Shopify Inc (TSX:SH., NYSE:SHOP) is expected to end 2025 on solid footing, with Jefferies forecasting strong fundamentals and disciplined spending as the e-commerce platform prepares to release its fourth-quarter results later this month.
Jefferies analysts said they expect Shopify to deliver a strong set of numbers, pointing to solid holiday performance and cost discipline. “We expect 4Q fundamentals to be solid, as third-party data points to a beat versus consensus on GMV and total revenue,” analysts wrote. “We also expect EBIT upside as a result of opex control.”
The firm projects gross merchandise volume (GMV) of $121 billion, up 28% year-on-year, and revenue of $3.57 billion, slightly below consensus but still implying 27% growth. Jefferies sees GAAP operating margins at 16.1%, just ahead of Street expectations. “Opex discipline has been a key driver of EBIT improvement, and we expect that to remain a theme into 2026,” the analysts added.
Still, Jefferies warned that near-term profitability could face pressure from higher infrastructure and AI-related costs. “Gross margins are likely to remain constrained as Shopify manages the mix shift toward Merchant Solutions revenue, higher hosting costs from international expansion, and increasing AI usage expenses,” they wrote.
The analysts also commented on Shopify’s new 4% OpenAI Instant Checkout fee, which has raised concerns among investors. “It has concerned investors that the channel may not be as profitable for merchants,” Jefferies noted, though it said Shopify “remains an agentic commerce beneficiary,” thanks to partnerships with Google and Microsoft.
Jefferies also expects the company to provide clarity on its sales structure changes, including a new three-year, quota-based compensation model announced in December. The shift could affect short-term margins but improve long-term consistency.
“EBIT and free cash flow margin commentary are in focus,” Jefferies wrote. “Investors would like to see more expansion in 2026 following a muted 2025.”
The firm maintains a “Hold” rating on the stock with a $160 price target, suggesting about 21% upside from current levels near $132.
Shopify is scheduled to report fourth-quarter and full-year 2025 results on February 11 before the market open.