SHOPIFY INC.

Previous wording

In this Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A"), "we", "us", "our", "Shopify" and "the Company" refer to Shopify Inc. and its consolidated subsidiaries, unless the context requires otherwise. In this MD&A, we present Shopify's results of operations and cash flows for the three and six months ended June 30, 2025 and 2024, and our financial position as of June 30, 2025. You should read this MD&A in conjunction with the unaudited condensed consolidated financial statements and the accompanying notes thereto in Part 1 - Item 1 of this Quarterly Report on Form 10-Q and with our audited consolidated financial statements included in the Company's 2024 Form 10-K.

Current wording

In this Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A"), "we", "us", "our", "Shopify" and "the Company" refer to Shopify Inc. and its consolidated subsidiaries, unless the context requires otherwise. In this MD&A, we present Shopify's results of operations and cash flows for the three and nine months ended September 30, 2025 and 2024, and our financial position as of September 30, 2025. You should read this MD&A in conjunction with the unaudited condensed consolidated financial statements and the accompanying notes thereto in Part 1 - Item 1 of this Quarterly Report on Form 10-Q and with our audited consolidated financial statements included in the Company's 2024 Form 10-K.

Previous wording

We believe we can help merchants of all verticals and sizes, from aspirational entrepreneurs to companies with large-scale, direct-to-consumer or business to business "B2B" operations, or both, realize their potential at all stages of their business life cycle. In the six months ended June 30, 2025, our platform facilitated gross merchandise volume ("GMV") of $162.6 billion, representing an increase of 27% from the six months ended June 30, 2024. A detailed description of this metric is presented below in the section entitled, "Key Performance Indicators".

Current wording

We believe we can help merchants of all verticals and sizes, from aspirational entrepreneurs to companies with large-scale, direct-to-consumer or business to business ("B2B") operations, or both, realize their potential at all stages of their business life cycle. In the nine months ended September 30, 2025, our platform facilitated gross merchandise volume ("GMV") of $254.6 billion, representing an increase of 29% from the nine months ended September 30, 2024. A detailed description of this metric is presented below in the section entitled, "Key Performance Indicators".

Previous wording

During the six months ended June 30, 2025, our total revenue was $5.0 billion, an increase of 29% versus the six months ended June 30, 2024. Our business model has two revenue components: a recurring subscription component we call subscription solutions and a merchant success-based component we call merchant solutions.

Current wording

During the nine months ended September 30, 2025, our total revenue was $7.9 billion, an increase of 30% versus the nine months ended September 30, 2024. Our business model has two revenue components: a recurring subscription component we call subscription solutions and a merchant success-based component we call merchant solutions.

Previous wording

In the six months ended June 30, 2025, subscription solutions revenues accounted for 25% of our total revenues (27% in the six months ended June 30, 2024). We offer a range of plans that increase in price depending on additional features and economic considerations. Shopify Plus is offered at a starting rate that is several times that of our standard Shopify plans. Shopify Plus solves for the complexity of merchants as they grow and scale globally, offering additional functionality and support, including features like Shopify Audiences, B2B features and Launchpad, for ecommerce automation. BarkBox, Vuori, BevMo, Carrier, JB Hi-Fi, Meta, ButcherBox, SKIMS and Supreme are a few of our notable merchants seeking a reliable, cost-effective and scalable commerce solution. The flexibility of our pricing plans is designed to help our merchants grow in a cost-effective manner and to provide more advanced features and support as their business needs evolve.

Current wording

In the nine months ended September 30, 2025, subscription solutions revenues accounted for 25% of our total revenues (September 30, 2024 - 28%). We offer a range of plans that increase in price depending on additional features and economic considerations. Shopify Plus is offered at a starting rate that is several times that of our standard Shopify plans. Shopify Plus solves for the complexity of merchants as they grow and scale globally, offering additional functionality and support, including features like Shopify Audiences, B2B features and Launchpad, for ecommerce automation. BarkBox, Vuori, BevMo, Carrier, JB Hi-Fi, Meta, ButcherBox, SKIMS and Supreme are a few of our notable merchants seeking a reliable, cost-effective and scalable commerce solution. The flexibility of our pricing plans is designed to help our merchants grow in a cost-effective manner and to provide more advanced features and support as their business needs evolve.

