Etsy, Inc. (NASDAQ: ETSY) nets $1.4B from Depop sale to eBay
Rhea-AI Filing Summary
Etsy, Inc. completed the sale of its wholly owned subsidiary Depop Limited to eBay Inc. on July 30, 2026, for aggregate consideration of approximately $1.4 billion in cash, reflecting a $1.2 billion base purchase price plus $200 million of net purchase price adjustments and interest. Etsy also executed a second amendment to its 2023 Credit Agreement to permit this disposition. The transaction closed after satisfaction of required regulatory approvals.
Etsy classifies Depop as a discontinued operation under U.S. GAAP and provides unaudited pro forma consolidated financial statements prepared under Article 11 of Regulation S-X. On a pro forma basis as of March 31, 2026, the Depop sale significantly increases cash balances and substantially reduces Etsy’s stockholders’ deficit, while historical results for 2023–2025 are recast to exclude Depop. Etsy states it plans to use the proceeds for general corporate purposes aligned with its capital allocation strategy, including accelerating its share repurchase program.
Positive
- Depop divestiture generates approximately $1.4 billion in cash proceeds, giving Etsy substantial additional liquidity for general corporate purposes and to support the capital allocation strategy that includes accelerating its share repurchase program.
- Unaudited pro forma figures show Etsy’s total stockholders’ deficit narrowing from 1,136,872 (in thousands) historically to 99,581 (in thousands) after the Depop sale, reflecting the transaction gain and release of accumulated currency translation adjustments.
Negative
- None.
Filing Explained
The final accounting gain remains unsettled; the filed pro forma balance sheet shows cash of $2,614,288 as of March 31, 2026.
The Depop sale closed on
The filing’s pro forma presentation treats the sale as if it had occurred on
The historical operating comparisons are not a complete picture of Etsy after all prior divestitures: the 2025 pro forma statement removes Reverb through its sale date, but the 2024 and 2023 statements do not remove Reverb’s earlier results, and 2023 does not remove Elo7’s results.
8-K Event Classification
3 items: 2.01, 7.01, 9.01
3 items
Item 2.01
Completion of Acquisition or Disposition of Assets
Financial
The company completed a significant acquisition or sale of business assets.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Aggregate cash consideration for Depop: approximately $1.4 billion
Base purchase price for Depop: $1.2 billion
Net purchase price adjustments and interest: $200 million
+5 more
8 metrics
Aggregate cash consideration for Depop
approximately $1.4 billion
Cash received at closing for sale of Depop to eBay
Base purchase price for Depop
$1.2 billion
Base cash purchase price under the Purchase Agreement
Net purchase price adjustments and interest
$200 million
Net purchase price adjustments and interest added to base price
Net cash proceeds from Depop sale
$1,399,914 thousand
Net cash proceeds per pro forma Note B(i), assuming closing on March 31, 2026
Pro forma gain on sale of Depop
$805,047 thousand
Gain on sale recorded to accumulated deficit as if closed March 31, 2026
Pro forma cash and cash equivalents
$2,614,288 thousand
Cash and cash equivalents as of March 31, 2026 on a pro forma basis
Historical 2025 revenue
$2,883,501 thousand
Total revenue for the year ended December 31, 2025, as reported
Pro forma 2025 net income
$369,685 thousand
Net income for 2025 assuming Depop sale and Reverb removal
Key Terms
discontinued operation, lockbox structure, purchase price adjustments, accumulated other comprehensive (loss) income, +2 more
6 terms
discontinued operation financial
"the sale of Depop has met the criteria to be classified as a discontinued operation"
A discontinued operation is a part of a company that has been sold, closed, or is planned to be shut down, and will no longer be part of its ongoing business activities. For investors, it matters because it can significantly affect a company's financial results and future outlook, similar to removing a large, ongoing project from a company's operations. Recognizing discontinued operations helps investors better understand a company's current performance separate from parts that are no longer active.
lockbox structure financial
"The Second Amendment established a lockbox structure to fix the economic measurement date"
purchase price adjustments financial
"Purchase price adjustments include those for Depop’s working capital, transaction expenses, cash, and indebtedness"
Purchase price adjustments are changes made to the agreed sale price of a company after closing to reflect actual financial facts—like cash on hand, debts, or inventory—found when final accounts are prepared. Think of it as the final bill after a home inspection: the buyer and seller settle differences so the price matches reality. For investors, these adjustments affect the true cost, future earnings and cash flow from a deal, and therefore the value of the investment.
accumulated other comprehensive (loss) income financial
"Accumulated other comprehensive (loss) income | (240,060)"
Accumulated other comprehensive (loss) income is a running total on a company’s balance sheet that captures certain unrealized gains and losses that are excluded from regular profit and loss, such as currency translation shifts, some investment value changes, and pension plan adjustments. Think of it like value swings recorded in a side ledger for items not yet sold; it matters to investors because large or growing balances can signal hidden volatility or future effects on shareholders’ equity when those unrealized items are settled.
