Etsy (NYSE:ETSY) reported a return to profitability for the first quarter ended March 31, 2026, as a robust increase in marketplace revenue and a record take rate offset a slight contraction in total gross merchandise sales (GMS).
The Brooklyn-based e-commerce leader posted total revenue of $631 million, representing a 3.1% increase year-over-year on a continuing operations basis and a 7.6% jump specifically within the Etsy Marketplace segment.
The quarter was defined by the company's ability to extract more value from its platform despite a cooling environment for consumer discretionary spending.
Etsy’s take rate reached 25.7% during the period, driven by the continued adoption of seller services and advertising tools.
While GMS for the Etsy Marketplace grew 5.5% year-over-year, total GMS on a continuing operations basis declined by 3.9% to $2.5 billion, reflecting the impact of recent divestitures and a more cautious consumer base.
Etsy’s bottom-line performance saw a dramatic recovery compared to the prior-year period.
The company reported net income of $105 million, a substantial $140 million improvement on a continuing operations basis.
Adjusted EBITDA came in at $185 million, representing a healthy 29.3% margin.