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    ETSY
    Earnings call· Jun 2026(Q2 FY26)

    ETSY Q2 FY26 earnings call ETSY

    Aug 6, 2026 Source

    Executive summary

    Etsy Q2 FY26 — Strong GMS Growth and Share Repurchase Authorization

    Etsy delivered strong Q2 FY26 results, with accelerating GMS and revenue growth driven by strategic focus on discovery, personalization, and buyer loyalty. The company authorized a new $2 billion share repurchase program, reflecting confidence in its execution and capital allocation strategy, while also announcing a workforce restructuring to optimize for future growth and efficiency.

    Highlights

    5

    • Etsy marketplace GMS grew 7.5% year-over-year to $2.6 billion, marking the third consecutive quarter of growth.

    • Revenue was $668 million, up 9.3% for the Etsy Marketplace stand-alone.

    • Adjusted EBITDA was $195 million, representing a 29.2% margin.

    • Active buyers improved by 350,000 sequentially to approximately 87 million, with sequential growth in habitual and repeat buyer cohorts.

    • New $2 billion share repurchase program authorized, following $250 million in buybacks during Q2.

    Concerns

    3

    • Restructuring plan will reduce workforce by approximately 220 employees (12%), incurring $35 million in charges.

    • Year-over-year continuing operations results are not directly comparable due to the sale of Depop and Reverb.

    • Purchase frequency remains below prior year levels, though the year-over-year decline moderated.

    Guidance & targets

    6
    CategoryTargetConfidence
    Etsy Marketplace GMS
    $2.53 billion and $2.58 billion
    high materiality
    High
    Take rate
    approximately 26%
    medium materiality
    High
    Adjusted EBITDA margin
    28% to 30%
    high materiality
    High
    Etsy Marketplace GMS growth
    mid-single-digit range
    high materiality
    High
    Full year take rate
    roughly equal to what we reported in the first half of the year
    medium materiality
    High
    Full year adjusted EBITDA margin
    29% to 30%
    high materiality
    High

    Segment performance

    1
    SegmentRevenueYoYQoQMargin
    Etsy Marketplace
    Etsy Marketplace GMS grew year-over-year for the third consecutive quarter, reflecting continued improvement across marketplace fundamentals. Revenue growth accelerated in tandem with GMS strength, with both marketplace and services revenue delivering solid year-over-year growth.
    GMS: $2.6 billionGMS growth: 7.5% year-over-yearTake rate: 25.9%
    		$668 million9.3%—29.2% adjusted EBITDA margin

    Operational metrics

    16
    Cash and investments balance
    $1.3 billion
    Q2 FY26

    Includes cash, cash equivalents, and short- and long-term investments.

    Adjusted EBITDA to Free Cash Flow conversion
    81%
    Q2 FY26
    Share repurchases executed
    $250 million70% more than Q1
    Q2 FY26
    Remaining share repurchase authorization
    $578 million
    Q2 FY26

    Remaining on current Board-authorized program.

    Workforce reduction
    220 employees12% of workforce
    Q2 FY26

    Concentrated in product and engineering group.

    Restructuring charges
    $35 million
    Q2 FY26
    Headcount post-restructuring
    1,600 people
    Q2 FY26
    Mobile app GMS growth
    12.5%year-over-year
    Q2 FY26

    Accelerated sequentially.

    Mobile app GMS as percentage of total GMS
    47%
    Q2 FY26
    Visits per monthly active user
    increasingyear-over-year
    Q2 FY26
    Orders per visit
    increasingyear-over-year
    Q2 FY26
    Organic GMS growth
    grew
    Q2 FY26

    Not driven by marketing.

    GMS per active buyer (TTM)
    $1242.8% year-over-year
    TTM Q2 FY26
    Gross buyer additions
    accelerated
    Q2 FY26
    Habitual and repeat buyer cohorts
    slight sequential growthfor the first time since 2023
    Q2 FY26

    These are the most valuable buyers.

    AI traffic from Agentic experiences
    less than 1%
    Q2 FY26

    Percentage of overall traffic.

    Industry KPIs

    6
    MetricValueDetails
    Segment revenue mixEtsy Marketplace: $668 millionUSD
    Ai cloud revenue backlogless than 1%%
    Regional market performancegrew
    Advertising revenue take rate25.9%%
    Subscription membership program87 millionusers
    Operating income EBIT and adjusted EBITDA$195 millionUSD

    Deals & partnerships

    2
    eBaySale of Depop to eBay.$1.4 billion

    Cash proceeds received from the sale of Depop. Etsy's results are presented on a continuing operations basis, while Depop's results are presented within discontinued operations.

