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Groupon's 3Q Conference Call Summary

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On Thursday, Groupon (NASDAQ: GRPN) had itsThird Quarter 2013 Teleconference Call.

Eric Lefkofsky, CEO of Groupon, commented on the third quarter conference call that "Despite the challenges that come with transition, we made significant progress in the last 90 days. We launched an entirely new website and new mobile app. We set new quarterly records with 9 million app downloads and crossed the 50 percent threshold for mobile transactions in North America."

New Features on Groupon

  • Local business has personalized widgets to build themes for users.
  • Groupon added variations in goods so that users can see other colors and styles. In addition, users can now purchase more than one item at a time.
  • In Getaways, users have greater search capability extending beyond Groupon deals to market picks.

Third Quarter Results

  • Gross billings grew 10 percent YoY due to 20 percent North American growth and 12 percent EMEA growth.
  • Revenue grew 5 percent year-over-year.
  • Operating income excluding stock-based compensation and acquisition-related costs was reported at $39 million. Adjusted EBITDA was $62 million this quarter.
  • Groupon billings in North America was reported at $665 million with $361 million in revenue and $25 million segment operating income.
  • EMEA improved 12 percent QoQ.
  • Free cash flow for the quarter was reported at -$27 million.
  • CFO Jason Child commented, "As of September 30, we had $1.1 billion in cash and cash equivalents. And finally, we repurchased 770,900 shares of Class A common stock in the quarter at an average price of $11.67 per share for an aggregate purchase price of $9 million."

Transaction and Apps Results

  • Groupon has over 60 million app downloads. Lefkofsky added, "we crossed the 50 percent threshold in September in North American transactions, which we believe makes us the first large scale e-commerce company in North America that is predominantly mobile."
  • More than 40 percent of all transactions were mobile in September.
  • Groupon had record downloads in the third quarter to 9 million.
  • 75 percent of North American merchants opt to be featured on an ongoing basis on Groupon.
  • Active deal count in North America exceeded 65,000 at the end of Q3.
  • Approximately 6 percent of total September traffic in North America was related to search activity.
  • Groupon has 43.5 million net active customers, a 10 percent quarter increase. North America active customer count is 19.9 million, 14 million in EMEA, and 9.6 million in the rest of the world.

Groupon closed at $9.50 on Thursday and is currently trading +7.21 percent.

Posted-In: Earnings News


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