On February 27, after market close, Groupon Inc. (NASDAQ:GRPN) announced its results for the fourth quarter of 2012. The company posted solid revenue growth but saw its international business decline.
Groupon Inc. (GRPN) reported revenue of $638 million, as gross billings soared to a record high of $1.52 billion. The company posted a net loss of $81 million, disappointing investors who had hoped the company would be closer to profitability by now.
The outlook that CEO Andrew Mason gave, didn’t do much to calm the nerves of Groupon’s investors: for the current quarter, Mason gave a revenue guidance of $560 to $610 million. Analysts on average had expected $647 million. Consequently, Groupon’s stock was punished in after-hours trading and continued its decline on the following day. On February 28, the stock closed at $4.53, 77 percent below the IPO price of $20.
Later that day, news broke that Andrew Mason had been fired as CEO of Groupon. In a letter to employees Mason showed little surprise and explained the reasons for his demise: “From controversial metrics in our S1 to our material weakness to two quarters of missing our own expectations and a stock price that’s hovering around one quarter of our listing price, the events of the last year and a half speak for themselves. As CEO, I am accountable.”
The market reacted positively on the news and the stock spiked in after-hours trading. Mason’s successor will inherit a couple of problems as the daily deals business has lost its magic and “Groupon Goods”, the company’s venture into traditional e-commerce, started off slower than hoped.
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