Etsy

NASDAQ: ETSY

Revenue

$2.76B

+0.7% FY2025 annual

Gross margin

73.4%

−63 bps FY2025 annual

GMS

$11.4B

Free Cash Flow to Firm

$517.43M

Last twelve months to June 30, 2026^†

Etsy reports Depop as a discontinued operation from its Q1 2026 10-Q and sold it to eBay on July 30, 2026, so quarters are shown from Q1 2026. Last-twelve-months income-statement figures are FY2025 without Depop (Etsy’s pro forma 8-K exhibit), less the first half of 2025 restated without it, plus the first half of 2026; growth compares FY2025 with FY2024, both without Depop. No filing yet restates the second half of 2025, so capex, D&A, stock-based compensation, the working-capital change and GMS include Depop for July–December 2025. Net income and the cash-flow totals (operating, investing and financing cash flow and the net change in cash) are whole-company figures as printed and include Depop for all twelve months.

Business overview

Company overview

Etsy operates online marketplaces that connect independent sellers with buyers around the world. The Etsy marketplace is its main business, selling unique and creative goods. It also owns Depop, a fashion resale marketplace, which it agreed in February 2026 to sell to eBay for $1.2 billion in cash. It sold its Reverb musical-instrument marketplace in June 2025.

How Etsy makes money

Etsy earns fees from sellers. Marketplace revenue comes mainly from transaction fees, payments processing fees, and listing fees. Services revenue comes from optional seller services, mainly on-site advertising and shipping labels. Revenue therefore depends on how much buyers spend on the platform (GMS), on fee rates, and on how many sellers pay for advertising and shipping.

Bull case

Marketplace GMS returned to slight growth in the fourth quarter of 2025 and Etsy expects growth in 2026. Services revenue, led by advertising, grew 11% in 2025 while marketplace revenue was roughly flat. Etsy generates strong operating cash flow, has been buying back shares, and expects to use the Depop sale proceeds for buybacks and investment in the Etsy marketplace.

Bear case

Consolidated GMS fell in each of the last three years and active buyers have slipped, so demand on the platform is under pressure. Etsy carries about $3 billion of debt, including convertible notes, and has negative shareholders’ equity after years of buybacks. Selling Depop removes a fast-growing business, and stock-based compensation remains a large cost.