Etsy Shares Dive Over 12% After CEO Transition Announcement

Key Takeaways

• Etsy, Inc. released its third-quarter results today and concurrently announced that longtime CEO Josh Silverman will be succeeded by growth chief Kruti Patel Goyal next year.

• Although Etsy beat expectations for both revenue and earnings per share in Q3, its stock still plunged sharply.

• The marketplace continues to face headwinds: declines in active buyers and sellers, and guidance for Gross Merchandise Sales (GMS) that appears uninspiring to investors.

A Leadership Shift Amid Mixed Results
Etsy confirmed that Josh Silverman, who has led the company since 2017, will step down as CEO on December 31, 2025, with Kruti Patel Goyal taking over as CEO effective January 1, 2026. Silverman will transition into the role of Executive Chair through the end of 2026. The Wall Street Journal

Silverman’s leadership saw Etsy’s stock surge significantly in earlier years, but it has also faced steeper declines since its 2021 peak. The news of his stepping down sparked an immediate negative reaction in the market. Retail Dive

Q3 Performance: Beating the Numbers, But Facing Clear Weaknesses
In Q3, Etsy posted revenue of $678 million and earnings per share of $0.63—both surpassing analysts’ forecasts. Yahoo Finance
Yet, the headline numbers mask some concerning trends:

• GMS fell year-over-year (some sources report a drop of 6.5% to $2.72 billion). Reuters

• Active buyers and active sellers both declined. The Wall Street Journal

• Forward guidance for GMS in Q4 came in between $3.50 billion and $3.65 billion, down from the prior year’s comparable figure, which disappointed investors. Investopedia

Why the Stock Fell Hard
Despite the earnings beat, the market focused on the weak underlying metrics and the murky near-term outlook. The leadership transition adds further uncertainty during a period when the business is already under pressure. The stock reacted accordingly. Barron’s

Key risk factors include:

• Slowing buyer/seller participation on the platform.

• Lower volumes in core marketplace activity (i.e., GMS).

• Competitive pressures and shifting consumer behavior in e-commerce.

• The leadership change signals both continuity and potential strategic shift—which may be welcomed but also raises questions about execution.

What’s Next Under the New CEO
Kruti Patel Goyal brings experience from leading the resale platform Depop and has had major growth roles within Etsy. With her promotion, she will be under pressure to reinvigorate Etsy’s core marketplace and restore growth momentum. Retail Dive

In her comments, Goyal emphasised that Etsy will double-down on what makes it unique: “showing up where shoppers find inspiration, matching them with items that feel tailor-made for them, deepening loyalty across our community, and amplifying what sets us apart — the creativity and authenticity of our sellers.”

For investors and market watchers, the key questions will be:

• Can Etsy halt or reverse declines in buyer and seller engagement?

• Will the new CEO be able to grow GMS meaningfully and improve monetisation?

• How quickly can strategic initiatives (e-commerce, AI, marketplace enhancements) translate into stronger results?