Stay-at-home orders and the mass work-from-home (WFH) migration that flew in the face of America’s sense of freedom acted as a tailwind for handmade eCommerce marketplace Etsy, pushing active buyers and sellers way up during the first quarter.
Buoyed by the digital shift that had moved most shopping online and out of physical stores by mid-March, Etsy was well-positioned for the lockdown as people took to vintage crafts, collectibles and the other homey merchandise for which the eCommerce brand is known.
Etsy reported Wednesday (May 6) that active buyers grew 16.4 percent year-over-year, with active sellers growing 26.4 percent in the same period. Total first-quarter revenue was $228.1 million, an increase of 34.7% year over year, which the company attributed to revenue growth in both its Marketplace and Services segments. Gross profit was $145.6 million, an increase of 24.8% year-over-year. First-quarter net income was $12.5 million.
Etsy CFO Rachel Glaser noted that while “we continue to be disciplined in our spending, optimizing for efficiencies in our cost base as well as in capital spending, our marketplace model allows Etsy to respond to changing conditions more rapidly than traditional retail models, resulting in solid profitability for the first quarter of 2020.
“Because we don’t have significant fixed costs in our structure such as inventory, retail stores, and fulfillment infrastructure, we have been able to stay focused and prioritize investments that will continue to drive top-line growth,” she said.
Among other first-quarter highlights was the fact that gross merchandise sales (GMS) per active buyer on a trailing 12-month basis grew for the eighth consecutive quarter to 4 percent year over year. GMS per active buyer also rose 6 percent on a two-year stacked basis. “These statistics represent further evidence of our continued progress improving frequency,” the company said in a statement.
Etsy had foreshadowed the positive earnings report in early April when CEO Josh Silverman said during a webcast that consolidated GMS growth between January and February were 41 percent higher year over year, dubbing the pandemic a “mindshare” event.
Sign up for the PYMNTS.com Newsletter to get updates on top stories and viral hits.