The e-commerce company's stock continues to scale new all-time highs and is up 17.3% year to date.
Shopify announced a blowout quarter with its recent full-year 2020 earnings release. Revenue for the fourth quarter nearly doubled year over year to $977.7 million. Its subscription solutions division saw a sharp rise in revenue due to a larger number of merchants joining Shopify's platform, while the merchant solutions segment enjoyed a more than a year-over-year doubling of revenue as gross merchandise value doubled to $41.1 billion.
Net income for the full year stood at $319.5 million, reversing 2019's loss of $124.8 million. The COVID-19 pandemic had pushed more people to start businesses from home as governments imposed lockdowns and movement restrictions, resulting in a surge in new merchants joining Shopify's platform. The network effect kicked in, with 42,200 partners referring a merchant to Shopify in 2020 compared to 24,500 in the previous year.
During the year, the company launched its new Shopify POS, offering a faster and more scalable software to meet the needs of more complex retailers. POS Pro was also launched in tandem based on a subscription model and came with attractive features such as buy online, pick up in store so that retailers could provide safety assurance to customers during the pandemic. Importantly, Shopify also onboarded Alipay, the payments division of Alibaba Group Holding, to allow U.S. merchants to accept payments from more than a billion active users in China.
The company is not done with its growth and projects that 2021 should see continued revenue growth for subscriptions as more merchants around the world join its platform. Gross merchandise volume is also expected to surge as Shopify expands its menu of merchant solutions, but is not expected to exceed 2020's stellar growth rate.
2021 promises to be yet another interesting year for Shopify as it makes plans to beef up its fulfillment network software to enable faster and cheaper deliveries, as well as localize its platform to suit non-English-speaking geographies where the company has a presence.