Core Insights - Etsy reported fourth-quarter earnings that exceeded Wall Street expectations on earnings per share, while revenue slightly missed forecasts. The stock surged over 11% intra-day following the announcement of the sale of Depop to eBay for $1.2 billion in cash [1] Financial Performance - The company posted earnings per share of $0.92, surpassing analyst estimates of $0.85. Revenue reached $881.6 million, reflecting a year-over-year increase of 6.6% when excluding Reverb from the prior-year period, but was marginally below the consensus estimate of $884.14 million [2] - Adjusted EBITDA was reported at $222.5 million, resulting in a consolidated adjusted EBITDA margin of approximately 25.2%. Gross merchandise sales (GMS) totaled $3.59 billion, marking a 2.4% year-over-year increase, or 1.3% growth on a currency-neutral basis when excluding Reverb. The quarterly take rate was 24.5% [3] Future Guidance - Looking ahead, Etsy provided guidance for first-quarter 2026 GMS in the range of $2.38 billion to $2.43 billion, with an expected adjusted EBITDA margin of roughly 28% to 30%. The company also forecasted a first-quarter take rate of approximately 25.5% [4]

Core Viewpoint - U.S. equity markets faced volatility as resilient labor market data contrasted with a cautious outlook from Walmart, leading to concerns over consumer spending and geopolitical tensions impacting risk appetite [1]. Major Market Indexes Performance Recap - Major benchmarks ended in negative territory, with the S&P 500 declining 0.28% to 6,861.89, the Nasdaq Composite slipping 0.31% to 22,682.73, and the Dow Jones Industrial Average falling 267 points, or 0.54%, to close at 49,395.16 [2]. Small-Cap vs. Large-Cap Performance - The small-cap Russell 2000 managed a late-day recovery, finishing up 0.25%, indicating that smaller domestic-focused firms found support despite headwinds faced by larger retail and tech companies [3]. Economic Data Insights - Initial jobless claims fell to 206,000, significantly lower than the projected 223,000, marking the lowest level since early January, complicating the Federal Reserve's interest rate cut path [4]. - The U.S. trade deficit unexpectedly widened to -$70.3 billion in December, exceeding the forecasted -$56 billion, while the Philadelphia Fed Manufacturing Index rose to 16.3 in February from 12.6 the previous month, indicating strength in the industrial sector [5]. Corporate News and Stock Movements - Walmart reported better-than-expected fourth-quarter earnings and revenue but saw its stock fall 1.4% due to a disappointing profit forecast, overshadowing a $30 billion share buyback announcement [6]. - Deere & Company shares surged 11.6% after reporting higher-than-expected quarterly profits and raising full-year net income guidance to $4.5 billion to $5.0 billion [7]. - Etsy's stock increased by 21.2% following a significant earnings beat, while Booking Holdings dropped 7.1% amid competition concerns [8]. - Other notable stock movements included Occidental Petroleum rising 9.4%, Blue Owl Capital falling 5.9%, Robinhood Markets tumbling 11.3%, and Nvidia edging higher due to a partnership with Meta Platforms [8]. Upcoming Market Events - Investors are focused on upcoming corporate reports from Newmont Corp. and Consolidated Edison, as well as monitoring Live Nation Entertainment, Texas Roadhouse, and Sprouts Farmers Market for insights into consumer spending [9]. - Nvidia's earnings report is highly anticipated on February 25th, with geopolitical developments in Iran supporting oil prices, which rose 2.6% to $66.71 per barrel [10].

Core Insights - Etsy's stock is experiencing a rise due to the announcement of selling its fashion marketplace Depop to eBay for $1.2 billion in cash, marking a strategic shift back to its core business focus [1][1][1] Group 1: Business Strategy - The sale of Depop signifies the end of Etsy's "house of brands" era, which previously included three other businesses, indicating a strategic refocus on its primary marketplace [1][1] - Etsy's management aims to concentrate on growing the Etsy marketplace, which had nearly 87 million buyers by the end of 2025, despite a year-over-year decline in global merchandise sales [1][1] Group 2: Financial Performance - Following the announcement, Etsy's shares rose approximately 9% to around $48, although the stock remains down for the year and over the past 12 months [1][1] - The sale of Depop, which was acquired for $1.6 billion in 2021, is seen as a positive outcome for Etsy's shareholders, as it allows the company to focus on its core operations [1][1] Group 3: Market Reaction - The news of the sale positively impacted eBay's shares, which rose about 5% in response to the acquisition announcement [1][1] - Wall Street analysts maintain a bullish outlook on Etsy's stock, with a mean price target of $67, although this is significantly lower than its previous peak [1][1]

