Crafts website operator Etsy's loss doubles; shares tumble

(Reuters) - Crafts shopping website operator Etsy Inc's quarterly loss doubled due to higher marketing expenses and the company said these costs would only increase in the current quarter.

Etsy's shares fell more than 15 percent to $16.27 in after-hours trading on Tuesday.

The company's marketing costs jumped 77 percent in the second quarter ended June 30 due in part due to higher spending on product listing ads. Total costs rose 49.3 percent.

Etsy said it plans to spend more on marketing in absolute dollars in the third quarter than it did in the second quarter or the year-earlier quarter.

It also said it expects to increase the pace of hiring in the current quarter compared with both the second quarter and the year-earlier quarter.

The company said the strengthening dollar could hurt demand for dollar-denominated goods in the current quarter, which could slow the pace of growth of gross merchandise sales.

Gross merchandise sales, a measure of total value of goods sold, rose 24.6 percent in the second quarter, driven by a 24.6 percent growth in active sellers and a 31.6 percent jump in active buyers on Etsy's website.

Revenue rose 44.4 pct to $61.4 million in the quarter.

Still, higher costs meant its net loss widened to $6.4 million or 7 cents per share, from $3.2 million or 8 cents per share.

Analysts on average had expected a loss of 8 cents per share and revenue of $59.5 million, according to Thomson Reuters I/B/E/S.

(Reporting by Sai Sachin R in Bengaluru; Editing by Sayantani Ghosh and Savio D'Souza)