What happened Shares of Etsy (NASDAQ: ETSY) fell 9.7% on Thursday, following the release of the online marketplace's second-quarter results. So what A 13% rise in gross merchandise sales -- essentially the dollar value of items sold on Etsy's platform -- helped to drive a 23.4% year-over-year increase in revenue, to $528.9 million. That was above the $524.7 million in revenue Wall Street had expected. Investors sold off shares of Etsy on Thursday. Image source: Getty Images. However, Etsy's sales growth decelerated sharply from the 141% increase it reported in the first quarter. Its active buyer and seller growth also slowed to 50.1% and 66.7%, respectively, from 89.9% and 67.1% in the prior quarter. Now what Looking ahead, management expects Etsy to generate revenue of $500 million to $525 million in the third quarter, which would be a year-over-year increase of roughly 13.5% at the midpoint. That's below the $527.5 million analysts had projected, suggesting that its growth will continue to slow. Etsy, like many e-commerce marketplaces, experienced a surge in demand from buyers during the early stages of the coronavirus pandemic. But with vaccinations climbing and the economy reopening, more people are beginning to shop in traditional retail stores once again. Still, the wide-scale migration of retail sales to online channels is likely to persist even after the health crisis eventually subsides. So, while Etsy's pace of expansion could certainly slow in the coming quarters, its long-term growth story remains intact. 10 stocks we like better than EtsyWhen our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* They just revealed what they believe are the ten best stocks for investors to buy right now... and Etsy wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of June 7, 2021 Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Etsy. The Motley Fool has a disclosure policy.Source