Etsy Faces Sales Decline Amid Market Challenges
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Oct 23 2024
0mins
Should l Buy ETSY?
Source: Business Insider
Etsy Inc. shares rose 5.02% as the stock reached a 5-day high.
Despite the price increase, Etsy is grappling with significant sales challenges, as its gross merchandise sales fell by 5.3% year-over-year. The company recently sold its Depop service for $1.2 billion, a notable loss compared to the $1.625 billion it paid in 2021, which raises concerns about its competitive position and future investor confidence. The overall outlook remains bleak, with a decline in active buyers and sellers impacting net income and revenue growth prospects.
This situation suggests that while the stock price has increased, underlying business challenges may hinder long-term performance, prompting investors to reassess their positions.
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Analyst Views on ETSY
Wall Street analysts forecast ETSY stock price to rise
26 Analyst Rating
6 Buy
18 Hold
2 Sell
Hold
Current: 53.940
Low
52.00
Averages
67.71
High
80.00
Current: 53.940
Low
52.00
Averages
67.71
High
80.00
About ETSY
Etsy, Inc. operates two-sided online marketplaces that connect buyers and sellers around the world. The Company's primary marketplace, Etsy.com, is the global destination for goods made by independent sellers. In addition to its core Etsy marketplace, its House of Brand consists of Depop Limited (Depop), which is its fashion resale marketplace. Each marketplace primarily operates independently, while benefiting from shared expertise in product development, marketing, technology, and customer support. The Company's top six retail categories on the Etsy marketplace include homewares and home furnishings, jewelry and personal accessories, apparel, craft supplies, paper and party supplies, and toys and games.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Etsy and Nike Face Declining Sales Challenges
- Etsy's Sales Struggles: Etsy's gross merchandise sales dropped by 5.3% year-over-year in 2025, indicating a trend of customer loss and profit decline, although Q4 showed a slight recovery of 2.4% when excluding Reverb sales, the overall outlook remains bleak.
- Depop Sale Loss: Etsy sold Depop for $1.2 billion, significantly lower than the $1.625 billion it paid in 2021, highlighting the company's weakened position in market competition, which may affect future investor confidence.
- Nike's Revenue Stagnation: Nike has experienced a -2.27% CAGR over the past three years, indicating a continuous loss of market share; while wholesale revenue grew by 5% year-over-year, direct sales fell by 4%, reflecting overall growth challenges.
- Tesla's Growth Challenges: Tesla's revenue declined by 3% year-over-year in 2025, with a 10% drop in automobile sales; despite exceeding a $1 trillion market cap, a P/E ratio above 300 indicates immediate valuation risks, as long-term growth potential has yet to materialize meaningfully.
See More
Investment Risk Alert: Etsy, Nike, Tesla
- Etsy Sales Decline: Etsy's gross merchandise sales fell by 5.3% year-over-year, and despite a slight recovery in Q4 excluding Reverb sales, the overall decrease in active buyers and sellers led to a drop in net income, indicating a weakening market appeal that could hinder future revenue growth.
- Nike Revenue Struggles: Nike has experienced a -2.27% CAGR over the past three years, with wholesale revenue up 5% year-over-year but offset by a 4% decline in direct sales, reflecting a loss of market share and casting doubt on future growth prospects.
- Tesla Profitability Risks: Despite Tesla exceeding a $1 trillion market cap, its revenue dipped by 3% year-over-year in 2025, with a 10% decline in automobile sales and a 46% drop in GAAP net income, highlighting significant growth challenges that investors should be wary of.
- Market Sentiment Shift: As these companies face fundamental issues, investors may need to reassess the risks of holding these stocks, especially ahead of their upcoming earnings reports, which could impact stock performance.
See More
eBay's Long-Term Returns Outpace Market
- Stable Compound Growth: eBay has achieved a 14.3% annual compound growth rate over the past decade, and with a 1.5% dividend policy, its total annual return reaches 15.8%, surpassing the S&P 500's 14.2% return, highlighting its robust investment value.
- Shareholder-Friendly Capital Allocation: In 2025, eBay returned approximately $3 billion to shareholders through buybacks and dividends, with its share count down by 62% since the end of 2015, indicating a focus on stable margins rather than endless expansion.
- Acquisition Brings New Opportunities: eBay's pending $12 billion acquisition of Etsy's Depop service is expected to attract millions of young users, refreshing its demographic, while management guides for 2026 GMV growth similar to last year's 6% increase.
