GMV

GMV, short for Gross Merchandise Value, is a metric commonly used by e-commerce platforms to measure the total value of goods and services sold through a marketplace over a defined period. In some contexts GMV may stand for Gross Market Value, a term used in finance to indicate the gross value of assets traded. GMV is not a measure of platform revenue or profitability; it does not reflect fees earned by the marketplace, refunds, cancellations, or other deductions. It is often used to gauge market activity, scale, and growth of a platform.

Calculation and interpretation: GMV is typically calculated by summing the price paid by buyers for each item multiplied by the quantity sold across all transactions in the period. Depending on the definition, it may include or exclude taxes, shipping charges, discounts, and refunds. Because GMV does not account for seller deductions or platform costs, a high GMV can occur even if the platform’s take rate is low or if there is substantial discounting.

Use and limitations: Analysts use GMV to compare marketplaces, track growth, and benchmark performance over time or against peers. However, GMV can be inflated by promotional activity or high order volume with low net revenue. It should be complemented with other metrics such as take rate, revenue, refunds, and operating income to provide a fuller picture of financial health and profitability.