By Adriano Marchese

Shopify is scheduled to release its fourth-quarter results Wednesday morning, covering the stretch that includes the key holiday shopping period and other major retail moments. Here is what you need to know.

REVENUE: Revenue is expected to rise to $3.59 billion, from $2.81 billion a year earlier, according to a poll on FactSet.

EARNINGS PER SHARE: Analysts are projecting per-share earnings of 43 cents, down from 99 cents a year earlier.

ADJUSTED EPS: Excluding exceptional items and one-off costs, analysts see adjusted per-share earnings of 50 cents.

Shares trading in Toronto during the quarter rose 5.9% and recently traded at 173.27 Canadian dollars ($127.80).

WHAT TO WATCH

--Gross margins are under pressure, according to Martin Toner of ATB Cormarck Capital, who says that free trial periods are acting as a temporary headwind. "We are monitoring gross margins for evidence of large merchant driven pricing pressure," Toner says in a report. He adds that investors should watch for strength in Shop Pay and in international gross merchandise volume--which grew 41% in the third quarter--to help counter the pressure coming from lower-margin payments growth.

--Investors will be keen to see early signs of Shopify's artificial intelligence integration, but Toner thinks it is still early to see the full picture of its growth potential. "While AI noted a 7x surge in AI-sourced traffic earlier in the year, any AI-related uplift during the peak season is a bonus," he says. Instead, agentic AI should be ramping up into the second half where it will have the greatest impact on revenue.

--Capital expenses are on investors' minds, especially among big tech companies as they dial up infrastructure and investment spending. Toner says Shopify stands out for its value-to-growth profile. "While M7 companies [large tech companies] are seeing free cash flow yields stagnate due to high capex, our updated model projects Shopify's free cash flow margin to hit 18.8% in 4Q and the high 20%s over time," he says.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

February 10, 2026 13:51 ET (18:51 GMT)

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