Shopify says AI search is driving more traffic and sales, not replacing Google

Shopify reported that AI-driven search is significantly boosting traffic and sales for its merchants, with AI-referred sessions tripling year-over-year in the second quarter, while traditional search remains a growing and vital channel, according to comments made by President Harley Finkelstein on the company’s earnings call.

How AI search is changing e-commerce

Finkelstein emphasized that AI is acting as a complement to traditional search, not a substitute. The company observed that AI agents are handling more complex, multi-constraint queries, such as finding a car seat that fits three across a sedan, by analyzing structured product data to match buyer intent more precisely than keyword-based searches. This results in higher conversion rates, with half of AI-referred sessions landing directly on product pages, 2.5 times more than traditional search.

Financial impact and merchant benefits

The e-commerce platform’s second-quarter revenue rose 36% to $3.6 billion, beating Wall Street forecasts of $3.4 billion, with gross operating profit up 31% to $1.71 billion. The company attributed part of this success to AI search, noting that 75% of AI-attributed purchases occurred outside the top 100 product categories, benefiting smaller and niche merchants. Shopify also highlighted that traditional search sessions have grown 1.3 times over the past two years, still accounting for about a third of storefront sessions.

Why this matters for the industry

This contrasts with the impact of AI summaries on online publishing, where click-through rates have dropped. Shopify’s experience suggests that for e-commerce, AI can enhance discovery and sales, especially for long-tail products, by improving the match between buyer intent and product offerings. The company is also integrating with AI tools like ChatGPT, Perplexity, and Claude, and building connectors to platforms like Lovable to help merchants leverage AI.

Conclusion

Shopify’s results indicate that AI search is not cannibalizing traditional search but rather expanding opportunities for merchants, particularly smaller ones, by improving conversion and discovery. This trend could reshape how e-commerce businesses approach search and AI integration, offering a positive counterpoint to the challenges faced by publishers.

FAQs

Q1: How is AI search different from traditional search for e-commerce?
AI search uses structured data and natural language processing to understand complex, multi-constraint queries, matching products based on specific needs like dimensions and compatibility, rather than just keywords. This leads to more relevant results and higher conversion rates.

Q2: What were Shopify’s key financial results in Q2?
Revenue rose 36% to $3.6 billion, exceeding forecasts, and gross operating profit increased 31% to $1.71 billion, also above expectations.

Q3: Does AI search replace traditional search for Shopify merchants?
No, traditional search remains a major traffic source, growing 1.3x over two years. AI search is complementary, driving new types of traffic and improving conversion, especially for long-tail products.