[November 01, 2017] |
|
Groupon Announces Third Quarter 2017 Results
Groupon, Inc. (NASDAQ: GRPN) today announced financial results for the
quarter ended September 30, 2017.
"We delivered another solid quarter while continuing to invest in the
growth and development of our local marketplace," said Groupon CEO Rich
Williams. "We continued to see strong demand in our core local business
and scale our voucherless products like Groupon+."
Third Quarter 2017 Summary
North America
-
North America gross profit in the third quarter 2017 increased 3% to
$207.9 million from $201.7 million in the third quarter 2016 driven by
strength in July, which was partially offset by softer spending in
markets affected by the hurricanes in late August and early September.
In Local, gross profit increased 7% to $162.9 million as unit growth
accelerated for the fourth consecutive quarter to the low teens. Gross
profit in Goods was $30.9 million versus $31.5 million in the third
quarter 2016, while Travel was $14.1 million versus $17.3 million in
the third quarter 2016.
-
Strength in the Local category was driven by an increase in active
customers and expanded supply through third party partners and premier
national brands. In addition, we have continued to make improvements
to the customer experience. Groupon+, one of our leading voucherless
initiatives, is now live in 23 markets.
-
Our focus is to maximize gross profit, which may come at the expense
of revenue. This emphasis includes an increasing shift toward
offerings in our higher margin, more differentiated Local category,
from our Goods category. In the third quarter 2017, North America
revenue decreased 14% driven by a 30% decline in Goods direct revenue
transactions, which are presented on a gross basis. Additionally, we
estimate the hurricanes had a $5 million negative impact on revenue
and $4 million on gross profit in the third quarter 2017.
-
North America active customers reached 32.5 million as of September
30, 2017, adding 600 thousand net new active customers during the
third quarter 2017. Active customers represent unique user accounts
that have made a purchase during the trailing twelve months either
through one of our online marketplaces or directly with a merchant for
which we earned a commission.
International
-
International gross profit increased 11% (7% FX-neutral) in the third
quarter 2017 to $101.5 million. Gross profit increased 15% (11%
FX-neutral) in Local and grew 24% (18% FX-neutral) in Goods, partially
offset by a 28% (31% FX-neutral) decline in Travel. We began to see
early traction from our supply, marketing, and product initiatives in
the third quarter 2017, and believe these initiatives will enable us
to continue our turnaround of international in the coming quarters.
-
International active customers increased 200 thousand during the third
quarter 2017 to 16.6 million as of September 30, 2017.
Consolidated
-
Gross billings were $1.34 billion in the third quarter 2017, up 1%
(flat FX-neutral) from $1.32 billion in the third quarter 2016. Gross
billings reflect the total dollar value of customer purchases of goods
and services.
-
Revenue was $634.5 million in the third quarter 2017, down 8% (9%
FX-neutral) from $686.6 million in the third quarter 2016 reflecting
our strategic emphasis on our Local category, resulting in lower
revenue from Goods.
-
Gross profit was $309.4 million in the third quarter 2017, up 6% (4%
FX-neutral) from $293.3 million in the third quarter 2016.
-
SG&A declined 8% year-over-year to $214.8 million in the third quarter
2017 as we continued to drive operational efficiency through
automation and our more streamlined organization, which we expect not
only to improve our customer experience but also to create greater
operating leverage over time.
-
Marketing was $101.5 million in the third quarter 2017, up 20%
year-over-year. We launched an integrated offline campaign in 3 cities
for Groupon+ across TV, radio and out-of-home advertising.
-
Net income from continuing operations was $3.8 million in the third
quarter 2017, which included a $17.1 million gain on an asset sale
partially offset by $11.5 million in restructuring charges. This
compares to a net loss of $34.4 million in the third quarter 2016.
-
Net income attributable to common stockholders was $0.1 million, or
$0.00 per share. Non-GAAP net income attributable to common
stockholders was $6.8 million, or $0.01 per share.
-
Adjusted EBITDA, a non-GAAP financial measure, was $46.6 million in
the third quarter 2017, up 43% from $32.6 million in the third quarter
2016.
