Etsy Stock Plummets After Q1 Results, Dismal FY22 Outlook

Etsy Inc ETSY reported first-quarter revenue growth of 5.2% year-over-year to $579.27 million, beating the consensus of $575.44 million.

Consolidated GMS was $3.3 billion, up 3.5% Y/Y, while Etsy marketplace GMS was $2.8 billion, down 2% Y/Y and up 177% compared to 1Q19.

The Etsy marketplace acquired ~7 million new buyers. Non-U.S. GMS for the Etsy marketplace was 45% of overall GMS and increased 5% Y/Y on a currency-neutral basis.

EPS was $0.60, above the consensus of $0.59. Adjusted EBITDA was $159.2 million (-13.5% Y/Y), and margin was 27.5%, down 600 bps.

The gross margin contracted by 391 bps to 70.1%. The operating margin fell b 44% Y/Y to $8 4.32 million, and the margin contracted by 1,280 bps to 14.6%.

Net cash provided by operating activities totaled $59.54 million for the quarter compared to $148,46 million in 1Q21. The company ended the quarter with $1 billion in cash and equivalents.

Etsy repurchased an aggregate of ~$63 million, or 420,398 shares, of its common stock.

2Q22 Outlook: Etsy expects GMS of $2.9 billion to $3.2 billion and Revenue of $540 million to $590 million, much below the consensus of $627.79 million. It expects an Adjusted EBITDA margin of ~25%.

Price Action: ETSY shares are trading lower by 10.4% at $98 during the post-market session on Wednesday.

Photo by Scott Beale via Flickr