The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Wix (NASDAQ: WIX) and the rest of the e-commerce software stocks fared in Q2.
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 5 e-commerce software stocks we track reported a satisfactory Q2. As a group, revenues beat analysts’ consensus estimates by 1.6% while next quarter’s revenue guidance was in line.
Luckily, e-commerce software stocks have performed well with share prices up 12.4% on average since the latest earnings results.
Wix (NASDAQ: WIX)
Powering over 263 million registered users worldwide with its AI-driven tools, Wix (NASDAQ: WIX) provides a cloud-based platform that helps individuals and businesses create and manage professional websites without requiring coding skills.
Wix reported revenues of $489.9 million, up 12.4% year on year. This print exceeded analysts’ expectations by 0.6%. Despite the top-line beat, it was still a mixed quarter for the company with billings in line with analysts’ estimates but a slight miss of analysts’ EBITDA estimates.
“Demand for AI-powered online creation continues to accelerate, and Wix is leading the way as more people use our platform to build sophisticated, high-quality projects with greater speed and ease. This ongoing momentum drove our new cohort bookings to their highest levels since peak-COVID, setting the stage for continued growth in the second half of the year and beyond,” said Avishai Abrahami, Co-founder and CEO at Wix.
Interestingly, the stock is up 42.2% since reporting and currently trades at $181.78.
Read our full report on Wix here, it’s free.
Best Q2: Shopify (NASDAQ: SHOP)
Starting with just three people selling snowboards online in 2004, Shopify (NYSE: SHOP) provides a comprehensive platform that enables merchants of all sizes to create, manage and grow their businesses across multiple sales channels.
Shopify reported revenues of $2.68 billion, up 31.1% year on year, outperforming analysts’ expectations by 5.2%. The business had an exceptional quarter with a solid beat of analysts’ gross merchandise volume and EBITDA 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 20.6% since reporting. It currently trades at $153.30.
Is now the time to buy Shopify? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: VeriSign (NASDAQ: VRSN)
As the silent guardian of the internet's roadmap, VeriSign (NASDAQ: VRSN) operates the authoritative registry for .com and .net domain names, enabling websites to be found reliably when users type web addresses.
VeriSign reported revenues of $409.9 million, up 5.9% year on year, in line with analysts’ expectations. It was a slower quarter, leaving some shareholders looking for more.
VeriSign delivered the weakest performance against analyst estimates in the group. As expected, the stock is down 1.5% since the results and currently trades at $282.50.
Read our full analysis of VeriSign’s results here.
BigCommerce (NASDAQ: BIGC)
As a founding member of the MACH Alliance advocating for modern tech standards, BigCommerce (NASDAQ: BIGC) provides a SaaS platform that enables businesses to build and manage online stores, connect with marketplaces, and integrate with point-of-sale systems.
BigCommerce reported revenues of $84.43 million, up 3.2% year on year. This result beat analysts’ expectations by 1.3%. It was a strong quarter as it also recorded a solid beat of analysts’ EBITDA and billings estimates.
BigCommerce scored the highest full-year guidance raise but had the slowest revenue growth among its peers. The stock is up 4.6% since reporting and currently trades at $4.99.
Read our full, actionable report on BigCommerce here, it’s free.
GoDaddy (NYSE: GDDY)
Known for its memorable Super Bowl commercials that put it on the map, GoDaddy (NYSE: GDDY) is a domain registrar and web services provider that helps entrepreneurs establish an online presence through domain registration, website building, hosting, and e-commerce tools.
GoDaddy reported revenues of $1.22 billion, up 8.3% year on year. This print surpassed analysts’ expectations by 0.9%. Zooming out, it was a satisfactory quarter as it also produced a decent beat of analysts’ EBITDA estimates but bookings in line with analysts’ estimates.
GoDaddy had the weakest full-year guidance update among its peers. The company lost 75,000 customers and ended up with a total of 20.41 million. The stock is down 3.7% since reporting and currently trades at $144.76.
Read our full, actionable report on GoDaddy here, it’s free.
Market Update
Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September 2024, a quarter in November) have propped up markets, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there’s still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.
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