The Yahoo Finance Live team discusses Etsy's Q4 earnings report and the markets' reaction.
Video Transcript
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- Let's take a look at shares of Etsy. Look at that jumping just about 6% following its most recent earnings results. Revenue coming in better than expected, 807.2 million. That beat the Street's estimates of 753.7 million. That $807 million revenue was a record, up 12.6% year-over-year. Gross merchandise sales also beating the Street's expectations, coming in at 4 billion. That, though, was down by 4% from a year-over-year basis.
A commentary here from Etsy executives in this earnings release, really taking a victory lap in terms of the performance of what we have seen here from Etsy. Their chief financial officer saying that, "We are now nearly three times the size we were pre-pandemic, and we've been careful about how we have grown our cost basis to catch up with the size of the business visible in our sustained profitable growth and strong free cash flow." Again, shares here jumping after hours. We were up just about 8% shortly after the release. Now, up about 6% here. But, Dave, another look at the consumer. And clearly, consumers still willing to spend, at least when it comes to Etsy.
- It's a very surprising look at the consumer, given what we saw. There's not any direct competitor to compare. But when you talk about the two biggest consumer-facing names this week were, of course, Walmart and Home Depot. And what we showed is a cautious consumer trading down, higher-income shoppers shopping at Walmart trading down. You saw Home Depot talk about visits down dramatically. So I think it is a surprising look.
Actually, bucks the trend, largely speaking, from what we've seen. It'll be interesting to see something relatively comparable when we get eBay here in just a couple of minutes. Are they seeing a consumer that is still eager to spend? Because generally speaking, the consumer is spending on experiences and travel away from goods like Etsy. But it also shows their ability to shake off that report from Citron that highlighted the amount of counterfeit goods on Etsy. Clearly, not much of an issue. Could be, I guess, moving forward for Q1. But the analysts we spoke with yesterday largely shook that off entirely. As you can see, shares continue to rise off this Q4 earnings report, up nearly 7%.
- Yeah. It certainly will be interesting here if we do get any commentary on that call about the short-seller Citron Research and what they had published here just in the last couple week--
