Q: Been reading that Shopify will likely partner with OpenAI with Shopify powering purchase transactions via Shop Pay. If this was to happen what do you anticipate the impact on the stock and revenue will be?
5i Research Answer:
Such a partnership would introduce a new revenue channel, with SHOP receiving commissions on purchases completed with Chat GPT. Merchants would have exposure to ChatGPT's vast user base. Analysts estimate the move would add at least $500M in revenue to SHOP annually. Now, while that is only about a 5% increase, it would be very high margin business so the profit impact would be higher. We might not expect a huge stock rally, though, on this news, as the stock is already anticipating good things, being up 106% in the past year.