By Dhirendra Tripathi
Investing.com – Etsy stock (NASDAQ:ETSY) plunged 11% in Thursday’s premarket trading as growth in new users as well as habitual buyers decelerated at a sharp pace in the second quarter ended June 30.
Etsy is not alone in reporting slower growth. As the pandemic waned and more people stepped out after spending heavily online over the last year, retailers, fast moving consumers goods companies and social media platforms have all reported slowing consumption.
During the quarter, the Etsy marketplace acquired approximately 11.9 million new and reactivated buyers who haven’t purchased in a year or more. Habitual buyers, those with 6 or more purchase days and $200 or more in spend in the trailing twelve months, grew 115% year-over-year.
In comparison, the marketplace had acquired approximately 16.3 million new and reactivated buyers in the first quarter. Similarly, acquisition of habitual buyers was also much larger with such users growing 205% year-over-year in count.
Riding on the unprecedented rise in users over the year, Etsy grew its gross merchandise sales by 10% to $3 billion. GMS (NYSE:GMS) is the total value of goods sold on a platform.
Revenue rose 23% to $529 million. Adjusted earnings per share was 68 cents. Both revenue and EPS topped estimates.
For the ongoing quarter, Etsy has forecast GMS to come between $2.9 billion and $3 billion with approximately 12.5% year-over-year growth at the midpoint.
Revenue for the third quarter is seen between $500 million and $525 million.