“Depop has been largely overlooked by investors, so the valuation Etsy secured appears to be a positive surprise,” said CFRA analyst Arun Sundaram.While the platform has expanded rapidly, it has been “significantly less profitable than the main Etsy marketplace,” and the divestiture should improve Etsy’s margins and overall financial profile, he said.
The sale of Depop, which Etsy acquired for $1.63 billion in 2021, is expected to close in the second quarter of 2026. The company had also sold its online music equipment marketplace, Reverb, to private investors in 2025 to focus on its core business.
Etsy posted fourth-quarter revenue of $881.6 million, below the average analyst estimate of $884.9 million, according to data compiled by LSEG.
Gross merchandise sales (GMS) – a key sales metric – on the Etsy marketplace fell 1% on a currency-neutral basis to $3.29 billion during the quarter. Adjusted earnings before interest, taxes, depreciation and amortization came to $222.5 million, while analysts estimated $213.5 million.
The company expects first-quarter GMS to be $2.38 billion to $2.43 billion, up from the $2.8 billion reported a year earlier. For the full year 2026, Etsy expects GMS to grow modestly, supported by marketing initiatives.
“We assume that macroeconomic conditions, especially those affecting consumer discretionary spending, will remain stable compared to where they are today,” Chief Financial Officer Lanny Baker said after the earnings report.
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