In April, Shopify CEO Tobi Lütke shared an internal memo on X, stating that “reflexive AI usage is now a baseline expectation at Shopify.” (AP Photo/Richard Drew) · ASSOCIATED PRESS
Canadian e-commerce giant Shopify (SHOP.TO) is showing resilience as Canadian tech stocks trail their U.S. counterparts. Analysts cite the company’s push to Artificial Intelligence (AI) and strength in e-commerce as key drivers of its growth.
“So far, 2025 has not been a banner year for Canadian technology,” said Richard Tse, an analyst at National Bank of Canada Financial Markets, in a report.
The S&P/TSX Information Technology Index provided a return of 5.6 per cent in the first half of the year, lagging broader benchmarks like the S&P 500 Information Technology Index and the NASDAQ 100, which returned 7.7 per cent and 7.9 per cent respectively, Tse said. In comparison, Shopify provided a return of approximately 8 per cent in the first half of 2025, according to National Bank.
National Bank, CIBC and RBC analysts consider Shopify a “buy,” primarily because of its investment in AI and merchant solutions.
“The most notable broad driver of growth and innovation for Shopify is from AI – its application both internally and for its merchants. In our view, this is by far the biggest potential driver of profitability for Shopify care of operating leverage,” Tse said.
Shopify CEO Tobi Lütke has been outspoken about the company’s AI ambitions. In April, he shared an internal memo on X, stating that “reflexive AI usage is now a baseline expectation at Shopify,” and teams must demonstrate why they can’t accomplish tasks via AI before asking for more staff or resources.
In May, the Canadian Press reported that Shopify iss leaning into AI to support its merchants and developers with everything from online store creation to virtual shopping assistants.
The company called its new product launches and enhancements a shift toward “declarative commerce — where business owners simply express their goals, and AI handles the rest.”
Beyond AI, Shopify is scaling its merchant solutions, such as payments. In 2025, Shopify expanded payments from 23 to 39 countries.
Further, Tse expects a potential Shop Pay partnership with OpenAI, and Shopify powering purchase transactions, could add $500 million in net revenue a year.
RBC Capital Markets analyst Paul Trieber noted that Shopify is “a key beneficiary of the transition to next generation commerce,” as more businesses shift from traditional retail to online platforms and adopt multi-channel strategies, including marketplaces and social commerce. In a note, Treiber forecasts Shopify’s gross merchandise value will rise from $292 billion in fiscal 2024 to $423 billion by 2026.
CIBC Capital Markets analyst Todd Coupland also points to Shopify’s growing merchant base as a sign of future strength. As of the fourth quarter of 2021, Shopify counted two million merchants on its platform. As of its fourth quarter in 2023, 25 million were either in Shopify’s sales pipeline or on free trials.
While U.S.-China tariff tensions were flagged as a potential threat, analysts see limited impact on the company’s growth trajectory so far. “While tariffs remain a key risk, Shopify is well positioned to help its merchants navigate those challenges,” Coupland said.
“It’s notable that if a reasonable China tariff agreement is reached, estimates for the second half of 2025 could be conservative, as they assume a deceleration in growth. We reaffirm our positive thesis on Shopify and recommend investors buy its shares,” Coupland said.
CIBC and RBC have raised their price target on Shopify to US$145, up from US$125, while National Bank increased its target to US$140 from US$120.