As Etsy managed to beat the Street estimates for Q4 2022 revenue, ETSY stock price surged by 6.46% in aftermarket hours. In Q1 2023, Etsy is expecting gross merchandise sales (GMS) anywhere in the range of $2.95 billion to $3.15 billion
On Wednesday, February 22, public-listed e-commerce firm Etsy Inc (NASDAQ: ETSY) reported the results for the fourth quarter (Q4) of 2022 and the entire full year.
Performance of Etsy in Q4 2022
During the last quarter, the company’s revenue was $807 million up by 12% year over year. With these numbers, Etsy managed to beat the street estimates of $750 million in revenue. However, the company’s earnings per share stood at 77 cents, a little lower than the market estimates of 80 cents.
In its press release, Etsy noted that its gross merchandise sale during the fourth quarter stood at $4 billion. This was down 4% year-over-year. But the company’s customer acquisition game was strong. During the fourth quarter, Etsy acquired a total of 9.5 million new customers. Although this is 60% up in comparison to Q4 2019, there was a drop in new customer acquisition when compared with the previous year.
For the entire year of 2022, Etsy reported a total revenue of $2.57 billion, up by 10.2% year-over-year. Also, the full year’s gross merchandise sale (GMS) stood at $13.32 billion, down by 1.3% year-over-year. By the end of the fourth quarter, Etsy had $1.2 billion in cash. Besides, the company also conducted a stock buyback purchasing 1.34 million shares at $150 million in the last quarter. Speaking on the development, Rachel Glaser, Etsy’s Chief Financial Officer said:
“The Etsy marketplace’s strong holiday performance and accelerating year-over-three-year GMS in the fourth quarter enabled us to end the year on a high note. We are now nearly three times the size we were pre-pandemic, and we’ve been careful about how we have grown our cost basis to catch up with the size of the business – visible in our sustained profitable growth and strong free cash flow.”
Etsy’s Future Guidance, ETSY Stock Surge
In its project guidance, Etsy said that it plans to clock a revenue anywhere between $600 million to $640 million during the first quarter of this year. The Street estimate is somewhere around $621 million.
In Q1 2023, Etsy is expecting gross merchandise sales (GMS) anywhere in the range of $2.95 billion to $3.15 billion. Etsy CEO Josh Silverman said that Etsy will continue to focus on growth investments while protecting its margins. He added:
“Etsy’s ‘Right to Win’ strategy remains robust and relevant, and we have deep conviction in our ability to compete by strategically differentiating our value proposition, focusing on our sellers’ unique items, best-in-class search and discovery, human connections and a trusted brand. This year we’ll be focused on welcoming new buyers to the joy of Etsy. We believe that put us in a position of relative strength; and it’s our goal to do that again in 2023.”
With Etsy (NASDAQ: ETSY) announcing its results after trading hours, the ETSY stock price jumped by 6.46% in the aftermarket hours to $136. With the broader market recovery in 2023, the ETSY stock is already up by 13% year-to-date.
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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