-
Global units sold declined 1% year-over-year to 44.1 million in the
third quarter 2017. Units in North America were flat as low teens
growth in Local was offset by a decline in Goods. International units
declined 1%. Units are defined as purchases before refunds and
cancellations made either through one of our online marketplaces or
directly with a merchant for which we earned a commission.
-
Operating cash flow was $161.5 million for the trailing twelve month
period as of the third quarter 2017. Free cash flow, a non-GAAP
financial measure, was $98.6 million for the trailing twelve month
period ending September 30, 2017.
-
Cash and cash equivalents as of September 30, 2017 were $638.7
million, and we had no outstanding borrowings under our $250.0 million
revolving credit facility.
Definitions and reconciliations of all non-GAAP financial measures and
additional information regarding operational measures are included below
in the section titled "Non-GAAP Financial and Operational Measures" and
in the accompanying tables.
Share Repurchase
During the third quarter 2017, Groupon repurchased 2,384,200 shares of
its common stock for an aggregate purchase price of $9.2 million.
Groupon repurchased 16,906,334 shares for an aggregate purchase price of
$60.0 million for the year-to-date period as of September 30, 2017. Up
to $135.2 million of common stock was available for repurchase under
Groupon's share repurchase program as of September 30, 2017. The timing
and amount of any share repurchases, if any, are determined based on
market conditions, limitations under our Amended and Restated Credit
Agreement, share price and other factors, and the program may be
terminated at any time.
Outlook
Groupon is updating its outlook for 2017, which reflects current foreign
exchange rates, as well as expected marketing investments and cost
benefits associated with our streamlining initiatives. The basis for our
full year 2017 guidance is continuing operations.
-
For the full year 2017, Groupon is raising its expected gross profit
guidance range to $1.305 billion to $1.355 billion.
-
Groupon is raising its expected Adjusted EBITDA guidance range to $225
million to $245 million in 2017.
Conference Call
A conference call will be webcast live today at 9:00 a.m. CDT / 10:00
a.m. EDT and will be available on Groupon's investor relations website
at http://investor.groupon.com.
This call will contain forward-looking statements and other material
information regarding the Company's financial and operating results.
Groupon encourages investors to use its investor relations website as a
way of easily finding information about the company. Groupon promptly
makes available on this website, free of charge, the reports that the
company files or furnishes with the SEC, corporate governance
information (including Groupon's Global Code of Conduct), and select
press releases and social media postings. Groupon uses its investor
relations site (investor.groupon.com) and its blog (https://www.groupon.com/blog)
as a means of disclosing material non-public information and for
complying with its disclosure obligations under Regulation FD.
Non-GAAP Financial and Operational Measures
In addition to financial results reported in accordance with U.S. GAAP,
we have provided the following non-GAAP financial measures: Adjusted
EBITDA, non-GAAP net income (loss) attributable to common stockholders,
non-GAAP earnings (loss) per share, free cash flow and foreign currency
exchange rate neutral operating results. These non-GAAP financial
measures, which are presented on a continuing operations basis, are
intended to aid investors in better understanding our current financial
performance and prospects for the future as seen through the eyes of
management. We believe that these non-GAAP financial measures facilitate
comparisons with our historical results and with the results of peer
companies who present similar measures (although other companies may
define non-GAAP measures differently than we define them, even when
similar terms are used to identify such measures). However, these
non-GAAP financial measures are not intended to be a substitute for
those reported in accordance with U.S. GAAP. For reconciliations of
these measures to the most applicable financial measures under U.S.
GAAP, see "Non-GAAP Reconciliation Schedules" and "Supplemental
Financial Information and Business Metrics" included in the tables
accompanying this release.
We exclude the following items from one or more of our non-GAAP
financial measures:
Stock-based compensation. We exclude stock-based compensation
because it is primarily non-cash in nature and we believe that non-GAAP
financial measures excluding this item provide meaningful supplemental
information about our operating performance and liquidity.
Acquisition-related expense (benefit), net. Acquisition-related
expense (benefit), net is comprised of the change in the fair value of
contingent consideration arrangements and external transaction costs
related to business combinations, primarily consisting of legal and
advisory fees. The composition of our contingent consideration
arrangements and the impact of those arrangements on our operating
results vary over time based on a number of factors, including the terms
of our business combinations and the timing of those transactions. We
exclude acquisition-related expense (benefit), net because we believe
that non-GAAP financial measures excluding this item provide meaningful
supplemental information about our operating performance and facilitate
comparisons to our historical operating results.
