Shopify - Earnings Call - Q2 2025

Executive Summary

• Q2 2025 revenue was $2.68B, up 31% YoY, with GMV up 31% and free cash flow margin at 16%; management highlighted acceleration in both the U.S. and Europe and strong FX tailwinds.
• Results beat Wall Street consensus: revenue $2.68B vs $2.55B* and EPS $0.35 vs $0.29*; strength came from Merchant Solutions (+37% YoY) and Payments penetration reaching 64%*.
• Guidance: Q3 revenue growth mid-to-high 20s YoY, gross profit dollars low-20s, OpEx at 38–39% of revenue, SBC $130M, and free cash flow margin mid-to-high teens.
• Strategic catalysts: AI commerce stack (Catalog, Universal Cart, CheckoutKit with Microsoft Copilot) and Sidekick upgrades, plus enterprise wins (Starbucks, Canada Goose, Miele, Signet) and Europe outperformance (GMV +49% YoY, +42% constant currency).
• Management emphasized durable growth with operating discipline (Q2 operating margin ~11%) and intention to settle the $920M convertible note in cash before the next call.

Note: Asterisks (*) denote values from S&P Global consensus estimates.

What Went Well and What Went Wrong

What Went Well

• Europe led growth with GMV +49% YoY (+42% constant currency), while U.S. growth accelerated QoQ; Payments penetration reached 64% on broader country availability and partnerships.
• AI commerce initiative launched: Catalog for real-time product data, Universal Cart, and upgraded CheckoutKit (already used by Microsoft Copilot), positioning Shopify at the center of agentic commerce.
• Enterprise traction: new logos across diverse verticals (Starbucks, Canada Goose, Miele, Signet, Beachbody; even Boart Longyear in B2B), highlighting upmarket momentum and TAM expansion.

Management quotes:

• “Shopify delivers. We do what we say we're going to do… durable growth… that is Shopify's MO.” — Harley Finkelstein.
• “GMV in Q2 was $88B up 31%… Europe up 49%… results exceeded expectations driven by outperformance in North America and Europe.” — Jeff Hoffmeister.

What Went Wrong

• Overall gross margin declined to 48.6% from 51.1% YoY, driven by Payments mix, PayPal accounting impact, higher hosting costs, and lower noncash partnership revenue.
• Subscription Solutions gross margin fell to 81.6% and MRR growth was only +9% YoY due to the shift back to 3‑month paid trials, creating tougher comparisons and delaying monetization.
• Continued GPV penetration headwind in Europe vs North America (lower Payments attach in Europe), partially offset by expanding Payments availability; this dynamic is expected to lessen as more countries launch.

Transcript

Speaker 1

Good morning and thank you for joining Shopify's second quarter 2025 conference call. I'm Carrie Gillard, Director of Investor Relations, and joining us today are Harley Finkelstein, Shopify's President, and Jeff Hoffmeister, our CFO. After their prepared remarks, we will open it up for your questions. We will make forward-looking statements on our call today that are based on assumptions and therefore subject to risks and uncertainties that could cause actual results to differ materially from those projected. Undue reliance should not be placed on these forward-looking statements. We undertake no obligation to update or revise these statements except as required by law. You can read about these assumptions, risks, and uncertainties in our press release this morning, as well as in our filings with U.S. and Canadian regulators. We also speak to adjusted financial measures which are non-GAAP and not a substitute for GAAP financial measures.

Reconciliations between the two are provided in our press release. Finally, we report in U.S. Dollars, so all amounts discussed today are in U.S. Dollars unless otherwise indicated. With that, I will turn the call over to Harley.

Speaker 0

Thanks, Carrie, and good morning everyone. Now, before we get into the numbers, I want to do something a little bit different today. I want to start by looking back at Shopify's last few earnings calls. Eighteen months ago, I said that we would power up our offline and our B2B on ramps, creating a truly unified commerce platform. Fast forward to today. Our offline GMV is up 29% year over year. Our B2B GMV is up 101% and we're bringing the biggest brands on the planet to the platform through our unified commerce offering. Twelve months ago, I said we would continue to deliver both growth and profitability. This past quarter we delivered $2.7 billion of revenue, up 31% year over year, and our free cash flow margin was 16%. Finally, six months ago, we committed to expanding our reach across all geographies and particularly in Europe.

Our international GMV for this most recent quarter was up 42% year over year, accelerating from Q1, largely by outperformance in Europe. The strong results you see today come from seeds we planted years ago. Past investments are now paying off and the ones we are making today will drive results for years to come. If you take one thing away from this call, let it be this: Shopify delivers. We do what we say we're going to do. That consistency, follow through and durable growth, that is Shopify's movie. I want to call this out at the top of this call because we've had a lot of wins this quarter which we'll get into next. This quarter to quarter consistency is really what matters. This is how generational companies are built, and this is what you're seeing from Shopify.

Now let's get into the wins and the progress we made in Q2. Specifically, as I mentioned earlier, we delivered Q2 revenue of $2.7 billion, up 31% year over year, and free cash flow margin was 16%. GMV was up 31%, accelerating from Q1. This strong GMV result was driven by continued outperformance in Europe as well as momentum in our largest market, the U.S. This is the outcome of a clear strategy executed really well. Agility and ease of use are now prerequisites for any modern commerce company. That's why we've become a strategic advantage to all businesses in today's unpredictable market. This quarter, we signed up some iconic global brands, including Starbucks, Canada Goose and Burton Snowboards. I love getting to speak to this diversity of brands choosing Shopify because it really reflects the flexibility of the platform.

The world's biggest coffee chain, the biggest name in luxury outerwear, and the most iconic brand in snowboarding are all migrating to Shopify because we give them agility, innovation, speed, and exceptional value. Speaking of innovation, let's talk about product. Shopify's superpower is that we always are at the center of where commerce is happening. We've consistently proven to be experts in anticipating where consumers will be showing up next and building accordingly. That means our merchants are better prepared to stay a step ahead. I'll give you a few examples. We were ahead of the curve with social commerce, building early integrations for Instagram and YouTube Shopping. We saw the opportunity for commerce to meet culture, so we built a Spotify integration. More recently, we predicted the rise of shopping in the metaverse with a Roblox integration that's already growing quickly. Shopify has been building infrastructure to power agent-to-commerce.