- Clear Market Positioning: eBay focuses on connecting buyers and sellers of rare or collectible items, and despite risks from sluggish European economies and shifting trade policies, its clear market target makes it more defensible, appealing to long-term investors.
See More
eBay Outperforms S&P 500 with 15.8% Annual Return
- Return Performance: eBay has achieved a 15.8% annualized total return over the past decade, slightly surpassing the S&P 500's 14.2%, indicating its robust growth potential in the e-commerce market.
- Share Buyback Strategy: Since 2015, eBay has reduced its share count by 62% through aggressive buyback programs, which not only boosts earnings per share but also enhances shareholder confidence in returns.
- Acquisition of Younger Users: eBay's pending $12 billion acquisition of Etsy's Depop is expected to bring 56 million younger users to the platform, facilitating a demographic refresh that strengthens its market competitiveness.
- Capital Return Policy: In 2025, eBay returned approximately $3 billion to shareholders through buybacks and dividends, showcasing its shareholder-friendly capital allocation strategy and reinforcing its appeal as a long-term investment.
See More
Chewy Reports Strong Q4 Results with Sales Beat
- Significant Sales Growth: Chewy's Q4 net sales reached $3.2647 billion, surpassing the market expectation of $3.256 billion, reflecting a 0.5% year-over-year increase that demonstrates the company's ability to gain market share in a stable environment.
- Strong Customer Growth: The number of active customers reached 21.3 million, a 4% year-over-year increase, indicating ongoing improvements in customer acquisition and retention, which enhances the sustainability of future revenues.
- Margin Expansion: Gross profit increased by 3.6% year-over-year to $959.7 million, with gross margin expanding to 29.4%, primarily driven by growth in higher-margin categories and increased advertising revenue, showcasing the company's operational efficiency success.
- Robust Cash Flow: The company generated free cash flow of $232 million in Q4, with a record annual free cash flow of $562.4 million, indicating a strong liquidity position while committing to shareholder returns, further boosting investor confidence.
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Surge in Options Trading Volume for Etsy and Netgear
- Etsy Options Volume: Etsy Inc saw options trading volume of 14,744 contracts, equating to approximately 1.5 million shares, which represents about 52% of its average daily trading volume of 2.8 million shares over the past month, indicating heightened market interest in its future performance.
- High Demand for Call Options: Notably, the $50 strike call option expiring on May 15, 2026, has seen 948 contracts traded today, representing around 94,800 underlying shares, reflecting investor expectations for a price increase in Etsy's stock.
- Netgear Options Activity: Netgear Inc's options trading volume reached 2,183 contracts, equivalent to approximately 218,300 shares, accounting for 50.8% of its average daily trading volume of 429,475 shares over the past month, showcasing active market interest in its stock.
- Put Options Trading Insights: Particularly, the $25 strike put option expiring on June 18, 2026, has recorded 800 contracts traded today, representing about 80,000 underlying shares, indicating investor concerns regarding a potential decline in Netgear's future stock price.
See More
Etsy and Nike Face Declining Sales Challenges
- Etsy's Sales Struggles: Etsy's gross merchandise sales dropped by 5.3% year-over-year in 2025, indicating a trend of customer loss and profit decline, although Q4 showed a slight recovery of 2.4% when excluding Reverb sales, the overall outlook remains bleak.
- Depop Sale Loss: Etsy sold Depop for $1.2 billion, significantly lower than the $1.625 billion it paid in 2021, highlighting the company's weakened position in market competition, which may affect future investor confidence.
- Nike's Revenue Stagnation: Nike has experienced a -2.27% CAGR over the past three years, indicating a continuous loss of market share; while wholesale revenue grew by 5% year-over-year, direct sales fell by 4%, reflecting overall growth challenges.
- Tesla's Growth Challenges: Tesla's revenue declined by 3% year-over-year in 2025, with a 10% drop in automobile sales; despite exceeding a $1 trillion market cap, a P/E ratio above 300 indicates immediate valuation risks, as long-term growth potential has yet to materialize meaningfully.
See More
Investment Risk Alert: Etsy, Nike, Tesla
- Etsy Sales Decline: Etsy's gross merchandise sales fell by 5.3% year-over-year, and despite a slight recovery in Q4 excluding Reverb sales, the overall decrease in active buyers and sellers led to a drop in net income, indicating a weakening market appeal that could hinder future revenue growth.
