Shares of Etsy Inc (NASDAQ:ETSY), the popular online arts and crafts marketplace, climbed to a new high today after revealing plans to take a bigger share of its vendors’ sales and increasing its full-year guidance.
The higher fees will be used to offset new investments in direct marketing and outreach and are set to provide an immediate jolt to Etsy's revenue.
The move to raise its fees is not likely to sit well with the legions of artisans who sell their goods via Etsy. But investors seemed quite pleased, sending shares 30% higher to US$42.71 and blowing past Wednesday's close of US$32.99.
Etsy now projects 2018 revenue to rise between 32% and 34%, up from its guidance last May of an increase between 22% and 24%.
Read: Etsy facing alternative scenarios, suggests broker Wedbush
Starting next month, the transaction fee charged when an Etsy seller makes a sale will rise to 5% from 3.5%.
The crafts marketplace will also roll out a tiered plan, whereby sellers can opt into Etsy Plus for an introductory rate of US$10 per month. The more extravagant Etsy Premium service, meanwhile, will cater to bigger and more established creative businesses.
In the year or so that Etsy’s new chief executive Josh Silverman has been at the helm, he has made moves to part with the company's ethically-minded reputation by slashing costs and abandoning the company’s BCorp designation that denotes higher corporate governance standards.
The stock has been on fire, doubling since the year started and more than tripling in the past 52 weeks.