As AI platforms become the new way people discover products, consumers are not just searching, they're having conversations with agents to find what they need. Powering seamless shopping across millions of brands is a massive technical challenge. That's where Shopify comes in. We've built a suite of products that make it easy for AI platforms to bring shopping to their agents from discovery to checkout, and our merchants are front and center. Let's start with discovery. We launched Shopify Catalog in Q2 to give AI partners and shopping apps real-time access to millions of products from across our global merchant network, all through a single connection available as an API or an MCP server. Shopify Catalog simplifies the process for apps and AI agents to search and pull product data so the results are clear, accurate, and up to date.

Shopify is uniquely positioned to build this because the brands consumers love and want more of are all on Shopify, and every day more of the world's favorite brands are joining, making our catalog the richest and the most dynamic anywhere. Let's also talk about Universal Cart, which literally launched yesterday in early access. Universal Cart holds items from multiple stores all in one spot so that shoppers can easily track all the items they want to buy within the chat. When it comes time to purchase, we've built a new and improved version of Checkout Kit and it's already being used by Microsoft Copilot, a huge player in the AI space. Checkout Kit lets partners embed the merchant's checkout right in their agent. We are also giving partners the power to theme the Checkout Kit so it matches their application's look and feel, creating this seamless experience.

They don't have to worry about payments, taxes, or regulations. We take care of all the complexity for them. Let me bring this to life for you. When a shopper asks an agent for the best travel bag, it instantly searches Shopify's Catalog and shows the top products, live prices, descriptions, and inventory. The shopper adds their choice to the cart. They don't have to check out right away. They can keep shopping. Everything they want is pulled into a single cart. When they're ready, the shopper completes their checkout without ever having to leave the chat. This unlocks a whole new kind of commerce for partners. We've made it easier than ever to integrate commerce without having to build the hard parts. For our merchants, we're making sure they stay at the forefront of wherever commerce is happening.

For shoppers, we're powering conversation-driven product recommendations from all of their favorite brands. This is yet another example of how Shopify is always leading the way. Now let's talk about our most exciting AI product offering for our merchants: Sidekick. Sidekick's unique ability for data analysis continues to shine through, helping merchants address their toughest business challenges. For example, a merchant in the kids' clothing category recently shared with me that Sidekick delivers the kind of actionable insights they used to spend hours searching for. Questions like, how can I optimize my inventory to avoid sellouts and boost cash flow? Or, why am I seeing more customer churn from subscriptions in the last three months? Or even, help me compare results from our last three BFCM campaigns and suggest improvements for the next one. They are all answered, explained, and visualized in seconds.

Instead of wrestling with spreadsheets or digging through endless tabs, merchants on Shopify get instant clarity of what's working, what's not working, and where to focus next, all without having to leave Shopify. Here's another example. A skincare merchant recently told us that in real time, Sidekick helped them pinpoint exactly where they were experiencing customer churn down to the cohort city and even purchase behavior in seconds. Insights like these used to take hours or days to uncover if they were found at all. Sidekick is doing exactly what we set out for it to do. Merchants are leaning in and leveraging the power of Sidekick for data analysis and performance insights, freeing them up to focus on strategic business decisions and helping them make sure those decisions are right for their business.

Of course, as I've talked about on previous calls, that's on top of all the other ways Sidekick helps merchants like writing product descriptions, generating logos and images, streamlining workflows and customizing their storefronts, and so much more. This quarter we also launched an AI store builder that can create a custom online store in seconds. Literally in seconds from a single phrase. Now all you need is an idea and a description of the product you want to sell, like stylish Athleisure apparel for women. Shopify will do the rest. We are continuing to make the barrier to entry lower than it's ever been in history, and we are not done. Okay, that was a lot on AI. As you can tell, we're really excited about the velocity of innovation happening at Shopify. Now let's turn our attention to payments.

On our last call, we discussed the expansion of our payments product into more countries, 16 so far this year alone, nearly doubling the markets where it's accessible. Many of these new markets are in Europe and are already seeing solid adoption, contributing to our global payments penetration of 64% in Q2, up from 61% last year at Shopify Editions. In May, we also rolled out multi-entity support in Shopify Payments. This means that merchants can now sell from multiple business entities all within a single shop, which is particularly valuable for our higher volume global merchants. No more juggling separate stores for each country or channel. This streamlines operations, it cuts costs and it removes barriers to global growth.

I've heard directly from some of our biggest global brands that the multi-entity unlock is a breakthrough and for those of you that have followed us for a while, you know that this was a pain we had not yet solved until now. Now as you know we are laser focused on building the future of commerce, especially as cross-border transactions become more important. This quarter we introduced a new USDC stablecoin option, giving merchants and buyers more choice and security, especially for international payments. We partner with Coinbase to bring the core features of commerce like authorize, capture, void, and refunds to crypto payments. In plain terms, these are the steps that make card payments safe and flexible. Now with smart contracts and blockchain, stablecoin payments can work the same way. With the built-in off-ramp to local currency, merchants can accept USDC without dealing with new crypto friction.

Payment preferences are changing fast and Shopify is making sure our merchants are ready for what is next. Now a quick note on Shop Pay. Over the past two and a half years, the user base has more than doubled as more buyers and merchants make it their go-to checkout. That momentum is showing up in the numbers. In fact, in Q2, Shop Pay GMV increased by 65% to $27 billion. Shop Pay is quickly becoming the standard for fast, secure, seamless payments trusted by millions of consumers and merchants, including leading brands like Michael Kors, the latest to sign up for Shop Pay Commerce Component. Honestly, most of you listening have probably used Shop Pay at least once in this past week alone. That is how deep the reach is. Now let's turn to the Shop app, the all-in-one shopping destination for the brands that buyers are passionate about.

The Shop app saw 140% year-over-year growth in native GMV, fueled by high-impact shopping events including Shop Week, where sales more than doubled compared to last year's event, and sign-ins through Shop increased by 46% thanks to improved availability and a much smoother user experience. AI-powered enhancements to Shop Search and the Home Feed ensure buyers see the right products at the right time, driving higher engagement and conversion. Unlike traditional marketplaces, Shop puts brands front and center, fostering genuine customer relationships without the burden of marketplace fees. With tools like Shop Minis, Shop Cash, and Sign in with Shop, we're helping merchants engage, convert, and retain buyers seamlessly from personalized recommendations and wish lists to in-app checkout and real-time order tracking and buyer rewards. Our collaborations with brands like Glossier, Summer Fridays, and J Balvin are strengthening Shop's position in beauty and entertainment, pushing the boundaries of customer engagement.

