Etsy Inc (NASDAQ:ETSY, ETR:3E2) shares tumbled almost 10% as the online marketplace’s holiday quarter sales came in below estimates.
For the fourth quarter, Etsy reported record revenue of $852.2 million, up 1.2% year-over-year but short of the $861.8 million expected by Street analysts.
Consolidated gross merchandise sales (GMS) fell 6.8% year-over-year to $3.7 billion. Analysts had expected GMS of $3.8 billion.
Etsy marketplace GMS fell 8.6% from the year-ago quarter to $3.3 billion, attributed to pressure on consumer discretionary product spending, challenging year-over-year comparisons in a shortened holiday season, category mix, and a highly promotional and competitive retail environment.
Earnings per share of $1.03, however, were ahead of estimates of $0.93.
“Despite facing significant GMS headwinds in 2024, we are proud to have delivered year-over-year revenue growth and very strong profitability, while simultaneously investing in our future,” Etsy CEO Josh Silverman said in a statement.
“Foundational improvements in the Etsy marketplace, particularly in quality, reliability, and in making our app a place for discovery, are already enhancing customer experiences, which we believe will further differentiate the Etsy experience, driving consideration and purchase frequency as we work to get back to GMS growth.”
Shares of Etsy traded down 9.4% at about $52 late morning on Wednesday.