Skip to main content

Bigcommerce Holdings Inc(BIGC-Q)
NASDAQ

Today's Change
Real-Time Last Update Last Sale Cboe BZX Real-Time

Unpacking Q2 Earnings: Squarespace (NYSE:SQSP) In The Context Of Other E-commerce Software Stocks

StockStory - Wed Oct 4, 2023

SQSP Cover Image

Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at Squarespace (NYSE:SQSP), and the best and worst performers in the e-commerce software group.

While e-commerce has been around for over two decades and enjoyed meaningful growth, its overall penetration of retail still remains low. Only around $1 in every $5 spent on retail purchases comes from digital orders, leaving over 80% of the retail market still ripe for online disruption. It is these large swathes of the retail where e-commerce has not yet taken hold that drives the demand for various e-commerce software solutions.

The 6 e-commerce software stocks we track reported a mixed Q2; on average, revenues beat analyst consensus estimates by 1.64%, while on average next quarter revenue guidance was 0.03% above consensus. Tech stocks have been under pressure as inflation makes their long-dated profits less valuable and while some of the e-commerce software stocks have fared somewhat better that others, they have not been spared, with share prices declining 6.16% since the previous earnings results, on average.

Squarespace (NYSE:SQSP)

Founded in New York City in 2003, Squarespace (NYSE:SQSP) is a platform for small businesses and creators to build their digital presences online.

Squarespace reported revenues of $247.5 million, up 16.4% year on year, beating analyst expectations by 1.71%. It was a solid quarter for the company, with strong sales guidance for the next quarter and a decent beat of analysts' revenue estimates.

"We are thrilled to report another strong quarter with revenue growth accelerating to 16% year over year as entrepreneurs continue to trust Squarespace to power their businesses," said Anthony Casalena, Founder & CEO of Squarespace.

Squarespace Total Revenue

The stock is down 11.2% since the results and currently trades at $28.47.

Is now the time to buy Squarespace? Access our full analysis of the earnings results here, it's free.

Best Q2: Shopify (NYSE:SHOP)

Originally created as an internal tool for a snowboarding company, Shopify (NYSE:SHOP) provides a software platform for building and operating e-commerce businesses.

Shopify reported revenues of $1.69 billion, up 30.8% year on year, beating analyst expectations by 4.27%. It was a decent quarter for the company, with an improvement in its gross margin. It was also good to see that its revenue growth outperformed Wall Street's expectations.

Shopify Total Revenue

Shopify achieved the strongest analyst estimates beat and fastest revenue growth among its peers. The stock is down 17.8% since the results and currently trades at $51.29.

Is now the time to buy Shopify? Access our full analysis of the earnings results here, it's free.

Weakest Q2: GoDaddy (NYSE:GDDY)

Founded by Bob Parsons after selling his first company to Intuit, GoDaddy (NYSE:GDDY) provides small and mid-sized businesses with the ability to buy a web domain and tools to create and manage a website.

GoDaddy reported revenues of $1.05 billion, up 3.21% year on year, missing analyst expectations by 0.61%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a miss of analysts' revenue estimates.

GoDaddy had the weakest performance against analyst estimates and slowest revenue growth in the group. The stock is down 2.15% since the results and currently trades at $74.09.

Read our full analysis of GoDaddy's results here.

Wix (NASDAQ:WIX)

Founded in 2006 in Tel Aviv, Wix.com (NASDAQ:WIX) offers a free and easy to operate website building platform.

Wix reported revenues of $390 million, up 13% year on year, beating analyst expectations by 1.92%. It was a decent quarter for the company, with an improvement in its gross margin. It was also good to see that its revenue growth outperformed Wall Street's expectations.

Wix scored the highest full year guidance raise among the peers. The stock is down 1.14% since the results and currently trades at $87.49.

Read our full, actionable report on Wix here, it's free.

BigCommerce (NASDAQ:BIGC)

Founded in Sydney, Australia in 2009 by Mitchell Harper and Eddie Machaalani, BigCommerce (NASDAQ:BIGC) provides software for businesses to easily create online stores.

BigCommerce reported revenues of $75.4 million, up 10.6% year on year, beating analyst expectations by 2.84%. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter.

BigCommerce had the weakest full year guidance update among the peers. The stock is up 0.21% since the results and currently trades at $9.55.

Read our full, actionable report on BigCommerce here, it's free.

Join Paid Stock Investor Research

Help us make StockStory more helpful to investors like yourself. Join our paid user research session and receive a $50 Amazon gift card for your opinions. Sign up here.

The author has no position in any of the stocks mentioned

More from The Globe