Lead: Etsy Inc. shares surged more than 14% in extended trading on Feb. 18, 2026, after the company agreed to sell its secondhand-fashion app Depop to eBay for about $1.2 billion in cash. The deal, announced alongside eBay’s fourth-quarter results, follows Etsy’s 2021 purchase of Depop for roughly $1.62 billion and is expected to close in the second quarter of 2026. eBay and Etsy said the transaction will refocus Etsy on its core marketplace while giving eBay expanded reach into younger recommerce buyers. Both companies reported positive market responses: eBay stock rose over 8% in extended trading.
Key Takeaways
- Etsy will sell Depop to eBay for approximately $1.2 billion in cash; the transaction is expected to close in Q2 2026.
- Etsy originally acquired Depop in 2021 for about $1.62 billion; about 90% of Depop users are under 34, per Etsy.
- Etsy shares jumped more than 14% in after-hours trading on Feb. 18, 2026; eBay shares rose over 8% the same session.
- eBay reported Q4 adjusted EPS of $1.41 and revenue of $2.97 billion, beating LSEG estimates of $1.34 and $2.88 billion.
- eBay’s gross merchandise volume grew 10% year-over-year to $21.2 billion, above Wall Street’s $20.8 billion expectation.
- eBay gave Q1 2026 guidance of $1.53–$1.59 adjusted EPS and $3.00–$3.05 billion in revenue; analysts expected $1.48 and $2.8 billion.
- Etsy has been pruning prior acquisitions (including Elo7 in 2023 and Reverb in 2025) while refocusing on its core marketplace amid slowing growth.
Background
Etsy bought Depop in 2021 for roughly $1.62 billion to strengthen its appeal with younger shoppers and to enter the fast-growing recommerce market. Depop, founded in the U.K., became known as a social-first marketplace where users buy and sell used clothing, shoes and accessories, with Etsy noting roughly 90% of its user base is under age 34. Etsy’s acquisition strategy over recent years emphasized a “house of brands” approach—buying niche marketplaces to capture adjacent audiences.
That strategy has been revised as Etsy faced slower post‑pandemic growth and intensified competition from Amazon, Shopify, Temu, Shein and social-commerce entrants such as TikTok Shop. Etsy reported year-over-year declines in active buyers and gross merchandise volume in 2024 and into 2025, and has cited macroeconomic headwinds and tariff exposure as headwinds to discretionary spending. As a result, the company has divested or wound down several prior deals, including Brazilian marketplace Elo7 in 2023 and musical-instrument marketplace Reverb in 2025.
Main Event
On Feb. 18, 2026, Etsy announced it reached an agreement to sell Depop to eBay for about $1.2 billion in cash. The companies said the sale will allow Etsy to concentrate resources on its core buyer-and-seller marketplace while enabling Depop to join a larger recommerce platform under eBay. Etsy’s statement framed the move as a strategic refocus rather than an exit from recommerce altogether.
Etsy CEO Kruti Patel Goyal emphasized the move’s strategic intent: she said the transaction will let Etsy “focus exclusively on the compelling opportunity” to grow its main marketplace for buyers and sellers. The companies said the deal is expected to complete in the second quarter of 2026, subject to customary closing conditions and regulatory review where applicable.
eBay CEO Jamie Iannone positioned the purchase as an acceleration of eBay’s fashion strategy and an entry point to younger shoppers. eBay reported its fourth-quarter earnings the same day, with stronger-than-expected revenue and earnings, and said the acquisition complements its existing marketplace categories and expands its recommerce footprint.
Analysis & Implications
For Etsy, the sale represents a pivot back to its core marketplace model after a period of diversification through acquisitions. The roughly $420 million difference between Depop’s 2021 purchase price (~$1.62 billion) and the $1.2 billion sale price will likely be scrutinized by investors for what it signals about acquisition discipline and integration challenges. Proceeds could be used to bolster Etsy’s balance sheet, invest in marketplace product improvements, or return capital to shareholders; the company has not provided a detailed deployment plan beyond refocusing priorities.
For eBay, Depop provides scale in recommerce and deeper access to Gen Z consumers—an audience it has targeted as it seeks faster growth in fashion categories. Integrating Depop’s social-commerce features and younger user base could help eBay diversify its buyer demographics and accelerate growth in a competitive fashion resale market. However, integration risks include preserving Depop’s community-driven culture while aligning payments, trust-and-safety, and seller policies with eBay’s broader platform.
Wider market implications include heightened consolidation in online resale and fashion. Large platforms acquiring niche recommerce players may compress independent marketplace options, but could also yield operational efficiencies and broader buyer reach. Regulators and industry observers will watch how eBay manages data, cross-listing, and potential impacts on competition, especially given the increasing strategic value of recommerce.
Comparison & Data
| Metric | Value | Note |
|---|---|---|
| Depop sale price | $1.2 billion | Cash transaction announced Feb. 18, 2026 |
| Depop purchase price (2021) | ~$1.62 billion | Etsy acquisition in 2021 |
| Etsy share move (after-hours) | +14%+ | Feb. 18, 2026 extended trading |
| eBay Q4 adjusted EPS | $1.41 | Revenue $2.97B; LSEG est. $1.34/$2.88B |
| eBay GMV | $21.2 billion | 10% YoY growth; est. $20.8B |
The table above summarizes the headline financial figures tied to the announcement and eBay’s quarterly results. Together they show why the market reacted positively to the deal: eBay posted stronger-than-expected quarterly performance while acquiring a younger-audience platform, and Etsy’s sale signals a narrower strategic focus that investors often reward.
Reactions & Quotes
“We are excited that this transaction allows us to focus exclusively on the compelling opportunity we see in front of us: to grow the Etsy marketplace in ways that matter most to our buyers and sellers.”
Kruti Patel Goyal, Etsy CEO
Context: Etsy framed the sale as a refocusing move after years of expanding outside its core marketplace. Management pointed to the need to allocate resources where they believe they will have the biggest impact on core metrics.
“This acquisition presents an opportunity to advance one of our newest and fastest-growing Focus Categories with a marketplace that complements our existing presence… and enables us to reach a younger demographic.”
Jamie Iannone, eBay CEO
Context: eBay described Depop as a strategic fit to accelerate growth in fashion and recommerce and to extend reach into younger shoppers, aligning with its category-focused growth agenda.
Unconfirmed
- The precise timeline for regulatory clearance or specific conditions required to close the deal beyond a generic Q2 2026 expectation has not been made public.
- Details on staff retention, product integration plans, and whether Depop will continue to operate independently under eBay are not fully disclosed.
- How Etsy will allocate the cash proceeds—whether toward buybacks, debt reduction, or reinvestment—has not been specified in the announcement.
Bottom Line
The Depop sale to eBay closes a chapter on Etsy’s recent acquisition spree and signals a strategic retrenchment to its core marketplace. Investors interpreted the transaction and eBay’s solid quarterly results as favorable, rewarding both stocks in extended trading. The deal gives eBay an immediate entry into a younger recommerce audience while freeing Etsy to prioritize buyer-and-seller experiences on its flagship platform.
Watch next: regulatory progress toward closing in Q2 2026, statements on integration and product strategy from eBay and Depop, and Etsy’s disclosure of how it plans to use the sale proceeds. Those developments will determine whether this transaction is seen as a disciplined strategic pivot or a concession on a prior acquisition bet.