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Etsy will cut 12% of its workforce

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Online marketplace Etsy will lay off about 220 employees, or roughly 12% of its workforce, as the company reshapes its organization to speed innovation and strengthen its position in an increasingly competitive e-commerce market.

The layoffs, announced Wednesday alongside the company’s second-quarter earnings report, will primarily affect Etsy’s product and engineering teams. Company leaders said the move is intended to streamline operations and better position the business for future growth rather than reduce costs.

CEO Kruti Patel Goyal, who took over the company’s top leadership role earlier this year, told employees the restructuring is designed to create an organization capable of moving faster and executing more effectively. The company also said the job cuts are not related to the use of artificial intelligence.

Founded as a marketplace for handmade, vintage and unique goods, Etsy experienced rapid growth during the COVID-19 pandemic as consumers shifted to online shopping. Since then, the company has faced stiffer competition from retail giants Amazon and Walmart, as well as newer online shopping platforms such as TikTok Shop and Temu.

In recent months, Etsy has doubled down on its identity as a marketplace for unique, handcrafted products while working to remove mass-produced items sold by resellers. The company has also introduced improvements to its search tools to deliver more personalized shopping results.

Despite announcing layoffs, Etsy reported stronger-than-expected financial results for the second quarter. Revenue reached $668.3 million, topping Wall Street expectations, while sales on its core marketplace increased 9.3%.

Source: CNBC

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