Mark my words, Shop is the future of direct to consumer shopping and we're just getting started. Let me speak briefly on advertising because I know you'll ask. Shopify campaigns is opening up new ways for merchants to reach buyers and grow. We are scaling risk free advertising across Shop, online stores, Meta, and Google, giving merchants efficient access to new audiences, and the earlier results are really promising. Brands like Caraway, Liquid I.V., and Kizik are seeing real impact, and as we continue to unlock more inventory and refine our recommendation algorithms, campaigns are getting more personalized and more effective. There is a ton of excitement at Shopify on what we are building and we look forward to sharing more about this on future calls. Now let's shift our focus to some other key growth drivers and how we're executing. First up, Point-of-Sale, or our offline business.

Q2 was another strong quarter for Shopify Point-of-Sale, with offline GMV up 29%. We launched a newly redesigned version of our POS app, making it faster and simpler for in-store staff and enhancing the connection between in-store and online. Retail staff are already benefiting from the new version with a more intuitive experience, faster checkouts, and shorter training time. This new release of our retail platform includes a suite of features that merchants requested, things like cash rounding, more granular staff permissions, more ways to build cart customizations, and store credit for instant customer retention. Direct API access now allows our developers and partners to customize Shopify Point-of-Sale workflows more efficiently, and it's these continuous enhancements that are further solidifying Shopify's reputation as a leader in retail point-of-sale software.

Shopify Point-of-Sale was named as a leader in retail point-of-sale software by IDC, and a new EY report shows it's driving real revenue growth for merchants and the results speak for themselves. Our investments are paying off and merchants on Shopify are reaping the benefits. Q2 saw more great brands join Shopify in part for our offline offering, from swimwear to furniture to car accessories. I said at the start, a special newly inked deal that's very close to my heart: the iconic Canadian brand Canada Goose is making the switch. On a personal note, I've been in talks with the CEO Danny for a long time, and incredibly, the deal actually closed on Canada Day this year, which made it feel extra special.

After years of building and refining our unified commerce platform, they have chosen to move to Shopify to power both their online business and about 50 physical stores beginning in 2026. This win is a clear signal that the leading brands trust Shopify to deliver what modern commerce demands. The progress in retail is evident, and we are confident that we are still in the early stages of what we will achieve. Moving on to international, we keep talking about our international business because the opportunity is so massive, and our team and merchants are knocking it out of the park. Our international regions are contributing more to our growth each quarter, becoming a vital part of Shopify's mission to support entrepreneurs worldwide.

In Q2, Europe led the way with strong GMV growth from both new merchants joining the platform as well as our existing merchants continuing to outperform their respective e-commerce markets. You have heard us talk about getting more of our product into more countries, and so far in 2025 we've made really great progress. Shopify Capital is now available in Germany and the Netherlands, providing more merchants with access to growth funding. We also launched Shop Pay Installments into Canada, allowing more merchants to offer flexible payment options, which contributed to the strong 38% increase we saw in Q2 for our Shop Pay installment GMV. At the core of our growth is our commitment to enabling merchants to sell seamlessly across borders, shown by Q2 cross-border GMV at 15% of total GMV while also winning at home.

With recent rollouts like multi-entity support and multi-currency payouts, we are making this a reality. These features are now available for Plus and enterprise merchants in most countries where Shopify Payments operate. This is big because by simplifying operations to one single shop, they avoid extra fees and the need for duplicate apps or integrations. That is why organizations like Fiskars Group, one of Europe's oldest companies and the owner of brands like Wedgwood and Waterford, recently chose Shopify to migrate five of their distinct e-commerce businesses from multiple brands into a single one on Shopify. It is a clear signal that Shopify is the platform for global growth. We got here in a very intentional and thoughtful way. The wins we see today are a direct result of the groundwork we've laid in international expansion, especially in Europe, from product development to marketing over the past few years.

Our aim is to keep this momentum going and unlock even more growth opportunities in the years ahead. Okay, now onto one of my favorite parts of the call. You all know that I love talking about winning larger merchants. Our upmarket strategy is continuing to deliver results. On top of the brands I mentioned earlier, Starbucks, Burton Snowboards, and Canada Goose, we also sign brands like luxury skincare company owned by Unilever, Tatcha, the high-end home appliance manufacturer Miele, Amazon's daily deal site Woot, the leading fitness and nutrition brand Beachbody, and one of the world's largest diamond retailers, Signet Jewelers. Now, there's another brand I want to highlight, and not because you'll know them, but actually because you probably don't know them. We just signed on the global leader in mining drilling services, Boart Longyear.

A few years ago, we wouldn't have imagined talking about drilling services and Shopify in the same breath, but that's how far we've come. Our roster keeps getting stronger, winning the brands people love across every major vertical and bringing on more names from industries you might not expect. Amongst these are the biggest brands you've never heard of. They're not household names to consumers, but they dominate their verticals, and they're choosing Shopify for our scalability, for our speed, flexibility, and the tools they need to grow. This diversity makes us even more resilient and fuels our growth, expanding our addressable market and the ways we power commerce. No matter how the market shifts, Shopify is built to thrive. We're expanding our reach, we're deepening our offerings, and we're laying the groundwork for long-term success from entrepreneur to enterprise.

When you look at our Q2 results and when you look at what we've achieved each quarter before, one thing should be clear: the Shopify Playbook delivers. We've built a product that helps every kind of merchant in every market win. We built a business model that means when our merchants win, we do too. We've built a roadmap that's focused on the future of commerce, so our merchants are always a step ahead. Shopify is executing consistently. We're building the right products consistently. We're growing in the right places consistently. We're investing for the long term. Consistently. Consistently. Our business model is durable, our opportunity is vast, and our focus is unwavering. With that, I'm going to turn the call over to Jeff for a deeper dive into the numbers and trends that we're seeing.

Speaker 2

Thanks, Harley. Q2 was an exceptional quarter and it represents a manifestation of the excellent product building, product market fit, and go to market momentum that our teams set in motion many quarters ago. We're delivering in the areas that matter most for our long term success: helping merchants grow and reach more buyers, expanding the diversity of our merchant base, and innovating continuously to provide products that help merchants run and scale their businesses. A few items to highlight before we dive into the numbers. First, the U.S. delivered standout results in Q2. Year over year growth rates for both GMV and revenue accelerated in Q2 versus Q1. We saw growth across all major verticals and merchant segments. Second, our international regions, particularly Europe, are thriving.