Article 11 of Regulation S-X regulatory
"have been prepared in accordance with Article 11 of Regulation S-X and has been derived"
significant disposition regulatory
"The sale of Depop constitutes a significant disposition for purposes of Item 2.01"
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
What transaction involving Depop did Etsy (ETSY) complete on July 30, 2026?
Etsy completed the sale of Depop Limited to eBay Inc. for approximately $1.4 billion in cash. This reflects a $1.2 billion base purchase price plus $200 million of net purchase price adjustments and interest under the Purchase Agreement.
How much cash did Etsy (ETSY) ultimately receive from the Depop sale?
Etsy received aggregate cash consideration of approximately $1.4 billion at closing, combining a $1.2 billion purchase price and $200 million of net purchase price adjustments and interest. Net cash proceeds remain subject to specified post-closing adjustments in the Purchase Agreement.
How does Etsy (ETSY) plan to use the Depop sale proceeds?
Etsy plans to use the Depop sale proceeds for general corporate purposes aligned with its capital allocation strategy. That strategy, referenced in its April 29 shareholder letter, includes plans to accelerate its share repurchase program alongside other corporate uses.
How is the Depop transaction reflected in Etsy (ETSY)’s pro forma financials?
Etsy’s unaudited pro forma financials treat Depop as a discontinued operation and reflect the Depop sale as if completed earlier periods. The pro forma balance sheet as of March 31, 2026 shows materially higher cash and a sharply reduced stockholders’ deficit after the transaction adjustments.
What gain does Etsy (ETSY) report from the Depop sale in its pro forma data?
The pro forma notes show a gain on sale of 805,047 (in thousands) recorded to accumulated deficit, based on net cash proceeds of 1,399,914 (in thousands), net assets sold, related accumulated other comprehensive loss, and costs to sell, assuming closing as of March 31, 2026.
Why did Etsy (ETSY) amend its 2023 Credit Agreement in connection with the Depop sale?
Etsy entered into a Second Amendment to its 2023 Credit Agreement with JPMorgan Chase Bank and other lenders. The amendment, among other changes, permits the disposition of Depop shares pursuant to the Purchase Agreement governing the sale to eBay.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
FORM 8-K
_____________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 30, 2026
(Exact name of registrant as specified in its charter)
_____________________________________
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of principal executive offices, including zip code)
(718 ) 880-3660
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
_____________________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □
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Item 1.01. Entry into a Material Definitive Agreement.
On July 30, 2026, Etsy, Inc. ("Etsy") entered into the Second Amendment to Amended and Restated Credit Agreement (the "Second Amendment to the 2023 Credit Agreement"), by and among Etsy, as borrower, the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent, which amends that certain Amended and Restated Credit Agreement, dated as of March 24, 2023 (the “2023 Credit Agreement,” as previously amended by the First Amendment to Amended and Restated Credit Agreement, dated as of June 2, 2025, the "First Amendment to the 2023 Credit Agreement," and as further amended by the Second Amendment to the 2023 Credit Agreement).
The Second Amendment to the 2023 Credit Agreement amends the 2023 Credit Agreement to, among other things, permit the disposition of the shares of Depop Limited, a wholly-owned subsidiary of Etsy ("Depop"), pursuant to the Purchase Agreement, as defined in and described further in Item 2.01 below.
The foregoing description of the Second Amendment to the 2023 Credit Agreement does not purport to be complete and is subject to, and qualified in its entirety by, reference to the full text of the Second Amendment to the 2023 Credit Agreement, a copy of which is filed as Exhibit 10.1 to this Current Report on Form 8-K.
Item 2.01. Completion of Acquisition or Disposition of Assets.
