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1. Company Snapshot

1.a. Company Description

Etsy, Inc.operates two-sided online marketplaces that connect buyers and sellers primarily in the United States, the United Kingdom, Germany, Canada, Australia, France, and India.Its primary marketplace is Etsy.com that connects artisans and entrepreneurs with various consumers.


The company also offers Reverb, a musical instrument marketplace; Depop, a fashion resale marketplace; and Elo7, a Brazil-based marketplace for handmade and unique items.In addition, it offers various seller services, including Etsy Payments, a payment processing service; Etsy Ads, an advertising platform; and Shipping Labels, which allows sellers in the United States, Canada, the United Kingdom, Australia, and India to purchase discounted shipping labels.Further, the company provides various seller tools, including Shop Manager dashboard, a centralized hub for Etsy sellers to track orders, manage inventory, view metrics and statistics, and have conversations with their customers; and Sell on Etsy, an application to enable enhanced onboarding and video uploading.


Additionally, it offers Etsy seller analytics pages that provides insights regarding traffic acquisition for their shops; Targeted Offers, a sales and promotions tool, and social media tool; and accounting and bookkeeping services.The company also provides educational resources comprising blog posts, video tutorials, Etsy Seller Handbook, Etsy.com online forums, and insights; Etsy Teams, a platform to build personal relationships with other Etsy sellers; and a Star Seller program.As of December 31, 2021, it connected a total of 7.5 million active sellers to 96.3 million active buyers; and had 120 million items for sale.


The company was formerly known as Indieco, Inc changed its name to Etsy, Inc.in June 2006.Etsy, Inc.


was founded in 2005 and is headquartered in Brooklyn, New York.

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1.b. Last Insights on ETSY

Etsy's recent performance was negatively impacted by a decline in gross merchandise sales (GMS) and a decrease in active buyers and sellers. The company's Q3 earnings beat expectations, but the stock tumbled following the announcement of CEO Josh Silverman's departure and a 6.5% decrease in GMS. Additionally, World Investment Advisors reduced its stake in Etsy by 21.5%, and Teacher Retirement System of Texas cut its position by 17.3%. The company's margins are under pressure, and adjusted EBITDA is declining year-over-year. Leadership changes and sales disappointments have raised concerns about future prospects.

1.c. Company Highlights

2. Etsy's Q3 2025 Earnings: A Strong Performance

Etsy's financial performance in Q3 2025 was robust, with consolidated revenue reaching $678 million, up 2.4% on a reported basis. The company's adjusted EPS came in at $0.63, beating estimates of $0.52. The consolidated take rate improved to 24.9%, ahead of guidance and up 90 basis points sequentially. This strong performance was driven by the growth in Services revenue, which rose 12.7% year-over-year, primarily due to the increase in Onsite Ad revenue at both Etsy and Depop.

Publication Date: Nov -01

📋 Highlights
  • Leadership Transition:: Josh Silverman transitioned to Executive Chair, with Kruti Patel Goyal as new CEO effective January 1, 2026.
  • Financial Performance:: Consolidated GMS of $2.72 billion (exceeding guidance), Etsy marketplace GMS down 2.4% YoY (-2.4%), but improved 300 bps sequentially; Depop GMS surged 39.4% YoY to $292 million.
  • App Growth:: Mobile app GMS outperformed non-app GMS by 13 percentage points in Q3, contributing 46% of total GMS, with 9% YoY growth in app downloads.
  • Strategic Priorities:: Kruti outlined four priorities: expanding shopper discovery, tailoring item matches, deepening community loyalty, and amplifying Etsy’s unique value proposition.
  • Cash Flow & Buybacks:: Generated $200 million free cash flow in Q3 ($635 million trailing 12 months), repurchased $120 million in shares, ending with $1.6 billion in cash and investments.

Revenue Growth and Profitability

The revenue growth was largely driven by the company's focus on improving its marketplace and services. Marketplace revenue decreased 1.7% year-over-year, largely due to the Reverb divestiture, but Services revenue growth more than offset this decline. The company's profitability profile remains a strength, with a consolidated adjusted EBITDA margin expected to be approximately 24%.

GMS Performance and Category Trends

Consolidated GMS reached $2.72 billion, exceeding the top end of the guidance range. Etsy marketplace GMS was down 2.4% year-over-year but showed sequential improvement of 300 basis points. Depop's GMS grew 39.4% year-over-year to $292 million. The company saw encouraging improvements in GMS performance across most of its top 6 categories, with strong performance in Vintage Home & Living, jewelry above $100, and wedding and engagement rings.

