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Once the crown jewel of the pandemic e-commerce boom, Etsy (ETSY) carved out a niche for handmade goods and one-of-a-kind treasures. But fast forward to 2025, and Etsy’s glow faded — sales dipped, user numbers shrank, and repeat purchases slowed. Rising take rates added pressure, and investor confidence wavered. The stock slumped as Etsy’s once-reliable model began to look more cyclical, an uncertain play amid a tough macroeconomic backdrop.
Then came the rebound. Etsy, once doubted, quietly turned into a cash-generating machine. Lean operations and strong free cash flow backed aggressive share buybacks, while high short interest set the stage for a sharp rally. The stock surged from April's lows, signaling improving sentiment and suggesting that a comeback might just be gaining steam.
And now? ETSY stock just surged to a fresh 52-week high of $68.45 on July 30 after dropping its second-quarter earnings report, with revenue topping expectations. Sure, earnings came in light, and both GMS and user numbers slipped again. But those figures didn’t scare off bulls. Investors are leaning into Etsy’s longer-term vision — big bets on AI-powered search, personalized marketing, and “agentic shopping” experiences. With 6.1 million habitual buyers and millions of new ones acquired, Etsy is evolving.
Since touching the high, ETSY stock has pared back some of its gains. Is this just a breather before the next leg up? Or a sign to stay cautious?
About Etsy Stock
Founded in 2005 and based in Brooklyn, Etsy is where creativity meets commerce. Valued at $6 billion by market capitalization, this online crafts marketplace connects inspired buyers with independent sellers offering handmade, vintage, and unique goods.
With a mission to “keep commerce human,” Etsy empowers entrepreneurs while delighting shoppers. It also owns fashion resale platform Depop, blending distinct communities with shared technology and marketing know-how across its growing online ecosystem.
The start of 2025 was not kind to Etsy. The stock sank to a low of $40.05 on April 9. But that did not last long. Etsy found its footing, ripping more than 50% from the lows and now up 13% year-to-date (YTD). Over the past three months alone, shares have soared 40%, crushing the S&P 500 Index's ($SPX) 11% rise during the same stretch.
On July 30, the stock shot past $68 after the Q2 report before pulling back to close at $61.98. That reversal came as the stock tested a major resistance zone around $68, right near the RSI 70 level of $67.67 — a level around which traders often start locking in profits.
Etsy stock is not just rebounding — it is doing so at a discount. Trading at 22 times forward earnings and 2.3 times sales, it sits well below its historical averages, giving bulls more reason to lean in.
Etsy's Mixed Q2 Report
Etsy’s Q2 earnings report was a mixed bag, but it kept investors intrigued. Revenue rose 3.8% year-over-year (YOY) to $672.7 million, beating Wall Street's expectations. That growth came largely from strong performance in on-site ads as well as payment services across both Etsy and Depop. The company’s take rate also increased to 24%, up from 22% a year ago.
However, earnings told a tougher story. EPS fell 39% annually to $0.25, missing estimates by a wide margin. Adjusted EBITDA slid 5.8% to $169 million, having a margin of 25.1%.
Etsy also closed the sale of Reverb during the quarter. Reverb contributed $17.6 million in revenue for the first two months before the sale, compared to $24.4 million in the full Q2 2024.
Meanwhile, gross merchandise sales (GMS) declined 4.8% to $2.8 billion, or 2.6% excluding Reverb. Active sellers fell to 8.1 million, while buyers dropped to 93.3 million. Still, Etsy reactivated 6.5 million buyers and brought in 4.8 million new ones. GMS per active buyer came in at $120, flat sequentially but down 2.9% YOY. Encouragingly, monthly GMS per buyer began to show positive annual growth in May and June, even after adjusting for currency swings.
Etsy ended Q2 with $1.5 billion in cash and investments, and it flexed that strength, buying back $335 million worth of stock, or 6.4 million shares, during the quarter.
Etsy’s leadership is laser-focused on reigniting GMS growth. Management laid out four priorities — stronger discovery, smarter machine learning, rewarding loyal buyers, and deepening Etsy’s human touch. They are also leaning into Depop’s $1 billion run rate with fresh marketing aimed at U.S. growth.
Management highlighted momentum heading into Q3, expecting GMS between $2.6 billion and $2.7 billion, a 24.5% take rate, and strong profitability with adjusted EBITDA margins estimated to be around 25%.
Analysts tracking Etsy expect the company’s Q3 EPS to surge by 42% YOY to $0.64. Looking further ahead, the company is projected to report a profit of $2.82 per share in fiscal 2025, up 20% YOY, with further annual growth of 16% to $3.28 per share in fiscal 2026.
What Do Analysts Expect for Etsy Stock?
Etsy’s Q2 earnings sparked a mix of cheers and caution on Wall Street. Canaccord Genuity kept a “Buy” rating and hiked its price target to $76 from $68. The brokerage firm was impressed by stronger-than-expected GMS, solid revenue, and standout profit margins. Sequential improvements in marketplace trends, boosted by Etsy ads and less ad pressure from Temu and Shein, painted a rosier picture. Strategic gains — from smarter Google listings to better paid social traction — also gave Etsy an edge heading into Q3.
BTIG followed suit, raising the target to $72 from $58 while maintaining a “Buy.” The firm liked Etsy’s improving sales momentum, pointing to GMS per buyer turning positive in May and holding in June. Even with foreign exchange tailwinds, that marked a clear trend reversal. Still, the dip in active buyers kept the tone cautiously optimistic.
But not everyone is sold. Stifel trimmed its target to $64 from $66, maintaining a "Hold." The firm called the Q2 results “solid” but flagged soft buyer trends and a mixed Q3 outlook. Stifel praised Etsy’s app growth and tech investments, but warned that policy changes and macroeconomic pressure could shake consumer behavior in the second half of 2025.
Etsy carries a consensus “Hold” rating overall. Of the 30 analysts covering the stock, six advise a “Strong Buy,” two recommend a “Moderate Buy,” a majority of 18 analysts suggest a “Hold,” and the remaining four have a “Strong Sell” rating.
ETSY is currently trading at a premium to its average analyst price target of $58.04.
