Shopify's Long-Term Growth Drivers Remain 'Intact' Amid Tariff, Macro Uncertainties, RBC Capital Says

The e-commerce landscape is undergoing seismic shifts, but Shopify’s ability to innovate and adapt has analysts at RBC Capital Markets declaring its long-term growth trajectory “intact” despite near-term headwinds. As tariffs and macroeconomic uncertainty cloud the near-term outlook, the company’s strategic moves to address trade complexities and expand its global reach are positioning it as a resilient player in an increasingly fragmented market.

Ask Aime: "Experts predict Shopify's strategic moves will outweigh near-term headwinds."

Tariff Headwinds: Navigating the New Trade Reality

The elimination of the U.S. de minimis rule—allowing duty-free imports under $800—has become a critical challenge for shopify. Effective May 2025 for goods from China and Hong Kong, this policy shift directly impacts 5–10% of Shopify’s gross merchandise value (GMV), with estimates suggesting a potential 50% GMV drop in the dropshipping segment. Smaller businesses relying on low-cost Asian imports face margin pressures, risking higher merchant churn and slower monthly recurring revenue (MRR) growth.

Inflation, exacerbated by tariffs (which can reach 145% on Chinese goods), further complicates the picture. Analysts warn that 25–30% of Shopify’s core verticals depend on Chinese imports, making the platform one of the most exposed to trade tensions. However, Shopify is proactively addressing these challenges: new tools like duty/tax calculators at checkout and cash advances for inventory aim to stabilize merchant costs and retention.

Macroeconomic Crosscurrents: Resilience Amid Volatility

While the U.S. economy shows underlying strength—bolstered by robust consumer and corporate balance sheets—geopolitical risks and potential Federal Reserve policy shifts add layers of uncertainty. RBC notes that a pause in rate cuts by early 2025 and a possible “hiking bias” later could raise borrowing costs for merchants. Meanwhile, global trade tensions and labor supply constraints from immigration policies threaten to further inflate costs.

Yet Shopify’s flexibility shines here. Adjustments to marketing spend and a focus on high-margin services like Shopify Capital loans allow the company to navigate softening GMV while maintaining profitability.

The Growth Engine: Innovation, Globalization, and AI

1. Unified Commerce & Platform Evolution:
   Shopify’s push to integrate online and offline sales channels, along with third-party integrations (e.g., payment and shipping providers), is deepening its ecosystem. Tools like supplier sourcing services and tailored international payment solutions are attracting larger, cross-border merchants, which now account for 40% of international revenue. This diversification reduces reliance on smaller, tariff-vulnerable businesses.

2. AI-Driven Advantages:
   Early adoption of AI for personalized customer experiences and operational efficiency is a key differentiator. Analysts at RBC and Roth Capital highlight this as a competitive edge against rivals like WooCommerce and BigCommerce, enabling Shopify to stay ahead in a crowded space.

3. Global Expansion & Strategic Partnerships:
   Partnerships such as Shop Pay Installments (collaborating with Affirm) are driving higher average order values (AOVs). Studies cited in RBC’s analysis show such tools can boost AOVs by up to 69%, as consumers opt for flexible payment plans. Meanwhile, Shopify’s dominance in non-North American markets—bolstered by 40% of international revenue from large omnichannel businesses—positions it to counter aggressive competitors like Temu and Shein.

Financial Projections: Growth Amid Adjustment

• RBC revised its 2025 revenue forecast to $10.5 billion (down from $10.8B) but maintains an “Outperform” rating, citing long-term scalability.
• Roth Capital’s 2025 estimates are slightly higher: $10.67 billion in revenue and $1.84 billion in adjusted EBITDA, with 2026 projections of $12.68B in revenue and $2.31B in EBITDA.

Despite these positives, Shopify’s stock has lagged, closing at $83.65 in April 10% below its 2025 peak. Analysts attribute this to tariff fears and broader market volatility. However, RBC’s $115 price target (down from $136) and its “Outperform” rating reflect confidence in Shopify’s long-term story.

Conclusion: A Resilient Ecosystem for the Future

Shopify’s journey through 2025 underscores its dual nature: a company both vulnerable to macroeconomic headwinds and uniquely equipped to weather them. While near-term metrics face pressure—from tariff-driven GMV declines to inflationary consumer caution—the company’s strategic bets on innovation, global diversification, and AI-driven efficiency are its strongest defenses.

The data reinforces this narrative:
- Merchant diversification (40% of international revenue from large omnichannel businesses) reduces exposure to tariff-vulnerable segments.
- AI and payment tools (e.g., Shop Pay Installments) are already boosting AOVs, a trend that could accelerate as these solutions scale.
- RBC’s “Outperform” rating and revised forecasts reflect confidence in Shopify’s ability to dominate its ecosystem, even as competitors like Temu encroach.

In a world of trade uncertainty, Shopify’s adaptability and ecosystem-centric approach make it a compelling long-term investment. The path to $12.68B in 2026 may be bumpy, but the foundation for sustained growth remains firmly intact.