Name: Etsy Inc. (NASDAQ:ETSY) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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Etsy Inc., consolidated income statement

US$ in thousands

12 months ended:	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Revenue	2,329,114)	1,725,625)	818,379)	603,693)	441,231)
Cost of revenue	(654,512)	(464,745)	(271,036)	(190,762)	(150,986)
Gross profit	1,674,602)	1,260,880)	547,343)	412,931)	290,245)
Marketing	(654,804)	(500,756)	(215,570)	(158,013)	(109,085)
Product development	(271,535)	(180,080)	(121,878)	(97,249)	(74,616)
General and administrative	(282,531)	(156,035)	(121,134)	(82,883)	(91,486)
Asset impairment charges	—)	—)	—)	—)	(3,162)
Operating expenses	(1,208,870)	(836,871)	(458,582)	(338,145)	(278,349)
Income from operations	465,732)	424,009)	88,761)	74,786)	11,896)
Loss on extinguishment of debt	—)	(16,855)	—)	—)	—)
Interest expense	(9,885)	(42,025)	(24,320)	(22,178)	(11,130)
Interest and other income	2,137)	7,102)	13,199)	8,957)	2,394)
Foreign exchange gain (loss)	13,670)	(6,522)	3,006)	(6,487)	29,105)
Other income (expense)	5,922)	(58,300)	(8,115)	(19,708)	20,369)
Income before income taxes	471,654)	365,709)	80,646)	55,078)	32,265)
(Provision) benefit for income taxes	21,853)	(16,463)	15,248)	22,413)	49,535)
Net income	493,507)	349,246)	95,894)	77,491)	81,800)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Revenue experienced exponential growth over the five-year period, increasing from 441.2 million US dollars in 2017 to 2.33 billion US dollars by 2021. The most significant acceleration occurred between 2019 and 2020, where revenue more than doubled, indicating a period of rapid scale-up. Gross profit followed a similar trajectory, rising from 290.2 million US dollars to 1.67 billion US dollars, with gross margins expanding from approximately 65.7% in 2017 to 72% in 2021.

Operating Expense Analysis: Operating expenses grew from 278.3 million US dollars in 2017 to 1.21 billion US dollars in 2021. Marketing expenses emerged as the primary cost driver, increasing from 109.1 million US dollars to 654.8 million US dollars over the period. Product development and general and administrative expenses also showed steady upward trends, reflecting investments in infrastructure and organizational growth to support the expanding revenue base.
Operating Profitability: Income from operations demonstrated substantial growth, rising from 11.9 million US dollars in 2017 to 465.7 million US dollars in 2021. The sharpest increase in operating income occurred in 2020, which suggests significant operating leverage as revenue growth outpaced the growth of operating expenses.
Net Income and Non-Operating Items: Net income increased from 81.8 million US dollars in 2017 to 493.5 million US dollars in 2021. It is observed that net income in 2017 was bolstered by a significant tax benefit of 49.5 million US dollars. Non-operating items showed volatility, including a loss on extinguishment of debt of 16.9 million US dollars in 2020 and fluctuating foreign exchange gains and losses, though these had a diminishing impact on the overall bottom line relative to the scale of operating income by 2021.

The overall financial trend is characterized by aggressive top-line growth and improving operational efficiency. The ability to expand gross margins while scaling revenue indicates strong pricing power or a shift toward more profitable revenue streams. By 2021, the company transitioned from a modest operating profit to a high-margin operational model with significantly strengthened net profitability.

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