Groupon Outlook Disappoints; Shares Plunge
Groupon's quarterly revenue hit analysts' target Wednesday but its outlook fell short, sending Groupon shares down more than 25 percent in after-hours trading.
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The daily deal site said it expects first-quarter revenue to be between $560 million and $610 million. Analysts currently expect $650 million, according to a consensus estimate from Thomson Reuters.
"This raises questions about how these guys are going to be able to scale the business," said Tom White, an analyst at Macquarie. "The forecast is underwhelming."
(Read More: Why Groupon Earnings Were Such a Disappointment)
For the fourth quarter, Groupon reported a 30-percent revenue increase to $638 million, on target with analysts' expectations.
The company posted a fourth-quarter loss of 12 cents a share, including a loss of 7 cents a share from a "non-operating item."
The results included stock-based compensation and acquisition-related expenses, plus depreciation and amortization.
Excluding items, Groupon's loss was 1 cent per share, compared with a loss of 2 cents a year ago. Analysts had expected the company to post a profit of 3 cents a share.
Consolidated gross billings (the total dollar value of customer purchases, excluding taxes and refunds) jumped 24 percent to $1.52 billion, which is a "clear signal that customers love Groupon," CEO Andrew Mason was quoted as saying in the earnings release. "We will continue to invest in growth through 2013 as we see new opportunities to give our customers what they want," he said.