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E-commerce software maker Shopify seems to be benefiting handily from people using AI to search. <\/p>\n
On the company\u2019s second-quarter earnings call, Shopify President Harley Finkelstein said AI has become a \u201ccomplement to search, rather than a substitute for it,\u201d and had particularly benefited the long tail of e-commerce, including the smaller merchants that make up the majority of its customer base. Indeed, the company credited its earnings beat<\/a> and soaring revenue to AI search, at least partly. <\/p>\n This is quite different from how AI is impacting<\/a> online publishing, where AI summaries have led to a measurable drop in click-through rates, which lowers traffic and consequently eats into advertising revenues.<\/p>\n Instead, Shopify believes that AI is a boon to its business. The company noted that AI-driven traffic and orders to Shopify stores had tripled year-over-year in the second quarter. <\/p>\n And, this was not a result of AI taking share from search. \u201cIn fact, search remains one of our largest sources of buyer traffic to our merchants, and it\u2019s still growing,\u201d Finkelstein told analysts on the call. \u201cTraditional search sessions are up 1.3x over the past two years, holding roughly a third of all storefront sessions.\u201d<\/p>\n The e-commerce platform reported strong results in the quarter, with revenue rising 36% to $3.6 billion from a year earlier, outstripping Wall Street\u2019s forecast of $3.4 billion. Gross operating profit rose 31% to $1.71 billion, also ahead of analysts\u2019 expectations of $1.63 billion.<\/p>\n The company went into further detail about why AI search was working for its business.<\/p>\n \u201cWhile search engines rank by popularity against a handful of keywords, AI agents make multiple calls into Shopify\u2019s catalog, working with richer structured data to match products with the buyer\u2019s specific intent, rather than just keywords,\u201d Finkelstein explained. <\/p>\n \u201cWhen a buyer asks an AI assistant for the best car seat that fits three across a sedan, traditional search focuses on the keyword \u2018car seat.\u2019 An agent, however, understands the actual need, the dimensions, the vehicle type, and the fact that they need three. It searches across all of those constraints at once to find the product that actually works, not just the one that ranks highest,\u201d he said.<\/p>\n In other words, AI\u2019s capability to search across many dimensions to find the best product for users is resulting in better conversions for merchants.<\/p>\n \u201cBuyers\u2019 shopping journeys are being compressed as half of all AI-referred sessions are landing directly on a product description page. That is 2.5 times more than what we see with traditional search,\u201d Finkelstein added. <\/p>\n Plus, the company said 75% of AI-attributed purchases in Q2 happened outside the top 100 categories, or what Shopify called its \u201csweet spot.\u201d<\/p>\n In addition, the company suggested Shopify stands to benefit from AI playing a larger role in transactions thanks to its trusted checkout experience.<\/p>\n The company pointed out that it\u2019s also working with AI tools and agents, having built connectors to Claude, ChatGPT, Perplexity, Manus, Replit and Vercel, as well as vibe-coding platforms like Lovable that let merchants build on Shopify however they choose.<\/p>\n<\/div>\n When you purchase through links in our articles, we may earn a small commission<\/a>. This doesn\u2019t affect our editorial independence.<\/em><\/p>\n