Etsy CEO Josh Silverman on the corporate’s post-Covid progress
Josh Silverman, Etsy CEO, told CNBC on Friday that no one knows what will happen to the coronavirus pandemic this year, but he hopes the company will “outperform e-commerce as a whole”.
“Neither of us have a crystal ball,” Silverman said on Squawk Box, the day after the online market posted much better-than-expected fourth-quarter earnings and sales.
Etsy was a big beneficiary of the stay-at-home economy during Covid.
“If I look at 2020, e-commerce has grown at a crazy rate. E-commerce has grown over 40% year-over-year, and yet Etsy has grown 2.5 times the e-commerce rate” , he said.
“I don’t know what ecommerce will do in 2021,” he admitted, but added, “I hope and believe that Etsy can continue to outperform ecommerce overall.”
Etsy revenue for full year 2020 was $ 1.73 billion, up 111% year over year, while net income increased 264% to $ 349 million. Gross merchandise sales in the company’s marketplace – known for its independent artisans who sell a range of products – rose to $ 10.28 billion last year. That’s an increase of $ 4.97 billion in 2019.
The company declined to issue full-year projections due to the pandemic and instead offered them quarterly. For the current first quarter, Etsy expects sales between 513 and 536 million US dollars, which is significantly better than the 383 million US dollars expected by Wall Street.
In a conference call following the profit on Thursday, Silverman told analysts that Etsy had met its 2023 business goals three years ahead of schedule after the pandemic accelerated online shopping adoption and demand for essentially new product categories in its market like Face masks.
Silverman told CNBC that when looking at Etsy’s position after Covid, he saw two competing forces. On the positive side, millions of people who typically shopped in brick and mortar stores prior to the pandemic have started buying goods online. On the flip side, he said retail will make up a smaller portion of consumer spending as a full economic reopening occurs and more people eat and travel in restaurants again.
“What I don’t know – and what I don’t know that any of us know – is what will happen to overall consumer spending as restrictions wear off,” said Silverman. “What I do know is that if you look long-term, if you look to 2022 and 2023 and beyond, e-commerce just keeps getting bigger and I think we’re getting bigger and bigger.”
Etsy stocks rose 9% just after Friday open. The company’s shares are up nearly 300% in the past 12 months.