SHOPBULLISH

SHOP Gross Margin Analysis

47.7%

Updated 118h ago·SEC filings & market data

Key Takeaway

Gross margin is the percentage of revenue a company keeps after paying direct production costs, so 47.7% means SHOP retains $0.477 of every sales dollar before other expenses.

Sector Performance

52th percentile

SHOP

47.7%

Sector Median

46.6%

Sector Avg

47.6%

Prior Period

48.8%(Aug 2026)

↓ Declining

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Deep Analysis

Gross margin is the percentage of revenue a company keeps after paying direct production costs, so 47.7% means SHOP retains $0.477 of every sales dollar before other expenses.

That level is just above the sector median of 46.4%, placing it at the 53rd percentile among peers, so SHOP is slightly more efficient than half its sector. The metric’s year-over-year change is N/A, and the quarter-over-quarter change is -2.3%, with historical values of 47.7% (current) and 48.8% (prior quarter). The combination of an above-median margin with a recent decline suggests modest operational strength but a short-term squeeze on cost efficiency. For investors, this is a minor risk factor because eroding margins can pressure earnings, yet the margin remains above the sector benchmark. This metric supports the overall BULLISH verdict, as the gross margin level is strong enough to sustain profitability, but the -2.3% QoQ drop warrants monitoring.

Frequently Asked Questions

What does the Gross Margin tell investors about SHOP?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

Who are SHOP's closest peers by Gross Margin?

The closest peers by Gross Margin include: MU (84.6%), CDNS (84.9%), TEAM (85.3%), VRTX (85.3%), INSP (85.5%).

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Learn More About Gross Margin

Gross Margin vs Net Margin: Why the Gap Between Them Tells You Everything

Gross margin vs net margin: learn what the spread between them reveals about operating leverage, cost structure, and early warning signs in any stock.

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.