Etsy stock plunged 15% after its earnings report showed a decline in sales. Facing fierce competition from Temu and Shein, Etsy's gross merchandise sales fell by 3.7%, down to $2.99B from an expected $3.03B.
Etsy's share value dropped 15% as the S&P 500's lowest performer, following a report of decreased sales and weak future projections. Analysts had forecasted slightly higher gross merchandise sales of $3.03B, but Etsy reported only $2.99B.
"Our first quarter was tough due to a challenging market for discretionary items," stated Etsy's CEO Josh Silverman. "These conditions are a significant barrier to our marketplace's growth."
Etsy confronts escalating threats from Temu and Shein, who are leveraging aggressive market strategies. This rivalry intensified last year, prompting Etsy to downsize its workforce to stay competitive.
Despite current setbacks, Etsy forecasts a similar decline for next quarter, expecting gross merchandise sales around $2.9B, below Wall Street's $3.07B expectation. The online marketplace currently connects 9M sellers with 91.6M buyers.
Will Etsy recover against Temu and Shein?
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