Shopify Inc (TSX:SH., NYSE:SHOP) shares surged more than 11% after it was revealed the company will be included in the Nasdaq-100 Index.
Effective May 19, the eCommerce platform will replace MongoDB in the tech-heavy index.
This inclusion typically triggers increased institutional buying since index funds and ETFs that track the Nasdaq-100, such as the Invesco QQQ Trust (QQQ), must purchase shares of the newly added company.
Last week, Shopify reported strong Q1 2025 revenue growth, with sales up 27% to $2.36 billion and Gross Merchandise Volume rising 23% to $74.8 billion, driven by gains in B2B and international markets.
Profitability improved on a free cash flow basis, but a GAAP net loss of $682 million, mainly from unrealized investment losses, led to an earnings miss.
The company issued cautious Q2 guidance, citing macroeconomic uncertainty and continued investment in long-term growth areas like B2B and offline commerce.
Shares of Shopify were up 11.7% at about $103 late morning on Monday.