In most countries in Europe, our merchants' GMV growth continues to outpace the overall e-commerce market by an average of 4% to 5% if not greater, and even accelerated in Q2 from already strong trends. This success underscores the effectiveness of our strategic investments in product expansion and localization. Over the past few years, merchant GMV accelerated across all sizes and GMV bands in Q2, highlighting broad based momentum throughout our platform. Notably, merchants above $50 million in annual GMV and those under $2 million in annual GMV showed particular acceleration in the quarter. Lastly, our products are growing and expanding, creating more opportunities to support our merchants, drive growth, and unlock new verticals. Growth is coming from every angle: offline, B2B, capital, tax, and more. These areas are gaining real traction, and while still on the earlier side of their growth curves, the potential remains incredibly compelling.

With that context around some key observations and trends this quarter, let's turn to our Q2 financial results. All growth rates mentioned are year over year unless specifically stated otherwise. GMV in Q2 was $88 billion, up 31% or 29% on a constant currency basis. This GMV outperformance was driven by strength in North America, with particular strength among Plus merchants, and continued strength in Europe, with GMV up 49%, 42% on a constant currency basis. In both North America and Europe, we saw broad based growth led by our existing merchants as well as growth from adding new merchants, with it tilting towards more same store sales growth this past quarter. Offline was up 29%, driven primarily by larger retailers joining the platform. Finally, while we had anticipated some benefit from FX in our outlook, the tailwind turned out to be stronger than expected as the quarter unfolded.

As we continue to expand our platform's capabilities, add new products, and build for where commerce is heading, Shopify is becoming even more compelling to a wider range of businesses than ever before. This growth opportunity is reflected in the strength we're seeing across a diverse set of categories. In Q2, apparel and accessories, our largest and most established category, continued to perform well. At the same time, we're seeing strong momentum in health and beauty, home and garden, and food and beverage. We're also experiencing rapid growth in emerging segments such as pet supplies, furniture, and arts and entertainment. Revenue for the second quarter was up 31%, driven by the exceptional GMV growth across geographies. Our merchants are succeeding. These results exceeded expectations, driven by the outperformance in North America and Europe, and importantly, we had factored into our guidance some potential impact from tariffs which did not materialize.

Looking at the two components of revenue, Merchant Solutions revenue increased 37%, with the strength in GMV driving the significant majority of the growth. To a lesser extent, we also saw increased penetration of Shopify Payments, which reached 64% for the quarter. Several factors powered the quarter's higher GPV penetration, including continued adoption of payments by more merchants around the world and the strong performance of those merchants, the expanded partnerships with PayPal and Klarna, and the availability of payments in more countries. These items were partially offset by our ongoing strong performance in Europe, which accounted for a larger share of GMV but has a lower gross payments volume penetration compared to North America. Over time, this should become less of an impact for payments penetration as we continue launching payments in more countries.

Subscription Solutions revenue grew 17%, primarily driven by a larger percentage of subscriptions coming from higher priced plans and, to a lesser extent, higher variable platform fees. As we have mentioned previously, in 2025 we expect Subscription Solutions growth to be impacted by the headwinds from extended paid trials, which affect our year-over-year growth rates. Q2 MRR was up 9% year over year, led by growth in our Plus plans, which represented 35% of MRR for the quarter. The shift back to three month trials for standard plans had a larger impact on Q2 than Q1, as these changes were rolled out to North America and our largest markets in Europe at the end of Q1, meaning that throughout most of Q2, new merchants were still within their initial three month trial period.

As a reminder, in Q2 of last year, MRR benefited from the move from a three month to a one month paid trial, which drove MRR higher and makes for a tougher comparison this year. As a result, MRR growth for standard merchants this quarter showed only a slight increase. As we examine the data that we have regarding the efficacy of these trials, we believe that they are working well. By giving merchants more time to explore Shopify, we increase the likelihood that they launch their businesses with a better understanding of the full capabilities of our platform and how we can help them succeed, reaching key GMV milestones earlier and enhancing their probabilities of long term success. Gross profit grew 25%, coming in ahead of expectations, driven by the outperformance in revenue.

Gross profit for Subscription Solutions grew 15%, slightly less than the 17% revenue growth for Subscription Solutions. This slightly lower growth rate vis a vis the revenue growth rate was from higher hosting cost needed to support higher volumes and geographic expansion, and secondly the impact of the change back to three month paid trials. While Subscription Solutions gross margin declined year over year, it remained above our five year historical median of 80% plus or minus a couple hundred basis points in any given quarter. We do not anticipate this trend changing in the near term. Gross margin for Subscription Solutions for the quarter was 81.6%. Gross profit for Merchant Solutions grew 32%, with gross margin coming in at 37.9% compared to 39.1% in Q2 of 2024.

The decrease was primarily driven by the same factors that we have seen the past two quarters, including the impact from the expanded partnership with PayPal, where the year over year comparison differential will persist through Q3, and lower non cash revenues from certain partnerships which carry a high gross margin. This brings our overall Q2 gross margin to 48.6% compared to 51.1% in the prior year. Operating expenses were $1 billion for the quarter or 38% of revenue, which is down from 39% in Q2 of last year on a GAAP basis or down from 42% when you exclude from the year over year comparison the reversal of a $55 million legal accrual from Q2 of last year. The 400 basis points year over year improvement demonstrates our continued efforts to drive operational efficiencies, all while supporting our 31% top line revenue growth.

Our disciplined approach to headcount continues to drive strong operating leverage. Our return based strategy in marketing remains unchanged. We continue to execute with discipline using data, testing, and the power of our internally built models to adjust our investments quickly and efficiently based on clear return metrics and payback periods. Transaction Loans and Losses, the smallest of the operating expense categories in our income statement, was 3% of revenues. The year over year increase stems from higher volumes in our payments and capital businesses. Our capital business continues to grow, supported by recent product innovations that enhanced our suite of credit offerings and expanded our geographic reach, including launching capital in Germany and the Netherlands. We've introduced new tools that give merchants more choice in how they manage and select loan options, providing greater flexibility to meet their financing needs.

