Etsy reported revenue growth of about 129% in the fourth quarter.
Gabby Jones/Bloomberg
Etsy stock is jumping more than 10% early Friday, after the online marketplace posted upbeat fourth-quarter results. Sales continued to snowball in the quarter, with little help from the face masks that lifted results early in the pandemic.
Etsy (ticker: ETSY) said it earned $148.5 million, or $1.08 cents a share, compared with a quarter a share in the year-ago period. Revenue soared 128.7% to $617.4 million. Analysts were looking for EPS of 59 cents on revenue of $515.6 million.
The company said gross merchandise sales (GMS) on its marketplace—excluding mask sales—was $3.3 billion, a 118% year-over-year increase; 4% of Etsy’s GMS was from mask sales.
Looking ahead, Etsy said it expects revenue between $513 million to $536 million in the current first quarter, on GMS of $2.9 billion to $3.1 billion. Consensus calls for revenue of $530.2 million.
The company noted that the Covid-19 pandemic was a major tailwind to 2020 results. Chief Executive Officer Josh Silverman said in the earnings release that although its growth this year is “likely to decelerate off of last year’s high levels along with the rest of e-commerce, we have more conviction than ever to invest in our business for the long-term, building top of mind awareness in the hearts and minds of consumers, with an ambition to outperform e-commerce and gain market share.”
Etsy surged 10.6% to $218.44 in recent trading. The shares have jumped more than 240% in the past year, and are up 11% since the start of 2021.
There was a lot to like the in quarter, beyond Etsy’s top- and bottom-line results coming in well ahead of expectations. Gross margins jumped 920 basis points to 75.6%, while active buyers and sellers grew more than 76% and 61%, respectively, in the period. GMS came in nearly double the low end of its initial guidance of 65% to 85% growth.
Of course, like all pandemic winners, Etsy faces tough year-over-year comparisons in the second quarter and beyond, and questions from investors as to how it will maintain its momentum. Yet investors may be taking heart from the increase in active users. In addition, repeat buyers are up 97% and habitual buyers—who make six or more purchases over a year and are even more valuable to the company—jumped 158%, the category with the best growth in the fourth quarter.
Write to Teresa Rivas at [email protected]
