Etsy’s sales grow 18.8% in 2016, and revenue from seller services surges

March 3, 2017 12:25 PM

Sales on Etsy Inc.’s marketplace for handcrafted goods grew 18.8% in its second full year as a public company.

Sales on, which the marketplace calls gross merchandise sales, were $2.84 billion in 2016, up from $2.39 billion in 2015. 48% of Etsy’s 2016 sales came through its mobile website and app, up from 43% a year earlier.

In the fourth quarter ended Dec. 31, gross merchandise sales grew 16.7% to $865.2 million from $741.5 million in the same period a year ago.

Etsy is gearing up to launch a new marketplace for craft supplies, called Etsy Studio, in April. With Studio, Etsy aims to bridge the gap between customers looking for do-it-yourself (DIY) projects and those customers buying the necessary craft supplies to complete the project, executives said on a call with investors discussing its full-year earnings results.

“With Etsy Studio, buyers will be able to browse tutorials and instructional content, and then purchase all of the relevant materials without ever leaving the page,” CEO Chad Dickerson said on the call, according to a transcript to SeekingAlpha. “We believe this cohesive and engaging experience will make buyers want to return again and again.”

Over the next several weeks craft supply sellers will begin setting up their accounts on Etsy Studio, which will be a separate website, Dickerson said. Etsy will charge similar listing fees to sellers as it does on In addition, Etsy Studio will offer the more than 8 million craft supply items already sold on

Total revenue, which Etsy generates from listing fees, seller services and commission on sales, jumped 33.5% to $365.0 million from $273.5 million.

Etsy is increasingly generating its revenue from services it offers sellers, which represented 55% of total revenue in 2016. That’s up from 50% in 2015. Seller services revenue, which Etsy receives from such services as promoted listings, credit card processing and web services, grew 47% in 2016. The rest of its revenue, which Etsy calls markets revenue, increased 19.3%. Markets revenue comes from the 20-cent listing fee Etsy charges and the 3.5% commission it takes on every sale.

In 2016, approximately 52% of Etsy’s active sellers used at least one seller service compared with 48% in 2015, executives said on the call. 32% of active sellers in 2013 remained active in 2016, and average gross merchandise sales for those sellers in 2016 was $4,620—about four times higher than it was in 2013, chief financial officer Kristina Salen said on the call.

In 2017, Etsy plans to invest $20 million in brand marketing, Salen said on the call. That’s more than three times the approximately $6 million spent on marketing in 2016. “We believe elevating the Etsy brand will not only allow us to further penetrate a large addressable market of untapped buyers, but will also encourage existing buyers to make more frequent purchases,” Salen said, according to a transcript from SeekingAlpha.

Etsy is No. 23 in the Internet Retailer Top 1000 rankings.

For the fourth quarter ended Dec. 31, Etsy also reports:

  • Gross merchandise sales of $865.2 million, up 16.7% from $741.5 million in Q4 2015.
  • Revenue of $110.2 million, up 25.4% from $87.9 million.
  • Markets revenue of $46.9 million, up 17.8% from $39.8 million.
  • Seller services revenue of $61.7 million, up 30.7% from $47.2 million.
  • EBITDA, (earnings before interest, taxes, depreciation and amortization) of $15.2 million, up 8.6% from $14.0 million.
  • Net loss of $21.4 million compared with a net loss of $4.2 million.

For 2016, Etsy also reports:

  • Active sellers increased 11.5% to 1.74 million from 1.56 million a year ago.
  • Active buyers increased 19.2% to 28.6 million from 24.0 million.
  • EBITDA, (earnings before interest, taxes, depreciation and amortization) of $57.1 million, up 84.2% from $31.0 million.
  • Net loss of $29.9 million compared with a net loss of $54.1 million. 



Top Solution Providers