Depreciation and amortization. We exclude depreciation and
amortization expenses because they are non-cash in nature and we believe
that non-GAAP financial measures excluding these items provide
meaningful supplemental information about our operating performance and
liquidity.
Interest and Other Non-Operating Items. Interest and other
non-operating items include: gains and losses related to minority
investments, foreign currency gains and losses, interest income and
interest expense, including non-cash interest expense from our
convertible senior notes. We exclude interest and other non-operating
items from certain of our non-GAAP financial measures because we believe
that excluding these items provides meaningful supplemental information
about our core operating performance and facilitates comparisons to our
historical operating results.
Special Charges and Credits. For the three and nine months ended
September 30, 2017, special charges and credits included charges related
to our restructuring plan and a gain from the sale of intangible assets.
For the three and nine months ended September 30, 2016, special charges
and credits included charges related to our restructuring plan and gains
from business dispositions. We exclude special charges and credits from
Adjusted EBITDA because we believe that excluding those items provides
meaningful supplemental information about our core operating performance
and facilitates comparisons with our historical results.
Income Tax Effect of Items Excluded from Non-GAAP Financial Measures. We
determine the income tax effect of items excluded from our measures
of non-GAAP net income (loss) attributable to common stockholders and
non-GAAP earnings (loss) per share by performing a tax provision
calculation using pre-tax income (loss) amounts that have been adjusted
to exclude those items in the respective jurisdictions to which they
relate. The difference between the income tax expense (benefit)
determined on that basis and our reported income tax expense (benefit)
represents the income tax effect of the excluded items.
Descriptions of the non-GAAP financial measures included in this release
and the accompanying tables are as follows:
Foreign exchange rate neutral operating results show our current
period operating results as if foreign currency exchange rates had
remained the same as those in effect in the prior-year period. We
present foreign exchange rate neutral information to facilitate
comparisons to our historical operating results.
Adjusted EBITDA is a non-GAAP performance measure that we define
as net income (loss) from continuing operations excluding income taxes,
interest and other non-operating items, depreciation and amortization,
stock-based compensation, acquisition-related expense (benefit), net,
and other special charges and credits. Our definition of Adjusted EBITDA
may differ from similar measures used by other companies, even when
similar terms are used to identify such measures. Adjusted EBITDA is a
key measure used by our management and Board of Directors to evaluate
operating performance, generate future operating plans and make
strategic decisions regarding the allocation of capital. Accordingly, we
believe that Adjusted EBITDA provides useful information to investors
and others in understanding and evaluating our operating performance in
the same manner as our management and Board of Directors. However,
Adjusted EBITDA is not intended to be a substitute for income (loss)
from continuing operations.
Non-GAAP net income (loss) attributable to common stockholders and
non-GAAP earnings (loss) per share are non-GAAP
performance measures that adjust our net income (loss) attributable to
common stockholders and earnings (loss) per share to exclude the impact
of:
-
stock-based compensation,
-
amortization of acquired intangible assets,
-
acquisition-related expense (benefit), net,
-
special charges and credits, including restructuring charges,
-
non-cash interest expense on convertible senior notes,
-
non-operating foreign currency gains and losses related to
intercompany balances and reclassifications of cumulative translation
adjustments to earnings as a result of business dispositions or
country exits,
-
non-operating gains and losses from minority investments that we have
elected to record at fair value with changes in fair value reported in
earnings,
-
non-operating gains and losses from the sale of minority investments,
-
income (loss) from discontinued operations, and
-
the income tax effect of those items.
We believe that excluding the above items from our measures of non-GAAP
net income (loss) attributable to common stockholders and non-GAAP
earnings (loss) per share provides useful supplemental information for
evaluating our operating performance and facilitates comparisons to our
historical results by eliminating items that are non-cash in nature,
relate to discrete events, or are otherwise not indicative of the core
operating performance of our ongoing business.
