Shopify (SHOP  ) shares jumped following its strong Q1 earnings report that topped on the bottom and top-line. However, shares gave back gains in the following days due to the sell-off in growth and tech stocks in addition to the company warning that growth could slow with economies reopening as consumers return to shopping in stores.

Inside the Numbers

In Q1, Shopify posted revenue of $988.6 million which topped expectations of $862.7 million and was a 110% increase from 2020's Q1. Adjusted earnings per share came in at $2.01 which was significantly higher than analysts' expectations of $0.75 per share.

A contributor to earnings strength was Affirm (AFRM  ) going public. Shopify was an early investor in the company, owning $1.3 billion, and benefitted from its IPO in January with a $1.3 billion gain on its investment.

Gross Merchandise Volume on the platform more than doubled to $37.3 billion in the quarter. For many quarters, the number of sellers on the platform has grown in addition to transactions and average transaction size. Once, sellers are on Shopify's platform, the company has the opportunity to sell them higher-margin products and services such as credit, marketing, and various apps on Shopify's app store with the goal to help businesses increase their sales.

Shopify was cautious about its full-year outlook. It believes that as "populations are able to move about more freely, the overall economic environment will likely improve; some consumer spending will likely rotate back to offline retail and services; and the ongoing shift to ecommerce, which accelerated in 2020, will likely resume a more normalized pace of growth."

Stock Price Outlook

Shopify was one of the big winners of the pandemic as businesses were forced to have an online presence. This resulted in Shopify's user growth and trajectory accelerating. Now, the company is facing somewhat of a reversion to the mean as it's likely spending in physical stores could be temporarily higher, while e-commerce growth rates could slip.

Further, the company will face higher comps in terms of growth rates. And, the market environment is already less favorable for growth stocks with interest rates rising and growth picking up.