Etsy, Inc. (ETSY) Q2 2023 Earnings Call Transcript

For the period ending July 1, 2023

August 2, 2023 5:00 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Deb Wasser

Hi, everyone, and welcome to Etsy's Second Quarter 2023 Earnings Conference Call. I'm Deb Wasser, VP of Investor Relations. And joining me today are Josh Silverman, Chief Executive Officer, Rachel Blazer, our Chief Financial Officer, and Jessica Schmidt, Senior Director of Investor Relations.

Today's prepared remarks have been prerecorded. This slide deck has also been posted to our website for your reference. Once we are finished with Josh and Rachel's presentations, we will transition to a live video webcast Q&A session. Questions can be submitted via the Q&A window chat displayed on your screen. Feel free to use it at any time as it will remain open throughout the entire conference call. I'll be reading your questions, and Jessica will help me try to get to as many as we can.

Forward-looking statements involve risks and uncertainties and some of which are described in today's earnings release and our most recent Form 10-Q, and which will be updated in future periodic reports that we file with the SEC. Any forward-looking statements that we make on this call are based on our beliefs and assumptions today, and we disclaim any obligation to update them.

Also during the call, we'll present both GAAP measures and non-GAAP financial measures, which are reconciled to GAAP financial measures when available in the appendix to today's slide deck posted on our IR website, along with a replay of this call.

With that, I'll turn it over to Josh.

Josh Silverman

Thanks, Deb, and good afternoon, everyone. Etsy's results landed in line with our expectations. Consolidated GMS was $3 billion about flat to last year, revenue grew 7.5% to $629 million and our adjusted EBITDA margin was again strong and 26.4%. GMS for the Etsy marketplace was about $2.6 billion this past quarter, about flat with the prior year.

Digging deeper, we've seen many of our key metrics trending positively again. Our negative year-over-year growth rate improved sequentially, and even more important GMS grew year-over-year in May June and in July as well. Quarterly active buyers reached 91 million an all-time high and when adding new and reactivated buyers together, we saw healthy growth in buyer additions on a year-over-year basis.

Additional green shoots included GMS growth outside of the U.S., improvement in trends in important category and early signs of stabilization in our GMS per buyer and habitual buyer metrics. Overall, this performance is quite encouraging especially given the tremendous gains we've maintained from our pandemic growth and the stiff headwinds we've continued to face in consumer discretionary spending. Economic cycles are just that cyclical. The Etsy brand stands for something different in a sea of sameness and I believe we've proven our resiliency. I'm confident that we're well set up for future growth as we continue to move through this cycle.