Etsy CEO Josh Silverman on the company’s post-Covid growth

by Buzz Street Times

Etsy CEO Josh Silverman told CNBC on Friday that nobody knows what’s going to happen with the coronavirus pandemic this year, but he hopes the company will “outpace e-commerce overall.”

“None of us have a crystal ball,” Silverman said on “Squawk Box,” one day after the online marketplace reported much better than expected fourth-quarter earnings and revenue.

Etsy has been a big beneficiary of the stay-at-home economy during Covid.

“If I look at 2020, e-commerce grew at a crazy rate. E-commerce grew at over 40% year over year, and yet Etsy grew 2.5 times the rate of e-commerce,” he said.

“I don’t know what e-commerce is going to do in 2021,” he acknowledged, but added, “I hope and believe that Etsy will be able to continue to outpace e-commerce overall.”

Etsy’s full-year 2020 revenue totaled $1.73 billion, up 111% year-over-year, while net income rose 264% to $349 million. Gross merchandise sales on the company’s marketplace — known for its independent artisans who offer a range of products — increased to $10.28 billion last year. That’s up from $4.97 billion in 2019.

The company declined to issue full-year guidance due to the pandemic, offering it instead on a quarter-by-quarter basis. For the ongoing first quarter, Etsy said it anticipates revenue between $513 million and $536 million, significantly better than the $383 million Wall Street had been anticipating.

In a post-earnings conference call Thursday, Silverman told analysts that Etsy roughly achieved its 2023 business goals three years ahead of schedule after the pandemic accelerated the adoption of online shopping and sparked demand for essentially new product categories on its marketplace, like for face masks.

Silverman told CNBC that as he considers Etsy’s post-Covid position, he sees two competing forces. On the positive side, he said millions of people who typically shopped at brick-and-mortar stores before the pandemic have started buying goods online. On the other hand, he said retail will make up a smaller portion of consumer spending as a complete economic reopening occurs and more people return to eating at restaurants and traveling.

“What I don’t know — and what I don’t know that any of us know — is what’s going to happen to consumer spending overall as restrictions ease,” Silverman said. “What I do know is that if you look over the long term, if you’re looking at 2022 and 2023 and beyond, e-commerce is bigger and stronger, and we’ll be bigger and stronger I believe as a result.”

Shares of Etsy rose about 9% shortly after the open Friday. The company’s stock has soared nearly 300% in the past 12 months.

You may also like

Leave a Comment