On July 30, 2026, Etsy completed the previously announced sale of Depop to eBay Inc., a Delaware corporation ("eBay”), pursuant to the terms of that certain Sale and Purchase Agreement, dated as of February 15, 2026 (the “Original Purchase Agreement”), as supplemented on May 21, 2026 (the "First Amendment") and as amended on July 12, 2026 (the "Second Amendment" and, together with the Original Purchase Agreement and the First Amendment, the "Purchase Agreement"), by and between Etsy and eBay (the “Transaction”). The aggregate consideration received by Etsy at the closing was approximately $1.4 billion in cash, reflecting the purchase price of $1.2 billion plus $200 million of net purchase price adjustments and interest. The net cash proceeds are further subject to certain post-closing adjustments as set forth in the Purchase Agreement.
The foregoing description of the Purchase Agreement and the Transaction does not purport to be complete and in each case is subject to, and qualified in its entirety by, reference to the full text of the Purchase Agreement, a copy of which was filed as Exhibit 2.1 to the Current Report on Form 8-K filed by Etsy on February 18, 2026, as supplemented by the First Amendment, dated May 21, 2026, a copy of which was filed as Exhibit 2.1 to the Current Report on Form 8-K filed by Etsy on May 28, 2026; and as amended by the Second Amendment dated July 12, 2026, a copy of which was filed as Exhibit 2.1 to the Current Report on Form 8-K filed by Etsy on July 16, 2026; each of which is incorporated herein by reference.
The unaudited pro forma financial information giving effect to the Transaction is filed herewith as Exhibit 99.2.
Item 7.01 Regulation FD Disclosure
On July 30, 2026, Etsy issued a press release announcing the completion of the previously announced sale of Depop to eBay. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1.
The information in this Item 7.01, including Exhibit 99.1, is furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, and shall not be deemed subject to the requirements of amended Item 10 of Regulation S-K or incorporated by reference into any filing under the Securities Act of 1933, as amended, regardless of any general incorporation.
Item 9.01. Financial Statements and Exhibits.
(b) Pro Forma Financial Information.
The unaudited pro forma consolidated financial information of Etsy giving effect to the Transaction is filed as Exhibit 99.2 hereto and is incorporated herein by reference. The unaudited pro forma consolidated financial information is provided for informational purposes only and does not purport to represent Etsy’s actual financial condition or results of operations had the Depop sale occurred on the dates indicated nor does it project Etsy’s results of operations or financial condition for any future period or date. Etsy has prepared the unaudited pro forma
2
financial information based on available information and using certain assumptions that Etsy’s management believes are reasonable as of the date of this filing. As a result, the actual results reported by Etsy in periods following the Depop sale may differ materially from this unaudited pro forma consolidated financial information.
(d) Exhibits.
The following materials are attached as exhibits to this Current Report on Form 8-K:
| Exhibit No. | Description | ||||
10.1 | Second Amendment to the Amended and Restated Credit Agreement, dated as of July 30, 2026, among Etsy, Inc., JPMorgan Chase Bank, N.A., and the other parties thereto | ||||
99.1 | Press Release issued by Etsy on July 30, 2026 | ||||
99.2 | Unaudited Pro Forma Consolidated Financial Information of Etsy | ||||
| 104 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document | ||||
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
ETSY, INC.
By: /s/ Colin Stretch
Colin Stretch
Chief Legal Officer
Dated: July 30, 2026
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Exhibit 99.1
Etsy, Inc. Completes Sale of Depop
Transaction enables exclusive focus on driving sustainable long-term growth for the Etsy marketplace
BROOKLYN, N.Y., July 30, 2026 — Etsy, Inc. (NYSE: ETSY), which owns and operates the Etsy marketplace, the global destination for unique and creative goods, today announced that it has successfully completed the previously announced sale of Depop, a community-powered fashion resale marketplace, to eBay Inc. (Nasdaq: EBAY) for approximately $1.4 billion in cash, reflecting the purchase price of $1.2 billion plus $200 million of net purchase price adjustments and interest. The net cash proceeds are further subject to certain post-closing adjustments. The transaction was finalized following the satisfaction of closing conditions including the receipt of required regulatory approvals.
With the divestiture complete, Etsy plans to utilize the proceeds from the transaction for general corporate purposes aligned with the capital allocation strategy outlined in its April 29th Shareholder Letter, which included plans to accelerate its share repurchase program.
“We are excited for what's next for both Etsy and Depop,” said Kruti Patel Goyal, Chief Executive Officer of Etsy. “This transaction allows us to move forward with a clear focus on building the best marketplace for Etsy's buyers and sellers, and is a strong outcome for our shareholders. We're proud of what the Depop team has built - a truly differentiated brand with a passionate community - and we wish them continued success as part of eBay."
