SHOPIFY INC.
For the period ended Sep 30, 2025. Filed Nov 4, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 4, 2025
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9. Deferred Revenue
- Deferred Revenue
| Three months ended September 30, | Nine months ended September 30, | |||
|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |
| (in US $ millions) | ||||
| Balance, beginning of the period | 421 | 468 | 430 | 498 |
| Deferral of revenue(1) | 122 | 111 | 211 | 194 |
| Recognition of deferred revenue from beginning balance | (133) | (130) | (231) | (243) |
| Balance, end of the period | 410 | 449 | 410 | 449 |
(1)Deferral of revenue includes only the portion of collections from merchant billings throughout the period, primarily related to subscription fees, for which the services have not yet been provided. The amounts primarily exclude subscription revenue that has both been deferred and recognized within the period presented.
| September 30, 2025 | September 30, 2024 | |
|---|---|---|
| (in US $ millions) | ||
| Current portion | 300 | 290 |
| Long-term portion | 110 | 159 |
| 410 | 449 | |
The opening balances of current and long-term deferred revenue were $302 million and $196 million, respectively, as of January 1, 2024.
As of September 30, 2025, the long-term deferred revenue, excluding non-cash consideration received, will be recognized ratably over the remaining terms of the contracts with the customers, which range fromtwo years tothree years.
The Company has received non-cash consideration in the form of equity investments in exchange for services to be rendered as part of strategic partnerships. As the Company is required to provide referral services and other services to support the partners' merchant offerings over the period of the performance obligations, revenue is deferred and recognized over time on a ratable basis over the expected terms of the contracts.
The table below summarizes the gross changes in deferred revenue associated with this non-cash consideration received for the three and nine months ended September 30, 2025 and 2024:
| Three months ended September 30, · Nine months ended September 30, | ||||||
|---|---|---|---|---|---|---|
| 2025 · 2024 · 2025 · 2024 | ||||||
| (in US $ millions) | ||||||
| Balance, beginning of the period | 165 | 228 | 190 | 284 | ||
| Revenue recognized related to non-cash consideration | (12) | (19) | (37) | (75) | ||
| Balance, end of the period | 153 | 209 | 153 | 209 | ||
| Current portion | 49 | 56 | ||||
| Long term portion | 104 | 153 | ||||
| 153 | 209 | |||||
The Company will recognize this revenue ratably over the remaining terms of the respective strategic partnership service agreements, which range fromtwo years tofour years.
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