e-commerce market, our margins take a disproportionate share of the growth. According to eMarketer, since the start of 2025, Shopify merchants have captured nearly half of all incremental e-commerce dollars in the U.S.

when it comes to monetization, the focus is very simple here. We unlock more places for our merchants to sell, and we earn on those sales the way we always have. You've seen this, of course, but agentic transactions carry the exact same economics as an online store transaction. There's no new fees. There's no separate pricing. More agentic GMV, it means more Shopify revenue

What these larger brands are looking for is they want a future-proofed commerce partner. They don't want to have to think about ever migrating again. The olden days of enterprise e-commerce, every couple of years, you had to sort of migrate to a new platform. That's not the case with Shopify.

In terms of upper bound, I don't think it's a GMV issue. We have merchants that are doing billions of dollars with a very small team. There's no upper bound in terms of GMV. […] I think we've captured less than 1% of global retail sales.

The way we think about these models is we use the best model for the job. We use frontier intelligence where it matters. We use less expensive models where it's simply not needed. Everything that we've done runs through an internal proxy, which gives us incredible visibility, gives us control, gives us security. Then as soon as a task becomes repeatable, we look at how to move it to a more efficient model.

Nothing's changed, Todd, in terms of how we look at free cash flow and the levers we have at our disposal. The gross margin is something where we've talked about in terms of any pressure we see on gross margin, we'll more than offset that with OpEx success. […] I don't think we can say, can we have a new normal? I would focus you on the guidance we gave for Q3. I would tell you we continue to drive more and more leverage through the system.

Native GMV was up 70% year-over-year, and we're seeing things like Cart Sync represented 30% of Shop app GMV.