Shopify shares drop after market close following secondary offering
- Shares of Shopify plummeted more than 5% during extended trading after the company announced a new stock offering.
- Over the past 12 months, however, the company's stock is up nearly 150%.
Shares of Shopify dropped more than 5% during extended trading after the company announced a new offering of 1.9 million Class A subordinate shares.
The Canadian e-commerce company said in a press release that it "expects to use the net proceeds from the offering to strengthen its balance sheet, providing flexibility to fund its growth strategies."
The offering is being underwritten by Credit Suisse and Morgan Stanley, according to the release.
The company, which helps small businesses market their products directly to consumers online, surpassed eBay in market cap this year to be the second-largest e-commerce platform behind Amazon.
In its most recent quarterly earnings report, Shopify posted revenue of $362 million, exceeding the $350 million expected by analysts. Its stock, meanwhile, has soared 144% year to date.