Etsy released the earnings results from its first fiscal quarter after closing bell tonight, sending shares into a downward spiral. The company posted a surprise loss of 84 cents per share on $58.5 million in revenue, a 44.4% year over year increase. Analysts had been expecting Etsy to post earnings of 3 cents per share with revenue of $58 million. In the same quarter last year, the company posted a loss of 1 cent per share on $40.5 million in revenue.
After tonight’s earnings report, shares of Etsy plunged, falling as much as 13.62% to $18.14 per share.
Key metrics from Etsy’s earnings report
The online marketplace posted Marketplace revenue of $30.15 million for the quarter, a 27.1% year over year increase from last year’s $23.73 million. Seller Services revenue climbed 72.3% year over year from $15.83 million last year to $27.28 million this year. Gross merchandise sales increased 28% compared to last year.
Etsy posted adjusted EBITDA of $6.67 million, a 9.3% increase from last year’s $6.1 million. Adjusted EBITDA margin fell 370 basis points to 11.4%. The company had 1.43 million active sellers at the end of the first quarter, an increase of 25.8% from last year’s 1.14 million active sellers.
The number of active buyers increased 36.5% year over year to 20.84 million. The percentage of mobile visits increased 750 basis points year over year to 57.7%, while the percentage of mobile GMs increased 620 basis points to 41.4%. Gross margin increased from 62% last year to 64.6% this year.
Etsy’s expenses surge
The company said expenses surged during the first quarter, with operating expenses climbing 72.6% from last year due to higher marketing and general and administrative expenses. Marketing expenses grew 63.5% due to increases in spending on product listing ads.
Etsy also recorded higher employee-related expenses and a 24.5% increase in product development expenses.
Etsy looks ahead to second quarter
