Etsy reported lower-than-expected sales for the holiday quarter. The company also missed expectations for gross merchandise sales, pointing to "significant headwinds," including dampened consumer spending on discretionary goods.

Key Takeaways Shares of online retailer Etsy fell Wednesday after revenue and sales on the platform came in below estimates in the fourth quarter.Revenue hit a quarterly record, but fell short of expectations as gross merchandise sales declined year-over-year.

The total dollar value of items sold across all platforms the company owns declined 6.8% from a year earlier in the fourth quarter.

Etsy stock is notably lower Wednesday after the online retailer fell short of revenue expectations for the key holiday quarter.