About Etsy
Etsy, Inc. owns and operates the Etsy marketplace, the global destination for unique and creative goods, connecting millions of creative entrepreneurs with buyers around the world.
In a time of increasing automation, it’s our mission to keep human connection at the heart of commerce. That’s why we built a place where creativity lives and thrives because it’s powered by people. We help our community of sellers turn their ideas into successful businesses. Our platform connects them with millions of buyers looking for an alternative—something special with a human touch, for those moments in life that deserve imagination.
Etsy was founded in 2005 and is headquartered in Brooklyn, New York.
Forward-Looking Statements
This press release contains “forward-looking” statements within the meaning of the federal securities laws, including statements regarding the potential benefits of the transaction, the final net cash proceeds and Etsy's intended use of proceeds, and our ability to grow the Etsy marketplace. In some cases, forward-looking statements can be identified by terms such as “aim,” “anticipate,” “believe,” “commit,” “continue,” “could,” “design,” “develop,” “enable,” “estimate,” "expect," “forecast,” “future,” “goal,” “impact,” “intend,” “likely,” “maintain,” “may,” “ongoing,” “opportunity,” “optimistic,” “outlook,” “plan,” “possible,” “potential,” “predict,” “probable,” “pursue,” “remain,” “seek,” “should,” “strategy,” “strive,” “target,” “value,” “will,” “would,” or similar expressions, variations and derivative forms and/or the negatives of those words. Forward-looking statements involve substantial risks and uncertainties that may cause actual results to differ materially from those that Etsy expects. These risks and uncertainties include market risks, trends and conditions, and are more fully described in Etsy’s filings with the Securities and Exchange Commission, including in the section titled “Risk Factors” in Etsy’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 and in the risk factors included in Etsy’s subsequent quarterly and annual reports. In light of such risks, readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements represent beliefs and assumptions of Etsy only as of the date of this press release. Etsy does not intend to update, and disclaims any obligation to update, any of these
forward-looking statements for any reason after the date of this press release or to conform these statements to actual results or revised expectations, except as required by law.
Etsy Contacts:
Investor Relations
Deb Wasser
ir@etsy.com
Media Relations
Lauren Bayse
press@etsy.com
Exhibit 99.2
Etsy, Inc.
Unaudited Pro Forma Consolidated Financial Information
Introduction
As previously disclosed, on February 15, 2026, Etsy, Inc., a Delaware corporation (“Etsy" or the "Company") executed a Sale and Purchase Agreement (the “Original Purchase Agreement”) to sell all of the outstanding equity interests of Depop Limited ("Depop"), a wholly-owned subsidiary of Etsy incorporated under the laws of England and Wales operating its fashion resale marketplace, to eBay Inc., a Delaware corporation (“eBay”). The Original Purchase Agreement, as supplemented May 21, 2026 (the “First Amendment”) and as amended July 12, 2026 (the “Second Amendment”), is referred to herein collectively as the “Purchase Agreement.” Pursuant to the Purchase Agreement, eBay agreed to acquire all of the outstanding equity interests of Depop for a base purchase price of $1.2 billion in cash, subject to certain purchase price adjustments as set forth in the Purchase Agreement. The First Amendment was intended to enable Etsy and Depop to make continued investments, in their sole discretion, to maintain the competitiveness of the Depop business. The Second Amendment established a lockbox structure to fix the economic measurement date for purchase price adjustments (other than transaction expenses) as of July 17, 2026 (the “Lockbox Date”), among other things. Purchase price adjustments include those for Depop’s working capital, transaction expenses, cash, and indebtedness as well as for the value of any forfeited equity awards of Depop employees continuing with eBay, and for certain investments Etsy and Depop, in their sole discretion, made in the Depop business prior to the Lockbox Date.
On July 30, 2026 (the “Closing Date”), pursuant to the Purchase Agreement, Etsy completed the sale of Depop to eBay for aggregate cash consideration of approximately $1.4 billion, reflecting the purchase price of $1.2 billion plus $200 million of net purchase price adjustments and interest as set forth in the Purchase Agreement. The net cash proceeds is further subject to certain post-closing adjustments as set forth in the Purchase Agreement.
