Etsy (NASDAQ:ETSY) has built a strong brand as the leading marketplace for handmade products. And thanks to massive sales growth in 2020 and 2021, Etsy stock skyrocketed to start the decade.
The online retailer's stock performance and sales have been a mixed bag since then. If you've been thinking of adding this company to your portfolio, here's a detailed look at how to invest in Etsy, as well as its pros and cons.
How to invest
How to buy Etsy stock
Since Etsy is a publicly traded company, you can invest in it through any brokerage account. Here's how to buy Etsy stock:
- Open your brokerage app: Log in to your brokerage account where you handle your investments.
- Search for the stock: Enter the ticker (ETSY) or company name into the search bar to bring up the stock's trading page.
- Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Should I invest?
Should I invest in Etsy?
Etsy looked like an exciting investment opportunity a few years ago, but it hasn't lived up to expectations. Growth has been hard to come by since 2021, as the online retailer has taken some big swings that haven't paid off. Specifically, it invested heavily in a few big-name acquisitions starting in 2019:
- Reverb: An online marketplace for new and used musical gear, acquired by Etsy in 2019.
- Depop: An online marketplace for used and vintage apparel that's popular with Generation Z, acquired by Etsy in 2021.
- Elo7: An online marketplace in Brazil with a similar focus on unique and handmade goods, acquired by Etsy in 2021.
Unfortunately, these investments didn't work out well. Etsy took a goodwill impairment charge of $1 billion only one year after the purchases of Depop and Elo7, indicating that CEO Josh Silverman overpaid. It sold Elo7 less than three years after buying it and Reverb in April 2025.
Recent metrics don't look good for Etsy, either. In 2024, revenue increased by just 2.2% year over year, continuing a trend of slow revenue growth. Net income decreased by 1.4%. More worryingly, its active user numbers had been stagnant and are now declining, with the retailer losing 1 million sellers from 2024 to 2025. Here's a look at Etsy's active buyer and seller numbers from its first quarter reports in 2021 through 2025:
| Year | Active buyers | Active sellers |
|---|---|---|
| 2021 | 90.7 million | 4.7 million |
| 2022 | 95.1 million | 7.7 million |
| 2023 | 95.5 million | 7.9 million |
| 2024 | 96.4 million | 9.1 million |
| 2025 | 94.8 million | 8.1 million |
To its credit, Etsy has built a powerful brand with its focus on unique items. It's not just another online retailer competing with Amazon (AMZN 1.34%). It also has a key advantage over most competitors in that Etsy sellers handle order fulfillment. While other retailers need to deal with product storage and shipping, Etsy doesn't. That allows it to run a capital-light business and turn most of its earnings into free cash flow.
Etsy's leadership has also done a good job of improving customer experience. It started investing in artificial intelligence (AI) earlier than most companies, with its 2016 acquisition of Blackbird Technologies, a start-up that developed algorithms for natural language processing and other AI elements.
Overall, Etsy looks like a solid business, but it's fair to wonder if its growth phase is over. It could be a worthwhile investment if you expect it to turn things around, but its lackluster performance doesn't inspire much confidence.
Profitability
Is Etsy profitable?
Etsy is largely a profitable company. Its net income was $303.3 million in 2024, a 1.4% decline from 2023.
Since 2017, Etsy has turned a profit every year except for 2022, when it posted a net income loss of $694.3 million. That was due to a one-time goodwill impairment charge of $1 billion for its acquisitions of Depop and Elo7. Here's a look at Etsy's net income over the last five years.
Net Income
| Year | Net income |
|---|---|
| 2020 | $349.2 million |
| 2021 | $493.5 million |
| 2022 | ($694.3 million) |
| 2023 | $307.6 million |
| 2024 | $303.3 million |
Dividends
Does Etsy pay a dividend?
Etsy doesn't pay a dividend. It hasn't paid a dividend before, and since it's a growth stock, it probably won't pay them in the future. If you're interested in receiving dividends, check out our list of top dividend stocks to find quality options.
ETFs
ETFs with exposure to Etsy
There are many exchange-traded funds (ETFs) that hold Etsy. ETFs are a good choice for those who prefer more passive investing over actively picking stocks and managing their portfolio. If you're looking for an ETF with substantial exposure to Etsy, here are a few options:
- SPDR S&P Retail ETF (XRT 0.07%) invests in U.S. retailers.
- Amplify Online Retail ETF (IBUY -0.58%) holds companies with significant revenue from the online retail business.
- Pacer US Large Cap Cows Growth Leaders ETF (COWG -0.28%) aims to invest in top growth companies by screening for above-average free cash flow margins.
Exchange-Traded Fund (ETF)
Stock splits
Will Etsy stock split?
Etsy hasn't announced any plans for a stock split. It also hasn't split its stock before, even when its share price increased by almost 700% between 2020 and 2021. While there's no way of predicting if a company will split its stock, Etsy is unlikely to do so at its current share price, which isn't prohibitively expensive.
Related investing topics
The bottom line on Etsy
There are still reasons to be optimistic about Etsy as an investment. It has built a recognizable brand name in a popular niche. By placing order fulfillment in the hands of its sellers, Etsy is also able to avoid some of the most common costs that online stores have, including storage and shipping.
The fact that Etsy's share price has decreased in the last few years means you won't need to pay a premium for it. Of course, part of the reason it's affordable is that it hasn't been meeting expectations.
Some investors still see Etsy as one of the better growth stocks. If you feel the same, this could be a buying opportunity. Just make sure to take a cautious approach.
Keep in mind that, like other consumer discretionary stocks, Etsy is highly dependent on the economy. During periods of economic uncertainty and high inflation, it likely won't be as successful. It does best when people have plenty of disposable income and aren't afraid to use it.
FAQ
Investing in Etsy FAQ
Can you invest in Etsy stock?
Yes, you can invest in Etsy stock. To invest, search for the stock using the name or ticker (ETSY) in your brokerage account.
Is Etsy a good company to invest in?
Etsy hasn't performed well as an investment recently. While it has built a strong brand as the leading e-commerce platform for handmade goods, growth has been slow, and its acquisitions of Reverb and Elo7 didn't pan out.
Is Etsy profitable?
Yes, Etsy is a profitable company with net income of $303.3 million in 2024.
Does Etsy stock pay dividends?
No, Etsy stock doesn't pay dividends.
What is Etsy's net income?
Etsy reported net income of $303.3 million in 2024.
