Etsy reported a triple-digit increase in the company's gross merchandise sales Wednesday as the coronavirus pandemic lead to an influx of 11.5 million new buyers and 7.2 million reactivated buyers who haven’t purchased in a year or more on the online retailer's marketplace.
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“Our extremely strong second quarter results, with consolidated GMS and revenue up 146% and 137% respectively, are a testament to the agility of our team, the strength of our brand, the innovation of our sellers and the unique and special nature of inventory on our core Etsy marketplace,” Etsy CEO Josh Silverman said in a statement. "Etsy marketplace [gross margin sales] increased 125% in the quarter, as we are attracting new buyers and engaging our existing customers more than ever before."
According to the company, consolidated active buyers grew 41% year-over-year in the second quarter, and active sellers grew 34.6% year-over-year.
The company said that its mask sales accounted for 14% of Etsy's overall gross merchandise sales. Excluding mask sales, the company's gross merchandise sales growth was up $1 billion year-over-year, or 93%. Other high-performing areas include homewares and home furnishings, up 128% year-over-year, jewelry and accessories were up 50% and craft supplies were up 138%.
Etsy reported net income of $96.4 million, or 75 cents a share in the second quarter, compared with $18 million, or 14 cents a share, a year ago, while revenue rose 137% to $429 million from $181 million a year ago. Gross profit for the quarter was $317.4 million, up 159.1% year-over-year, and the company's gross margin was 74%, up 640 basis points compared with 67.6% in the second quarter of 2019, driven by the company's shift to Offsite Ads.
Looking ahead, Etsy is not providing new guidance for the full year, but it expects year-over-year growth for its gross merchandise sales to be between roughly $2.2 billion and $2.5 billion, or 80% to 110% for the third quarter, and year-over-year growth for revenue is expected to be between roughly $366 million and $426 million, or 85% to 115%.
“Events of the last few months have driven dramatic shifts in consumer shopping habits, which we believe will increase the total available market opportunity for Etsy, particularly given our powerful, purpose-focused brand, the agility of our vibrant two-sided marketplace, and our unique competitive advantages,” Silverman said. “While we have limited visibility for the fourth quarter, particularly related to macro trends and consumer spending around Holiday, our third quarter guidance clearly indicates very strong overall performance for 2020."
Etsy stock closed at $135.52 per share, up nearly 4.5% at the end of Wednesday's trading session. The stock hit a record high earlier in the after-hours trading session Wednesday before dropping to around $132 per share.