Could a Consumer Bull Market Supercharge Shopify?

The SPDR S&P Retail ETF is up about 25% since April 1, putting it within reach of its all-time high from late 2021. That kind of pop isn’t happening in isolation.

Consumer sentiment, which had been stuck near recessionary levels for most of 2022–2023, has recovered to a three-year high in 2025, according to the University of Michigan’s surveys.

If consumer discretionary stocks truly break out, it could extend this bull market for several more years. And at the center of that shift could be Shopify, one of the market’s most durable growth engines.

Key Points

• The SPDR S&P Retail ETF has surged 25% since April with Shopify positioned as a standout beneficiary.

• Despite scaling from $205 million in revenue in 2015 to over $8 billion in 2024, Shopify powers only a fraction of the $6 trillion global e-commerce market.

• Shopify’s AI-driven tools lower customer acquisition costs and boost merchant retention.

Shopify’s Hidden Strength in the Consumer Economy

When most people think about online shopping, Amazon immediately comes to mind. It dominates U.S. e-commerce with nearly 40% market share. But Shopify is the rails beneath millions of other merchants, giving them the ability to build storefronts, manage payments, and now, with new AI integrations, optimize everything from customer service to inventory management.

Shopify’s rise began as a way for small business owners to sell online without coding or hiring an expensive web team. But over the past five years, the company has steadily climbed the ladder into the enterprise tier.

Major global brands now run on Shopify. Heinz shifted to Shopify Plus for direct-to-consumer sales. Mattel, decades into its life cycle, moved parts of its e-commerce operations to Shopify.

This migration to larger merchants also gives Shopify a valuable cushion. Enterprise clients are less likely to churn during downturns and tend to process higher volumes, which boosts Shopify’s “take rate” on each dollar of GMV.

The AI Angle Few Are Talking About

Most investors think of Shopify as an e-commerce software company, but in reality, it’s becoming an AI-enabled operating system for retail.

Its new “Shopify Magic” suite uses AI to automatically generate product descriptions, predict demand, and even tailor email campaigns to improve conversion rates.

This matters because the biggest expense for small merchants isn’t always rent or labor, it’s customer acquisition. Digital ad costs on platforms like Meta and Google surged 30% from 2021 to 2024.

Shopify’s AI tools help sellers do more with less, making them stickier to the platform. Investors rarely price in this second-order effect: AI isn’t just a growth lever for Shopify, it’s a retention moat.

Growth That’s Hard to Ignore

Shopify’s growth trajectory is staggering. Revenue has grown nearly 40x in a decade. Even with that growth, it controls just a fraction of global e-commerce, which had penetration of only 12% by the end of 2024. The long-term upside remains significant.

Shopify Beyond E-Commerce

One of the company’s most overlooked strengths is its expansion beyond online retail.

Shopify is building out offline point-of-sale solutions, enabling merchants to use one system across both physical and digital storefronts.

The line between “online” and “offline” shopping is blurring, and Shopify is positioning itself as the connective tissue.

It has also leaned into B2B commerce, a market worth over $20 trillion globally. While B2B won’t replace consumer sales as its core engine, it provides another layer of growth and resilience. Few investors appreciate just how much Shopify is diversifying its revenue streams.

Valuation Is Expensive but Justified?

At nearly 12x forward sales, Shopify isn’t cheap by traditional standards. But Wall Street expects earnings per share to compound at over 35% annually for the next three years. Few large-cap stocks in the consumer sector have that kind of growth profile.

And Shopify’s free cash flow margin has expanded to double digits as management tightened costs in 2023 and 2024.

That means the company no longer needs to rely on outside capital to fund its expansion, reducing risk during economic downturns.

What Could Go Wrong?

Of course, no investment is bulletproof. Shopify still faces challenges from competitors like Wix, BigCommerce, and Adobe Commerce. Amazon, meanwhile, has been experimenting with opening its marketplace logistics to third-party sites, a direct threat to Shopify’s fulfillment network.

The Long-Term Case for Shopify

Despite the risks, Shopify remains one of the most compelling growth stories in consumer tech.

If consumer stocks become the next leg of this bull market, Shopify has the potential to be its flagship growth name. Even without that macro tailwind, its fundamentals make it a classic long-term compounder.

For investors willing to buy and hold through volatility, Shopify could deliver market-beating returns for the next decade.

The consumer sector may be staging its comeback, and Shopify is positioned to ride that wave. With a massive addressable market, AI-powered tools, and growing adoption from global brands, Shopify is more than just an e-commerce stock, it’s becoming the backbone of modern retail.