Core Insights - Etsy is significantly enhancing its engagement with the Prompt Economy, focusing on artificial intelligence (AI) and mobile-first strategies for sustainable growth [2][3][5] Financial Performance - In Q4, Etsy reported a consolidated gross merchandise sales (GMS) of $3.6 billion, reflecting a year-over-year increase of 2.4% [14] - Active buyers totaled 86.5 million, remaining largely flat sequentially, while consolidated revenue reached a record $882 million, up 6.6% year over year [14] - For Q1 2026, Etsy anticipates GMS between $2.38 billion and $2.43 billion, indicating a year-over-year growth of 2% to 4% [15] AI and Technology Integration - Etsy is leveraging AI to enhance product discovery rather than replacing its marketplace model, with agentic traffic increasing approximately 15 times year over year [3][4] - The company has expanded integrations with Microsoft Copilot and Google, and established an agentic payments agreement with Stripe, focusing on AI-generated recommendations leading to Etsy listings [5] User Engagement and Mobile Strategy - The app's share of GMS reached 46% in Q4, up five percentage points since the end of 2023, with app users generating about 40% higher lifetime value than non-app users [11] - Etsy added 6.8 million new buyers and reactivated 10.4 million lapsed buyers in Q4, marking the first year-over-year increase in gross additions in over two years [12] Market Trends and Buyer Behavior - U.S. buyer GMS grew 0.3% year over year, the first positive comparison in four years, while trailing 12-month GMS per active buyer stabilized at $121 [12] - Personalized categories, particularly in Home and Living, showed growth, driven by higher-ticket subcategories [16]

Company Performance - eBay reported a strong fourth quarter, earning $1.41 per share, which is a 13% year-over-year increase and beat estimates by $0.10 [1] - Sales increased by 15% year-over-year to $2.97 billion, surpassing estimates by at least $100 million, driven by holiday shopping and AI initiatives [1] - eBay announced an acquisition of a secondhand clothing marketplace for $1.2 billion from Etsy, aiming to attract a younger customer base [1] Shareholder Returns - eBay increased its first quarter cash dividend from $0.29 to $0.31 per share, payable on March 20 [1] - Analysts have responded positively to eBay's performance and acquisition, with price target adjustments reflecting optimism [1][2] Analyst Reactions - Analysts have given positive feedback on eBay's acquisition, with NEM raising its price target for eBay from $115 to $122, maintaining a buy rating [1] - Barclays has lowered its price target but kept an overweight rating, while Bernstein and Morgan Stanley provided favorable commentary on eBay's performance [1] - Stiffel's analyst expressed caution regarding the sustainability of growth, projecting 6% GMV growth in 2026, but still increased the price target to $94 from $88 [1] Market Context - eBay's stock saw a 4.5% increase following the earnings report, while Etsy's stock rose by about 10% due to the acquisition news [1] - The overall market is experiencing volatility, with mixed performances across sectors, leading to cautious sentiment among some investors [2][6]

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

Core Viewpoint - Etsy's stock surged following the announcement of the sale of its fashion resale app Depop to eBay for approximately $1.2 billion in cash, despite mixed fourth-quarter earnings results [2][4]. Financial Performance - Total gross merchandise sales decreased by 3.8% year-over-year to $3.59 billion, falling short of analyst expectations of $3.6 billion [2][11]. - Fourth-quarter net profit was $110.7 million, with earnings per share (EPS) of $0.92, a decline of 14.8% compared to the previous year's net profit of $129.9 million and EPS of $1.03 [2][12]. Market Position and Strategy - The CEO stated that the sale of Depop will allow the company to focus on its core e-commerce platform business [2][4]. - eBay noted that Depop is popular among younger consumers and will complement its own business, enhancing its position in the fast-growing fashion category [2][4]. User Metrics - Active sellers increased by 7.7% year-over-year to 8.76 million, exceeding analyst expectations of 8.5 million [6][14]. - Active buyers decreased by 2% year-over-year to 93.54 million, slightly above Wall Street's expectation of 93.1 million [6][14]. Future Guidance - The company expects gross merchandise sales for the upcoming quarter to be in the range of $2.38 billion to $2.43 billion, down from $2.8 billion in the same quarter last year, with analyst expectations at $2.68 billion [14].

The Etsy company logo is seen at its headquarters in New York City on Dec. 13, 2023.Etsy shares popped on Thursday after the company said it plans to offload its fashion resale app Depop to eBay for about $1.2 billion in cash. The online marketplace also reported mixed earnings results for the fourth quarter. Here's how Etsy did, compared with estimates from analysts polled by LSEG: Earnings per share: 92 cents vs. 84 cents estimatedRevenue: $882 million vs. $885 million estimatedGross merchandise sales, or ...

