Etsy revenue up 24.8% in Q1, raises 2018 guidance
Etsy continued to see revenues climb for the third consecutive quarter, prompting the online marketplace to raise its full-year guidance on Tuesday.
The craft-focused e-commerce platform reported gross merchandising sales (GMS) of $861.1 million in the first quarter ended March 31, 2018, up 19.8 percent, compared with the first quarter of 2017. The growth was primarily driven by a jump of 9.4 percent year-over-year in active sellers and a 16.9 percent year-over-year growth in active buyers.
International GMS was also up at 35 percent in the first quarter of 2018, from 32 percent in the first quarter of 2017 and 33 percent in the fourth quarter of 2017.
Total revenue was $120.9 million for the first quarter of 2018, up 24.8 percent year-over-year. The growth was driven by both Marketplace and Seller Services revenue, where Marketplace revenue grew 24.7 percent year-over-year, and Services revenue grew 35 percent year-over-year.
Meanwhile, net income for the first quarter of 2018 was $13 million, with diluted earnings per share of $0.10, compared with a net loss of $0.4 million and a net loss per share of $0 in the first quarter of 2017.
"Q1 was another strong quarter of both revenue and Adjusted EBITDA growth" said Rachel Glaser, Chief Financial Officer, in a news statement. "As an organization, we exercise a disciplined approach to resource investment, focusing our efforts on initiatives that we believe have highest probability to create long-term growth while continuously striving for operational efficiencies."
Following a slow 2016, Etsy launched a new strategy focused on growing the Etsy.com marketplace in their six core geographies and owning special purchase occasions throughout the year. The strategy is focused on four key initiatives—trust and reliability on Etsy.com, search and discovery, world-class marketing capabilities, and best-in-class seller tools and services.
In the first quarter of 2018, the company specifically invested resources in foundational work, which addressed three primary areas: technical debt, operational efficiency, and infrastructure imperatives.
As a result of strong first quarter results, the company raised its 2018 guidance for GMS growth, revenue growth and Adjusted EBITDA margin.
Etsy now expects revenue to be in the range of 22 to 24 percent compared with the previously forecasted range of 21 to 23 percent. GMS is expected to rise in the range of 16 to 18 percent, up from 14 to 16 percent.
Finally, the adjusted EBITDA margin is now projected to be in the range of 21 to 23 percent, as opposed to its earlier projection in the range of 20 to 22 percent.
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