Operational Highlights and Strategic Priorities

The company is focusing on its strategic priorities, including showing up where shoppers discover, matching them with items that feel tailor-made, deepening loyalty across the community, and amplifying what sets Etsy apart. The new CEO, Kruti Patel Goyal, is emphasizing delivering robust, sustainable growth and has outlined plans to invest in personalization, rewards, and retention benefits to increase GMS per buyer.

Valuation and Growth Prospects

With a P/E Ratio of 33.81 and an EV/EBITDA of 9.28, the market is pricing in a certain level of growth for Etsy. Analysts estimate revenue growth at 1.9% for next year. The company's Free Cash Flow Yield is 10.89%, indicating a strong ability to generate cash. The ROE is -18.65%, but this is expected to improve as the company continues to grow and invest in its business. Overall, Etsy's strong financial performance and strategic priorities position the company for long-term success.

3. NewsRoom

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Arrowstreet Capital Limited Partnership Acquires 1,416,772 Shares of Etsy, Inc. $ETSY

Dec -03

Source: defenseworld.net

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AI Pushes Black Friday E-Commerce Sales to a Record-High: 5 Picks

Dec -01

Source: zacks.com

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54% of consumers use AI for holiday shopping support: Simon-Kucher

Nov -26

Source: youtube.com

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Envestnet Asset Management Inc. Has $2.99 Million Position in Etsy, Inc. $ETSY

Nov -16

Source: defenseworld.net

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Head to Head Contrast: Etsy (NYSE:ETSY) vs. Avenir Wellness Solutions (OTCMKTS:CURR)

Nov -15

Source: defenseworld.net

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Etsy to Participate in Upcoming Investor Conferences

Nov -12

Source: prnewswire.com

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Teacher Retirement System of Texas Has $1.46 Million Position in Etsy, Inc. $ETSY

Nov -05

Source: defenseworld.net

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World Investment Advisors Reduces Stock Position in Etsy, Inc. $ETSY

Nov -05

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.77%)

6. Segments

Marketplace

Expected Growth: 5.5%

Etsy's marketplace growth of 5.5% is driven by increasing active buyers and sellers, expansion into new categories, and improved user experience. Strong demand for unique, handmade, and vintage items, as well as growing adoption of e-commerce, contribute to the growth. Additionally, Etsy's investments in marketing, shipping, and payment capabilities enhance the overall platform experience, attracting more buyers and sellers.

Services

Expected Growth: 6.5%

Etsy's 6.5% growth is driven by increasing demand for unique, handmade, and vintage items, as well as the platform's expanding presence in international markets. Additionally, the company's focus on improving user experience, enhancing search functionality, and investing in marketing efforts have contributed to its growth.

7. Detailed Products

Handmade Products

Unique, handmade items such as jewelry, clothing, accessories, and home decor created by independent sellers.

Vintage Items

Gently used, unique, and rare items from past decades, including clothing, accessories, and home decor.

Craft Supplies

Materials and tools for crafting, including fabric, yarn, beads, and other creative materials.

Digital Goods

Digital files, such as printables, templates, and tutorials, for creative projects and small businesses.

Etsy Payments

A payment processing system for sellers to manage transactions and track sales.

Etsy Ads

A platform for sellers to advertise their products and reach a targeted audience.

Etsy Plus

A subscription-based service offering additional features and tools for sellers to manage and grow their business.

8. Etsy, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Etsy's unique marketplace model and strong brand recognition reduce the threat of substitutes, but some customers may still opt for alternative platforms or DIY solutions.

Bargaining Power Of Customers

Individual customers have limited bargaining power due to Etsy's large customer base and the platform's ability to attract new buyers.

Bargaining Power Of Suppliers

Etsy's large supplier base and the ease of onboarding new sellers reduce the bargaining power of individual suppliers.

Threat Of New Entrants

While entering the market requires significant investment, new entrants could potentially disrupt Etsy's market share if they offer innovative features or better user experiences.

Intensity Of Rivalry

The online marketplace industry is highly competitive, with established players like Amazon and eBay, as well as niche platforms, competing for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 129.46%
Debt Cost 3.95%
Equity Weight -29.46%
Equity Cost 13.94%
WACC 1.00%
Leverage -439.48%

11. Quality Control: Etsy, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Ulta Beauty

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Growth: 7.7

Quality: 6.5

Yield: 0.0

Momentum: 9.0

Volatility: 6.7

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Etsy

A-Score: 5.4/10

Value: 6.0

Growth: 7.8

Quality: 7.0

Yield: 0.0

Momentum: 8.5

Volatility: 3.3

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Value: 5.7

Growth: 4.6

Quality: 4.0

Yield: 0.0

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RH

A-Score: 2.9/10

Value: 6.9

Growth: 2.9

Quality: 4.4

Yield: 0.0

Momentum: 1.5

Volatility: 2.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

53.43$

Current Price

53.43$

Potential

0.00%

Expected Cash-Flows