The 5 Most Interesting Analyst Questions From Etsy's Q3 Earnings Call

Etsy’s third quarter results were met with a significant negative market reaction, despite exceeding Wall Street expectations for revenue and profit. Management pointed to the continued decline in active buyers as a central concern, with CEO Josh Silverman acknowledging, “we're not satisfied with any decline in Etsy GMS.” The company emphasized progress in app engagement and AI-driven personalization, but also discussed ongoing headwinds, such as the expiration of the de minimis exemption on imports and persistent pressure on consumer discretionary spending. Notably, the upcoming leadership transition—with Kruti Patel Goyal taking the CEO role—was framed as a pivotal moment for the company’s next phase.

Is now the time to buy ETSY? Find out in our full research report (it’s free for active Edge members).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Etsy’s Q3 Earnings Call

• Maria Ripps (Canaccord): asked about the scope and economics of the OpenAI integration. CEO Josh Silverman explained the data feed and transaction fee model, emphasizing that the fee is not currently passed on to sellers and operates similarly to influencer or affiliate commissions.

• Steven Forbes (Guggenheim): inquired about recent app engagement improvements and their implications for product development. President Kruti Patel Goyal described increased home screen engagement from new ML models and said this early traction supports continued investment in app-centric growth priorities.

• Anna Andreeva (Piper Sandler): questioned the company’s Q4 outlook and balance between profitability and growth investment. CFO Lanny Baker cited ongoing macro uncertainty while Goyal highlighted willingness to invest more aggressively, as shown with Depop, when opportunity warrants.

• Bryan Smilek (JPMorgan): sought clarity on Goyal’s strategic approach as incoming CEO. Goyal emphasized that her focus is on executing the four strategic priorities and building on the groundwork laid over the past year, aiming for robust, sustainable growth.

• Eric Sheridan (Goldman Sachs): asked about learnings from loyalty program pilots and their impact on buyer retention. Goyal noted that rewards increased engagement and frequency, and the next beta iteration will target frequent buyers with more tangible, per-purchase benefits.

Catalysts in Upcoming Quarters

As we look to future quarters, the StockStory team will closely track (1) the impact of new AI-powered discovery features and recommendation models on buyer engagement and frequency, (2) the effectiveness of increased marketing investments and loyalty program enhancements in stabilizing or growing the active buyer base, and (3) the progress in scaling Depop’s U.S. footprint and sustaining double-digit growth. Any changes in trade policies or consumer spending trends will also be critical to monitor.

Etsy currently trades at $58.27, down from $74.80 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free for active Edge members).

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