Free cash flow is a non-GAAP liquidity measure that comprises net
cash provided by (used in) operating activities from continuing
operations less purchases of property and equipment and capitalized
software from continuing operations. We use free cash flow to conduct
and evaluate our business because, although it is similar to cash flow
from operations, we believe that it typically represents a more useful
measure of cash flows because purchases of fixed assets, software
developed for internal-use and website development costs are necessary
components of our ongoing operations. Free cash flow is not intended to
represent the total increase or decrease in Groupon's cash balance for
the applicable period.
Active customers. We have historically defined active customers
as unique user accounts that have made a purchase through one of our
online marketplaces during the trailing twelve months ("TTM"). As a
result of our ongoing development and testing of voucherless offerings
that are linked to customer credit cards, we have updated our definition
of active customers as follows: unique user accounts that have made a
purchase during the TTM either through one of our online marketplaces or
directly with a merchant for which we earned a commission. This change
in definition did not have a significant impact on our active customer
count for the TTM ended September 30, 2017. We consider this metric to
be an important indicator of our business performance as it helps us to
understand how the number of customers actively purchasing our offerings
is trending. Some customers could establish and make purchases from more
than one account, so it is possible that our active customer metric may
count certain customers more than once in a given period. For entities
that we have acquired in a business combination, active customers
include unique user accounts that have made a purchase through the
acquired entity's website during the trailing twelve months, which
includes customers who have made purchases prior to our acquisition of
the entity.
Units. This metric has historically represented the number of
purchases made through our online marketplaces, before refunds and
cancellations. As a result of our ongoing development and testing of
voucherless offerings that are linked to customer credit cards, we have
updated our definition of units as follows: purchases during the
reporting period, before refunds and cancellations, made either through
one of our online marketplaces or directly with a merchant for which we
earned a commission. This change in definition did not have a
significant impact on our unit count for the three and nine months ended
September 30, 2017. We consider unit growth to be an important indicator
of the total volume of business conducted through our marketplaces.
Note on Forward-Looking Statements
The statements contained in this release that refer to plans and
expectations for the next quarter, the full year or the future are
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended, that involve a number of risks and
uncertainties, and actual results could differ materially from those
discussed. The words "may," will," should," "could," "expect,"
anticipate," "believe," "estimate," intend," "continue" and other
similar expressions are intended to identify forward-looking statements.
These forward-looking statements involve risks and uncertainties that
could cause our actual results to differ materially from those expressed
or implied in our forward-looking statements. Such risks and
uncertainties include, but are not limited to, volatility in our revenue
and operating results; risks related to our business strategy, including
our strategy to grow our local marketplaces, marketing strategy and
spend and the productivity of those marketing investments; effectively
dealing with challenges arising from our international operations,
including fluctuations in currency exchange rates and any potential
adverse impact from the United Kingdom's likely exit from the European
Union; retaining existing customers and adding new customers; retaining
and adding high quality merchants; cyber security breaches; incurring
expenses as we expand our business; competing successfully in our
industry; maintaining favorable payment terms with our business
partners; providing a strong mobile experience for our customers;
delivery and routing of our emails; product liability claims; managing
inventory and order fulfillment risks; integrating our technology
platforms; litigation; managing refund risks; retaining, attracting and
integrating members of our executive team; difficulties, delays or our
inability to successfully complete all or part of the announced
restructuring actions or to realize the operating efficiencies and other
benefits of such restructuring actions; higher than anticipated
restructuring charges or changes in the timing of such restructuring
charges; completing and realizing the anticipated benefits from
acquisitions, dispositions, joint ventures and strategic investments;
tax liabilities; tax legislation; compliance with domestic and foreign
laws and regulations, including the CARD Act and regulation of the
Internet and e-commerce; classification of our independent contractors;
maintaining our information technology infrastructure; protecting our
intellectual property; maintaining a strong brand; seasonality; customer
and merchant fraud; payment-related risks; our ability to raise capital
if necessary and our outstanding indebtedness; global economic
uncertainty; the impact of our ongoing strategic review and any
potential strategic alternatives we may choose to pursue; our senior
convertible notes; and our ability to realize the anticipated benefits
from the hedge and warrant transactions. For additional information
regarding these and other risks and uncertainties, we urge you to refer
to the factors included under the headings "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" in the company's Annual Report on Form 10-K for the year
ended December 31, 2016, and our other filings with the Securities and
Exchange Commission, copies of which may be obtained by visiting the
company's Investor Relations web site at http://investor.groupon.com
or the SEC's web site at www.sec.gov.