Note that loss rates have remained consistent with prior quarters. This is about the successful, thoughtful expansion of capital. Operating income for the quarter was $291 million or 11% of revenue. This 11% compares to a 9% operating income margin last year and yields a 56% year over year growth rate when excluding the impact of last year's legal accrual of $55 million, which was a one time lift to last year's Q2 profit. Stock based compensation for Q2 was $120 million and capital expenditures were $6 million. For the quarter, Q2 free cash flow was $422 million or 16% of revenue. Our commitment to operating discipline gives us the ability to achieve our desired free cash flow margins.

Even as we periodically face gross profit pressure, such as those discussed earlier regarding PayPal and the paid trials, quarter after quarter, we continue to deliver balanced growth and profitability with investments that support long term growth in key areas like our core platform, international expansion, enterprise, and offline. This disciplined approach works. We have driven 11 consecutive quarters of positive free cash flow, eight of which have been in the double digits. We're building for the long term, delivering results today while making Shopify stronger and more durable for the years ahead. Now shifting to the broader macroeconomic environment and tariff implications before discussing our Q3 outlook, through Q2 and into early August, our merchant base has remained resilient. Merchants are adapting to changes in the economic landscape and continue to perform well, supported by the flexibility and capabilities of our platform.

This resilience highlights the strength of our commerce solutions in helping merchants navigate challenges and pursue new opportunities. As our merchants grow and evolve, our platform continues to support their success and scalability in a dynamic market, just as it always has. Last quarter I shared some observations about our merchants and our business in the context of the trade environment. Fast forward to today and those same observations hold. We haven't seen any drops in U.S. demand, whether inbound, outbound, or local. In fact, the U.S. accelerated in Q2. As I mentioned previously, cross border GMV remained consistent at 15% of our total GMV in Q2. One change that we have seen is that many of our merchants have raised prices. We are tracking that in relation to overall inflation levels in the U.S. The U.S.

Government's recent announcements regarding the de minimis exemption for other countries beyond China is still in the very early stages. Importantly, only approximately 4% of our GMV globally is currently shipped under de minimis exemptions, and we've not seen any significant changes in our GMV levels related to merchants that shipped products under the de minimis exemptions for China. Since those rules were changed back in May, we'll continue monitoring these trends closely, staying focused on supporting our merchants in an evolving environment. Turning to our outlook for the third quarter, merchant GMV remains strong and continues to reinforce our confidence in outperforming the broader market. This momentum has carried into Q3 with core trends across our merchant base remaining stable.

We expect Q3 revenue growth in the mid to high 20% year over year, driven by the same factors that supported our strong results in the first half, led by continued growth in merchant solutions. While we anticipate some FX tailwinds, they are expected to be similar to what we experienced in Q2. We expect gross profit dollars to grow in the low 20s trailing revenue growth due to the continued strength in payments, the accounting impact from PayPal, and the changes to paid trial links. We anticipate that our Q3 operating expenses will be 38% to 39% of revenue on a dollar basis.

Operating expenses are increasing year over year primarily due to three: higher planned marketing spend, higher compensation as a result of both mix shift to higher paying roles like R&D and our biannual merit increases, and higher losses from the expected volume growth of payments and capital. Marketing is the largest driver year over year. It's important to note that our marketing investments in Q3 last year were lower than intended as we chose to focus on testing and refining new approaches. The increase this year is largely going to be in performance marketing. As we have continued to test and refine our models, we are discovering new audiences and are unlocking higher value in the merchants we bring on. Moving to stock-based compensation, Q3 SBC is expected to be $130 million.

Finally, on free cash flow for Q3, we expect our free cash flow margin to be in the mid to high teens. Let me repeat what I said last quarter. We continue to focus on driving growth, not optimizing for near-term margin. We believe that the free cash flow margin profile that we've achieved over the past several quarters strikes the right balance between profitability and investments in building the best products for our merchants today and into the future. There are simply too many compelling growth opportunities ahead. One other item regarding our cash flow and cash management: our convertible note matures November 1 before our next earnings call. A couple of things to mention. We expect to settle the $920 million principal in cash. To the extent that there is any excess value above par, we also expect that to be settled in cash.

Our disciplined execution has delivered 11 consecutive quarters of positive free cash flow and the financial strength to enable us to make this choice. This decision is a clear demonstration of our belief in Shopify's long-term growth and resilience and Shopify being mindful of dilution to shareholders quarter over quarter. We're proving that our approach works, consistently executing, delivering for our merchants, and maintaining double-digit free cash flow margin even as we invest for the long term. This is what sets Shopify apart. Durable growth, disciplined execution, and a track record of results. With that, I will turn the call back over to Carrie.

Speaker 1

Thanks, Jeff. We will now take your questions before turning the call back to Harley for some final words. Please use the Raise hand feature in Zoom to ask your question. If you are dialing in by phone, you'll need to press Star nine to join the queue and Star six to unmute yourself. We ask that you limit yourself to one question so we can try to get to as many questions as possible. Our first question comes from Brian Peterson at Raymond James.

Speaker 0

Oh, sorry, I tripped up by that.

Speaker 2

Mute button, but congrats on the really strong quarter, Jeff. I appreciate all the comments on the macro. I know you mentioned that you saw the U.S. accelerate. How would you characterize the demand?

Speaker 0

Did you see any potential pull?

Speaker 2

Forward for consumers that may have wanted to take advantage of pricing before tariff increases? Would love to get any comments there. Thanks guys. Yeah, no, Brian, very good question. We have not seen any real pull forward of demand. I think you can see some of that when you look at the results that we delivered in Q2. You compare that to the guidance and see that consistency of performance. Obviously, any guidance that we give is going to be reflective of the information that we have going into the call. As we look at what we've seen in July and the consistency of strength, the consistency of merchant success in July is kind of what we've seen in Q2.

From a tariff perspective, I also alluded to it briefly on the call that we haven't seen any meaningful changes in the various elements in terms of cross-border activity, in terms of what we're seeing in buyer behavior. The business remains in very good shape. I don't have anything where I have anything in our internal data which says to me, hey, there's been a pull forward. The business is simply continuing to perform very, very well. I mentioned obviously the strength in Europe, the strength in North America, the strength across all the different GMV bands, the strength across the products. I think that's just our business performing at a very, very high level.

Speaker 1

Thank you for your question. Our next question comes from Arjun Bhatia at William Blair.

Speaker 2

Perfect, thank you. I will add my congrats here on a great quarter. This might be a little bit difficult to answer, but obviously the international growth is very strong. You have a very broad platform. When we think about what is localized and what is available for merchants and international markets, how should we think about where we are in that journey, and is there more opportunities still to unlock internationally despite the success that we've been seeing thus far?

