AI-powered shopping assistants are changing how consumers buy online, raising questions about Shopify’s future role. Bank of America sees opportunity, but risks remain as competition from Amazon and others intensifies ahead of Shopify’s next earnings report
Online shopping is entering a new era, with artificial intelligence increasingly guiding how consumers discover and purchase products. Instead of browsing traditional retailer websites, shoppers can now use AI assistants to compare items, find deals, read reviews, and even build carts—sometimes completing purchases without ever visiting a merchant’s site. This shift is forcing e-commerce platforms to rethink their role in the digital shopping experience.
Bank of America’s Bullish View
Bank of America has reinstated coverage of Shopify with a Buy rating and a $150 price target, according to reporting by TheStreet. The firm argues that Shopify, which powers millions of online and in-store sellers, could benefit from the rise of AI-driven commerce rather than be sidelined by it. While some investors worry that AI shopping tools might bypass merchant websites and reduce Shopify’s influence, Bank of America believes the company’s infrastructure—handling product catalogs, inventory, pricing, checkout, payments, and fulfillment—remains essential as transactions move closer to AI interfaces.
Shopify’s stock has struggled in 2026, down about 24% year to date as of early July. Bank of America’s price target implies nearly 25% upside from recent levels, but the firm cautions that the real test will be whether Shopify can maintain its relevance as AI changes how consumers shop. The company is set to report second-quarter results on August 5, a key moment for investors tracking its progress in AI, payments, international expansion, and enterprise growth.
AI Shopping Moves to Checkout
AI shopping is no longer a futuristic concept. Amazon has rolled out Alexa for Shopping, which combines its AI models to help customers compare products, track prices, build carts, and reorder essentials. For eligible items, Amazon’s Buy for Me feature lets consumers shop across the web using agentic AI. Walmart and Google are also integrating AI deeper into the checkout process. Google’s Gemini shopping expansion, for example, allows users to find and sometimes buy products directly within the Gemini chat, thanks to partnerships with retailers like Walmart, Shopify, and Wayfair.
Microsoft is adding similar capabilities to its Copilot platform, enabling in-chat checkout flows with retail partners such as Urban Outfitters, Anthropologie, and Ashley Furniture. Payment providers including PayPal, Stripe, and Shopify are working with Microsoft to support these transactions. For merchants, this means their product data, inventory, and checkout systems must be compatible with AI-driven shopping surfaces to remain competitive.
Shopify is not standing still. The company has co-developed the Universal Commerce Platform (UCP), an open-standard framework built with Amazon, Meta, Microsoft, Stripe, and Salesforce. UCP aims to standardize how autonomous AI agents discover inventory, negotiate terms, and complete transactions across the web. With more than 14% share of total U.S. e-commerce—second only to Amazon—Shopify is positioning itself to remain a critical part of the online retail infrastructure as AI becomes more central to commerce.
Shopify’s Growth Drivers and Risks
Shopify’s first-quarter 2026 results showed revenue up 34% year over year, with gross merchandise volume (GMV) reaching $100.7 billion and free cash flow margin at 15%. The company expects second-quarter revenue to grow at a high-twenties percentage rate, with gross profit dollars up in the mid-twenties and operating expenses at 35% to 36% of revenue. Bank of America projects annual revenue growth of 24% to 28% from 2026 through 2028, driven by AI-enabled commerce, international expansion, and growth among larger enterprise merchants.
AI is already making an impact. According to Bank of America, AI-driven traffic to Shopify merchants increased eightfold year over year in the first quarter, while orders from AI-powered searches rose about 13 times. Orders from new buyers via AI surfaces nearly doubled compared to traditional channels. Shopify’s Catalog product, which feeds inventory and pricing into AI agents, and its Sidekick AI assistant for merchants, are both seeing rapid adoption. Catalog-powered AI searches converted to purchases at twice the rate of general AI search traffic, and Sidekick’s weekly active users quadrupled year over year.
International growth is another bright spot. Shopify’s international GMV rose 45% year over year in the first quarter, outpacing overall GMV growth. Shop Pay’s GMV outside the U.S. grew more than 70%. Larger merchants are also becoming a bigger part of Shopify’s business, with the number of merchants generating over $100 million in GMV doubling in the past two years. Shopify Plus, the company’s enterprise offering, now accounts for 35% of total monthly recurring revenue.
Still, risks remain. Bank of America warns that Shopify could face greater-than-expected disruption from AI-native commerce platforms, slower adoption of key merchant solutions, execution challenges in international markets, and increased competition as it targets larger sellers. If major AI platforms or payment companies capture more of the shopping journey, Shopify will need to prove its infrastructure remains indispensable.
Key Figures and Market Context
Shopify reported $100.7 billion in gross merchandise volume for the first quarter of 2026, a 34% increase from the prior year. The company’s free cash flow margin reached 15%, and international GMV grew 45% year over year. Shopify’s stock was down about 24% year to date as of July 2026, while Bank of America’s $150 price target suggests a potential 25% upside from recent prices.
As AI-driven shopping becomes more common, the competitive landscape for e-commerce platforms is shifting rapidly. Companies that can adapt their infrastructure to support AI-powered transactions may be better positioned to capture future growth, but the pace and direction of this transition remain uncertain.
AI-driven commerce is changing the way consumers interact with online retailers, but it also raises new questions about visibility, control, and competition. As AI assistants become the starting point for more shopping journeys, the systems that power inventory, pricing, and checkout behind the scenes become increasingly important. For merchants, integrating with these systems is essential to reach customers wherever they begin their search. For investors, the challenge is to identify which companies will remain critical as the digital shopping landscape evolves.
