Etsy estimated third-quarter sales below market estimates on Wednesday, indicating a slowing in demand for handcrafted goods on its online marketplace, sending its shares down 6% after the bell.
Reuters reported that consumers have cut back on spending, which includes higher-margin home furnishings and personalized products and gifts sold on Etsy’s marketplace.
This has dulled Etsy’s COVID-era profits when buyers with disposable income splurged on decor and other non-essential items. In the second quarter that ended on June 30, the company’s consolidated gross merchandise sales declined 0.6% to $3.01 billion.
According to Refinitiv data, the company expects revenue in the third quarter to range between $610 and $645 million.