The sale of Depop constitutes a significant disposition for purposes of Item 2.01 of Form 8-K. Etsy has also determined that the sale of Depop has met the criteria to be classified as a discontinued operation in accordance with accounting principles generally accepted in the United States of America. Accordingly, the Company began to account for Depop as a discontinued operation beginning in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 (“Q1 2026 Quarterly Report”).
The unaudited pro forma consolidated financial statements presented below have been prepared in accordance with Article 11 of Regulation S-X and has been derived from the Company’s historical consolidated financial statements and are being presented to give effect to the sale of Depop.
The Unaudited Pro Forma Consolidated Balance Sheet as of March 31, 2026 adjusts the Company’s assets, liabilities, and stockholders' deficit to reflect the sale of Depop as of March 31, 2026, including but not limited to, recognition of a gain on sale in accumulated deficit of $805.0 million. The amount of the actual gain on sale to be recorded within our consolidated statements of operations for the three and nine months ended September 30, 2026 will be calculated based on the carrying value of Depop as of the Closing Date, and therefore may differ materially from the gain on sale presented below. The Unaudited Pro Forma Consolidated Statements of Operations for the fiscal years ended December 31, 2025, December 31, 2024, and December 31, 2023 give effect to the sale of Depop as if it had been consummated on January 1, 2023. A pro forma consolidated statement of operations for the three months ended March 31, 2026 is not presented because the historical unaudited condensed consolidated statement of operations included in the Company’s Q1 2026 Quarterly Report already reflects Depop as a discontinued operation.
The unaudited pro forma consolidated financial statements and the accompanying notes should be read in conjunction with:
i.The unaudited interim historical condensed consolidated financial statements of the Company, the accompanying notes, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Q1 2026 Quarterly Report.
ii.The audited historical financial statements of the Company, the accompanying notes, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report on Form 10-K for the fiscal years ended December 31, 2025, December 31, 2024, and December 31, 2023.
The unaudited pro forma consolidated financial information is provided for informational purposes only and does not purport to represent the Company’s actual financial condition or results of operations had the Depop sale occurred on the dates indicated nor does it project the Company’s results of operations or financial condition for any future
1
period or date. The Company has prepared the unaudited pro forma financial information based on available information and using certain assumptions that the Company’s management believes are reasonable as of the date of this filing. As a result, the actual results reported by the Company in periods following the Depop sale may differ materially from this unaudited pro forma consolidated financial information.
Pro Forma Consolidated Balance Sheet (Unaudited)
(In thousands, except per share amounts)
| As of March 31, 2026 | |||||||||||||||||
| Historical (As Reported) | Removal of Depop Discontinued Operations (Note A) | Transaction Adjustments | Notes | Pro Forma | |||||||||||||
| ASSETS | |||||||||||||||||
| Current assets: | |||||||||||||||||
| Cash and cash equivalents | $ | 1,214,374 | $ | — | $ | 1,399,914 | B (i) | $ | 2,614,288 | ||||||||
| Short-term investments | 211,391 | — | — | 211,391 | |||||||||||||
| Accounts receivable, net of expected credit losses | 8,711 | — | — | 8,711 | |||||||||||||
| Prepaid and other current assets | 98,625 | — | — | 98,625 | |||||||||||||
| Funds receivable and seller accounts | 185,863 | — | — | 185,863 | |||||||||||||
| Current assets of discontinued operations | 393,845 | (393,845) | — | — | |||||||||||||
| Total current assets | 2,112,809 | (393,845) | 1,399,914 | 3,118,878 | |||||||||||||
| Restricted cash | 7,591 | — | — | 7,591 | |||||||||||||
| Property and equipment, net of accumulated depreciation and amortization | 202,426 | — | — | 202,426 | |||||||||||||
| Goodwill | 37,600 | — | — | 37,600 | |||||||||||||
| Intangible assets, net of accumulated amortization | 13,168 | — | — | 13,168 | |||||||||||||
| Deferred tax assets | 114,612 | — | — | 114,612 | |||||||||||||
