After reporting disappointing results for the first quarter, Etsy Inc NASDAQ: ETSY announced that it is replacing its CEO and cutting 8% of its workforce.
The company has appointed Josh Silverman as CEO, replacing Chad Dickerson, who led the company for six years. Dickerson will serve as an adviser until the end of May.
Dickerson was not only ousted as CEO, but will also be stepping down as chairman of the board. Fred Wilson will take his place.
Etsy Inc NASDAQ: ETSY posted a $421,000 loss in the first quarter. The online marketplace reported a profit of $1.2 million in the same period last year. Revenue jumped 18% to $96.9 million, but operating expenses also climbed, up 36% to $64.3 million.
Etsy Inc NASDAQ: ETSY in Cutting Costs Exercise
The company plans to cut 80 positions as part of its plan to cut costs, equivalent to about 8% of its workforce.
Chief Technology Officer (CTO) John Allspaw will also be leaving the company, with Mike Brittan, vice president of engineering, named interim CTO.
“It has been an honor to lead Etsy as CEO for the past six years and the three years before that as CTO.” said Dickerson in the company’s press release. The Board decided that it was time for new leadership to take Etsy forward and I support that decision.”
Silverman said that as CEO, his main focus will be to drive more traffic to the company’s marketplace, increasing loyalty and converting browsers into buyers.
“Etsy is actively investing in machine learning, search and marketing to attract new buyers and drive purchase frequency. Additionally, we just completed the successful launch of Etsy Studio,” Dickerson said.
Etsy has in recent years invested heavily in improving the user experience on its mobile site, website and search feature. Development expenses increased by 48% in the quarter as a result.
Etsy expects to incur severance costs of between $4.5 million and $6 million related to the job cuts.