Previous wording

Revenue from subscription solutions is generated through the sale of subscriptions to our platform, including variable platform fees, as well as through the sale of subscriptions to our POS Pro offering, the sale of apps, the sale of themes and the registration of domain names. Subscription solutions revenues increased from $1.1 billion in the six months ended June 30, 2024 to $1.3 billion in the six months ended June 30, 2025, representing an increase of 19%. Our merchants typically enter into monthly subscription agreements. The revenue from these agreements is recognized over time on a ratable basis over the contractual term and therefore we have deferred revenue on our balance sheet. We do not consider this deferred revenue balance to be a good indicator of future revenue. Instead, we believe MRR is most closely correlated with the long-term value of our merchant relationships. As of June 30, 2025, MRR totaled $185 million, representing an increase of 9% relative to MRR at June 30, 2024. A detailed description of this metric is presented below in the section entitled, "Key Performance Indicators".

Current wording

Revenue from subscription solutions is generated through the sale of subscriptions to our platform, including variable platform fees, as well as through the sale of subscriptions to our POS Pro offering, the sale of apps, the sale of themes and the registration of domain names. Subscription solutions revenues increased from $1.7 billion in the nine months ended September 30, 2024 to $2.0 billion in the nine months ended September 30, 2025, representing an increase of 17%. Our merchants typically enter into monthly subscription agreements. The revenue from these agreements is recognized over time on a ratable basis over the contractual term and therefore we have deferred revenue on our balance sheet. We do not consider this deferred revenue balance to be a good indicator of future revenue. Instead, we believe MRR is most closely correlated with the long-term value of our merchant relationships. As of September 30, 2025, MRR totaled $193 million, representing an increase of 10% relative to MRR at September 30, 2024. A detailed description of this metric is presented below in the section entitled, "Key Performance Indicators".

Previous wording

We offer a variety of merchant solutions that are designed to add value to our merchants by passing on our economies of scale and augment our subscription solutions. During the six months ended June 30, 2025, merchant solutions revenues accounted for 75% of total revenues (73% in the six months ended June 30, 2024). We principally generate merchant solutions revenues from payment processing fees and currency conversion fees from Shopify Payments. Shopify Payments is a fully integrated payment processing service that allows our merchants to accept and process payment cards online and offline. In addition to payment processing fees and currency conversion fees from Shopify Payments, we also generate merchant solutions revenue from referral fees from third parties, other transaction services and other services rendered as part of strategic partnerships and Shopify Capital. The majority of our merchant solutions revenues are directionally correlated with the level of GMV that our merchants process through our platform. Merchant solutions revenues increased from $2.8 billion in the six months ended June 30, 2024 to $3.8 billion in the six months ended June 30, 2025, representing an increase of 33%.

Current wording

We offer a variety of merchant solutions that are designed to add value to our merchants by passing on our economies of scale and augment our subscription solutions. During the nine months ended September 30, 2025, merchant solutions revenues accounted for 75% of total revenues (September 30, 2024 - 72%). We principally generate merchant solutions revenues from payment processing fees and currency conversion fees from Shopify Payments. Shopify Payments is a fully integrated payment processing service that allows our merchants to accept and process all major payment methods. In addition to payment processing fees and currency conversion fees from Shopify Payments, we also generate merchant solutions revenue from referral fees from third parties, other transaction services and other services rendered as part of strategic partnerships and Shopify Capital. The majority of our merchant solutions revenues are directionally correlated with the level of GMV that our merchants process through our platform. Merchant solutions revenues increased from $4.4 billion in the nine months ended September 30, 2024 to $5.9 billion in the nine months ended September 30, 2025, representing an increase of 35%.

Previous wording

The following table shows MRR and GMV for the three and six months ended June 30, 2025 and 2024:

Current wording

The following table shows MRR and GMV for the three and nine months ended September 30, 2025 and 2024:

Previous wording

MRR is the aggregate value of all subscription plans, excluding variable platform fees, in effect on the last day of the period, assuming merchants maintain their subscription the following month. Subscription plans to both our platform and our POS Pro offering are included in this calculation. When applicable, MRR relating to subscription plans billed in a merchant's local currency is converted to USD using the respective currency exchange rate as of the period end date. Prospective merchants that have joined the platform through special new merchant trial incentives, including paid trials, are included in MRR at their trial price while merchants on free trials are excluded from the calculation of MRR through the duration of the free trial. MRR allows us to average our various pricing plans and billing periods into a single, consistent number that we can track over time. We also consider the factors that contribute to MRR, specifically the number of paying merchants using our platform, the number of merchants that are on full-price plans or paid trials, the mix of subscription plan types, and overall pricing of our subscription plans. In addition, we use MRR to forecast monthly, quarterly and annual subscription plan revenue, which makes up the majority of our subscription solutions revenue. We had $185 million of MRR as of June 30, 2025 compared to $169 million as of June 30, 2024.