Groupon's actual results could differ materially from those predicted or
implied and reported results should not be considered an indication of
future performance.
You should not rely upon forward-looking statements as predictions of
future events. Although Groupon believes that the expectations reflected
in the forward-looking statements are reasonable, it cannot guarantee
that the future results, levels of activity, performance or events and
circumstances reflected in the forward-looking statements will be
achieved or occur. Moreover, neither the company nor any other person
assumes responsibility for the accuracy and completeness of the
forward-looking statements. The forward-looking statements reflect
Groupon's expectations as of November 1, 2017. Groupon undertakes no
obligation to update publicly any forward-looking statements for any
reason after the date of this release to conform these statements to
actual results or to changes in its expectations.
About Groupon
Groupon (NASDAQ: GRPN) is building the daily habit in local commerce,
offering a vast mobile and online marketplace where people discover and
save on amazing things to do, eat, see and buy. By enabling real-time
commerce across local businesses, travel destinations, consumer products
and live events, shoppers can find the best a city has to offer.
Groupon is redefining how small businesses attract and retain customers
by providing them with customizable and scalable marketing tools and
services to profitably grow their businesses.
To download Groupon's top-rated mobile apps, visit www.groupon.com/mobile.
To search for great deals or subscribe to Groupon emails, visit www.groupon.com.
To learn more about the company's merchant solutions and how to work
with Groupon, visit www.groupon.com/merchant.
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Groupon, Inc.
|
Condensed Consolidated Balance Sheets
|
(in thousands, except share and per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
September 30, 2017
|
|
December 31, 2016
|
Assets
|
|
|
|
|
Current assets:
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
638,657
|
|
|
$
|
862,977
|
|
Accounts receivable, net
|
|
|
78,284
|
|
|
|
71,272
|
|
Prepaid expenses and other current assets
|
|
|
99,855
|
|
|
|
94,441
|
|
Current assets of discontinued operations
|
|
|
-
|
|
|
|
63,246
|
|
Total current assets
|
|
|
816,796
|
|
|
|
1,091,936
|
|
Property, equipment and software, net
|
|
|
150,023
|
|
|
|
169,452
|
|
Goodwill
|
|
|
285,436
|
|
|
|
274,551
|
|
Intangible assets, net
|
|
|
24,028
|
|
|
|
42,915
|
|
Investments (including $104,268 and $110,066 at September 30, 2017
and December 31, 2016, respectively, at fair value)
|
|
|
129,504
|
|
|
|
141,882
|
|
Deferred income taxes
|
|
|
5,007
|
|
|
|
5,151
|
|
Other non-current assets
|
|
|
17,302
|
|
|
|
23,484
|
|
Non-current assets of discontinued operations
|
|
|
-
|
|
|
|
12,006
|
|
Total Assets
|
|
$
|
1,428,096
|
|
|
$
|
1,761,377
|
|
Liabilities and Equity
|
|
|
|
|
Current liabilities:
|
|
|
|
|
Accounts payable
|
|
$
|
25,954
|
|
|
$
|
28,551
|
|
Accrued merchant and supplier payables
|
|
|
598,251
|
|
|
|
770,992
|
|
Accrued expenses and other current liabilities
|
|
|
324,553
|
|
|
|
366,456
|
|
Current liabilities of discontinued operations
|
|
|
-
|
|
|
|
47,052
|
|
Total current liabilities
|
|
|
948,758
|
|
|
|
1,213,051
|
|
Convertible senior notes, net
|
|
|
186,959
|
|
|
|
178,995
|
|
Deferred income taxes
|
|
|
1,927
|
|
|
|
1,714
|
|
Other non-current liabilities
|
|
|
102,386
|
|
|
|
99,628
|
|
Non-current liabilities of discontinued operations
|
|
|
-
|
|
|
|
2,927
|
|
Total Liabilities
|
|
|
1,240,030
|
|
|
|
1,496,315
|
|
Commitments and contingencies
|
|
|
|
|
Stockholders' Equity
|
|
|
|
|
Common stock, par value $0.0001 per share, 2,010,000,000 shares
authorized, 746,422,199 shares issued and 557,819,957 shares
outstanding at September 30, 2017 and 736,531,771 shares issued and
564,835,863 shares outstanding at December 31, 2016
|
|
|
75
|
|
|
|
74
|
|
Additional paid-in capital
|
|
|
2,161,139
|
|
|
|
2,112,728
|
|
Treasury stock, at cost, 188,602,242 shares at September 30, 2017
and 171,695,908 shares at December 31, 2016
|
|
|
(867,450
|
)
|
|
|
(807,424
|
)
|
Accumulated deficit
|
|
|
(1,135,925
|
)
|
|
|
(1,099,010
|
)
|
Accumulated other comprehensive income (loss)
|
|
|
29,099
|
|
|
|
58,052
|
|
Total Groupon, Inc. Stockholders' Equity
|
|
|
186,938
|
|
|
|
264,420
|
|
Noncontrolling interests
|
|
|
1,128
|
|
|
|
642
|
|
Total Equity
|
|
|
188,066
|
|
|
|
265,062
|
|
Total Liabilities and Equity
|
|
$
|
1,428,096
|
|
|
$
|
1,761,377
|
|
|
|
|
|
|
|
|
|
|
|
|
Groupon, Inc.
