Picture this: you’re chatting with a friend about needing a new pair of running shoes, and right there in the chat window you ask an AI for recommendations, see photos, pick a pair, and check out—all without ever opening a browser tab. Sounds like science fiction from five years ago, right? Well, that future just went live for millions of online stores, and the company making it happen is having one heck of a year on the stock market.
Shopify has absolutely crushed it in 2025. The stock is sitting on gains of roughly 50% year-to-date, punched through all-time highs back in October, and still looks like it has plenty of runway left. The question every investor is asking right now is simple: can the company’s aggressive push into artificial intelligence give it another leg higher?
Why 2025 Has Already Been Shopify’s Year
Let’s start with the numbers because they’re honestly hard to ignore. Third-quarter revenue jumped 32% compared to the same period last year. That’s not a fluke—that’s the kind of growth you normally see from companies one-tenth Shopify’s size. Even more impressive? This marked the ninth straight quarter where free cash flow margin stayed comfortably in double-digit territory.
In a world where most tech giants are burning cash on moon-shot AI projects, Shopify is actually printing it. That combination of top-line acceleration and bottom-line discipline is catnip for growth investors, and the market has rewarded the stock accordingly.
The OpenAI Partnership Everyone Is Talking About
The real spark, though, came in September when Shopify announced a deep integration with ChatGPT. We’re not talking about a superficial plug-in here. Merchants can now sell products directly inside the chat interface, and shoppers can complete the entire purchase—yes, even payment—without ever leaving the conversation.
Think about that for a second. The average person already spends hours a day inside messaging apps. If a meaningful percentage of commerce shifts into those environments, the platforms that own the rails stand to win big. And right now, Shopify is the only major e-commerce player with a seat at that particular table.
“Shopify, for its millions of merchants, organized all their information and now the AI can talk to that data in order to help consumers shop online at millions of merchants.”
– Gil Luria, Head of Technology Research at D.A. Davidson
That quote nails it. Shopify didn’t just bolt AI onto the side of its platform; it spent years quietly restructuring product catalogs, images, and inventory data so large language models could actually understand and sell from them. Most competitors are still figuring out step one.
Early, But the Early Bird Usually Wins
Wall Street loves to remind us that we’re still in the very early innings. Referral traffic coming from AI chatbots remains in the low single digits today. Perfectly fair point. But here’s the counter: every transformational technology looked tiny at the beginning.
Mobile commerce was less than 1% of U.S. retail in 2009. Social commerce was a rounding error in 2014. Anyone who bet against those trends because “the numbers are still small” spent the next decade watching from the sidelines.
- Shopify powers more than 12% of all U.S. e-commerce today
- Brands like Mattel, Allbirds, Gymshark, and thousands of fast-growing DTC names run on the platform
- Over a million merchants now have an AI-ready storefront whether they realize it or not
When adoption curves eventually bend upward—and history says they almost always do—the companies with the widest moats and the deepest integrations tend to capture the lion’s share.
What Shoppers Are Already Doing (Whether Analysts Notice or Not)
Here’s something that doesn’t always make it into the research notes: real people are already using AI agents to shop. I’ve lost count of how many friends have told me they asked an AI for gift ideas, product comparisons, or even specific niche items and ended up buying something recommended on the spot.
One health coach I know barely shops online at all—she prefers local stores—but when she needed very specific vegan, low-sugar protein bars, she typed her criteria into a chatbot and discovered a brand she’d never heard of. The bars showed up two days later. That brand? A Shopify merchant.
Multiply that story by millions and you start to see why analysts, even the cautious ones, are willing to look past today’s tiny traffic numbers.
“In agentic commerce, we believe winners will be platforms that can move fast, integrate securely, and serve a diverse set of merchants—key attributes underscoring Shopify’s demonstrated competitive moat.”
– Keith Weiss, Morgan Stanley
The Competitive Landscape: Who Else Is Even Playing?
Sure, other players are making moves. Etsy announced something similar a few weeks after Shopify. Walmart followed shortly after that. But scale matters here in a massive way.
Shopify has roughly ten times more active stores than Etsy and a far more sophisticated developer ecosystem. Walmart has deep pockets, but its merchant base is tiny by comparison and mostly consists of third-party sellers who already lean on… you guessed it… Shopify for their standalone sites.
Being first and being biggest at the same time is a powerful cocktail.
Valuation: Expensive or Actually Reasonable?
Growth stocks trading at 50%+ year-to-date gains rarely look cheap on a snapshot basis, and Shopify is no exception. But dig a little deeper and the picture gets more interesting.
Free cash flow margins are expanding, not contracting. Revenue growth is re-accelerating after a post-pandemic slowdown. And perhaps most importantly, the company is planting flags in what could be the next major commerce channel while still growing its core business at 30%-plus.
When you pay a premium for a compounder, you’re usually betting on duration of growth. In my view, Shopify just extended its runway by several years.
Price Targets and Upside Potential
The Street is starting to catch on. Recent updates:
- Morgan Stanley – Overweight, $165 target
- Citizens – Outperform, $185 target (16% upside)
- D.A. Davidson – Buy, $195 target (20%+ upside)
Those are some of the highest targets on the Street, and they were all raised after the AI partnership news. More will likely follow if early adoption metrics keep trending positive into 2026.
Risks? Of Course There Are Risks
No investment conversation is complete without them. AI hallucination is still a thing—chatbots can recommend the wrong product or send shoppers to out-of-stock items. Scaling seamless checkout inside third-party apps has technical hurdles. Competition will intensify.
But here’s the thing: Shopify has spent the last decade proving it can execute through competitive threats. Amazon, Walmart, traditional software giants—none of them have managed to slow the company down in any meaningful way. I’m not saying this time is guaranteed to be different, but the track record deserves respect.
The Bottom Line for Investors
Shopify isn’t just riding the AI wave; it’s helping build the surfboard everyone else will eventually want to borrow. The core business is strong, cash flow is abundant, and the company just positioned itself at the center of what could be the biggest shift in online shopping since mobile.
Is the stock going to double from here in the next twelve months? Probably not. Could it deliver another 30-50% over the next couple of years if agentic commerce gains real traction? That scenario looks increasingly plausible.
For long-term growth investors comfortable with some volatility, Shopify remains one of the most compelling stories in tech right now. The rocket fuel is already in the tank—the only question is how high it decides to fly.
