Etsy Q4 Earnings: Sales Miss, Pressured Consumer Spending, Active Buyers Dip And More

Shares of e-commerce company Etsy Inc ETSY are trading lower after the fourth-quarter FY24 earnings result.

The company reported fourth-quarter sales growth of 1.2% year-on-year to $852.2 million, missing the analyst consensus estimate of $862.82 million.

Consolidated GMS declined 6.8% to $3.7 billion. EPS of $1.03 beat the consensus estimate of $0.94.

Etsy marketplace GMS decreased 8.6% to $3.3 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.

Active buyers declined 2.6% to 89.6 million. GMS per active buyer on a trailing twelve month basis slipped 3.5% to $121.

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Gross profit for the quarter increased 8.2% to $634.4 million with a gross margin of 74.4%. Operating expenses for the quarter rose 1.7% to $479.3 million. Operating income climbed 34.4% to $155.1 million and the operating margin expanded 450 basis points to 18.2%.

Adjusted EBITDA improved 6.4% to $250.64 million and the corresponsding EBITDA margin expanded 140 basis points to 29.4%.

The company held $1.2 billion in cash and equivalents as of December 31, 2024. The operating cash flow for the year totaled $752.5 million.

Outlook: Etsy expects first-quarter FY25 GMS to decline at a rate similar to the year-over-year performance reported for the fourth quarter of FY24.

The company expects first quarter adjusted EBITDA margin of about 25% – 26%.

Price Action: ETSY shares are trading lower by 10.2% at $51.48 at the last check Wednesday.

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