| Long-term investments | 150,591 | — | — | 150,591 | |||||||||||||
| Other assets | 42,256 | — | — | 42,256 | |||||||||||||
| Total assets | $ | 2,681,053 | $ | (393,845) | $ | 1,399,914 | $ | 3,687,122 | |||||||||
| LIABILITIES AND STOCKHOLDERS’ DEFICIT | |||||||||||||||||
| Current liabilities: | |||||||||||||||||
| Accounts payable | $ | 15,444 | $ | — | $ | — | $ | 15,444 | |||||||||
| Accrued expenses | 260,602 | — | 20,632 | (C) | 281,234 | ||||||||||||
| Short-term debt, net | 649,301 | — | — | 649,301 | |||||||||||||
| Funds payable and amounts due to sellers | 185,863 | — | — | 185,863 | |||||||||||||
| Deferred revenue | 30,347 | — | — | 30,347 | |||||||||||||
| Other current liabilities | 57,142 | — | — | 57,142 | |||||||||||||
| Current liabilities of discontinued operations | 51,854 | (51,854) | — | — | |||||||||||||
| Total current liabilities | 1,250,553 | (51,854) | 20,632 | 1,219,331 | |||||||||||||
| Finance lease obligations—net of current portion | 91,902 | — | — | 91,902 | |||||||||||||
| Deferred tax liabilities | 9,783 | — | — | 9,783 | |||||||||||||
| Long-term debt, net | 2,334,570 | — | — | 2,334,570 | |||||||||||||
| Other liabilities | 131,117 | — | — | 131,117 | |||||||||||||
| Total liabilities | 3,817,925 | (51,854) | 20,632 | 3,786,703 | |||||||||||||
| Stockholders’ deficit: | |||||||||||||||||
| Common stock ($0.001 par value, 1,400,000 shares authorized as of March 31, 2026; 94,887 shares issued and outstanding as of March 31, 2026) | 95 | — | — | 95 | |||||||||||||
| Preferred stock ($0.001 par value, 25,000 shares authorized as of March 31, 2026) | — | — | — | — | |||||||||||||
| Additional paid-in capital | 1,583,820 | — | — | 1,583,820 | |||||||||||||
| Accumulated deficit | (2,480,727) | — | 795,126 | B (ii), (C) | (1,685,601) | ||||||||||||
| Accumulated other comprehensive (loss) income | (240,060) | — | 242,165 | B (iii) | 2,105 | ||||||||||||
| Total stockholders’ deficit | (1,136,872) | — | 1,037,291 | (99,581) | |||||||||||||
| Total liabilities and stockholders’ deficit | $ | 2,681,053 | $ | (51,854) | $ | 1,057,923 | $ | 3,687,122 | |||||||||
See accompanying notes to Unaudited Pro Forma Consolidated Financial Statements.
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Etsy, Inc.
Pro Forma Consolidated Statement of Operations (Unaudited)
(In thousands, except per share amounts)
| Year ended December 31, 2025 | |||||||||||||||||
| Historical (As Reported) | Removal of Depop Discontinued Operations (Note A) | Removal of Reverb (Note D) | Transaction Adjustments (Note E) | Pro Forma | |||||||||||||
| Revenue | $ | 2,883,501 | $ | (186,559) | $ | (43,236) | $ | — | $ | 2,653,706 | |||||||
| Cost of revenue | 817,800 | (108,770) | (21,439) | 91 | 687,682 | ||||||||||||
| Gross profit | 2,065,701 | (77,789) | (21,797) | (91) | 1,966,024 | ||||||||||||
| Operating expenses: | |||||||||||||||||
| Marketing | 914,830 | (119,012) | (11,380) | 251 | 784,689 | ||||||||||||
| Product development | 450,192 | (48,988) | (7,270) | 1,363 | 395,297 | ||||||||||||
| General and administrative | 332,766 | (18,666) | (9,774) | 8,216 | 312,542 | ||||||||||||
| Asset impairment charge | 101,703 | — | (101,703) | — | — | ||||||||||||
| Total operating expenses | 1,799,491 | (186,666) | (130,127) | 9,830 | 1,492,528 | ||||||||||||
| Income from operations | 266,210 | 108,877 | 108,330 | (9,921) | 473,496 | ||||||||||||
| Other expense: | |||||||||||||||||
| Interest expense | (18,509) | — | — | — | (18,509) | ||||||||||||
| Interest and other income | 44,489 | — | 380 | — | 44,869 | ||||||||||||
| Foreign exchange loss | (40,428) | 53 | (573) | — | (40,948) | ||||||||||||
| Loss on sale of business | (5,097) | — | — | — | (5,097) | ||||||||||||
| Total other expense | (19,545) | 53 | (193) | — | (19,685) | ||||||||||||
| Income before income taxes | 246,665 | 108,930 | 108,137 | (9,921) | 453,811 | ||||||||||||
| Provision for income taxes | (83,683) | (552) | 109 | — | (84,126) | ||||||||||||
| Net income | $ | 162,982 | $ | 108,378 | $ | 108,246 | $ | (9,921) | $ | 369,685 | |||||||
| Net income per share attributable to common stockholders: | |||||||||||||||||
| Basic | $ | 1.59 | $ | 3.61 | |||||||||||||
| Diluted | $ | 1.39 | $ | 3.06 | |||||||||||||
| Weighted average common shares outstanding: | |||||||||||||||||
| Basic | 102,356 | 102,356 | |||||||||||||||
| Diluted | 124,114 | 124,114 | |||||||||||||||
See accompanying notes to Unaudited Pro Forma Consolidated Financial Statements.
