$36.2 billion of GMV was processed on Shopify Payments in the first quarter, 32% higher than in the first quarter of 2023. The penetration rate of Shopify Payments as a percentage of GMV was 60% compared to 56% in Q1 of 2023. Several factors powered the quarter’s higher gross payments volume compared to the prior year, including the strong performance of those merchants utilizing Shopify Payments, an increasing percentage of which are Shopify Plus, more merchants across the globe adopting payments, greater penetration of Shop Pay, which was 39% of GPV in the quarter and continued growth of our point-of-sale solution. These items were partially offset by the continued strength of our business in Europe, which was a larger percentage of GMV, but where we have a lower GPV penetration than North America.
Subscription Solutions revenue was $511 million, up 34% over Q1 of 2023, with the two largest drivers being the impact from the pricing increases of our standard plans, which went into effect for existing merchants in the second quarter of 2023 and the growth in the number of merchants. These two factors were roughly equally balanced contributors. An increase in revenues from variable platform fees was also a contributor to the quarter. As a reminder, existing Plus merchants had until the end of April to commit to their existing rates or move to a new pricing plan. As of today, the majority of our existing Plus merchants have chosen to commit to three-year contracts at existing 2023 rates, a clear testament to the exceptional value that we provide and the trust and confidence our merchants place in us to consistently deliver the solutions they need for their success.
We expect more of the financial impact from these changes to occur in the second half of the year. We are not anticipating as much of a benefit from this pricing change as we did from the changes to standard pricing in 2023. MRR was $151 million, up 32% year-over-year. We saw growth year-over-year in MRR across each of standard, plus and offline point-of-sale. This strength stemmed from increases in the number of merchants in each of these three categories combined with, for Plus, growth from both new Shopify merchants joining and existing merchants upgrading from one of our standard plans of Plus, with Plus representing 32% of MRR for Q1 of this year. You should expect the Plus pricing changes to have more of an impact on our second quarter MRR as existing Plus merchants did not have to commit until after the end of Q1.
For point-of-sale MRR, which was up 50% year-over-year, growth was driven by improvements in our go-to-market strategy and our new retail plan. And for standard, the pricing change that we implemented last year. On a sequential quarter-over-quarter basis, MRR increased in Plus, standard and point-of-sale, primarily from growth in the number of merchants in each of these groups. It is important to note, we refined our MRR calculation for standard. We adjusted how we factor in merchants transitioning from a paid trial to full price status. Previously, we reflected an MRR the full price plan when the merchant’s paid trial ended but before the first payment was received. Now we do not capture an MRR or the change in the pricing until after we have received the first full price payment.
We believe this approach better reflects the way we look at our business. The change does not impact revenue. In Q1, our attach rate was 3.06%, up from 3.04% in Q1 of 2023. Key drivers of attach rate expansion in the quarter were the continued gains in GPV penetration and higher subscription revenues, largely offset by the logistics business in the prior year and lower non-cash revenues from strategic partnerships. Moving to gross profit. Gross profit was $957 million for the quarter, up 33% year-over-year. Gross margin for Subscription Solutions was 81.4% compared to 78.0% in Q1 of 2023. The increase stems from pricing changes on standard plans and, to a lesser extent, continued support and hosting efficiencies. Gross margin for Merchant Solutions was 40.1% compared to 37.2% in Q1 of 2023.
Our improvement in gross margin for Merchant Solutions was primarily due to the benefit from the absence of logistics, which was dilutive to margin. When excluding the impact of logistics, our Merchant Solutions gross margin was down year-over-year primarily from lower non-cash revenues from certain partnerships and the continued growth of our lower-margin Shopify Payments business, with these impacts partially offset by growth in the products like Shop Cash and installments. This brings our overall Q1 gross margin to 51.4% compared to 47.5% in the prior year. Operating expenses were $871 million for the quarter, in line with our expectations and representing 47% of revenue. Compared to Q1 of 2023, operating expenses of Q1 2024 were down 4%.
