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Etsy's gross merchandise sales (GMS) in Q2 reached $3.0 billion, down 0.6% year over year. Meanwhile, Etsy revenue reached $628.9 million, up 7.5% from the year-ago period.

Etsy Inc.’s active buyers reached an all-time high in its fiscal second quarter ended June 30, 2023. Still, Etsy’s gross merchandise sales (GMS) were largely flat.

Etsy gross merchandise sales (GMS)

Etsy sales in Q2 reached $3.0 billion. That’s down 0.6% year over year. Whereas Etsy sales were nearly flat, revenue grew. Etsy revenue reached $628.9 million. That’s up 7.5% from the year-ago period.

The marketplace’s active buyers grew 3% year over year to reach 91 million. It acquired 6 million new buyers and retained 21% more buyers than during the year-ago period. Etsy “retained active buyers at levels above pre-pandemic rates,” it said in an Aug. 2 earnings press release. “On a quarterly basis, active buyer retention trends improved both from the prior year and prior quarter.”

Etsy GMS per active buyer declined 6% year over year to $128 in Q2. The number of habitual buyers “was largely flat” at 7 million.

CEO Josh Silverman said more than a quarter of GMS comes from buyers who purchased again within 14 days of their prior purchase.


Silverman said about 14% of GMS from wedding registries came from new buyers. He added that Etsy is experiencing higher-than-average order value from those items.

“While GMS per buyer has shown early signs of stabilization, taking this metric to new heights is a top priority for us,” Silverman said.

Etsy ranks No. 17 in Digital Commerce 360’s new 2023 Global Online Marketplaces Report. The Global Online Marketplaces Database ranks the 100 largest such marketplaces by 2023 third-party GMV.

The online sales of mass merchants like Etsy grew 5.6% in 2022, outpacing the growth rate of total U.S. retail sales (3.3%), according to a Digital Commerce 360 analysis of U.S. Department of Commerce retail data.


Etsy wields AI, machine learning tools

Silverman attributed positive trends to the number of items available on Etsy and the average search result yielding more than 1,000 listings.

“Our product teams are helping buyers more easily navigate the breadth and depth of our sellers’ inventory leveraging the latest AI advances to improve our discovery and inspiration experiences, while surfacing the very best of Etsy,” Silverman said.

He said Etsy has more than double the size of its “Best of Etsy” library in the past quarter. He said expert merchandisers curate the library based on items’ visual appeal, uniqueness and apparent craftsmanship.

“We’re now using this library to train our ML (machine learning) models to better predict of quality of items as perceived by humans,” Silverman said. “We’re seeing encouraging results from first iterations on these models, and I’m optimistic that this work will have a material impact helping us to surface the best of Etsy in every search.”


He said specific to Etsy’s trust and safety, advances in AI and machine learning have enable enforcement models to detect an increasing number of policy violations. Combined with “human knowhow,” he said, that “is starting to have a meaningful impact on the buyer and seller experience.”

Similar to Ebay, Etsy is using artificial intelligence and machine learning to:

  • Enhance buyer search and recommendations
  • Streamline sellers’ listing process
  • Assist with customer queries
  • Improve fraud detection and safety models

Etsy agrees to sell Elo7

Silverman said Etsy agreed two weeks before its Q2 earnings call to sell its Brazil-based handmade goods marketplace, Elo7. It sold Elo7 to Enjoei, a Brazilian company that operates an online marketplace for clothes and furniture.


Etsy acquired Elo7 in July 2021 and sold it last month for $217 million, according to a Business Insider report.

Moreover, Etsy also owns marketplaces Reverb (No. 45) and Depop (No. 58).

Etsy earnings

For the fiscal second quarter ended June 30, Etsy Inc. reported:

  • Active buyers reached 91 million. That’s 3% growth and a new company record.
  • Etsy gross merchandise sales, or GMS, declined to $3.01 billion. That’s down 0.6% from $3.03 billion in the second quarter of fiscal 2022.
  • Etsy revenue grew to $628.88 million. That’s up 7.5% from $585.14 million in the year-ago period.

For the fiscal first half ended June 30, Etsy Inc. reported:

  • Etsy gross merchandise sales, or GMS, declined to $6.11 billion. That’s down 2.7% from $6.28 billion in the first half of fiscal 2022.
  • Etsy revenue grew to $1.27 billion. That’s up 9.0% from $1.16 billion in the year-ago period.
  • Etsy active sellers grew to 8.31 million. That’s up 12.3% from 7.4 million in the previous year.

Percentage changes may not align exactly with dollar figures due to rounding.

Check back for more earnings reports.


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