Speaker 0

Hey Arjun, it's Harley. I'll take that question. To be clear, we've been tackling some of these product updates for international for quite some time now. Obviously, merchant solutions continue to expand. I mentioned that this year alone we expanded Shopify Payments to 60 new countries. Multi-currency is now in 20 countries. Shopify Capital is now expanded to Germany and the Netherlands. We're making really good progress here. Obviously, the international results speak for themselves. International GMV was up 42% year over year, with Europe leading the way there. There still are other areas for us to expand, specifically on the product rollout side of things. I think the results you are seeing from us internationally is a combination of the product getting much better but also the go-to-market engine becoming much stronger, much more sophisticated.

Whether it's through partnerships with SIS or with our own team understanding what product market fit looks like in those countries, I think wins that you are seeing are a result of the groundwork that we've laid in international expansion both from product and from marketing over the past few years. We still have quite a bit to go there and we think we can continue to grow internationally. Obviously, we're still going to be dominant in the English-speaking world and North America is a huge market for us specifically. International, we still think, is a strong opportunity for us going forward.

Speaker 2

Yeah Arjun, maybe the only point I'd add, I think one of the things that Harley and I don't talk enough about is our success in Asia Pacific. I mean Europe has been going so strongly in terms of the results we're seeing. It continues to perform very well, and as we alluded to earlier, it also accelerated versus what we saw in Q1. It's really international for us broadly, it's just doing really well.

Speaker 1

Thank you for your question. Our next question comes from Gabriella Borges at Goldman Sachs. Hi, good morning. Congratulations on the quarter, Harley and Jeff. So much of the prepared remarks talked about the durability of growth and the compounding of your product cycles as numbers get bigger. We as analysts tend to model slowing growth as companies scale and that's.

Speaker 2

Really not happening when I look at it.

Speaker 1

Your organic growth, adjusting for some of the one-time items over the past couple of years. My question for both of you is how do you think about the long-term growth algorithm? Do you think you can be in this north of 25%, closer to 30% range for the next couple of years? Give us some color on how you forecast internally. Thanks so much.

Speaker 0

Yeah, maybe I'll start and then I'll hand it over to Jeff to talk a little bit about some of the forecasting. I think what you're seeing, Gabriella, is the result of past investments over the years. Presumably you've picked up from the tone of both Jeff and my comments that we believe we're consistently performing quarter after quarter, both in terms of top line momentum, but also in terms of managing our expenses and how we deliver profitability. In terms of our merchant acquisition that's accelerating, especially internationally, as we mentioned, there's also these new areas, these sort of on ramps into Shopify. Whether it's large Enterprise or it's B2B point of sale, the growth runway we think remains long. There's a number of these really durable avenues, including TAM expansion. I mentioned some new verticals that historically Shopify never even considered going into, the drilling and mining.

Drilling companies that are very large and dominant now come to Shopify. I think when you add that to adding more value to our subscriptions with things like audiences and Plus and B2B, payment innovation continues to lead. In terms of some of the products that are still more early in their adoption, things like tax and managed markets, we think we are really well positioned to be at the center of commerce. Certainly these multiple levers to drive our growth we think are going to continue to provide for growth in the future. We think this is the best version of Shopify. We think we're operating on all cylinders here and we still think there's a lot of room for us to keep growing.

Speaker 2

Yeah, I mean, obviously, Gabrielle, I'm not going to guide you to some specific growth numbers over time. To pile on to some of Harley's comments, it's really the durability of growth from our vantage point is a function of all the different Harley alludes to what we've done over the past couple years in terms of introducing all new products. You think over the last, you know, two to three years in terms of what we've done with tax, what we've done with B2B, how we've really reinvigorated Point-of-Sale, the international expansion, all that is something which is really helping us deliver this growth. This is just in terms of the tailwinds we've talked a lot in the past about what we're seeing on entrepreneurship more broadly.

I think the velocity of change in these markets is actually driving more and more merchants to our platform, given the capabilities of our platform. We're the ones that are giving merchants the ability to adapt to this environment. I think the overall comments in terms of e-commerce growth rates and the penetration of e-commerce in various economies, that is obviously continuing to pick up. We think some of the things in agentic commerce will help that, the necessity for omnichannel, kind of what we're seeing on a global basis. There are so many things that merchants need to do. We're expanding the products and we're expanding their capabilities to succeed in this environment. We feel good about our durability of growth over a multi-year period.

Speaker 1

Thanks, Gabriela. Our next question will come from Terry Tilban at Truist Securities.

Speaker 2

Yeah, thanks for taking my question. Hopefully you all can hear me. Okay, Universal Cart, the Checkout Kit, that sounds really interesting, timely because of large language models and that is an on ramp for shopping. Will this be generally available in time for the holiday season, and how do you think about that as we go into the back half of the year? Thank you.

Speaker 0

Hey Terry, thanks for the question. Look, we've been building infrastructure to make it easy to bring native shopping into every, every AI conversation for a while now. Obviously, yesterday, hopefully most of you saw Tobi's post about how we think about the future of agentic commerce and just frankly conversational shopping. We introduced three new products: Catalog, which was launched in Q2, that's already out there, that really helps agents to search but also to surface exactly what customers want in seconds. It uses these very specialized large language models to categorize, to enrich, but also to standardize product data at these massive volumes. The other thing is Universal Cart, which is actually part of Checkout Kit, but that really allows you to hold items from multiple stores all in one spot so that buyers can easily track all the items they want to purchase directly in the conversation.

Then of course, Checkout Kit, which you mentioned, that's out there, that was launched last year. We're really excited that Microsoft Copilot is already using it. That really lets partners embed the merchant's checkout right in terms of their agent, and it actually works with Shop Pay. What we're trying to do here is kind of three things from a partnership perspective. What this means for partners is we're trying to ensure that consumers get these incredibly personalized, conversational shopping experiences and make it really easy for these partners to get that easy integration. From the merchant perspective, of course, that means that their products and their brand are going to show up across every AI platform. We are really excited by this.

Part of what we think is important if you're a merchant on Shopify is that by virtue of being on Shopify, merchants are everywhere where consumers are spending time, wherever commerce is happening. I think the unfair advantage we have in working with all of these AI companies and certainly around agentic commerce is that consumers' favorite brands are all on Shopify. When you couple that with an incredible technology stack, an incredible product that we've been building, I think we become the partner that everyone wants to work with. It's a really exciting area for us. Most of the products that we're talking about, they're already out there. Like I mentioned, companies like Microsoft are already working with some of them, including Checkout Kit.

