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Groupon Shares Soar as Revenue Climb 7% in Q2 (GRPN)

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E-commerce services provider, Groupon Inc. (NASDAQ: GRPN) reported better-than-expected revenue and earnings which matched expectation for the fiscal second quarter, late on Wednesday.

Strong revenue growth from its mobile commerce business helped the company to offset its weakness in daily deals business.

As the company’s core business area, (the deal deals business) is flagging amid proliferation of smaller players, the Chicago based company has been re-inventing itself by focusing on conventional business such as providing long term deals via its app. The strategic shift has paid off which is evident by its stock’s performance. The stock is up about 80% since the beginning of the year.

Shares rallied almost 21% in afterhours trading after the company said that revenue soared 7% in the fiscal second quarter.

Commenting over the results, Groupon’s Chief Executive Eric Lefkosky (he was appointed the CEO on permanent basis yesterday) said to analysts in a conference call, “We significantly exceeded our operating income expectations, and delivered our strongest quarter ever in North America, due in part to accelerated billings growth of 30 percent.”

Separately, the Company also said that it will begin a shares buyback program worth $300 million.

For the quarter, the Chicago based company reported a net loss of $7.6 million or penny a share compared to a net profit of $28.4 million or 4 cents a share, in the year-earlier quarter.

Stripping out onetime items, the Company earned 2 cents a share compared to 8 cents a share, in the same period of last year.

Revenue climbed to $609 million from $568 million.

Analysts surveyed by Thomson Reuters had forecasted earnings of 2 cents a share on revenue of $606 million.

During the quarter, more than 7.5 million people downloaded the Groupon app on their smartphones, the company said. Thus far, more than 50 million people have downloaded the app.

 








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Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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