12:30 PM EDT, 04/24/2024 (MT Newswires) -- Etsy ( ETSY ) is expected to see mostly in-line Q1 results and a modest risk to Q2 gross merchandise sales guidance, Wedbush said in a note to clients Wednesday.

Etsy ( ETSY ) is scheduled to release its earnings results on May 1.

The investment firm estimates a Q1 gross merchandise sales decline of 3.5%, compared with a consensus estimate of a 2.4% fall and Etsy's ( ETSY ) guidance of a low-single to mid-single-digit decline range, as engaged traffic trends for Etsy.com and its noncore brands modestly improve from the soft January trend but not enough to suggest meaningful upside to consensus, according to the note.

Wedbush also forecasts revenue of $640.1 million, versus consensus estimate of $645.5 million, according to the note.

Core April month-to-date desktop engaged traffic decelerated to an annual decline of 8% from 6% in March and 2% in February. A soft start to April might lead to the company issuing a Q2 gross merchandise sales guide for a low-single-digit decline compared with a consensus estimate of a 0.3% fall, Wedbush said.

"Weak engagement trends to start Q2, consumers' continued preference for lower-cost alternatives in this weak macro environment, and fierce competition in performance marketing channels leave more cautious on the possibility for significant improvement near-term," Wedbush said.

Wedbush cut Etsy's ( ETSY ) price target to $70 from $80 and kept its neutral rating.

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