Etsy ETSY Q2 2025 Earnings Preview Downside Risk Amid Declining GMS and Buyer Trends

Forward-Looking Analysis
Etsy is set to release its Q2 2025 earnings next week, with analysts closely monitoring its performance against a backdrop of challenges. The company has been struggling with falling Gross Merchandise Sales (GMS) and weak buyer trends, despite efforts to enhance product offerings and services. This has led to a downgrade to a "Hold" by analysts, with an average price target of $51.58, indicating a potential decrease of 17.94% in stock value. The consensus earnings forecast for 2025 is $289,716,964, with EPS estimates ranging from $2.57 to $3.72. Although Etsy anticipates a take rate of 23.3% for Q2, the outlook remains cautious given the ongoing decline in GMS. B. Riley has set a higher EPS estimate of $3.72, suggesting potential upside, but overall sentiment remains wary amidst the uncertainties.

Historical Performance Review
In the first quarter of 2025, Etsy reported revenue of $651.18 million but faced significant challenges, with a net income of -$52.10 million and an EPS of -$0.49. The company's gross profit stood at $459.12 million. Consolidated GMS was $2.8 billion, marking a 6.5% decline year-over-year and a 5.7% decline on a currency-neutral basis. These results underscored the ongoing difficulties Etsy faces in maintaining growth amid shifting market dynamics.

Additional News
Recent news highlights Etsy's ongoing struggles with declining GMS and weak buyer trends, despite investments in product and service growth. Analysts have downgraded Etsy stock to "Hold," with a price target of $51.58, forecasting a -17.94% decrease in stock value. While Etsy anticipates a take rate of 23.3% for the second quarter, the company has no clear recovery path, as indicated in analyst forecasts. B. Riley's EPS estimate of $3.72 for fiscal 2025 suggests potential for earnings growth, yet overall sentiment remains cautious. There are no recent M&A activities, CEO announcements, or major product launches noted in the available data.

Summary & Outlook
Etsy's financial health presents challenges with declining GMS and weak buyer trends impacting growth. Analysts have downgraded the stock to "Hold," with a negative price outlook. The company's efforts in product and service investment have yet to yield clear recovery results. Despite projected earnings growth and an EPS estimate of $3.72 by B. Riley, the overall sentiment remains neutral to bearish. Risks continue to overshadow potential catalysts, necessitating careful monitoring of Etsy's strategies and market conditions in the upcoming quarter.