Groupon’s Shares Gyrate In Wake Of Profit Beat, Revenue Miss In Q1

After the bell today, Groupon reported its first-quarter financial performance. The company, best known for its discount coupons to local businesses, earned an adjusted $0.03 per share on $750.4 million during the period. Those figures compare to street expectations of a $0.01 per-share profit, and revenue of $812.19 million.

Down around 3 percent in regular trading, Groupon is now mostly flat in after-hours trading following its mixed earnings report.

Groupon was recently in the news for selling a majority stake in its Korean ticket sales service, Ticket Monster. The service, as TechCrunch noted during Groupon’s fourth-quarter report, helped the company grow its international revenue, but was a drag on profitability. Rumored last year, the $360 million sale was stapled to a promise that the Chicago-based deals company would initiate a share repurchase program.

The company posted a slim gross billings increase on a year-over-year basis, with total product of $1.55 billion moving through its service during the quarter, up from $1.52 billion in the year-ago quarter.

Despite missing street estimates on revenue, Groupon’s profit beat appears to be enough to keep its shares afloat. The company’s GAAP loss, before non-traditional adjustments, came to a $0.02 share loss, or a net loss of around $14 million.

The company’s profit miss, while disappointing to investors, grew from the year-ago period. The company’s $750.4 million top line in the period grew 3 percent from $728.4 million in the first quarter of 2014. However, Groupon notes, as every other tech firm has as well, the strong dollar is problematic. Groupon wrote in its earnings report that its revenue “grew 10%, excluding the unfavorable impact from year-over-year changes in foreign exchange rates throughout the quarter.”

Adjusting for constant-currency, Groupon grew its North American revenue by 11 percent and its EMEA revenue by 13 percent. Groupon’s ‘Rest of World’ revenue declined 8 percent.

Units, or units sold, is an important metric for Groupon: The company’s unit count grew by 6 percent in the period, driven by an 8 percent uptick in North America and a 10 percent bump in EMEA areas. Groupon’s active customer count picked up 7 percent during the quarter.

For the current quarter, Groupon expects revenue of between $700 million and $750 million. The company expects to earn a similar, sequential $0.01 to $0.03 on an adjusted basis.

Groupon’s big fourth quarter was not replicated. Groupon’s challenge remains as it always has been: That it can show material profit while also growing its revenue.