January 21, 5:35 am
After a brutal 2020, which brought the first-ever revenue drop, 2023 was a fantastic year for e-commerce industry. The market revenue jumped by almost 10% year-over-year and hit $3.15 trillion, up from $2.87 a year before, while more than 300 million new users flocked to shopping apps and platforms. Market projections for 2024 are even more optimistic, with another 300 million new users and revenue expected to grow by 15% to $3.65 trillion. This new momentum in the e-commerce industry has helped the largest players in the market add billions of dollars to their stock values. Still, none competes with Shopify, the biggest gainer of them all.
According to data presented by AltIndex.com, Shopify's market cap surged by a massive 120% year-over-year, the biggest increase among the top five e-commerce giants.
After delivering 661% positive returns in 2019 and 2020 combined, Shopify (SHOP) stocks saw high volatility in 2021 as the global demand for the e-commerce platform started falling. A year later, US and Canadian banks started rapidly raising interest rates to fight inflationary pressures, triggering a massive selloff in high-growth tech stocks, led by Shopify. As a result, the e-commerce platform ended 2022 by losing 73% of its value.
However, the company's ability to maintain strong growth even in a challenging economic environment impressed investors and triggered a surge in its share price in 2023. The price of a single SHOP share stood at around $38 in January 2023, and now it's more than $80, which is still 52% below its all-time high of $169 from November 2021.
The impressive price surge has helped Shopify to grow its stock value by $56B or almost 120% year-over-year, the biggest increase among the top five e-commerce giants. The world's largest e-commerce company, Amazon, saw an 83% year-over-year growth, with its market cap rising from $878bn last January to over $1.6trn last week.
Statistics show Mercado Libre saw the second-largest market cap growth. Last week, the combined value of shares of the Argentinian e-commerce giant stood at $87.2bn, or 98% more than in the same month a year ago. The second-largest player in the market behind Amazon, Chinese online retailer Pinduoduo, follows with a 57% year-over-year increase and a stock value of more than $190bn as of last week.
Unlike Shopify, Amazon, Pinduoduo, and Mercado Libre, which all saw double and triple-digit growth in 2023, Alibaba (BABA) ended the year with a huge market cap drop, and the negative trend continued this year.
The e-commerce giant faced several setbacks in 2023, including a prolonged recovery of the Chinese economy, loss of market share to Pinduoduo parent PDD Holdings, and an abandoned plan to spin off its cloud computing unit due to new US chip export restrictions. As a result, Alibaba's share price plummeted, wiping $112bn off its market cap.
The combined value of Alibaba shares stood at $285bn in January 2023. Since then, this figure has plunged by 40%, falling to around $173bn last week.
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The information provided by AltIndex is solely for informational purposes and not a substitute for professional financial advice. Investing in financial markets carries inherent risks, and past performance doesn't guarantee future results. It's crucial to do your research, consult with financial experts, and align your financial objectives and risk tolerance before investing. AltIndex creators and operators are not liable for any financial losses incurred from using this information. Users should exercise caution, seek professional advice, and be prepared for the risks involved in trading and investing in financial assets, only investing what they can afford to lose. The information in this application, derived from publicly available data, is believed to be reliable but may not always be accurate or current. Users should verify information independently and not solely rely on this application for financial decisions. By using AltIndex, you acknowledge that it doesn't offer financial advice and agree to consult a qualified financial advisor before making investment decisions.
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