Current wording

MRR is the aggregate value of all subscription plans, excluding variable platform fees, in effect on the last day of the period, assuming merchants maintain their subscription the following month. Subscription plans to both our platform and our POS Pro offering are included in this calculation. When applicable, MRR relating to subscription plans billed in a merchant's local currency is converted to USD using the respective currency exchange rate as of the period end date. Prospective merchants that have joined the platform through special new merchant trial incentives, including paid trials, are included in MRR at their trial price while merchants on free trials are excluded from the calculation of MRR through the duration of the free trial. MRR allows us to average our various pricing plans and billing periods into a single, consistent number that we can track over time. We also consider the factors that contribute to MRR, specifically the number of paying merchants using our platform, the number of merchants that are on full-price plans or paid trials, the mix of subscription plan types and overall pricing of our subscription plans. In addition, we use MRR to forecast monthly, quarterly and annual subscription plan revenue, which makes up the majority of our subscription solutions revenue. We had $193 million of MRR as of September 30, 2025 compared to $175 million as of September 30, 2024.

Previous wording

In the three and six months ended June 30, 2025, the MRR growth rate for the period was lower than the same period in 2024 driven by the impact of extending the length of the paid trials.

Current wording

In the three and nine months ended September 30, 2025, the MRR growth rate for the period was lower than the same period in 2024 driven by the impact of extending the length of the paid trials.

Previous wording

GMV is the total dollar value of orders facilitated through our platform including certain apps and channels for which a revenue-sharing arrangement is in place in the period, net of refunds, and inclusive of shipping and handling, duty and value-added taxes. GMV does not represent revenue earned by us. However, the volume of GMV facilitated through our platform is an indicator of the success of our merchants and the strength of our platform. Our merchant solutions revenues are also directionally correlated with the level of GMV facilitated through our platform. For the three and six months ended June 30, 2025 we facilitated GMV of $87.8 billion and $162.6 billion, respectively (June 30, 2024 - $67.2 billion and $128.1 billion), representing year-over-year growth of 31% on a quarterly basis and 27% on a year-to-date basis (2024 vs 2023 - 22% and 22%). On a constant currency basis, in which GMV in the three and six months ended June 30, 2025 is converted using the comparative period's monthly average exchange rates, year-over-year growth was 29% and 27%, respectively (2024 vs 2023 - 23% and 23%).

Current wording

GMV is the total dollar value of orders facilitated through our platform including certain apps and channels for which a revenue-sharing arrangement is in place in the period, net of refunds, and inclusive of shipping and handling, duty and value-added taxes. GMV does not represent revenue earned by us. However, the volume of GMV facilitated through our platform is an indicator of the success of our merchants and the strength of our platform. Our merchant solutions revenues are also directionally correlated with the level of GMV facilitated through our platform. For the three and nine months ended September 30, 2025 we facilitated GMV of $92.0 billion and $254.6 billion, respectively (September 30, 2024 - $69.7 billion and $197.8 billion), representing year-over-year growth of 32% on a quarterly basis and 29% on a year-to-date basis (2024 vs 2023 - 24% and 23%). On a constant currency basis, in which GMV in the three and nine months ended September 30, 2025 is converted using the comparative period's monthly average exchange rates, year-over-year growth was 30% and 28%, respectively (2024 vs 2023 - 24% and 23%).

Previous wording

As a result of the continued growth of Shopify Payments, referral fees, other transaction services and other services rendered as part of strategic partnerships and Shopify Capital, our revenues from merchant solutions have increased. Merchant solutions are intended to complement subscription solutions by providing additional value to our merchants and increasing their use of our platform. Gross profit margins on Shopify Payments, the biggest driver of merchant solutions revenue, are typically lower than on subscription solutions due to the associated third-party costs of providing this solution. We view this revenue stream as beneficial to our operating margins, as Shopify Payments requires significantly less sales and marketing and research and development expense than Shopify’s core subscription business. The lower margins on merchant solutions compared to subscription solutions means that the continued growth of merchant solutions has caused in the past, and may cause in the future, a decline in our overall gross margin percentage.

