Is Groupon Back on Track After Q1?
Groupon reported first-quarter financial results after markets closed on Tuesday. The company said that it had a net loss of $1.63 per share and $374.2 million in revenue, beating analysts' consensus estimates on both metrics.
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Groupon Inc. (NASDAQ: GRPN) reported first-quarter financial results after markets closed on Tuesday. The company said that it had a net loss of $1.63 per share and $374.2 million in revenue. That compares with consensus estimates calling for a net loss of $1.91 per share and $369.14 million in revenue. The same period of last year reportedly had EPS of $0.60 on $578.41 million in revenue.
During the first quarter, North American gross profit decreased by 31% to $143.8 million. Also, international gross profit decreased 40% to $57.5 million, down 39% on a currency neutral basis.
Both of these segments were primarily driven down due to the negative impact of COVID-19 on demand and refund levels in March and lower Goods performance throughout the quarter. Local gross profit in the first quarter of 2020 decreased by 23% to $123.9 million.
On the books, the company ended the first quarter with $667 million in cash, which included $150 million of outstanding borrowings under the revolving credit facility.
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Aaron Cooper, Interim CEO of Groupon, commented:
COVID-19 has had a major impact on our business and we have moved quickly to position Groupon to weather the pandemic and to help our merchants face these unprecedented challenges,” “At the same time, during the first half of 2020, we created a more agile organization that is focused on improving the long-term health of our marketplace. Notwithstanding the challenges created by the macroeconomic landscape, we continue to believe we have distinct competitive advantages that will allow us to take share in the highly fragmented, $1 trillion-plus local experiences market.
Groupon stock closed Tuesday at $27.23, with a 52-week range of $9.60 to $73.00. The consensus analyst price target is $26.66. Following the announcement, the stock was initially up 1% at $27.55 in the after-hours session.
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Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics. Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications. A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.
