eBay Acquires Depop from Etsy for $1.2 Billion — Fashion Resale Market Enters a New Chapter

eBay Acquires Depop for $1.2 Billion as Etsy Refocuses on Core Business

EBay Strikes $1.2 Billion Deal To Buy Depop From Etsy. Both E-Commerce Stocks Are Rallying.

EBay stock was surging Thursday after the company posted strong Q4 results and said it will buy Depop from Etsy.

On February 18, 2026, eBay announced a definitive agreement to acquire fashion resale marketplace Depop from Etsy for approximately $1.2 billion in cash. The transaction is expected to close in Q2 2026, subject to regulatory approval. Both eBay and Etsy boards unanimously approved the deal.

Etsy had acquired Depop in 2021 for $1.625 billion. The current sale price represents an approximately 25% discount, resulting in a book loss of roughly $420 million. However, according to CNBC's reporting, Etsy stock surged approximately 14% and eBay stock rose about 7% following the announcement, with the market viewing the deal as rational for both parties.

Industry Landscape

Understanding this acquisition requires two key contexts: the unique nature of Depop and the rapid expansion of the secondhand fashion market.

Depop is a mobile-first, community-driven C2C (consumer-to-consumer) fashion marketplace. As of December 2025, it has 7 million active buyers and over 3 million active sellers, with approximately 90% of its users under the age of 34 — an overwhelming Gen Z and millennial user base.

Meanwhile, the secondhand fashion market overall is in a rapid growth phase. According to research by Persistence Market Research, the global secondhand apparel market is projected to grow from approximately $67.4 billion in 2025 to roughly $154.6 billion by 2032, representing a compound annual growth rate (CAGR) of 12.6%. Analysis from Business of Fashion indicates that the resale market is growing at 2-3 times the pace of new fashion retail.

Driving this growth are rising consumer price sensitivity, increasing sustainability awareness, and Gen Z's preference for "unique, one-of-a-kind items." Depop sits squarely at the center of these trends.

Depop's Rapid Growth and Etsy's Decision to Divest

Etsy's decision appears contradictory at first glance. Depop reached approximately $1 billion in GMS (gross merchandise sales) for the full year 2025, with the US market growing 60% year-over-year. GMS in Q4 2025 alone reached $300 million, setting a new record.

So why would Etsy part with a growing asset? The answer lies in profitability. According to reporting from Investing.com, Depop was dragging down Etsy's consolidated adjusted EBITDA margin by 350 basis points (3.5%) in 2025. Despite top-line growth, operational synergies with Etsy's handmade-focused business model were limited.

Etsy CEO Kruti Patel Goyal stated that "this transaction will allow Etsy to focus on growth opportunities in its core marketplace," with proceeds earmarked for share buybacks and investment in the Etsy marketplace. For Etsy, this represents the culmination of four years of strategic focus and prioritization.

Depop's Role in eBay's Recommerce Strategy

For eBay, acquiring Depop is a critical move within its "focus categories strategy." CEO Jamie Iannone commented that "this acquisition advances one of our newest and fastest-growing focus categories."

eBay's fashion category already generates over $10 billion in annual GMV, growing 10% year-over-year in the US. According to eBay's full-year 2025 results, the company has generated a cumulative $25 billion in economic impact across pre-loved and refurbished goods over the past five years. The company also cited data showing that "approximately 90% of consumers plan to maintain or increase their spending on secondhand goods," reinforcing its conviction in the recommerce market.

Post-acquisition, Depop will continue to operate as an independent brand with its headquarters remaining in London. By integrating eBay's global logistics network, payment infrastructure, and luxury authentication program "Authenticity Guarantee" into Depop's ecosystem, the company aims to enhance both the user experience and trust for younger audiences. Branding foundations are also in place, including eBay's "Official Pre-Loved Partner" affiliation with Vogue and GQ under Conde Nast.

Notably, eBay's Q4 2025 earnings were strong, with revenue of $3 billion (up 15% year-over-year), GMV of $21.2 billion (up 10%), and adjusted EPS of $1.41 (beating the market consensus of $1.35). The Depop acquisition was announced amid this momentum.

Implications and Takeaways for E-Commerce Businesses

This acquisition offers several key insights for e-commerce operators.

Resale market entry is accelerating. The fact that major platforms like eBay and Depop are making substantial investments in recommerce signals that secondhand commerce is shifting from niche to mainstream. Apparel and fashion e-commerce businesses should now concretely explore building resale channels and buyback programs for their products.

Adapting to younger consumers' purchasing behavior is urgent. The fact that 90% of Depop's users are under 34 demonstrates that Gen Z's pattern of fashion consumption through C2C marketplaces is now firmly established. The combination of eBay's logistics and authentication infrastructure with Depop's young community will further strengthen reach to this demographic.

The competitive landscape among platforms is shifting. With the Depop acquisition, eBay secures advantages in both technology and scale against competitors such as Poshmark (acquired by Naver in 2023), Vinted, and ThredUp. E-commerce businesses operating on marketplace models need to closely monitor the strategic shifts of their listing platforms.

Conclusion

eBay's acquisition of Depop is a transaction at the intersection of two major trends: the expansion of the secondhand fashion market and platform consolidation. For Etsy, it represents an opportunity to improve profitability and refocus on its core business. For eBay, it provides a foothold for capturing Gen Z audiences and establishing recommerce leadership.

The key point to watch going forward is the speed and direction of Depop integration after the transaction closes in Q2 2026. In particular, the timeline for bringing eBay's "Authenticity Guarantee" to Depop and the extent to which global logistics connectivity accelerates Depop's growth will be focal points. With the secondhand fashion market growing at over 12% annually, this acquisition is not just an M&A deal — it is a defining moment that symbolizes the broader recommerce shift across the entire e-commerce industry.