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Shopify's stock erases all pandemic gains

Jul 26, 2022
Chart: Axios VIsuals; Data: S&P Capital IQ

Shares of e-commerce company Shopify dropped over 16% in trading Tuesday after the company cut 10% of its workforce, pushing its stock below its lowest pandemic-era closing pricing.

Why it matters: Many companies thought the pandemic would accelerate certain digital trends, including e-commerce and fintech. That turned out to be more wishful thinking than previously was thought.

Driving the news: In a somber letter to employees, Shopify CEO Tobi Lütke offered a mea culpa for making that gamble.

  • "We bet that the channel mix — the share of dollars that travel through ecommerce rather than physical retail — would permanently leap ahead by 5 or even 10 years," he wrote.
  • "It’s now clear that bet didn’t pay off. What we see now is the mix reverting to roughly where pre-Covid data would have suggested it should be at this point.""
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