Etsy sells second-hand fashion app Depop to eBay for $1.2bn

Source: BBC Technology

Deal overview

• Etsy is offloading Depop just five years after acquiring the UK‑founded business for $1.6 bn.
• The transaction is an all‑cash deal expected to close by mid‑year.
• Depop will retain its name and branding under eBay ownership.

Why eBay is buying Depop

• eBay aims to “reach a younger demographic across the expanding re‑commerce landscape.”
• Used‑clothes sales are one of eBay’s fastest‑growing categories.
• CEO Jamie Iannone said the acquisition will boost eBay’s performance in the sector.

Market context

• Apps that enable buying and selling pre‑loved garments have grown as young consumers seek sustainable, low‑cost alternatives to traditional retailers.
• According to Etsy, nearly 90 % of Depop’s seven million active buyers are under 34, and the platform has more than three million active sellers.
• Kruti Patel Goyal, CEO of Etsy, described Depop as “one of the fastest‑growing fashion resale marketplaces in the US.”

Financial impact

• The announcement coincided with eBay’s 2025 financial results, showing revenues of $11.1 bn, an 8 % increase year‑over‑year.
• Etsy’s share price rose more than 15 % in after‑hours trading, while eBay’s shares gained almost 6.5 %.

Etsy’s recent strategy

• Etsy bought Depop in 2021 as part of a series of major purchases aimed at competing with online retail giants such as Amazon.
• Since then, Etsy has divested several assets:
  • Elo7 (Brazil’s version of Etsy) was sold in 2023 at a loss after a $217 m purchase two years earlier.
  • Reverb, a music‑equipment resale site acquired in 2019, is being sold to refocus on Etsy’s core business.
• The platform, known for handcrafted and niche goods, thrived during the COVID‑19 pandemic but has faced shrinking demand and stiff competition from low‑price fast‑fashion players like Temu and Shein.