Etsy Marketplace Shows Flat Growth in GMS in 4th Quarter of 2025

Etsy, the global online marketplace for handmade, vintage, and unique goods, reported a modest 2.4% year-over-year increase in consolidated Gross Merchandise Sales (GMS) for the fourth quarter of 2025. This growth translates to a 1.3% increase when adjusted for foreign exchange fluctuations. The consolidated GMS figure encompasses sales from both the Etsy platform and its used-fashion marketplace, Depop. Importantly, the GMS from Reverb, the company’s musical instrument marketplace, was excluded from the prior-year period’s comparison, as Reverb was sold by Etsy in 2025.

Consolidated revenue for the fourth quarter saw a more robust growth of 6.6% year-over-year, also excluding Reverb from the prior-year comparison. The company’s consolidated take rate, a measure of the percentage of revenue retained from GMS, stood at 24.5%. Etsy attributed this revenue growth primarily to "continued strong consolidated on-site ads performance."

Delving deeper into the performance of the core Etsy marketplace, the company reported specific figures for the fourth quarter of 2025. These standalone numbers highlight the operational dynamics of the primary platform.

For the Etsy marketplace specifically, the fourth quarter of 2025 saw the following performance metrics:

• Gross Merchandise Sales (GMS): A year-over-year increase of 1.7%, or 0.6% on a foreign exchange-neutral basis.
• Number of Buyers: A slight decrease of 0.8% year-over-year.
• Number of Active Buyers: A decrease of 0.7% year-over-year.
• Number of Seller Items: An increase of 7.8% year-over-year.
• Number of Active Sellers: An increase of 3.5% year-over-year.
• Take Rate: An increase of 1.3% year-over-year, reaching 27.8%.
• Revenue: A year-over-year increase of 4.2%, or 3.3% on a foreign exchange-neutral basis.
• Advertising Revenue: A significant year-over-year increase of 12.6%.
• Shipping Revenue: A year-over-year increase of 2.4%.
• Gross Profit: A year-over-year increase of 3.6%, or 2.7% on a foreign exchange-neutral basis.
• Operating Income: A year-over-year decrease of 4.8%.
• Net Income: A year-over-year decrease of 6.5%.

The performance of Etsy’s used-fashion marketplace, Depop, which the company has recently agreed to sell to eBay, also provided insights into the quarter. For Depop, the fourth quarter of 2025 reported the following statistics:

• Gross Merchandise Sales (GMS): A year-over-year increase of 7.5%, or 6.7% on a foreign exchange-neutral basis.
• Number of Buyers: A year-over-year increase of 8.7%.
• Number of Active Buyers: A year-over-year increase of 8.2%.
• Number of Seller Items: A decrease of 4.3% year-over-year.
• Number of Active Sellers: A decrease of 1.4% year-over-year.
• Take Rate: A decrease of 1.0% year-over-year, standing at 14.9%.
• Revenue: A year-over-year increase of 17.9%, or 17.1% on a foreign exchange-neutral basis.
• Advertising Revenue: A substantial year-over-year increase of 28.4%.
• Shipping Revenue: A year-over-year increase of 26.5%.
• Gross Profit: A year-over-year increase of 25.5%, or 24.6% on a foreign exchange-neutral basis.
• Operating Income: A significant year-over-year increase of 150.0%.
• Net Income: A year-over-year increase of 150.0%.

In an accompanying press release, Etsy CEO Kruti Patel Goyal expressed optimism about the company’s strategic direction and execution. "Our clear strategic focus and solid execution are driving progress on the journey to bring the Etsy marketplace back to sustained growth," Goyal stated. She further elaborated on Etsy’s unique value proposition, emphasizing the platform’s appeal to buyers seeking personalized items and sellers who bring their creativity to life.

"What sets Etsy apart is not just what we sell, but who we’re built for: buyers seeking something personal and sellers bringing creativity to life," Goyal remarked. "By strengthening how we connect the right people with the right items at the right moments, we see a meaningful opportunity to grow relevance, engagement, and market share over time, while continuing to deliver long-term value to all of our stakeholders."

The commentary from the CEO suggests a strategic focus on enhancing the user experience and deepening the connection between buyers and sellers to foster sustained growth and market share. The sale of Depop, as indicated by the press release referencing an agreement to sell, marks a significant shift in Etsy’s portfolio strategy. The company’s financial results for the fourth quarter of 2025, as detailed in the February 19th press release, provide a comprehensive overview of its performance across its marketplaces and highlight key drivers of revenue and profitability.

The financial report indicates a mixed performance for the Etsy marketplace itself, with GMS and revenue experiencing modest growth, but a decline in active buyers. This contrasts with Depop’s stronger growth in GMS and revenue, alongside an increase in active buyers, despite a slight decrease in active sellers. The significant increase in advertising revenue across both platforms points to the success of Etsy’s advertising strategies in driving monetization. However, the decline in operating income and net income for the core Etsy marketplace warrants further examination of cost structures and operational efficiencies.

The strategic decision to sell Reverb and the pending sale of Depop suggest a potential refocusing of Etsy’s core business on its original mandate of unique and handmade goods. The company’s stated commitment to connecting "the right people with the right items at the right moments" indicates a continued emphasis on personalization and curated discovery as key elements of its growth strategy. The future performance of Etsy will likely be closely watched as it navigates these strategic shifts and works to reignite sustained growth within its primary marketplace. Investors and market observers will be keen to see how the company’s strategies translate into tangible improvements in buyer engagement and overall GMS growth in the coming quarters.