Current wording

As a result of the continued growth of Shopify Payments, referral fees, other transaction services and other services rendered as part of strategic partnerships and Shopify Capital, our revenues from merchant solutions have increased. Merchant solutions are intended to complement subscription solutions by providing additional value to our merchants and increasing their use of our platform. Gross profit margins on Shopify Payments, the biggest driver of merchant solutions revenue, are typically lower than on subscription solutions due to the associated third-party costs of providing this solution. We view this revenue stream as beneficial to our operating margins, as Shopify Payments requires significantly less sales and marketing and research and development expenses than Shopify’s core subscription business. The lower margins on merchant solutions compared to subscription solutions means that the continued growth of merchant solutions has caused in the past, and may cause in the future, a decline in our overall gross margin percentage.

Previous wording

See Part II — Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2024 Form 10-K for details on the key components of results of operations. There have been no material changes to our key components of results of operations during the six months ended June 30, 2025, as compared to those described in our 2024 Form 10-K.

Current wording

See Part II — Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our 2024 Form 10-K for details on the key components of results of operations. There have been no material changes to our key components of results of operations during the nine months ended September 30, 2025, as compared to those described in our 2024 Form 10-K.

Previous wording

The following table sets forth a summary of our condensed consolidated statements of operations for the three and six months ended June 30, 2025 and 2024:

Current wording

The following table sets forth a summary of our condensed consolidated statements of operations for the three and nine months ended September 30, 2025 and 2024:

Previous wording

Subscription solutions revenues increased for the three months ended June 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in subscription fees of $80 million driven by an increase in MRR, which was the result of a larger percentage of subscriptions coming from higher priced plans, such as Plus, and by higher GMV resulting in an increase in subscription fees from the variable component of certain subscription contracts.

Current wording

Subscription solutions revenues increased for the three months ended September 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in subscription fees of $79 million driven by an increase in MRR, which was the result of a larger percentage of subscriptions coming from higher priced plans, such as Plus, and by higher GMV resulting in an increase in subscription fees from the variable component of certain subscription contracts.

Previous wording

Subscription solutions revenues increased for the six months ended June 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in subscription fees of $183 million driven by an increase in MRR, which was the result of a larger percentage of subscriptions coming from higher priced plans, such as Plus, and by higher GMV resulting in an increase in subscription fees from the variable component of certain subscription contracts.

Current wording

Subscription solutions revenues increased for the nine months ended September 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in subscription fees of $262 million driven by an increase in MRR, which was the result of a larger percentage of subscriptions coming from higher priced plans, such as Plus, and by higher GMV resulting in an increase in subscription fees from the variable component of certain subscription contracts.

Previous wording

Merchant solutions revenues increased for the six months ended June 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in Shopify Payments revenue of $800 million, relating to payment processing and currency conversion fees, growing in the six months ended June 30, 2025 compared to the same period in 2024. This increase was a result of an increase in our Shopify Payments penetration rate and an increase in GMV from our merchants using our platform. These factors drove $26.8 billion of additional GMV facilitated using Shopify Payments in the six months ended June 30, 2025 compared to the same period in 2024, representing growth of 35%. For the six months ended June 30, 2025, the Shopify Payments penetration rate was 64%, resulting in GMV of $104.1 billion that was facilitated using Shopify Payments. This compares to a penetration rate of 60% resulting in GMV of $77.3 billion that was facilitated using Shopify Payments in the same period in 2024.

Current wording

Shopify Payments revenue of $518 million, relating to payment processing and currency conversion fees, growing in the three months ended September 30, 2025 compared to the same period in 2024. This increase was a result of an increase in our Shopify Payments penetration rate and an increase in GMV from merchants using our platform. These factors drove $17.3 billion of additional GMV facilitated using Shopify Payments in the three months ended September 30, 2025 compared to the same period in 2024, representing growth of 40%. For the three months ended September 30, 2025, the Shopify Payments penetration rate was 65%, resulting in GMV of $60.2 billion that was facilitated using Shopify Payments. This compares to a penetration rate of 62% resulting in GMV of $42.9 billion that was facilitated using Shopify Payments in the same period in 2024.

