By Nivedita Balu

(Reuters) – Shopify(NYSE:) Inc plunged almost 9% to an 18 month low on Monday as Canadian ecommerce giant Faces the Full Impact of a Global Tech Sell Off

This slump is mirrored in Canada’s main stock market index. It fell to a 3-month low due to global equity losses. The decline was caused by growing tensions between Russia, Ukraine, and before major central bank meeting this week.

Losses have increased in the US for those tech-hungry as investors fear an increase in Treasury yields, causing fears that the Federal Reserve might take action to limit inflation and grow shares.

Shopify’s shares rose more than 20% and 178% last year, thanks to the wider adaptation of ecommerce. Shopify was once Canada’s largest company.

Shopfiy has seen a 40% decline in share prices so far in 2022. Shares fell Monday to C$1,007.4, the lowest level since June 2020.

Shopify may be terminating or reducing its contracts with fulfillment partners and warehouses, which might reduce the company’s ability to ship orders from merchants.

“Shopify has not yet built a kind of fulfillment organization at Amazon (NASDAQ) scale, and investors should expect nothing like that in near future,” Ygal Aronian, Wedbush analyst.

Arounian said that the changes could result in large investments in Shopify’s fulfillment network, as well as a shift from a capital-light to ownership model for distribution centers. This is something investors are likely to question given current market conditions.

Shopify stated that it has communicated its plans to warehouse partners and merchants, and that the capacity will not be diminished.

The company stated in a statement that they will make changes to Shopify’s fulfillment network to enable merchants to compete with large-box retailers. This includes prioritizing 2-day shipping at reasonable prices, and easy returns for U.S. customers.

(Graphic: Shopify’s 2022 decline takes it off top spot Shopify’s 2022 decline pushes it off top spot, https://graphics.reuters.com/SHOPIFY-STOCKS/SHOPIFY-STOCKS/zgpomaoykpd/Shopify%202022%20deline.jpeg)