Ecommerce platform Shopify is the latest company to announce a stock split. The Ottawa-based firm said Apr. 11 it would move ahead with a 10-for-1 split, also creating a special provision that allows founder and CEO Tobi Lutke to preserve his voting power. Planned for June 22, the split is the first in the company’s history.
Shopify’s revenue surged after the pandemic forced businesses online, sending its value soaring. The company’s platform is a one-stop shop for setting up internet stores, with tools to do everything from accepting credit card payments, managing inventory and creating shipping labels. “The shift to digital commerce has been supercharged over the last two years,” said Robert Ashe, Shopify’s lead independent director in a statement announcing the stock split.
In its last earnings reported in February, the company said that it had nearly tripled revenue and doubled the number of merchants using Shopify from 2019 levels.
The market shrugged off Shopify’s stock split
This move follows recent stock splits at Tesla, Google, and Amazon. Stock splits don’t change the value of an investor’s holdings, but divide it into a bigger number of shares. They are seen as a way to boost interest among retail investors and potentially improve stock performance.
While those tech giants saw their share prices jump after their announcements, Shopify’s stock only got a 2.5% bump on Monday, closing at $617.38 a share. Over the last six months, the company’s shares have fallen as people transition to a less socially distanced lifestyle, with the stock is trading at less than half of its price at the beginning of the year.