Previous wording

Merchant solutions revenues increased for the three months ended June 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in Shopify Payments revenue of $455 million, relating to payment processing and currency conversion fees, growing in the three months ended June 30, 2025 compared to the same period in 2024. This increase was a result of an increase in our Shopify Payments penetration rate and an increase in GMV from merchants using our platform. These factors drove $15.5 billion of additional GMV facilitated using Shopify Payments in the three months ended June 30, 2025 compared to the same period in 2024, representing growth of 38%. For the three months ended June 30, 2025, the Shopify Payments penetration rate was 64%, resulting in GMV of $56.6 billion that was facilitated using Shopify Payments. This compares to a penetration rate of 61% resulting in GMV of $41.1 billion that was facilitated using Shopify Payments in the same period in 2024.

Current wording

Merchant solutions revenues increased for the nine months ended September 30, 2025 compared to the same period in 2024. The largest component of the period-over-period change was an increase in Shopify Payments revenue of $1.3 billion, relating to payment processing and currency conversion fees, growing in the nine months ended September 30, 2025 compared to the same period in 2024. This increase was a result of an increase in our Shopify Payments penetration rate and an increase in GMV from our merchants using our platform. These factors drove $44.1 billion of additional GMV facilitated using Shopify Payments in the nine months ended September 30, 2025 compared to the same period in 2024, representing growth of 37%. For the nine months ended September 30, 2025, the Shopify Payments penetration rate was 65%, resulting in GMV of $164.3 billion that was facilitated using Shopify Payments. This compares to a penetration rate of 61% resulting in GMV of $120.2 billion that was facilitated using Shopify Payments in the same period in 2024.

Previous wording

Cost of subscription solutions increased for the three months ended June 30, 2025 compared to the same period in 2024. The increase was driven by a $22 million increase in cloud and infrastructure costs. As a percentage of revenues, cost of subscription solutions remained flat for the three months ended June 30, 2025 compared to the same period in 2024.

Current wording

Cost of subscription solutions increased for the three months ended September 30, 2025 compared to the same period in 2024. The increase was driven by a $20 million increase in cloud and infrastructure costs. As a percentage of revenues, cost of subscription solutions remained flat for the three months ended September 30, 2025 compared to the same period in 2024.

Previous wording

Cost of subscription solutions increased for the six months ended June 30, 2025 compared to the same period in 2024. The increase was driven by a $50 million increase in cloud and infrastructure costs. As a percentage of revenues, cost of subscription solutions remained flat for the six months ended June 30, 2025 compared to the same period in 2024.

Current wording

Cost of subscription solutions increased for the nine months ended September 30, 2025 compared to the same period in 2024. The increase was driven by a $70 million increase in cloud and infrastructure costs. As a percentage of revenues, cost of subscription solutions remained flat for the nine months ended September 30, 2025 compared to the same period in 2024.

Previous wording

GMV facilitated through Shopify Payments. As a percentage of revenues, cost of merchant solutions increased for the six months ended June 30, 2025 compared to the same period in 2024, due to Shopify Payments representing a larger percentage of total revenue.

Current wording

Cost of merchant solutions increased for the nine months ended September 30, 2025 compared to the same period in 2024. The increase was driven by higher payment processing fees resulting from an increase in GMV facilitated through Shopify Payments. As a percentage of revenues, cost of merchant solutions increased for the nine months ended September 30, 2025 compared to the same period in 2024, due to Shopify Payments representing a larger percentage of total revenue.

Previous wording

Sales and marketing expenses increased for the three months ended June 30, 2025 compared to the same period in 2024, due to increases of $58 million in overall marketing program spend and $13 million in employee-related costs, offset by a $10 million decrease in payouts related to our affiliate partner programs.

Current wording

Sales and marketing expenses increased for the three months ended September 30, 2025 compared to the same period in 2024, due to increases of $65 million in overall marketing program spend and $12 million in employee-related costs.

Previous wording

Sales and marketing expenses increased for the six months ended June 30, 2025 compared to the same period in 2024, due to increases of $93 million in overall marketing program spend and $27 million in employee-related costs, offset by a $17 million decrease in payouts related to our affiliate partner programs.

Current wording

Sales and marketing expenses increased for the nine months ended September 30, 2025 compared to the same period in 2024, due to increases of $158 million in overall marketing program spend and $39 million in employee-related costs, offset by a $17 million decrease in payouts related to our affiliate partner programs.

Previous wording

Research and development expenses increased for the three months ended June 30, 2025 compared to the same period in 2024, due to increases of $30 million in employee-related costs and $14 million in computer hardware and software costs.

