Etsy Inc. is replacing its CEO and cutting jobs as it faces pressure from shareholders upset with its lackluster profits and anemic stock performance.
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The online crafts marketplace said Tuesday that it has named board member Josh Silverman as CEO, replacing Chad Dickerson, who also stepped down as board chairman.
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The Brooklyn, New York-based company also said it is also eliminating about 80 jobs, or 8 percent of its workforce, as it moves to trim costs.
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The announcement came just hours after shareholder Black-and-White Capital made public letters it had sent to Etsy’s board lamenting what it called the company’s destruction of shareholder value. It called for Etsy to explore strategic alternatives, a phrase that often includes searching for a buyer.
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Etsy’s stock tumbled more than 16 percent to $9.50 in after-hours trading Tuesday after the company unveiled the management move and posted a first-quarter loss of $421,000. It had a profit in the same period a year earlier.
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Etsy went public just over two years ago with a splash that had is stock nearly doubling from its $16 IPO price in its first day of trading. But the stock has slumped amid stagnant sales and investor concern about counterfeit goods being sold on the site.
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Its latest quarterly report did not impress Wall Street. On a per-share basis, Etsy said it had a loss of less than 1 cent in the quarter. The average estimate of four analysts surveyed by Zacks Investment Research was to break even.
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Etsy posted revenue of $96.9 million in the period. Three analysts surveyed by Zacks expected $98.6 million.