3
Etsy, Inc.
Pro Forma Consolidated Statement of Operations (Unaudited)
(In thousands, except per share amounts)
| Year ended December 31, 2024 | |||||||||||
| Historical (As Reported) | Removal of Depop Discontinued Operations (Note A) | Pro Forma | |||||||||
| Revenue | $ | 2,808,332 | $ | (129,411) | $ | 2,678,921 | |||||
| Cost of revenue | 774,554 | (87,245) | 687,309 | ||||||||
| Gross profit | 2,033,778 | (42,166) | 1,991,612 | ||||||||
| Operating expenses: | |||||||||||
| Marketing | 856,565 | (65,592) | 790,973 | ||||||||
| Product development | 443,056 | (45,549) | 397,507 | ||||||||
| General and administrative | 353,949 | (24,125) | 329,824 | ||||||||
| Total operating expenses | 1,653,570 | (135,266) | 1,518,304 | ||||||||
| Income from operations | 380,208 | 93,100 | 473,308 | ||||||||
| Other income: | |||||||||||
| Interest expense | (13,806) | — | (13,806) | ||||||||
| Interest and other income | 30,982 | — | 30,982 | ||||||||
| Foreign exchange gain | 13,391 | 69 | 13,460 | ||||||||
| Total other income | 30,567 | 69 | 30,636 | ||||||||
| Income before income taxes | 410,775 | 93,169 | 503,944 | ||||||||
| Provision for income taxes | (107,494) | (25,126) | (132,620) | ||||||||
| Net income | $ | 303,281 | $ | 68,043 | 371,324 | ||||||
| Net income per share attributable to common stockholders: | |||||||||||
| Basic | $ | 2.64 | $ | 3.23 | |||||||
| Diluted | $ | 2.35 | $ | 2.87 | |||||||
| Weighted average common shares outstanding: | |||||||||||
| Basic | 114,944 | 114,944 | |||||||||
| Diluted | 131,721 | 131,721 | |||||||||
See accompanying notes to Unaudited Pro Forma Consolidated Financial Statements.
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Etsy, Inc.
Pro Forma Consolidated Statement of Operations (Unaudited)
(In thousands, except per share amounts)
| Year ended December 31, 2023 | |||||||||||
| Historical (As Reported) | Removal of Depop Discontinued Operations (Note A) | Pro Forma | |||||||||
| Revenue | $ | 2,748,377 | $ | (88,637) | $ | 2,659,740 | |||||
| Cost of revenue | 828,675 | (64,498) | 764,177 | ||||||||
| Gross profit | 1,919,702 | (24,139) | 1,895,563 | ||||||||
| Operating expenses: | |||||||||||
| Marketing | 759,196 | (47,290) | 711,906 | ||||||||
| Product development | 469,332 | (45,149) | 424,183 | ||||||||
| General and administrative | 343,242 | (18,813) | 324,429 | ||||||||
| Asset impairment charge | 68,091 | — | 68,091 | ||||||||
| Total operating expenses | 1,639,861 | (111,252) | 1,528,609 | ||||||||
| Income from operations | 279,841 | 87,113 | 366,954 | ||||||||
| Other income: | |||||||||||
| Interest expense | (14,042) | — | (14,042) | ||||||||
| Interest and other income | 35,999 | 6 | 36,005 | ||||||||
| Foreign exchange loss | (6,348) | 168 | (6,180) | ||||||||
| Loss on sale of business | (2,630) | — | (2,630) | ||||||||
| Total other income | 12,979 | 174 | 13,153 | ||||||||
| Income before income taxes | 292,820 | 87,287 | 380,107 | ||||||||
| Benefit (provision) for income taxes | 14,748 | (29,851) | (15,103) | ||||||||
| Net income | $ | 307,568 | $ | 57,436 | 365,004 | ||||||
| Net income per share attributable to common stockholders: | |||||||||||
| Basic | $ | 2.51 | $ | 2.98 | |||||||
| Diluted | $ | 2.24 | $ | 2.65 | |||||||
| Weighted average common shares outstanding: | |||||||||||
| Basic | 122,503 | 122,503 | |||||||||
| Diluted | 140,145 | 140,145 | |||||||||
See accompanying notes to Unaudited Pro Forma Consolidated Financial Statements.
