Why Etsy Stock Dropped Today
Shares of Etsy (NASDAQ: ETSY) sank on Thursday after the online marketplace for craft goods warned shareholders that its pace of expansion was slowing. As of 2:22 p.m. ET, Etsy's stock price was down more than 18%.
The total dollar value of transactions processed on the company's e-commerce platforms, a key metric known as gross merchandise sales (GMS), rose 3.5% year over year to $3.3 billion in the first quarter. However, GMS declined by 2%, to $2.8 billion, on Etsy's namesake marketplace.
The company said consumers are shopping more in traditional retail stores now that the economy has reopened. They are also spending less on discretionary items, due in part to negative macroeconomic factors. Conflict in Europe and a corresponding surge in energy prices, as well as stubbornly high inflation in areas like food and housing costs, are widely expected to force many consumers to rein in their spending.
Source Fool.com
