Etsy(ETSY) - 2025 Q1 - Quarterly Results

Financial Performance - Consolidated GMS for Q1 2025 was $2.8 billion, down 6.5% year-over-year, with Etsy marketplace GMS at$ 2.3 billion, down 8.9% year-over-year[5]. - Consolidated revenue was $651.2 million, up 0.8% compared to Q1 2024, with a take rate of 23.3%, an increase of 170 basis points[5]. - Consolidated net loss was$ 52.1 million, reflecting an impairment charge of $101.7 million related to Reverb, with a net loss margin of approximately (8.0)%[5]. - Revenue for Q1 2025 was$ 651,176,000, a slight increase from $645,954,000 in Q1 2024, representing a growth of 0.2%[23]. - Net loss for Q1 2025 was$ 52,096,000 compared to a net income of $63,004,000 in Q1 2024, indicating a significant decline[23]. - Total operating expenses increased to$ 481,442,000 in Q1 2025 from $390,731,000 in Q1 2024, reflecting a rise of 23.3%[23]. - Adjusted EBITDA for Q1 2025 was$ 171,102,000, up from $167,935,000 in Q1 2024, resulting in an adjusted EBITDA margin of 26.3%[26]. - Currency-neutral Gross Merchandise Sales (GMS) declined by 5.7% in Q1 2025 compared to a decline of 4.1% in Q1 2024[25]. User Engagement and Buyer Activity - Active buyers decreased by 3.4% year-over-year to 88.5 million, while 6.5 million buyers were reactivated, representing a 2.1% increase from the prior year[5]. - The Etsy app achieved its highest ever share of GMS, with significant improvements in user engagement and new features driven by AI and machine learning[7]. - Depop experienced strong top-line growth, particularly in the U.S., with increased personalized email and push content leading to higher engagement[10]. Future Outlook - Etsy anticipates that consolidated Q2 2025 GMS will decline at a rate similar to Q1 2025 performance, with an Adjusted EBITDA margin guidance of approximately 25%[12]. - The company is focusing on enhancing the buyer experience through improved search capabilities and local shipping messaging in response to evolving tariff landscapes[8]. Asset and Liability Management - Total assets decreased from$ 2,417,782 thousand as of December 31, 2024, to $2,120,802 thousand as of March 31, 2025, representing a decline of approximately 12.3%[22]. - Current liabilities decreased from$ 665,113 thousand to $519,138 thousand, a reduction of about 21.9%[22]. - Total stockholders' deficit increased from$ (758,866) thousand to $(910,299) thousand, indicating a decline in equity[22]. - Long-term debt remained relatively stable, increasing slightly from$ 2,288,083 thousand to $2,289,149 thousand[22]. - Cash and cash equivalents decreased from$ 811,178 thousand to $649,191 thousand, a decline of approximately 20%[22]. - Accounts payable decreased from$ 25,979 thousand to $17,396 thousand, a reduction of about 33%[22]. - Accrued expenses decreased from$ 374,947 thousand to $264,207 thousand, a decline of approximately 29.5%[22]. - Deferred revenue increased from$ 19,213 thousand to $22,297 thousand, an increase of about 15.5%[22]. - Total current assets decreased from$ 1,109,983 thousand to $1,032,727 thousand, a decline of approximately 6.9%[22]. - Total liabilities decreased from$ 3,176,648 thousand to $3,031,101 thousand, a reduction of about 4.6%[22]. Cash Flow and Financing Activities - Cash and cash equivalents at the end of Q1 2025 were$ 649,191,000, down from $788,837,000 at the end of Q1 2024, a decrease of 17.7%[24]. - The company reported an asset impairment charge of$ 101,703,000 in Q1 2025, which was not present in Q1 2024[23]. - Stock-based compensation expense for Q1 2025 was $62,108,000, compared to$ 70,683,000 in Q1 2024, showing a decrease of 12.1%[26]. - The weighted-average common shares outstanding for basic shares decreased to 107,084,000 in Q1 2025 from 118,440,000 in Q1 2024[23]. - The company experienced a net cash used in financing activities of $204,782,000 in Q1 2025, compared to$ 163,014,000 in Q1 2024, an increase of 25.6%[24]. Strategic Decisions - Etsy has signed a definitive agreement to sell Reverb, with the transaction expected to close in the coming months[9].