Speaker 1

Thanks for your question, Terry. Our next question will come from Reggie Smith at JPMorgan.

Speaker 0

Hey, good morning.

Speaker 2

Great quarter, I guess.

Speaker 0

Quick question for me. You guys have obviously done a great job of product innovation and consistently raising the bar. It seems like to this point you haven't really priced explicitly or specifically for different product enhancements.

Speaker 2

How are you guys thinking about that longer term?

Speaker 0

Is there an opportunity to almost, like, a la.

Speaker 2

Cart price for different services you've added.

Speaker 0

Over the last 18 months or so? And when could that shift happen, if at all? Yeah. Hey Reggie, a couple things I'll say on that. First of all, we still believe that the business model that we've built, it's predicated on our merchants doing really well. The better that our merchants do, the better Shopify does. I mean that's the gist. GMV based revenue model and business model. We really like where that's at in terms of sort of pricing specific products. I mean you saw the introduction of Commerce Components by Shopify which effectively allows merchants to select in a very modular fashion different products. They may just take checkout or they may just take Shop Pay. Part of that is obviously making sure that we have individual products in market which have individual pricing. Part of that is just to create more on ramps into Shopify.

A very large, I mean I mentioned three very large retailers, Burton Snowboards, Starbucks, and Canada Goose coming. Some of these brands want to come to us and use all of Shopify. Some of them may just want to start with us with something like checkout or Shop Pay for example. By creating more of these on ramps to Shopify, it means more people can come into us. We believe over time we'll take more of our products and services. Beyond that, we're not necessarily pricing individual merchant solutions. All of those obviously are priced on their own. It's part of a much larger business model which is to get as many people to use Shopify as possible, to get them to use as many of our services and products as possible and then as they succeed, we succeed with them.

We think that particular pricing model works really well for us.

Speaker 1

Thank you for your question. Our next question will come from Ken Wong at Oppenheimer.

Speaker 0

Fantastic. Harley, I wanted to touch on your partnership with OpenAI. Very exciting to see you facilitate that commerce experience. Do you see this as a new GMV opportunity or just a shift from existing buying channels over to agentic shopping? Yeah, look, we are, as you can probably tell from my tone, incredibly excited about the possibilities of AI for both discovery and for shopping. I'm not going to discuss or disclose our product roadmap. Obviously, we're actively working on new opportunities and partnerships because we think that helping our merchants thrive wherever customers are is very important. We'll share those updates when we're ready. We are built to partner and I think winning alongside others is kind of part of Shopify's core DNA and that extends to our AI approaches.

I think we're one of the best partnership companies when it comes to the technology space and something we're very, very proud of. We have great relationships with all the AI companies and we'll continue to work with them. In terms of where it's coming from, it's a really good question. In the same way, I mentioned this in my prepared remarks. When we began to anticipate that social commerce was going to be something that some consumers may start using, we immediately integrated with companies like Instagram, Snap, and TikTok. Obviously, when we saw that more embedded video commerce may happen, we integrated with YouTube, and when culture and music became something where commerce was happening, same thing with Spotify. This is another surface area where there is a very serious potential where commerce could be taking place.

Whether it takes some of the market share away from search-based commerce or not, we want to be prepared. We want to make sure that merchants on Shopify are simply better prepared than merchants who are not, which is why we have all these incredible integrations. One thing that we do think was really interesting about agentic commerce in particular is it's not necessarily based on who is the largest company. It's based on what consumers are looking for. Back to my point earlier, the unfair advantage we have is that consumers' favorite brands, the products, the companies they love most, for the vast majority of them, they're already on Shopify. I think that puts us in a really, really key position in terms of these partnerships with all these companies and building these incredible products only further substantiates that.

Speaker 1

Thank you for your question. Our next question comes from Richard Hsu at National Bank.

Speaker 2

Yes, thank you. It was interesting to hear you talk about mining and drilling services. I'm guessing that's on the B2B side, but can you maybe help us understand the use case there and how it may be applicable to others for sort of potential other customers on that side?

Speaker 0

Yeah, part of the reason why I mentioned it, it's sort of a, you know, I like to mention the large ones. I mean Michael Kors came to Shopify and Miele came to Shopify and Signet Jewelers came. I like talking about obviously the brands that merchants, that consumers know and that all of you know because it shows that the enterprise is really moving to Shopify and migrating to us in this incredible clip right now. The reason I want to bring up one that you may have not heard of is because it's just, it's a new vertical. I mean some of these industries historically we did not play in, automotive or education or food and beverage or industrial. We are now seeing merchants come to Shopify from those industries.

We just think it, number one, expands our TAM, it expands the types of merchants that can come to us. We also believe that these are opportunities for those merchants to modernize their commerce, you know, their commerce technology, whether it is direct to consumer or in the case of mining drilling services on the B2B side. It's just one new on ramp into Shopify. We think it's a really exciting area because frankly when you meet these industrial brands and these very large companies selling, you know, I mean, remember talking to Carrier a couple years ago who sells, you know, heating and cooling equipment on Shopify today. It wasn't as if they were migrating from something good to something amazing.

They were migrating from effectively, you know, a technology stack that was non-existent, that was still, you know, almost archaic in some ways to this incredibly, you know, innovative user-friendly interface and commerce stack that allows them to be scalable and allows them to keep innovating. We just think it's a great new opportunity for us. You know, Boart Longyear is not a company that many of you know, but it's a new industry and a new vertical that we can go after and we think we can win there.

Speaker 2

Yeah, Richard, the only two things I would add, obviously, and Harley alluded to the diversification and getting into new industries, that obviously helps add stability to how we think about our merchant base, how we think about our buyers. That's one point which we really like about the success in B2B, and obviously it helps strengthen the offering that we go to the largest, largest enterprises, the largest global brands with, in terms of all the capabilities that we have. We're really excited about it.

Speaker 1

Thank you for your question. Our next question will come from Tyler Radke at Citi Investment.

Speaker 2

Hey, thank you very much for taking.

Speaker 0

The question for Jeff. Performance marketing spend, you talked about that ramping up in the third quarter. I was wondering if you could just double click on kind of what specifically is driving that.

Speaker 2

Are you seeing.

