Vit Kopriva of the Czech Republic topped the No. 10-ranked Shapovalov 2-6, 6-3, 6-2 within the second spherical in Gstaad.
It is a disappointing outcome for the Canadian, who fell to Novak Djokovic within the semifinals at Wimbledon earlier this month.
Shapovalov mentioned the loss in England made him hungrier to win a trophy and pinpointed the place he may enhance his sport.
Kopriva will play No. 96 Mikael Ymer of Sweden within the quarter-finals on Friday.
Shapovalov has opted out of the Tokyo Olympics alongside Canada’s Bianca Andreescu, who mentioned she wouldn’t compete in an effort to deal with her well being.