Ina Fried

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Groupon Smacks Naysayers With Earnings Over Forecast

Groupon on Monday announced revenues that topped the company’s prior forecast as well as analyst expectations.

The Chicago-based company, which has had a bumpy road of late, said that it took in $559.3 million in revenue during the first quarter 2012, compared with $295.5 million a year ago. Operating income was $39.6 million, including an expense of $28 million related to non-cash stock-based compensation.

The company had said to expect revenue of up to $550 million, and net income from operations of up to $35 million.

“We are pleased to report a record quarter that demonstrates our progress in unlocking the opportunity in local commerce for merchants and customers worldwide,” CEO Andrew Mason said in a statement.

The company posted a per-share loss of two cents, though excluding various items, it would have earned two cents per share, in line with analysts’ forecasts.

The report comes as the deal-making service faced tough times as it has had to restate fourth quarter earnings amid what it said were a large number of post-holiday returns. In the aftermath, the company has shuffled around its board of directors, bringing in some new outside expertise.

In a letter to shareholders earlier this month, Mason defended the company’s efforts to move quickly in a fast-changing market.

Looking forward, Groupon said to expect second quarter revenue of between $550 million and $590 million, with income from operations in the range of $25 million and $45 million.

In slides accompanying the earnings report, Groupon noted that its customer base continues to grow, with 36.9 million active customers versus 33.7 million a quarter earlier. Marketing spend as a percentage of revenue, meanwhile, dropped to 21 percent from 32 percent in the same period.

The company’s stock has lost as much as half its value since going public late last year at $20 a share. However, shares traded up strongly on Monday ahead of the earnings report. Just before the close of regular trading, shares were at $11.63, up $1.73, or more than 17 percent.


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There’s a lot of attention and PR around Marissa, but their product lineup just kind of blows.

— Om Malik on Bloomberg TV, talking about Yahoo, the September issue of Vogue Magazine, and our overdependence on Google