Online handicraft retailer Etsy Inc. (NASDAQ: ETSY) released its third-quarter forecast last week which disappointed some investors. ETSY share prices dropped more than 3% after the publication of the report. In the trading on August 10, the share’s price reached $188.46, up by 2.93%.
The Etsy marketplace is one of those that benefited from the lockdown and the pandemic, as sales grew steadily during this period, including thanks to the implementation of handmade protective masks. With the economy recovering and the demand for protective masks decreasing, Etsy sales also began to stabilize.
Etsy Inc. (ETSY), however, beat Wall Street’s revenue and earnings forecasts in the second quarter of 2021. The retailer’s revenue increased by 23 percent year on year to $528.9 million, surpassing the projection by $3.2 million. The company’s net income for the quarter was 98.3 million dollars, or $0.68 per share, which exceeded expectations by four cents.
With the funds received during the growth phase, ETSY made several important acquisitions to expand the business. Etsy has acquired British online fashion retailer Depop and Brazilian handicraft retailer Elo7. Both deals are expected to be closed in the third quarter of 2021. The acquisitions should boost Etsy’s international sales, which accounted for 41% of its gross merchandise sales in the second quarter.
Wall Street analysts predict Etsy’s revenue to rise 33% this year and about 20% next year as business normalizes in the post-pandemic market. Profits are projected to rise by 16 percent this year and 22 percent next year. Nonetheless, the pandemic has not yet ended, and the number of COVID-19 cases in some parts of the world is beginning to rebound. No exception applies to the United States. Hence, Etsy sales may still be higher than they were forecasted to be.