In a phone call immediately after earnings were released, Groupon CFO Jason Child explained the company's lower margins. Why? The company has been "flexing" the fees it charges merchants—charging a small percent higher fees, but the majority lower fees, hence its profit drop.
Groupon's outlook for the first quarter is lower than expected in part because after its "goods" business benefited from the holiday season this past quarter, now it's expected to decline.
(Read More: One Franchisee's Cautionary Tale About Groupon's Pitfalls)
Child tried to stress the positive—a $300 million in gross billing between the third and fourth quarter. "That's the number that points to the long term health of the business and the long term health of the marketplace."
He also pointed to the growth of mobile: nearly 40 percent of total transactions are on mobile devices.
When asked about the swiftly plummeting stock Child said simply "it's a volatile stock."
—By CNBC's Julia Boorstin; Follow her on Twitter: @JBoorstin