Feeds

Groupon loses $42.7m in Q4, shares tumble

Hang on to your coupons, we'll make a profit next quarter

Top 5 reasons to deploy VMware with Tegile

Groupon (GRPN) has posted a net loss of $42.7m for the last three months of 2011, disappointing Wall Street's expectation that the coupon-pushers would make a small profit. Groupon stocks closed the day at $24.58 but in after-hours trading stocks tumbled 15 per cent to $20.75 – suggesting that Groupon shareholders might want to brace themselves for a rocky ride when Thursday trading opens in New York.

Analysts had predicted that Groupon could turn a profit for the last quarter of 2011, after the company went public in November and promised to cut costs. Still, Groupon's 2011 Q4 loss is an improvement on the net loss of $378.6m it posted for the last three months of 2010.

Factors contributing to the loss were outlined by Chief Financial Officer Jason E Child in the SEC filing and included a higher-than-expected overseas tax bill thanks to Groupon's new operations abroad. The company said that if stock based compensation and acquisition charges were excluded, it would've have presented shareholders with a loss of just $9.8m.

Overall, revenue for Groupon increased significantly: the online voucher deals site pulled in $506.5m in the fourth quarter of 2011 compared to $172.2m in fourth quarter of 2010, an increase of 194 per cent.

Despite the missed target, Groupon is predicted to make a profit of between $15m and $35m in the first quarter of 2012.

In the investor conference call, CEO Andrew Mason said that Groupon would cut costs further in marketing but spend more on technological innovation by hiring in engineers, Bloomberg reported.

“We are still far under-indexed in terms of our technology headcount, compared to traditional California-based technology companies,” Mason said. “We expect to continue to invest aggressively.”

International revenue rose more sharply than North American revenue. Groupon posted a yearly revenue rise of 771 per cent internationally to $980.9m following an major overseas expansion, compared to a revenue rise of 221 per cent in North America, to $643.8m.

In 2011 as a whole, Groupon posted a net loss of $203.4m – compared to a loss of $420.3m in 2010. Revenue for 2011 was $1.62bn – up 419 per cent year on year.

The Chicago-based company employs over 10,000 people and operates in 47 countries. It raised $700m after its IPO in November though stock prices have fluctuated since

Beginner's guide to SSL certificates

More from The Register

next story
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
Lords take revenge on REVENGE PORN publishers
Jilted Johns and Jennies with busy fingers face two years inside
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Yes, yes, Steve Jobs. Look what I'VE done for you lately – Tim Cook
New iPhone biz baron points to Apple's (his) greatest successes
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Edward who? GCHQ boss dodges Snowden topic during last speech
UK spies would rather 'walk' than do 'mass surveillance'
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.