eBay Buys Etsy's Depop for $1.2B in Cash - AI News Today Recency

# eBay Buys Etsy's Depop for $1.2B in Cash

In a significant move to strengthen its position in the booming secondhand fashion market, eBay has agreed to acquire Depop from Etsy for approximately $1.2 billion in cash, subject to purchase price adjustments[1][2]. The transaction, unanimously approved by both companies' boards, represents eBay's strategic push to deepen its reach with younger, fashion-forward consumers and expand its consumer-to-consumer (C2C) fashion marketplace capabilities[1][2].

eBay's Strategic Acquisition of the Gen Z Fashion Marketplace

eBay's acquisition of Depop marks a critical expansion in the e-commerce giant's C2C strategy, particularly in the rapidly growing resale fashion sector[1][2]. Fashion represents more than $10 billion in annual gross merchandise volume (GMV) for eBay and delivered 10% year-over-year GMV growth in the U.S. in 2025, making it one of eBay's newest and fastest-growing focus categories[2]. By acquiring Depop, eBay gains access to a highly-engaged customer base, with 7 million active buyers (nearly 90% under age 34) and over 3 million active sellers, along with approximately $1 billion in annual gross merchandise sales from 2025[4].

eBay CEO Jamie Iannone stated that "Depop has built a trusted, social-forward marketplace with strong momentum in the pre-loved fashion category, and we are confident that as part of eBay, Depop will be even more well-positioned for long-term growth, benefiting from our scale, complementary offerings, and operational capabilities."[2] This acquisition aligns with eBay's broader effort to maintain its position as the premier destination for secondhand fashion, particularly after being named Condé Nast's official Pre-Loved Partner in October 2025[1].

How Depop Will Benefit from eBay's Scale and Resources

Following the acquisition, Depop will retain its name, brand, platform, and culture while gaining access to eBay's extensive global infrastructure[1]. The integration will provide Depop sellers and buyers with numerous operational enhancements, including eBay's financial services, shipping solutions, and the company's trusted Authenticity Guarantee program[1][2]. Additionally, eBay plans to expand the visibility of Depop's inventory through cross-listing opportunities, which will amplify global demand and unlock additional market opportunities[2].

Depop CEO Peter Semple expressed enthusiasm about the partnership, stating: "We're thrilled to begin this next chapter with eBay. This transaction is a testament to the significant growth we have delivered as we have evolved our product experience and strengthened our brand's place in the world."[1] By leveraging eBay's operational capabilities and global reach, Depop is positioned to accelerate its growth trajectory while maintaining the community-driven, social-forward experience that has resonated with Gen Z and millennial consumers[1][2].

Etsy's Strategic Pivot and Focus on Core Marketplace

For Etsy, the sale of Depop represents a strategic decision to concentrate resources on its core marketplace and existing operations[1][3]. Etsy CEO Kruti Patel Goyal explained: "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."[3] The company plans to utilize the proceeds from the $1.2 billion sale for general corporate purposes, continued share repurchases, and investment in its core marketplace[2].

This transaction continues a pattern of Etsy acquiring and then divesting niche online marketplaces[3]. In 2025, Etsy sold its music-gear marketplace Reverb to investment firms, and the company has also previously divested Brazilian e-commerce platform Elo7[3][4]. By refocusing on its primary marketplace, Etsy aims to strengthen its competitive position and deliver more compelling value to its core buyer and seller communities[1].

Timeline and Regulatory Considerations

The transaction is expected to close in the second quarter of 2026, subject to the satisfaction of certain closing conditions and receipt of required regulatory approvals[2]. eBay intends to fund the acquisition using cash on hand, ensuring a straightforward financial structure for the deal[2]. Both companies' executives are expected to discuss the acquisition in detail during their respective earnings calls, with eBay reporting fourth-quarter earnings today and Etsy reporting tomorrow[4].

Frequently Asked Questions

What is Depop and why is it valuable to eBay?

Depop is a leading consumer-to-consumer (C2C) fashion marketplace specializing in pre-loved and secondhand clothing, particularly popular with Gen Z and millennial consumers[1][3]. The platform has 7 million active buyers (nearly 90% under age 34) and over 3 million active sellers, with approximately $1 billion in annual gross merchandise sales as of 2025[4]. eBay values Depop because fashion represents more than $10 billion in annual GMV for eBay, and the acquisition deepens eBay's reach with younger, fashion-forward consumers in the rapidly expanding recommerce landscape[2].

How much did Etsy originally pay for Depop?

Etsy acquired Depop for $1.625 billion in June 2021[1][4]. The company is now selling it to eBay for $1.2 billion, representing a loss of approximately $425 million on the original investment[4].

Will Depop maintain its brand and platform after the acquisition?

Yes, Depop will retain its name, brand, platform, and culture following the acquisition by eBay[1]. However, the platform will benefit from eBay's global scale and capabilities, including financial services, shipping solutions, and the Authenticity Guarantee program[1][2].

When is the acquisition expected to close?

The transaction is currently expected to close in the second quarter of 2026, subject to the satisfaction of certain closing conditions and receipt of required regulatory approvals[2].

Why is Etsy selling Depop?

Etsy is selling Depop to focus exclusively on growing its core marketplace and delivering more value to its existing buyers and sellers[1][3]. This strategic pivot allows Etsy to concentrate resources on its primary platform rather than managing multiple niche marketplaces[3].

How will eBay use Depop to expand its fashion business?

eBay plans to expand Depop's visibility through cross-listing opportunities, which will amplify global demand and unlock additional market opportunities[2]. Additionally, eBay will integrate Depop with its existing capabilities, including financial services, shipping solutions, and the Authenticity Guarantee, to enhance the buyer and seller experience and accelerate growth in the secondhand fashion sector[1][2].