Current wording

Research and development expenses increased for the three months ended September 30, 2025 compared to the same period in 2024, due to increases of $21 million in computer hardware and software costs and $19 million in employee-related costs.

Previous wording

Research and development expenses increased for the six months ended June 30, 2025 compared to the same period in 2024, due to increases of $67 million in employee-related costs and $23 million in computer hardware and software costs.

Current wording

Research and development expenses increased for the nine months ended September 30, 2025 compared to the same period in 2024, due to increases of $86 million in employee-related costs and $44 million in computer hardware and software costs.

Previous wording

General and administrative expenses increased for the six months ended June 30, 2025 compared to the same period in 2024, primarily due to a reversal of a previously recorded estimated legal liability of $55 million in the second quarter of 2024, offset by an increase of $15 million in indirect taxes.

Current wording

General and administrative expenses increased for the nine months ended September 30, 2025 compared to the same period in 2024, due to a reversal of a previously recorded estimated legal liability of $55 million in the second quarter of 2024 and an increase of $13 million for impairment related costs associated with right-of-use assets and leasehold improvements, offset by a decrease of $17 million in indirect taxes.

Previous wording

Transaction and loan losses increased for the three months ended June 30, 2025 compared to the same period in 2024, due to increases of $22 million in losses related to Shopify Payments driven by higher realized losses in the period and due to higher GMV processed through Shopify Payments relative to the same period in 2024 and $15 million in losses related to lending services driven by an expansion of our offerings and programs relative to the same period in 2024.

Current wording

Transaction and loan losses increased for the three months ended September 30, 2025 compared to the same period in 2024, due to increases of $73 million in losses related to Shopify Payments driven by an increase in expected losses, higher realized losses in the period and due to higher GMV processed through Shopify Payments relative to the same period in 2024 and $15 million in losses related to lending services driven by an expansion of our offerings and programs relative to the same period in 2024.

Previous wording

Transaction and loan losses increased for the six months ended June 30, 2025 compared to the same period in 2024, due to increases of $35 million in losses related to lending services driven by an expansion of our offerings and programs relative to the same period in 2024 and $26 million in losses related to Shopify Payments driven by higher realized losses in the period and due to higher GMV processed through Shopify Payments relative to the same period in 2024.

Current wording

Transaction and loan losses increased for the nine months ended September 30, 2025 compared to the same period in 2024, due to increases of $99 million in losses related to Shopify Payments driven by an increase in expected losses, higher realized losses in the period and due to higher GMV processed through Shopify Payments relative to the same period in 2024 and $50 million in losses related to lending services driven by an expansion of our offerings and programs relative to the same period in 2024.

Previous wording

In the three months ended June 30, 2025, we had a net gain on equity and other investments of $681 million, which included a $502 million unrealized gain in investments with readily determinable fair values which was the result of the change in share prices from March 31, 2025 to June 30, 2025, $165 million unrealized gain on investments without readily determinable fair values which was the result of an observable price change and a $14 million unrealized gain in an investment option. Additionally, we had a net loss of $24 million on our equity method investment.

Current wording

In the three months ended September 30, 2024, we had a net gain on equity and other investments of $512 million which included a $454 million unrealized gain in investments with readily determinable fair values and was the result of the net change in share prices from June 30, 2024 to September 30, 2024 and a $59 million unrealized gain in an investment option. Additionally, we had a net loss of $28 million on our equity method investment.

Previous wording

In the six months ended June 30, 2025, we had a net loss on equity and other investments of $340 million, which included a $428 million unrealized loss in investments with readily determinable fair values which was the result of the change in share prices from December 31, 2024 to June 30, 2025 and a $72 million unrealized loss in an investment option, offset by $165 million unrealized gain on investments without readily determinable fair values which was the result of an observable price change. Additionally, we had a net loss of $47 million on our equity method investment.

Current wording

In the nine months ended September 30, 2025, we had a net loss on equity and other investments of $402 million, which included a $400 million unrealized loss in investments with readily determinable fair values which was the result of the change in share prices from December 31, 2024 to September 30, 2025 and a $147 million unrealized loss in an investment option, offset by $165 million unrealized gain on investments without readily determinable fair values which was the result of an observable price change. Additionally, we had a net loss of $68 million on our equity method investment and an unrealized loss of $29 million on the embedded derivative held prior to the settlement of the Notes.