The decline year-over-year was primarily due to the sale of the logistics business and lower headcount, partially offset by increases in marketing spend. I know many of you look at operating expenses both pre and post stock-based comp. OpEx excluding SBC and related payroll taxes or adjusted OpEx for the quarter was 41% of revenue compared to 51% of revenues in Q1 2023. We continue to remain disciplined on headcount with total headcount remaining essentially flat for the past three quarters, all while maintaining and, in fact, accelerating our product innovation capabilities and continuing the top line momentum of our business. How we leverage AI internally is an important element of how we are able to do that. And as an example, let’s talk about how we are using AI in merchant support.
A couple of data points for you. During Q1, over half of our merchant support interactions were assisted with AI and often fully resolved with the help of AI. AI has enabled 24/7 live support in eight additional languages that previously were offered only certain hours of the day. We have significantly enhanced the merchant experience. The average duration of support interactions has decreased. And the introduction of AI has helped reduce the reluctance that some merchants previously had towards asking questions that they might perceive as trivial or naive. Additionally, our support staff has experienced a significant reduction in the amount of toil that is part of their jobs. We are improving the merchant support process and achieving much greater efficiency than ever before.
Moving to operating income. For the quarter, operating income was $86 million or approximately 5% of revenue compared to an operating loss of $193 million in Q1 of 2023. Stock-based compensation for Q1 was $111 million, and capital expenditures were $6 million for the quarter. Free cash flow was $232 million or 12% of revenue, doubling as a percentage of revenue versus Q1 2023 free cash flow margin of 6%. Turning to our balance sheet. Our cash and marketable securities balance was $5.2 billion as of March 31. And we had a net cash position of $4.3 billion after consideration of the outstanding convertible notes. Before turning to our outlook, a few comments regarding the broader economy and the macroeconomic assumptions that underpin our Q2 expectations.
We see consumer spend in North America remaining resilient, but we have factored in headwinds related to FX from the strong US dollar and some softness in European consumer spending in our Q2 outlook. We have and expect to continue to outperform the e-commerce growth rates in North America and Europe. We otherwise assume that the macroeconomic environment remains consistent with current conditions. Keeping all this in mind, let’s now turn to outlook. Our expectations for the second quarter of 2024 are as follows. First, on revenue. We expect Q2 year-over-year revenue growth to be in the high teens on a GAAP basis, which equates to a year-over-year growth rate in the low to mid-20s when excluding the 300 to 400 basis point impact from the sale of our logistics business.
An important dynamic to highlight is the impact of the Standard and Plus pricing changes and how they affect our growth rate for Q2 versus Q1. The impact of the pricing changes in Standard and Plus will have a smaller combined benefit in Q2 versus Q1. In Q2, we begin to lap the initial pricing changes on our Standard plans that went into effect in April of 2023, resulting in a headwind to our revenue growth quarter-over-quarter. While the Plus pricing billing cycle went into effect today for those existing merchants who did not sign up for the three-year contract, this uplift is expected to be minimal in Q2, given both the mid-quarter timing of the change and the fact that the majority of our merchants did choose to opt into three-year contracts at their existing 2023 price.
Q2 will simply be a quarter where the lapping effect of the Standard plan changes exceeds the initial benefit of the Plus pricing changes. We remain resolutely confident in the great products and go-to-market initiatives fueling our continuous growth and our ability to further strengthen our position as a leader in unified commerce. We expect Q2 to be a continuation of our strong momentum. Q2 gross margin is expected to be down approximately 50 basis points from Q1 of 2024. The primary drivers of the decline quarter-over-quarter are the expected growth of our lower-margin payments business and lower revenue contribution from a high-margin non-cash partnership revenue agreement that we’ll have fully amortized. Offsetting these factors are the expected positive impacts from the Standard and Plus pricing changes that I just referenced above and the benefit from shortening our trial length from three months down to one month.