    Not statedSale of Reverb.

    Reverb was sold in June of last year (Q2 2025) and is included in Q2 2025 continuing operations, whereas Q2 2026 reflects only the Etsy Marketplace.

    Risks & headwinds

    4
    Workforce Restructuring ChargesSubstantially complete by the end of Q3 2026

    Approximately $35 million in charges

    Mitigation: Aimed at building a more focused organization, accelerating execution, and deepening expertise in strategically critical areas like machine learning, rather than primarily cost-cutting.

    Comparability of FinancialsQ2 FY26 vs Q2 FY25

    Year-over-year continuing operations results are not directly comparable

    Mitigation: Provided Etsy stand-alone marketplace comparisons where most relevant to evaluate go-forward operations.

    Purchase Frequency Below Prior YearQ2 FY26

    Purchase frequency remains below prior year levels

    Mitigation: The year-over-year decline moderated compared to the first quarter, indicating improving overall customer experience efforts.

    Impact of Gas Prices on Consumer SpendingQ2 FY26

    Not a discernible impact right now

    Mitigation: Consumer demand held up well across the second quarter, with growth in GMS in the United States and across all household income segments, though the high end is growing faster.

    What to watch in Q3 FY26

    5

    Etsy Marketplace GMS growth

    Q3 FY26
    Current7.5% YoY in Q2 FY26
    Target4%-6% YoY in Q3 FY26

    Why it matters

    Key indicator of marketplace health and growth momentum, reflecting the impact of strategic initiatives.

    We currently anticipate that Etsy Marketplace third quarter GMS will be between $2.53 billion and $2.58 billion, representing year-over-year growth of approximately 4% to 6% for the quarter.

    Q&A highlights

    5

    What are the most effective drivers of Q2 GMS growth and opportunities for improvement? How is Etsy tackling discovery among young buyers and are there early signs of progress?

    Kruti highlighted strong execution against strategic priorities, product and marketing improvements (efficient marketing, better on-site experience, richer buyer profiles), and the app as a clear proof point. For younger buyers, she noted shifting marketing investments to social channels (YouTube, TikTok) and cultural partnerships (Olivia Rodrigo) to resonate with this audience.

    “our research showed that our value proposition resonates with this younger audience as much as it does with older audiences. But what wasn't happening was that we weren't showing up where these shoppers are discovering and with relevant content as much as we could.”

    asked by Rakesh Patel · answered by Kruti Goyal

    2 min read5 chapters

    Detailed Narrative

    01

    Strategic Priorities Driving Performance

    Etsy's focus on human-centered marketplace differentiation, discovery, matching, loyalty, and human connection is translating into stronger marketplace fundamentals. This includes improved active buyer metrics, moderated decline in purchase frequency, and accelerated mobile app growth. The company's product and marketing improvements are working together to drive growth, with more efficient marketing and a meaningfully better on-site experience.

    02

    Organizational Restructuring for Future Growth

    The company announced a restructuring, reducing its workforce by approximately 220 employees (12%), primarily in product and engineering. This move is aimed at creating flatter, faster teams, reducing silos, and deepening expertise in strategically critical areas like machine learning. Management emphasized this is not a cost-cutting measure but an investment in execution to accelerate growth and innovation.

    03

    Capital Allocation and Share Repurchase Program

    Etsy completed the sale of Depop, receiving $1.4 billion in cash proceeds. In Q2, the company repurchased $250 million in stock, reducing the outstanding share count by approximately 3.9 million shares. A new $2 billion share repurchase program was authorized, reflecting confidence in strategic execution and commitment to returning excess capital to shareholders.

    04

    Marketing Efficiency and Investment Strategy

    Etsy achieved leverage across marketing, product development, and G&A, with nearly half of the Etsy Marketplace revenue growth flowing through to adjusted EBITDA. The company is seeing increased efficiency in paid search and PLA performance due to better segmentation and bidding strategies. This efficiency allows for flexibility to invest in social channels and marketing partnerships to reach younger demographics, such as the Olivia Rodrigo collaboration.

    05

    AI and Machine Learning Focus

    Etsy is deepening its investment in machine learning to enhance discovery, matching, and personalization, aiming to connect buyers with sellers more effectively. The company is also experimenting with AI-native shopping experiences, such as a gifting assistant, to understand buyer intent. Traffic from agentic experiences remains less than 1% but shows higher intent and average order value.

    AI-generated summary of the company’s earnings call. Not investment advice.