Online retail giant eBay has announced a significant acquisition, agreeing to purchase the secondhand fashion marketplace Depop from Etsy for approximately $1.2 billion in cash. The deal, revealed on Wednesday, is strategically designed to help eBay tap into a younger consumer base, as Depop boasts a user demographic heavily skewed towards Generation Z.
Targeting the Youth Market
Depop, which is currently owned by Etsy, reported having 7 million active buyers on its platform as of 31 December 2025. Notably, nearly 90% of these buyers are under the age of 34, positioning the marketplace as a key player in the youth-oriented resale sector. This acquisition comes at a time when the popularity of used clothing is surging, driven by Gen Z shoppers seeking unique, affordable items and aiming to reduce environmental waste by keeping garments out of landfills.
Strategic Growth and Integration
Based in London and founded in 2011, Depop is expected to maintain its name, brand, platform, and distinct culture post-acquisition. eBay's CEO, Jamie Ianonne, expressed confidence in the move, stating, "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." This integration aims to leverage eBay's extensive resources to bolster Depop's market presence.
Etsy's Shift in Focus
The transaction marks a reversal for Etsy, which acquired Depop for $1.6 billion five years ago as part of a broader strategy to build a "House of Brands" and compete with larger e-commerce entities like Amazon. Since then, Etsy has streamlined its operations, divesting marketplaces outside its core platform. Etsy CEO Kruti Patel Goyal commented on the sale, noting that it "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."
Financial Details and Market Reaction
eBay, headquartered in San Jose, California, plans to fund the acquisition entirely with cash. Meanwhile, Etsy, based in Brooklyn, New York, intends to use the proceeds for general corporate purposes. The deal has received unanimous approval from the boards of both companies and is anticipated to close in the second quarter of this year. Following the announcement, eBay's shares increased by over 7%, while Etsy's stock surged nearly 15% in after-hours trading, reflecting positive market sentiment towards the strategic move.
This acquisition underscores the growing importance of the secondhand fashion market and highlights eBay's efforts to adapt to evolving consumer trends by targeting younger shoppers through innovative platforms like Depop.