Previous wording

In the three months ended March 31, 2025, other income, net was driven by interest income of $106 million recognized on marketable securities compared to interest income of $80 million recognized on marketable securities for the same period in 2024 and net gain on foreign exchange of $24 million compared to $2 million net gain on foreign exchange for the same period in 2024.

Current wording

In the three months ended September 30, 2024, other income, net was driven by interest income of $81 million recognized on marketable securities compared to interest income of $77 million recognized on marketable securities for the same period in 2024 and net loss on foreign exchange of $4 million compared to $16 million net gain on foreign exchange for the same period in 2024.

Previous wording

In the six months ended June 30, 2025, other income, net was driven by interest income of $171 million recognized on marketable securities compared to interest income of $159 million recognized on marketable securities for the same period in 2024 and net gain on foreign exchange of $30 million compared to $2 million net loss on foreign exchange for the same period in 2024.

Current wording

In the nine months ended September 30, 2025, other income, net was driven by interest income of $252 million recognized on marketable securities compared to interest income of $236 million recognized on marketable securities for the same period in 2024 and net gain on foreign exchange of $26 million compared to $14 million net gain on foreign exchange for the same period in 2024.

Previous wording

We had a provision for income taxes of $173 million in the three months ended June 30, 2025, compared to provision for income taxes of $32 million in the same period in 2024, driven by related taxes on an unrealized gain on equity and other investments.

Current wording

We had a provision for income taxes of $44 million in the three months ended September 30, 2025, compared to provision for income taxes of $32 million in the same period in 2024, as a result of earnings in various jurisdictions, partially offset by an unrealized loss on equity and other investments.

Previous wording

We had a provision for income taxes of $85 million in the six months ended June 30, 2025, compared to provision for income taxes of $49 million in the same period in 2024, driven by earnings in various jurisdictions.

Current wording

We had a provision for income taxes of $129 million in the nine months ended September 30, 2025, compared to provision for income taxes of $81 million in the same period in 2024, as a result of earnings in various jurisdictions, partially offset by an unrealized loss on equity and other investments.

Previous wording

(3) In the second quarter of 2024, we released an accrual for an estimated liability of $55 million associated with a legal matter.

Current wording

(3)In the second quarter of 2024, we released an accrual for an estimated liability of $55 million associated with a legal matter.

Previous wording

(4)Includes impairment related costs associated with right-of-use assets and leasehold improvements of $10 million in the second quarter of 2025 and $38 million in the third quarter of 2023.

Current wording

(4)Includes impairment related costs associated with right-of-use assets and leasehold improvements of $3 million in the third quarter of 2025 and $10 million in the second quarter of 2025.

Previous wording

Historically, revenues experienced a seasonal decrease in our first quarter as consumers typically reduce their spending following the holiday season resulting in a seasonal decrease in GMV, which was not completely offset by Shopify Payments penetration and MRR growth. Subsequently, revenues have increased in each of the next three quarters as a result of MRR and overall GMV growth. Our merchants have processed additional GMV during the fourth-quarter holiday seasons, and as a result, we have generated higher merchant solutions revenues in our fourth quarters compared to other quarters. Due to the continued growth of our merchant solutions offerings, we believe that our business may become more seasonal in the future.

Current wording

Historically, revenues experienced a seasonal decrease in our first quarter as consumers typically reduce their spending following the holiday season resulting in a seasonal decrease in GMV, which was not completely offset by Shopify Payments penetration and MRR growth. Subsequently, revenues have increased in each of the next three quarters as a result of MRR and overall GMV growth. Our merchants have processed additional GMV during the fourth-quarter holiday seasons, and as a result, we have generated higher subscription solutions and merchant solutions revenues in our fourth quarters compared to other quarters. Due to the continued growth of our merchant solutions offerings, we believe that our business may become more seasonal in the future.

Previous wording

Quarterly Gain (Loss) on Equity and Equity Method Investments and Other Income Trends

Current wording

Quarterly (Loss) Gain on Equity and Equity Method Investments and Other Income Trends

Previous wording

Historically, there have been no consistent trends associated with gain (loss) on equity and equity method investments and other income as changes are impacted by fluctuations in the fair value of our equity investments in public companies with readily determinable fair values, observable changes or impairments associated with our equity investments in private companies without readily determinable fair values, changes in our equity method investment based on our share of income and loss, including amortization of the basis difference, changes in the fair value of our investments in convertible notes of private companies, foreign exchange rates and interest rates. The results from these changes may fluctuate from period to period and may cause volatility to our earnings as well as impact comparability of our results from period to period.

