Shopify (SHOP), based in Ottawa, has been hit by a wave of change, with its board of directors proposing a 10-for-1 stock split as well as changes to its governance structure.
Meanwhile, the e-commerce firm has confirmed that it will issue a new class of shares to ensure that its founder and CEO, Tobi Lütke, can keep control of the company. The creation of a new "founder share" will give Lütke 40% of the company's overall voting power.
A stock split may have been necessary because Shopify sales growth has slowed over the past three quarters, decreasing to 41% in the December 2021 quarter after peaking at 110% in the March 2021 quarter, following three straight quarters above 90%. Revenue growth this year is expected to grow 31%, down from 57% last year. Shopify's stock has dropped 50% year to date — just over $500 a share.