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Consolidated GMS was down 4.6% year-over-year (down 2.6% on a currency-neutral basis) to $3.1 billion, impacted by consumer wallet share shifts from goods to services, year-over-year declines in some of the larger categories such as home and living and craft supplies, and pressure on consumer discretionary spending particularly for lower household income buyers.
Etsy marketplace GMS fell 4.7% year-over-year (down 2.6% on a currency-neutral basis) to $2.7B. Active buyers grew by 1% year-over-year to 89.9M, marking the first year-over-year growth since Q4/21.
The company expects Q2/23 revenue in the range of $590-$640M, compared to the consensus of $623.7M. GMS is expected in the range of $2.85-$3.10B.
Goldman Sachs analysts said Etsy proved to be “more resilient than feared”. Still, the new price target on ETSY stock is $130 (down from $140).
“Longer-term, we continue to believe that Etsy can execute against an array of platform and marketing levers and compound GMS & profit dollars above overall eCommerce growth once the operating environment normalizes,” they said.
Evercore ISI analysts see ETSY stock trading sideways in the near term. Similarly, they also remain bullish on Etsy long-term. The price target goes to $120 (down from $140).
“Etsy’s management team has excellent track record, the company generates healthy EBITDA and FCF, we believe Etsy should be able to grow faster than the overall eCommerce market over the next several years driven by growth catalysts (product improvements, geographic expansion, marketing spend), the company faces a very large TAM, and Etsy offers a differentiated value prop while benefiting from a very sticky user and seller base.”
Additional reporting by Senad Karaahmetovic
