Gross Merchandise Sales (GMS): $3 billion, down 3.7% year-over-year.
Revenue: Increased slightly by 0.8% to $646 million.
Adjusted EBITDA: $168 million, maintaining a healthy adjusted EBITDA margin of approximately 26%.
Etsy Marketplace GMS: Down 5.3% compared to the prior year.
Active Buyers: Held at a record-high level of 92 million, showing stability amidst declining sales.
Etsy Marketplace Active Buyers Growth: Grew by 2% year-over-year.
GMS Per Active Buyer: Decreased by 3.5% in the quarter.
Future Guidance
Consolidated GMS for April: Slightly improved, down about 2% year-over-year, benefiting from the timing shift of Easter.
Caution for Future: Despite early promising signs in April, the company remains cautious due to continued macroeconomic pressures.
Trends, Market Conditions, Sentiment
Discretionary Spending Declines: The steady decline in U.S. consumer discretionary spending continued through Q1 2024, affecting the types of merchandise Etsy sells.
Category Performance: Declines were seen across top categories, with craft supplies showing slight positive results.
Marketing Initiatives: Emphasized the launch of Gift Mode and expanded product feed testing across channels to improve inventory quality shown to users.
Technology Investments: Leveraged machine learning and AI to enhance customer experience and suppress listings violating policies, contributing to a cleaner shopping environment.
Macro Challenges: Continued macroeconomic challenges in key markets (U.S., U.K., Germany), including high costs of living and structural economic pressures.
E-commerce Competition: Larger e-commerce platforms grew by focusing on everyday essentials at low prices, highlighting a competitive challenge for discretionary goods platforms like Etsy.
Buyer Perception Efforts: Efforts to change buyer perception around Etsy’s value and convenience were highlighted as ongoing strategic priorities.
Product Development: Focused on making Etsy more engaging and inspiring for window shopping, not only directed searches.
Subsidiary Performance: Positive momentum from subsidiaries like Reverb and Depop, with both showing GMS growth outpacing their respective market segments.
Investor Sentiment: Despite the current challenges, leadership expressed confidence in strategic initiatives to set Etsy back on a growth path.
Notable Quotes
”GMS was just shy of $3 billion, down 3.7% from last year.” - Josh Silverman
”While U.S. unemployment is low and inflation data is mixed, consumer sentiment remains depressed.” - Josh Silverman
”Our key focus for 2024 is to continue to build consideration for Etsy.” - Josh Silverman
”We’re confident we’re working on areas that will positively impact Etsy in the months and years ahead.” - Josh Silverman
”We are not deterred. And as I’ve said to some of you, proving doubters wrong is frankly quite energizing for us.” - Josh Silverman
