New York, Feb 19, 2026, 15:04 EST — Regular session underway.
- Etsy jumped roughly 9% after agreeing to offload Depop to eBay in a $1.2 billion all-cash deal.
- The company is projecting first-quarter GMS to fall short of last year’s figure, though it’s pointing to some modest growth for 2026.
- Some analysts call the sale a margin and focus move, with demand still uneven.
Etsy shares jumped roughly 9% to $48.04 Thursday afternoon, bouncing around between a low of $45.06 and a high of $54.03. The stock’s rally came after Etsy said it would unload its secondhand fashion app Depop to eBay for $1.2 billion in cash—a transaction both companies anticipate will wrap up in the second quarter.
Etsy’s latest move hands it a cash boost and sheds a business that had been a headache for analysts trying to pin down its value, as the company seeks to jumpstart growth in its core marketplace focused on handmade and vintage items. Investors shrugged off weak quarterly numbers and guidance showing first-quarter gross merchandise sales (GMS) are headed lower year-over-year. CFRA’s Arun Sundaram pointed out that Depop had largely flown under the radar and was “meaningfully less profitable” than Etsy’s main business. Etsy acquired Depop for $1.63 billion back in 2021, but has struggled since with sluggish demand and stiffer competition from bigger rivals like Amazon. Reuters
eBay is betting the Depop acquisition will help attract younger buyers and ramp up its “recommerce” ambitions, CEO Jamie Iannone said to Reuters. The company expects to wrap up the Depop deal in its second quarter, projecting it could boost 2026 gross merchandise volume growth by one to two percentage points. Reuters
Etsy reported fourth-quarter revenue of $881.6 million in its SEC filing, with consolidated gross merchandise sales (GMS) at $3.59 billion. The company’s take rate for the quarter landed at 24.5%, and adjusted EBITDA came in at $222.5 million. Looking ahead, Etsy is projecting first-quarter GMS between $2.38 billion and $2.43 billion. For full-year 2026, only slight GMS growth is expected. Following the Depop sale, Etsy will treat the unit as discontinued operations starting in the first quarter. By the end of 2025, cash and investments totaled $1.8 billion, while roughly $133 million of stock was bought back during Q4. CEO Kruti Patel Goyal says the focus is on returning the marketplace to “sustained growth.” CFO Lanny Baker noted “early indicators of progress.” Etsy, Inc.
Etsy’s move marks another effort to streamline after the long unwind from its pandemic surge. The sale shines a sharper spotlight on whether the core marketplace can keep buyers coming back—without having to rely heavily on major promotions.
All eyes on whether Etsy manages to hold GMS steady—marketing efforts and ad tech aimed at squeezing more revenue from each order. That low first-quarter range? It doesn’t offer much cushion if discretionary spending takes another hit.
Still, Etsy’s forecast signals another year-on-year decline in first-quarter GMS, and a dip in buyer activity tends to show up fast in services revenue. On top of that, the Depop deal is still waiting on standard closing conditions—any holdup there keeps numbers messy and might undermine the “clean-up” trade.
For some investors, the Depop sale price is less about 2026 projections and more a litmus test for how much value Etsy can claw back from earlier acquisitions. The immediate cash is a plus, though the old capital-allocation questions come right back up.
Depop shifting into discontinued operations means headline growth numbers will look different over the next few quarters. Now, attention snaps back to the core marketplace: buyer trends, take rate, margins — that’s where the focus lands.
Now, attention turns to two things: progress on wrapping up the Depop sale in Q2, plus Etsy’s first-quarter readout for GMS and margins.