- Nike Revenue Struggles: Nike has experienced a -2.27% CAGR over the past three years, with wholesale revenue up 5% year-over-year but offset by a 4% decline in direct sales, reflecting a loss of market share and casting doubt on future growth prospects.
- Tesla Profitability Risks: Despite Tesla exceeding a $1 trillion market cap, its revenue dipped by 3% year-over-year in 2025, with a 10% decline in automobile sales and a 46% drop in GAAP net income, highlighting significant growth challenges that investors should be wary of.
- Market Sentiment Shift: As these companies face fundamental issues, investors may need to reassess the risks of holding these stocks, especially ahead of their upcoming earnings reports, which could impact stock performance.
See More
eBay's Long-Term Returns Outpace Market
- Stable Compound Growth: eBay has achieved a 14.3% annual compound growth rate over the past decade, and with a 1.5% dividend policy, its total annual return reaches 15.8%, surpassing the S&P 500's 14.2% return, highlighting its robust investment value.
- Shareholder-Friendly Capital Allocation: In 2025, eBay returned approximately $3 billion to shareholders through buybacks and dividends, with its share count down by 62% since the end of 2015, indicating a focus on stable margins rather than endless expansion.
- Acquisition Brings New Opportunities: eBay's pending $12 billion acquisition of Etsy's Depop service is expected to attract millions of young users, refreshing its demographic, while management guides for 2026 GMV growth similar to last year's 6% increase.
- Clear Market Positioning: eBay focuses on connecting buyers and sellers of rare or collectible items, and despite risks from sluggish European economies and shifting trade policies, its clear market target makes it more defensible, appealing to long-term investors.
See More
eBay Outperforms S&P 500 with 15.8% Annual Return
- Return Performance: eBay has achieved a 15.8% annualized total return over the past decade, slightly surpassing the S&P 500's 14.2%, indicating its robust growth potential in the e-commerce market.
- Share Buyback Strategy: Since 2015, eBay has reduced its share count by 62% through aggressive buyback programs, which not only boosts earnings per share but also enhances shareholder confidence in returns.
- Acquisition of Younger Users: eBay's pending $12 billion acquisition of Etsy's Depop is expected to bring 56 million younger users to the platform, facilitating a demographic refresh that strengthens its market competitiveness.
- Capital Return Policy: In 2025, eBay returned approximately $3 billion to shareholders through buybacks and dividends, showcasing its shareholder-friendly capital allocation strategy and reinforcing its appeal as a long-term investment.
See More
Chewy Reports Strong Q4 Results with Sales Beat
- Significant Sales Growth: Chewy's Q4 net sales reached $3.2647 billion, surpassing the market expectation of $3.256 billion, reflecting a 0.5% year-over-year increase that demonstrates the company's ability to gain market share in a stable environment.
- Strong Customer Growth: The number of active customers reached 21.3 million, a 4% year-over-year increase, indicating ongoing improvements in customer acquisition and retention, which enhances the sustainability of future revenues.
- Margin Expansion: Gross profit increased by 3.6% year-over-year to $959.7 million, with gross margin expanding to 29.4%, primarily driven by growth in higher-margin categories and increased advertising revenue, showcasing the company's operational efficiency success.
- Robust Cash Flow: The company generated free cash flow of $232 million in Q4, with a record annual free cash flow of $562.4 million, indicating a strong liquidity position while committing to shareholder returns, further boosting investor confidence.
See More
Surge in Options Trading Volume for Etsy and Netgear
- Etsy Options Volume: Etsy Inc saw options trading volume of 14,744 contracts, equating to approximately 1.5 million shares, which represents about 52% of its average daily trading volume of 2.8 million shares over the past month, indicating heightened market interest in its future performance.
- High Demand for Call Options: Notably, the $50 strike call option expiring on May 15, 2026, has seen 948 contracts traded today, representing around 94,800 underlying shares, reflecting investor expectations for a price increase in Etsy's stock.
- Netgear Options Activity: Netgear Inc's options trading volume reached 2,183 contracts, equivalent to approximately 218,300 shares, accounting for 50.8% of its average daily trading volume of 429,475 shares over the past month, showcasing active market interest in its stock.
- Put Options Trading Insights: Particularly, the $25 strike put option expiring on June 18, 2026, has recorded 800 contracts traded today, representing about 80,000 underlying shares, indicating investor concerns regarding a potential decline in Netgear's future stock price.
See More