5
Etsy, Inc.
Notes to Unaudited Pro Forma Consolidated Financial Statements
Basis of Presentation
The accompanying unaudited pro forma consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission on the basis described under the heading “Introduction.”
Adjustments
Transaction Adjustments
The Unaudited Pro Forma Consolidated Balance Sheet as of March 31, 2026, and the Unaudited Pro Forma Consolidated Statements of Operations for the fiscal years ended December 31, 2025, December 31, 2024, and December 31, 2023, include the following transaction adjustments:
(A)Reflects the deconsolidation of assets and liabilities disposed of in connection with the sale of Depop from the historical information presented. The Unaudited Pro Forma Consolidated Statements of Operations present Depop as discontinued operations. Additionally, the Depop discontinued operations provision for income taxes of ($552) thousand, ($25.1) million, and ($29.9) million for each of the fiscal years ended December 31, 2025, December 31, 2024, and December 31, 2023, respectively, reflects both the income tax effect as if Depop was reported on a separate return basis of $78 thousand, ($13.2) million, and ($19.4) million, respectively, as well as the income tax effect on Etsy from the sale of Depop of ($630) thousand, ($11.9) million, and ($10.5) million, respectively.
(B)Reflects the sale of Depop pursuant to the Purchase Agreement, which includes adjustments required to record the net cash proceeds received in connection with the sale and recognition of the gain on sale in accumulated deficit as if the transaction had occurred on March 31, 2026. The amount of the actual gain on sale to be recorded within our consolidated statements of operations for the three and nine months ended September 30, 2026 will be calculated based on the carrying value of Depop as of the Closing Date, and therefore may differ materially from the gain on sale presented below.
(i)Net cash proceeds in connection with the sale of Depop are as follows (in thousands):
| Base purchase price | $ | 1,200,000 | |||
| Purchase price adjustments and interest | 199,914 | ||||
| Net cash proceeds | $ | 1,399,914 | |||
(ii)The gain on sale of Depop recorded to accumulated deficit, assuming the sale was completed as of March 31, 2026, is as follows (in thousands):
| Net cash proceeds | $ | 1,399,914 | |||
| Net assets sold | (341,991) | ||||
| Accumulated other comprehensive loss | (242,165) | ||||
| Costs to sell | (10,711) | ||||
| Gain on sale | $ | 805,047 | |||
(iii)Reflects the release of currency translation adjustments directly attributable to Depop in the amount of $242.2 million.
(C)Reflects the recognition of accrued expenses of approximately $20.6 million related to non-recurring costs to sell of $10.7 million and non-recurring transaction costs of $9.9 million estimated to be incurred subsequent to March 31, 2026. The $10.7 million of costs to sell is included in the gain on sale of $805.0 million and recorded to accumulated deficit as per Note B (ii) above. The transaction costs of $9.9 million are recorded to accumulated deficit for a net adjustment to accumulated deficit of $795.1 million.
(D)Other than the adjustment for the year ended December 31, 2025 to remove the results of operations for Reverb Holdings, Inc. (“Reverb”) through its June 2, 2025 sale date, the Unaudited Pro Forma Consolidated Statements of Operations have not been adjusted to exclude Reverb’s results of operations for the years ended December 31, 2024 or 2023 or Elo7 Serviços de Informática S.A. results of operations through its
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Etsy, Inc.
August 10, 2023 sale date for the year ended December 31, 2023. Accordingly, the pro forma results for the years ended December 31, 2024 and 2023 do not represent Etsy’s results excluding all businesses disposed of during the periods presented. The pro forma adjustments are limited to those required or permitted under Article 11 of Regulation S-X for the transactions and periods reflected herein.
(E)Reflects non-recurring transaction costs incurred or estimated to be incurred through the Closing Date, and primarily relate to legal fees and employee transaction bonuses. The transaction adjustments are not deductible for tax purposes, therefore no tax rate is applied.
7