Etsy (ETSY) stock is soaring 5.12% in intraday trading on Friday, following the release of its first-quarter 2025 earnings report. The e-commerce platform specializing in handmade and vintage items surprised investors with better-than-expected revenue figures, despite missing earnings per share estimates.

According to the report, Etsy's revenue for Q1 2025 came in at $651.2 million, flat compared to the same period last year but exceeding analyst estimates by 1.5%. However, the company reported a net loss of $52.1 million, or $0.49 per share, down from a profit of $63.0 million, or $0.53 per share, in Q1 2024. The earnings per share figure fell short of analyst expectations.

While Etsy's strong revenue performance has buoyed investor sentiment, the company faces potential challenges ahead. The recent announcement of the end of US tariff exemptions for small parcels from China could impact Etsy's sellers who source products from overseas. This change may lead to increased costs for some sellers and potentially affect the platform's competitiveness in the e-commerce landscape. However, Etsy's focus on unique, handmade items may provide some insulation from these tariff-related pressures compared to mass-market retailers.