Etsy 'Stays Nimble,' CEO Says As Revenue Grows, Active Buyers Decline

Etsy Inc ETSY shares are trading higher in premarket on Wednesday after the e-commerce company released first-quarter 2025 earnings.

The company reported first-quarter sales growth of 0.8% year-on-year to $651.18 million, beating the analyst consensus estimate of $642.67 million.

The revenue gain was due to growth in on-site advertising revenue for both Etsy and Depop, a full quarter impact of the seller set-up fee, and continued benefit from Payments expansion.

Consolidated GMS declined 6.5% to $2.8 billion. Adj EPS of 46 cents missed the consensus estimate of 49 cents.

Etsy marketplace GMS decreased 8.9% to $2.3 billion, a result of pressure on consumer discretionary product spending, challenging year-over-year comparisons in a shortened holiday season, category mix, and a highly promotional and competitive retail environment.

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Active buyers declined 3.4% to 88.5 million. GMS per active buyer on a trailing twelve-month basis slipped 3.5% to $120.

Gross profit for the quarter increased 0.1% to $459.11 million with a gross margin of 70.5%. Operating expenses for the quarter rose 23.2% to $481.442 million.

Adjusted EBITDA improved 1.9% to $171.1 million and the corresponding EBITDA margin expanded 30 basis points to 26.3%.

As of March 31, the company held $649.1 million in cash and equivalents. Operating cash flow for the quarter totaled $49.18 million.

“We are keeping a clear eye on Etsy’s long-term opportunities, while also staying nimble in the face of uncertainty given recent tariff announcements and the fluid state of consumer confidence in our core markets,” said CFO Lanny Baker.

Outlook: Etsy expects second-quarter FY25 GMS to decline at a rate similar to, to potentially lightly better than the year-over-year performance reported for the fourth quarter of FY24.

The company expects second quarter adjusted EBITDA margin of about 25%.

Price Action: ETSY shares traded higher by 0.61% at $46.41 in premarket at last check Wednesday.

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