Financial Data and Key Metrics Changes - Consolidated GMS for Q4 was $3.6 billion, up 2.4% year-over-year, excluding Reverb, and up 1.3% year-over-year on a currency-neutral basis [20] - Consolidated revenue reached $882 million, up 6.6% year-over-year, marking a new quarterly record [20] - Adjusted EBITDA was $222 million, with a consolidated adjusted EBITDA margin of 25.2% [20] - Etsy Marketplace adjusted EBITDA margin was slightly above 30% in Q4, though slightly lower year-over-year due to higher costs [21] - Consolidated fourth quarter take rate was 24.5%, expanding by 170 basis points year-over-year [30] Business Line Data and Key Metrics Changes - Etsy Marketplace GMS was up 0.1% year-over-year in Q4, marking the first positive comparison since Q3 2023 [22] - U.S. buyer GMS grew 0.3% year-over-year, marking the first quarter of positive growth in four years [23] - Home and living category returned to positive year-over-year GMS growth, driven by high average order value subcategories [24] - Active sellers increased to 5.6 million, up 1.5% sequentially, reflecting growth in both U.S. and international sellers [26] Market Data and Key Metrics Changes - Trailing 12-month active buyer count in the U.S. increased slightly from Q3 to Q4, with a total of 86.5 million active buyers [25] - Mobile app downloads grew 4% year-over-year, with app GMS growth accelerating in Q4 [24] - Agentic traffic to Etsy in Q4 was about 15 times what it was last year, indicating rapid growth in this channel [16] Company Strategy and Development Direction - The company signed a definitive agreement to sell Depop to eBay for $1.2 billion, allowing a focus on growing the Etsy marketplace [4] - Strategic priorities include improving the shopping journey, enhancing machine learning for item matching, deepening customer loyalty, and emphasizing human connection [10] - The company reorganized around customer outcomes, consolidating product and engineering teams for better execution [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the changes made, noting that the trajectory is improving with a return to growth in the core marketplace [12] - The company aims for sustained, durable growth by leveraging AI technology to enhance the shopping experience [15] - Management anticipates Q1 2026 GMS growth in the range of 2%-4% year-over-year, with expectations for positive growth throughout the year [34] Other Important Information - The company plans to use proceeds from the Depop sale for general corporate purposes, share repurchases, and investment in the Etsy marketplace [27] - For the full year 2025, Depop generated $1.1 billion in GMS and $187 million in revenue, impacting consolidated margins [28] Q&A Session Summary Question: Improvement in gross buyer adds and reactivated buyers - Management noted that cumulative investments in product experience, app usage, and personalized marketing contributed to the improvement in buyer metrics, indicating sustainability in these trends [40] Question: Key drivers of sustaining GMS growth - Management emphasized that the four strategic priorities work as a system to drive durable growth, focusing on discovery, matching, loyalty, and differentiation [45] Question: Traffic from AI platforms and its impact - Management observed that early signs indicate agentic platforms can serve as valuable discovery channels, with higher intent and average order value among users engaging through these platforms [58]

Financial Data and Key Metrics Changes - Consolidated GMS for Q4 was $3.6 billion, up 2.4% year-over-year, excluding Reverb, and up 1.3% year-over-year on a currency-neutral basis [20] - Consolidated revenue reached $882 million, up 6.6% year-over-year, marking a new quarterly record [20] - Adjusted EBITDA was $222 million, representing a consolidated adjusted EBITDA margin of 25.2% [20] - Etsy Marketplace adjusted EBITDA margin was slightly above 30% in Q4, though slightly lower year-over-year due to higher costs [21] Business Line Data and Key Metrics Changes - Etsy Marketplace GMS was up 0.1% year-over-year in Q4, marking the first positive comparison since Q3 2023 [21] - U.S. buyer GMS grew 0.3% year-over-year, marking the first quarter of positive growth in four years [23] - Depop's Q4 GMS was up nearly 38% year-over-year to a new record of $300 million, with U.S. GMS growing 60% year-over-year [27] Market Data and Key Metrics Changes - Mobile app downloads grew 4% year-over-year, with app GMS growth accelerating in Q4 [24] - The app's contribution to total GMS reached 46% in Q4, five percentage points higher than at the end of 2023 [24] - The year-over-year rate of decline in active buyers improved for the first time in over a year, with active buyers largely flat sequentially at 86.5 million [25] Company Strategy and Development Direction - The company signed a definitive agreement to sell Depop to eBay for $1.2 billion, allowing a focus on growing the Etsy marketplace [4] - Strategic priorities include improving discovery, matching buyers with items, deepening loyalty, and enhancing human connection [10] - The company reorganized around customer outcomes rather than functional silos to drive clearer focus and better execution [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the changes made, noting that the trajectory is improving with a return to growth in the core marketplace [12] - The company anticipates first quarter 2026 GMS to be in the range of $2.38 billion to $2.43 billion, representing year-over-year growth of approximately 2%-4% [34] - Management highlighted the importance of AI technology in enhancing the shopping experience and driving growth [15] Other Important Information - The company plans to use proceeds from the Depop sale for general corporate purposes, continued share repurchases, and investment in the Etsy marketplace [27] - Etsy held $1.8 billion in cash and equivalents as of December 31, 2025, with $735 million in adjusted EBITDA generated in 2025 [32] Q&A Session Summary Question: What changed in Q4 regarding buyer acquisition and reactivation? - Management noted that cumulative investments in product experience, app usage, and personalized marketing contributed to improved buyer metrics [40] Question: What are the key drivers of sustaining GMS growth through 2026? - The company emphasized a system of strategic priorities focused on discovery, matching, loyalty, and differentiation to drive durable growth [45] Question: How is the company leveraging AI and agentic platforms for consumer behavior? - Management indicated that early signs show agentic platforms can be valuable for discovery, with higher intent and average order value from consumers engaging through these channels [58]