Etsy Misses Earnings Forecast, Reverses Seller Payment Policy — Retail Bum

Etsy’s forecast for the third quarter fell below market expectations, resulting in the company’s share value dipping by 6% in after-hours trading.

The company’s forecast reflects softening demand for handicrafts and other home decor products as consumers continue cutting back on discretionary purchases.

“Consumers continue to make very tough choices on where and how to spend their money, and we’re fighting hard to help our sellers get their share,” said Etsy CEO Joshua Silverman on a call with investors.

With student loan repayments set to resume in the coming months and the continued decline in consumers’ savings, Etsy’s sales figures are unlikely to see a significant rebound in the coming months.

For the last quarter that ended June 30, 2023, Etsy’s gross merchandise volume fell by 0.6% to $3.01 billion in the second quarter. Still, the company’s overall quarterly revenue of $628.9 million exceeded market expectations of $619.1 million, thanks to a 21% increase in its advertising revenue.

Looking ahead, the company expects to generate $610 million to $645 million in Q3 revenue, compared to analysts’ estimates of $4632.4 million.