Etsy Inc.’s core marketplace sales returned to growth in Q4 — its first year-over-year increase in two years — as the company begins to see early traction from strategic changes it rolled out in 2025.
The results came a day after Etsy said it would sell its resale fashion platform Depop to eBay for $1.2 billion in cash. The company expects the sale to further narrow Etsy’s focus to its namesake marketplace, which is showing early signs of stabilization.
For its fiscal Q4 ended Dec. 31, Etsy’s gross merchandise sales (GMS) on its primary marketplace totaled $3.29 billion, up 0.1% year over year.
On a consolidated basis, total GMS was $3.59 billion, including Depop sales. That’s down 3.8% from a year earlier, reflecting the absence of comparable sales from Reverb, the online music-gear marketplace Etsy sold in June.
Excluding Reverb’s prior-year contribution, consolidated GMS rose 2.4% year over year, Etsy said.
Revenue for the quarter reached $881.6 million, up 6.6% year over year on a comparable basis.
“We delivered record revenue, and we did so while continuing to invest for growth at both Etsy and Depop, all while maintaining very healthy profitability,” CEO Kruti Patel Goyal told investors on the marketplace’s quarterly earnings call.
Patel Goyal, who officially took the reins on Jan. 1, said the company remains confident its strategic changes are gaining traction. Looking ahead, the sale of Depop will allow Etsy to “focus exclusively” on growing its namesake marketplace “in ways that matter most to our buyers and sellers,” she said, calling the deal a positive outcome for shareholders.
Etsy ranks No. 20 in the Global Online Marketplaces Database. The database is Digital Commerce 360’s ranking of the 100 largest marketplaces by third-party gross merchandise value (GMV). Before Etsy sold Reverb, Reverb ranked No. 45 in the database. Depop currently ranks No. 49.
Marketplace trends show signs of Etsy sales stabilization in Q4
For its fiscal full-year 2025, Etsy’s total GMS was $11.92 billion, down 5.3% from 2024. Meanwhile, Etsy revenue increased 2.7% to $2.89 billion in 2025.
Etsy saw customer trends improve throughout 2025, executives said. From the first to the fourth quarter, Etsy’s year-over-year GMS comparisons for its core marketplace improved by nine percentage points. U.S. buyer GMS rose 0.3% in Q4 — its first increase in four years, Patel Goyal said.
Active buyers on the marketplace totaled 86.5 million, down 3.4% year over year, but nearly flat sequentially. Active sellers reached 5.6 million, down 1.5% from a year earlier but slightly higher than the prior quarter as retention improved, the company said.
During the quarter, Etsy added 6.8 million new buyers and reactivated 10.4 million shoppers. This brought total gross buyer additions to 17.2 million, up 2.7%.
Spending trends also showed signs of stabilization. Trailing 12-month GMS per active buyer was $121, down 0.5% year over year, but improving sequentially as declines moderated.
“Home and Living, our largest category, returned to positive year-over-year GMS growth, led by strength in high average order value subcategories where Etsy has high-quality differentiated items, such as vintage home decor, rugs and lighting,” chief financial officer Lanny Baker said on the call.
Etsy’s mobile engagement also strengthened further. App-based GMS grew 6.6% year over year and accounted for 46% of total GMS – five percentage points higher than at the end of 2023, Baker said. He noted that app users visit more often and convert at higher rates.
Depop grows rapidly ahead of planned sale
Etsy acquired Depop in 2021 for $1.63 billion. Even as it prepares to divest the secondhand apparel platform, Depop delivered strong fourth-quarter growth.
Depop’s GMS totaled $299.7 million, up 37.2% year over year on a currency-neutral basis. U.S. buyer GMS jumped 60.2%, fueled by new sign-ups and marketing momentum. Active sellers rose 41.1% to 3.2 million, while active buyers climbed 37.7% to 7 million.
Patel Goyal, who previously led Depop, said the platform is now the fastest-growing fashion resale marketplace in the U.S.
Etsy expects the $1.2 billion cash sale to eBay to close in the second quarter of 2026. Baker said proceeds will support share repurchases, general corporate purposes and reinvestment in the Etsy marketplace.
“We believe that obtaining a strong value for Depop now and focusing on Etsy, where we believe we can achieve a higher rate of return on invested capital, will best enable us to maximize shareholder value in the long term,” he said.
In a separate statement, eBay CEO Jamie Iannone said the acquisition strengthens eBay’s fast-growing position in recommerce fashion and expands its reach among younger shoppers. Nearly 90% of Depop’s 7 million active buyers are under age 34, according to the companies.
Agentic and AI shopping traffic accelerates
Etsy is also leaning further into artificial intelligence (AI) and agentic commerce.
The company was the first to participate in OpenAI’s “Instant Checkout” rollout, which allows shoppers to discover and purchase Etsy products directly within ChatGPT. It later expanded with partnerships with Google and Microsoft, enabling purchases through Google’s AI Mode, Gemini and Copilot Checkout. Etsy also partnered with Stripe to support agentic payments across platforms.
Agentic activity remains small but is growing rapidly. In the fourth quarter, traffic from these channels was roughly 15 times higher than a year earlier, Patel Goyal said, though still under 1% of total visits.
Early data suggests agentic shoppers may be high value. Patel Goyal said buyers arriving through these channels show higher purchase intent and average order values, with engagement spanning both new and returning customers.
“Orders originating from ChatGPT also tend to skew higher value compared to some of our more mature acquisition channels,” she said, adding that Etsy is seeing strong engagement with listings discovered through the platform.
Etsy is also applying AI to help sellers automate routine tasks. On the buyer side, the technology is “making discovery easier and more relevant, helping Etsy show up in more of the moments where inspiration begins,” Patel Goyal said.
Etsy projects a gradual return to growth
Patel Goyal said the company’s growth priorities are focused on four areas:
- Reaching shoppers earlier in their buying journeys.
- Improving product discovery through machine learning.
- Strengthening loyalty among high-value customers.
- Highlighting human connection.
Baker said these and other initiatives are beginning to gain traction, though he cautioned that stronger, sustained growth will take time.
For the first quarter of 2026, Etsy projects GMS between $2.38 billion and $2.43 billion, representing year-over-year growth of 2% to 4%.
The company expects “to further improve our performance this year, achieving slight growth for 2026,” Baker said, “with positive year-over-year GMS comparisons in each quarter of the year.”
Percentage changes may not align exactly with dollar figures due to rounding. Check back for more earnings reports. Here’s last quarter’s report on Etsy revenue and GMS.
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