Speaker 0

Kind of improving GMV trends, new logo acquisition opportunity, or is this more up market? If you could also just provide an update. Obviously, the initial ramp up in performance marketing spend was a little over a year ago.

Speaker 2

Just sort of how that's played out.

Speaker 0

Obviously really strong GMV results. Is there anything you could share on payback periods and ROI?

Speaker 2

Yeah, Tyler, maybe in reverse order as you just alluded to, we're really seeing the strength in the GMV, we're seeing the strength in the merchant base and the revenue growth. We do believe it's working. We have, as you correctly pointed out, roughly a year ago we talked about some of the changes, the updates we made in performance marketing and the continued enhancements that we've made in our own internal models, how we look at the data, how we find signal quickly from all this, and we have continued to improve those models and they're just getting better and better and better, which is one of the things that gives us the belief to continue to lean into performance marketing.

I do want to make sure, partly because, and I alluded to this in my prepared remarks, when you compare the numbers this year versus last year in terms of growth, one of the things that we were doing this time last year was some of this testing which you alluded to, which really helped us improve even more our model. There's a little bit of year over year comparability which goes into this. If you look at the operating expenses more broadly, you kind of look at quarter to quarter versus year over year, it's up some. I don't want to make it sound like we have some massive ramp in marketing. We are continuing to do more with marketing. We have a lot of great markets. We want to support their specific products. They get success, we spend behind those. From a marketing perspective that fuels more success.

We really think the marketing engine is working, working very well. I don't have on one of your questions in terms of their specific size or segment. We talked about this a little bit last quarter too. I don't have some, we don't have some segment where we say hey, we really need to, quote, support this segment because it's behind. We're pretty broad based in performance marketing in terms of how we think about, again, geographies, products, things we want to be doing. We're supporting the growth of these. I don't have some segment where I feel like we need to do some catch up or we have some, excuse me, strategic agenda that we need to support. We think our models are working very well and we're continuing to lean into those.

Speaker 1

Thank you for your question, Tyler. Our next question comes from Brad Sills at Bank of America.

Speaker 2

Wonderful, thank you so much.

Speaker 0

Wanted to ask a question about the.

Speaker 2

Success you're seeing upmarket in the enterprise. Really impressive to see some of the logos that you signed this quarter. Has there been any change in go to market specifically in the channel?

Speaker 0

We'd love to get some color as to what's driving that success from a go-to-market standpoint. Any changes there? With the focus on system integrators, has that been a benefit to that business as well?

Speaker 2

Thank you.

Speaker 0

Yeah, I mean, I don't think there's necessarily one thing that's leading to it. The product is incredible. The value to cost ratio is incredibly on the side of value. More importantly, as we add new functionality, for example, some of the stuff we discuss around agent commerce, these are the conversations that all of these very large retailers are having in their own boardrooms, their own management teams about where commerce is going and the fact that they know that if they come to Shopify, they will be future proofed. I think it's incredible. Certainly, some of the stuff we're doing with product getting much better obviously helps. The reason they're coming is they see the value of what we're doing.

One of the cool parts of this commerce component play for us is that some of these, as I said earlier, some of these merchants, some of these very large brands are coming to us simply because they see and believe in the value of Shop Pay and they see the conversion lift and they want to have this incredible accelerated checkout experience. That opens a conversation with Shopify to figure out whether or not we can do more with them. Once they come in the door for a commerce component or for checkout, we can begin to show them what else we can do for them. I think part of it is we have the largest ecosystem in commerce. We have this incredible innovation.

The network keeps getting stronger and the more, you know, part of the reason why I love sharing these names that are joining every single quarter is because these are brands that other brands look up to and they want to know, you know, if Miele, the high end kitchen appliance company, is using Shop, maybe we should be thinking about that as well. I think this exceptional value they're getting, this powerful platform, this modern technology stack, this innovation that they see us coming in, the amount of velocity we are shipping, the velocity we're shipping product with every single quarter. We ship more products at each Shopify Edition than some of our competition ship over the course of five years and we do two of those every single year.

I think generally this is all leading to some of the most important, some of the largest brands on the planet, not only considering Shopify but coming to Shopify as well. It's an area of the business I'm incredibly excited.

Speaker 1

Thank you for your question. Our last question will come from Deepak Mathew at Canter.

Speaker 2

Great, thanks. Gary Harley, just wanted to ask you about the AI assistants. You have a great purview into the traffic patterns of your merchants. Can you give more color on how traffic is shifting towards AI assistance, and what are you thinking are kind of the gating factors right now for commercial.

Speaker 0

Use cases to grow more on AI.

Speaker 2

Assistance distance and perhaps become a bigger channel for all you merchants? Thanks so much.

Speaker 0

Thanks for the question. Look, we are getting prepared that if agentic commerce and more of the, you know, more traffic is flowing towards AI to ensure that Shopify and Shopify's merchants are front and center. The reason that you're hearing about all these new, you know, these new innovative things we're doing, whether it's Catalog or Universal Cart or Checkout Kit, is because we want to make sure that we become the best partner for these AI, these AI companies to work with and these agents to work with. We are preparing ourselves forward in terms of, you know, is it taking market share from a different channel yet? Too early to tell.

Like we did historically with new areas of commerce and e-commerce, we are prepared that if something does shift, Shopify merchants are better prepared and Shopify is at the core at the center of all of that. We'll continue to see, we'll keep updating you on that. Certainly as you're seeing the pace of innovation and products and partnerships that we're rolling out around agentic commerce is second to none. Maybe before we just close up here, I'll just finish with a couple things. I said this earlier, but hopefully you've all now picked up the tone of this call. We believe that Shopify is steady, strong and certainly built on discipline. We show up for our merchants of every size every single day, whether it's BFCM or it's a random Wednesday in August.

We think that we can really help merchants of every size, whether it's the biggest brands or the best entrepreneurs. We're aiming very high. We're investing early. We are never going to settle. We also are seeing that there's always new frontier and you should expect us to show up there and be the first ones to reach it. We see our channels are growing, our roster of incredible merchants keeps growing, our global footprint keeps growing and we still believe there's so much left to do. I think you're seeing the best version of Shopify. We are really excited about where we're going. We're excited about how we're operating steady, strong and built on discipline. Just want to say thanks for joining the call. Now the team and I and Jeff, we're going to go back to shipping.

Speaker 2

Thank you so much for that.

Speaker 1

This concludes our second quarter 2025 conference call. Thank you for joining us. Goodbye.