10:26 AM EDT, 10/18/2024 (MT Newswires) -- Shopify ( SHOP ) will likely post Q3 results that will beat expectations, Deutsche Bank said Friday in a note to clients.

The e-commerce company's gross merchandise value, or GMV, and revenue will likely reflect "market share gains (Enterprise/International/PoS)" while its profitability will reflect "overall expense prudence," Deutsche said.

Based on industry conversations with agencies and merchants, coupled with the analysis of app usage data, Deutsche anticipates year-over-year gross merchandise value expansion to mirror the second quarter's pace, approximately 22% year-over-year, and surpassing the Street's forecast of 20.5%.

The company's revenue is expected to increase due to strong payment transactions, the impact of previous pricing adjustments on earnings, and the growth of merchants, the note said.

Deutsche anticipates revenue growth guidance of between low to mid 20% compared to market expectations and mid-30%s of revenue in GAAP operating expenses. Collectively, these factors are expected to lead to upward adjustments in both the Q4 and the fiscal 2025 outlook.

"From a margin perspective, our conversations/data suggest potential modest q/q decline in marketing spend from 2Q levels which should lead to operating margin/profit ahead of expectations," according to the note.

Deutsche has a buy rating on Shopify ( SHOP ) and a $85 price target.

Shares of Shopify ( SHOP ) were up 1% in recent trading.

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