Etsy stock pops 17% on sale of Depop to eBay for $1.2 billion

Etsy The company’s shares rose more than 17% on Wednesday. announced eBay will acquire second-hand clothing retailer Depop for approximately $1.2 billion in cash.

The deal comes almost five years after Etsy acquired Depop for about $1.62 billion, giving the online marketplace a head start on younger consumers who have flocked to the UK-based app to sell used clothes, shoes, accessories and other items. Etsy said nearly 90 percent of Depop users are under 34.

“We’re excited that this transaction allows us to focus solely on the compelling opportunity we see before us: growing the Etsy marketplace in the way that matters most to our buyers and sellers,” Etsy CEO Kruti Patel Goyal said in a statement. he said.

In recent years, Etsy has acquired several niche online marketplaces as part of its “house of brands” strategy to compete with larger, faster-growing rivals. Amazon. But many of those deals have since been undone, including Brazilian e-commerce company Elo7 in 2023 and musical instrument marketplace Reverb last year.

Etsy has struggled to grow its business since the pandemic e-commerce boom, while it battles stiff competition from Amazon, Shopify and ultra-cheap online marketplaces like Temu, Shein and TikTok Shop.

Etsy saw active buyers and gross product volume decline year over year on its main platform in 2024a trend that continued last year. The company is also bearing the brunt of President Donald Trump’s tariff policies and a difficult macroeconomic environment that has led to a pullback on discretionary spending among consumers.

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