Etsy 2015 Annual Report Download - page 52

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
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Revenue:
Marketplace
$ 108,732
$ 132,648
$ 23,916
22.0 %
Percentage of total revenue
55.6%
48.5%
Seller Services
$ 82,502
$ 136,608
$ 54,106
65.6 %
Percentage of total revenue
42.2%
49.9%
Other
$ 4,357
$ 4,243
$ (114)
(2.6)%
Percentage of total revenue
2.2%
1.6%
Total revenue
$ 195,591
$ 273,499
$ 77,908
39.8 %
GMS increased $456.4 million, or 23.6%, to $2.4 billion in the year ended December 31, 2015 compared to the year ended December 31, 2014.
During the year ended December 31, 2015, mobile GMS increased as a percentage of total GMS to approximately 43%, up from 37% for the year ended
December 31, 2014, as a result of increased mobile traffic and, to a lesser extent, improvements in our mobile offerings for Etsy buyers.
For the year ended December 31, 2015, international GMS decreased as a percentage of total GMS to 29.8%, from 30.9% for the year ended December 31,
2014. We believe that the impact of currency exchange rates contributed to the year-over-year decline in percent international GMS for the reasons described
below.
In the year ended December 31, 2015, approximately 10% of GMS was from goods that were not listed in U.S. dollars and, as a result, was impacted by
currency exchange fluctuations. On a currency-neutral basis, GMS growth for the year ended December 31, 2015 would have been 25.2%, or approximately
1.6 percentage points higher than the reported 23.6% growth. In addition, we believe weaker local currencies in key international markets continued to
dampen the demand for U.S. dollar-denominated goods during the year ended December 31, 2015, impacting both GMS growth and percent international
GMS. In light of these factors, we estimate that the impact of currency translation on goods not listed in U.S. dollars and the impact of currency exchange
rates on international buyer behavior reduced our year-over-year GMS growth rate by approximately two to four percentage points for the year ended
December 31, 2015.
Revenue increased $77.9 million, or 39.8%, to $273.5 million in the year ended December 31, 2015 compared to the year ended December 31, 2014, of
which 49.9% consisted of Seller Services revenue and 48.5% consisted of Marketplace revenue.
Marketplace revenue increased $23.9 million, or 22.0%, to $132.6 million in the year ended December 31, 2015 compared to the year ended December 31,
2014. This growth corresponded with a 23.6% increase in GMS to a total of $2.4 billion for the year ended December 31, 2015. As our GMS increased, our
Marketplace revenue increased, primarily due to growth in transaction fee revenue and, to a lesser extent, an increase in listing fee revenue. Active sellers
increased 15.5% to 1.6 million and active buyers increased 21.4% to 24.0 million for the year ended December 31, 2015 compared to the year ended
December 31, 2014.
Seller Services revenue increased $54.1 million, or 65.6%, to $136.6 million in the year ended December 31, 2015 compared to the year ended December 31,
2014. The growth in Seller Services revenue was primarily driven by an increase in revenue from Promoted Listings, as well as increases in Direct Checkout
and Shipping Labels revenue. The increase in Promoted Listings revenue was due to the re-launch of the product at the end of the third quarter of 2014. The
fourth quarter of 2015 was the first full quarter following the anniversary of the re-launch of Promoted Listings. The increase in Direct Checkout revenue
reflects an increase in the number of Etsy sellers using the service and the increase in overall GMS. Additionally, Direct Checkout revenue benefited from our
recent integration of PayPal during the fourth quarter of 2015. The increase in Shipping Label revenue reflects a combination of an increase in the number of
Etsy sellers using the service and enhancements to the product. As of December 31, 2015, 48.1% of active sellers use one or more of our Seller Services
compared to 46.1% of active sellers as of December 31, 2014. For December 31, 2015, this included 16.7% of active sellers used Promoted Listings, 40.2% of
active sellers used Direct Checkout and 23.9% of active sellers in the United States and Canada used Shipping Labels.
48