Etsy has seen shares plummet 14 per cent despite beating analyst estimates over its second quarter as investors fear the pandemic driven online boom is coming to an end.
The online marketplace, which now owns Depop and Reverb, saw group revenues rise 23.4 per cent to $528.9 million in the three months to June 30, coming comfortably above analysts’ estimates of $525.8 million.
Meanwhile, the group saw net income edge up 1.9 per cent to $98,254 year-on-year, once again beating analyst estimates, although non-adjusted EBITDA dropped 7.4 per cent to $139.5 million.
Gross merchandise sales across its various platforms also grew 13.1 per cent over the period to $3.04 billion, alongside a 66 and 50 per cent growth in active sellers and buyers respectively.
Despite its seemingly positive quarterly figures, Etsy’s growth slowed down significantly compared to the heady gains made during pandemic quarters, seeing it enjoy triple digit growth over the last four quarters.
It also warned that this deceleration as due to increase, predicting revenues for the current quarter will come in between $500 million and $525 million, below analyst estimates of $527.5 million.
Investors’ fears were exacerbated by Etsy’s refusal to provide a full year guidance, blaming the “continued uncertainty of future macroeconomic conditions”.
“Etsy’s second quarter 2021 performance is quite remarkable when viewed in context of how dramatically the world changed during the year-ago period,” Etsy chief executive Josh Silverman said in a statement.
“It is deeply gratifying to me and our entire team that we are able to report strong year-over-year growth, with GMS and revenue up approximately 13 per cent and 23 per cent respectively.
“In fact, excluding facemasks, which were an important driver of the prior year period, second quarter GMS for the Etsy marketplace increased 31 per cent.”