Photo: Flickr/The DEMO Conference
Groupon shares crashed another 16% after earnings, to a new all-time low of $3.25 a share.Why?
Because the company blew another quarter.
Revenue of $569 million came in below expectations of $590 million.
Non-GAP EPS of $0.03 was in line with estimates of $0.03.
And Groupon’s guidance was disappointing.
“Our solid performance in North America was offset by continued challenges in Europe,” said Andrew Mason, CEO of Groupon. “Groupon Goods has evolved into a second major category that our customers clearly love. With deals on everything from designer sunglasses to big-screen televisions to most-wanted toys, we think it will be a great gifting destination this holiday season.”
Groupon’s stock is now down a staggering 85% from last year’s IPO.
Adding insult to injury, the company fired some folks today.
Groupon reports earnings after the market closes tonight.
We’ll have the numbers as soon as they hit, so tune in.
What is Wall Street looking for? Numbers from Yahoo Finance and Morgan Stanley:
- EPS: $0.03
- Revenue: $590 million
- CSOI: $55 million
- Q4 Revenue: $634 million
- Q4 EPS: $0.05
- Q4 CSOI: $62 million
Beyond the numbers, investors are going to be taking a close look at total “billings,” which shrank on a quarter over quarter basis last quarter. They shrank because Groupon’s core coupon business, coupons has shrunk.
This is forcing Groupon to figure out new businesses.
CEO Andrew Mason led the company to develop a payment system for local businesses. This is a massive pivot for the company, and one where it has no expertise. It’s also the second time Mason has tried a new line of attack for Groupon. He previously tried Groupon Now, which was supposed to be an on-demand mobile coupon network. It failed.
Investors want to know if the new payment business is working.
Additionally, we reported today that Groupon is laying people off. We expect to hear more details about why Groupon is letting people go.
One more thing to keep an eye on: net additions. Is Groupon gaining or losing subscribers? It says its gross additions are up, but because of churn the net additions are not strong, according to Morgan Stanley analyst Scott Devitt.
If you want to be bullish on Groupon, you could say it can only get better from here. The stock has fallen 85 per cent since its first day of trading. And even with $1.2 billion in cash on hand, its market cap is only $2.6 billion.
Don’t Miss: Why Groupon Got Demolished Last Time
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