Current wording

Historically, there have been no consistent trends associated with (loss) gain on equity and equity method investments and other income as changes are impacted by fluctuations in the fair value of our equity investments in public companies with readily determinable fair values, observable changes or impairments associated with our equity investments in private companies without readily determinable fair values, changes in our equity method investment based on our share of income and loss, including amortization of the basis difference, changes in the fair value of our investments in convertible notes of private companies, changes in the fair value of the embedded derivative held to settle the Notes, foreign exchange rates and interest rates. The results from these changes may fluctuate from period to period and may cause volatility to our earnings as well as impact comparability of our results from period to period.

Previous wording

Our principal cash requirements are for working capital and ongoing operations. Excluding current deferred revenue and the Notes, working capital as of June 30, 2025 was $7.1 billion. From August 1, 2025 to October 30, 2025, holders of our Notes may convert all or any portion of their Notes at the applicable conversion rate at the time. If converted, we will settle at least the aggregate principal amount of the Notes, $920 million, in cash and will settle the excess conversion consideration, if any, in cash and (if applicable) Class A subordinate voting shares. As a result of our employee compensation program there is a potential for an increase in cash usage as employees have the ability to elect how much of their total compensation will be in the form of cash versus stock-based compensation awards. Given the ongoing cash generated from operations and our existing cash and cash equivalents, we believe there is sufficient liquidity to meet our current and planned financial obligations over the next 12 months and into the foreseeable future, including cash payments for the Notes due November 1, 2025. Our future financing requirements will depend on many factors, including but not limited to our growth rate, subscription renewal activity, the timing and extent of spending to support development of our platform, the expansion of sales and marketing activities, the macroeconomic conditions and overall levels of consumer spending on goods and potential strategic investments and acquisitions activity. Although we currently are not a party to any material undisclosed agreement and do not have any understanding with any third parties with respect to potential material investments in, or material acquisitions of, businesses or technologies, we may enter into these types of arrangements in the future, which could also require us to seek additional equity or debt financing. Additional funds may not be available on terms favorable to us or at all.

Current wording

Our principal cash requirements are for working capital and ongoing operations. Excluding current deferred revenue and the Notes, working capital as of September 30, 2025 was $7.7 billion. As a result of our employee compensation program, there is a potential for an increase in cash usage as employees have the ability to elect how much of their total compensation will be in the form of cash versus stock-based compensation awards. Given the ongoing cash generated from operations and our existing cash and cash equivalents, we believe there is sufficient liquidity to meet our current and planned financial obligations over the next 12 months and into the foreseeable future. Our future financing requirements will depend on many factors, including but not limited to our growth rate, subscription renewal activity, the timing and extent of spending to support development of our platform, the expansion of sales and marketing activities, the macroeconomic conditions and overall levels of consumer spending on goods and potential strategic investments and acquisitions activity. Although we currently are not a party to any material undisclosed agreement and do not have any understanding with any third parties with respect to potential material investments in, or material acquisitions of, businesses or technologies, we may enter into these types of arrangements in the future, which could also require us to seek additional equity or debt financing. Additional funds may not be available on terms favorable to us or at all.

Previous wording

Cash, cash equivalents and marketable securities increased by $341 million to $5.8 billion as of June 30, 2025 from $5.5 billion as of December 31, 2024, as a result of cash provided by our operations and proceeds from the exercise of stock options partially offset by the purchase and origination of loans, net of repayments, the purchase of equity and other investments and acquisition of business, net of cash acquired. Cash equivalents and marketable securities include money market funds, term deposits, U.S. federal bonds and agency securities and corporate bonds and commercial paper, all maturing within 12 months from June 30, 2025.

Current wording

Cash, cash equivalents and marketable securities increased by $870 million to $6.3 billion as of September 30, 2025 from $5.5 billion as of December 31, 2024, as a result of cash provided by our operations and proceeds from the exercise of stock options partially offset by the purchase and origination of loans, net of repayments, the purchase of equity and other investments and acquisition of business, net of cash acquired. Cash equivalents and marketable securities include money market funds, term deposits, U.S. federal bonds and agency securities and corporate bonds and commercial paper, all maturing within 12 months from September 30, 2025.