|
Condensed Consolidated Statements of Operations
|
(in thousands, except share and per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
Third-party and other
|
|
$
|
302,458
|
|
|
$
|
283,809
|
|
|
$
|
919,884
|
|
|
$
|
888,014
|
|
|
|
Direct
|
|
|
332,008
|
|
|
|
402,746
|
|
|
|
1,050,827
|
|
|
|
1,220,736
|
|
|
|
Total revenue
|
|
|
634,466
|
|
|
|
686,555
|
|
|
|
1,970,711
|
|
|
|
2,108,750
|
|
|
|
Cost of revenue:
|
|
|
|
|
|
|
|
|
|
|
Third-party and other
|
|
|
41,858
|
|
|
|
34,837
|
|
|
|
123,209
|
|
|
|
114,006
|
|
|
|
Direct
|
|
|
283,183
|
|
|
|
358,450
|
|
|
|
900,559
|
|
|
|
1,065,997
|
|
|
|
Total cost of revenue
|
|
|
325,041
|
|
|
|
393,287
|
|
|
|
1,023,768
|
|
|
|
1,180,003
|
|
|
|
Gross profit
|
|
|
309,425
|
|
|
|
293,268
|
|
|
|
946,943
|
|
|
|
928,747
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
Marketing
|
|
|
101,456
|
|
|
|
84,748
|
|
|
|
288,456
|
|
|
|
261,223
|
|
|
|
Selling, general and administrative
|
|
|
214,828
|
|
|
|
234,266
|
|
|
|
677,061
|
|
|
|
755,981
|
|
|
|
Restructuring charges
|
|
|
11,503
|
|
|
|
1,163
|
|
|
|
18,818
|
|
|
|
28,378
|
|
|
|
Gain on sale of intangible assets
|
|
|
(17,149
|
)
|
|
|
-
|
|
|
|
(17,149
|
)
|
|
|
-
|
|
|
|
Gains on business dispositions
|
|
|
-
|
|
|
|
(2,060
|
)
|
|
|
-
|
|
|
|
(11,399
|
)
|
|
|
Acquisition-related expense (benefit), net
|
|
|
-
|
|
|
|
(9
|
)
|
|
|
48
|
|
|
|
4,305
|
|
|
|
Total operating expenses
|
|
|
310,638
|
|
|
|
318,108
|
|
|
|
967,234
|
|
|
|
1,038,488
|
|
|
|
Income (loss) from operations
|
|
|
(1,213
|
)
|
|
|
(24,840
|
)
|
|
|
(20,291
|
)
|
|
|
(109,741
|
)
|
|
|
Other income (expense), net
|
|
|
7,546
|
|
|
|
(7,917
|
)
|
|
|
8,822
|
|
|
|
(16,552
|
)
|
|
|
Income (loss) from continuing operations before provision
(benefit) for income taxes
|
|
|
6,333
|
|
|
|
(32,757
|
)
|
|
|
(11,469
|
)
|
|
|
(126,293
|
)
|
|
|
Provision (benefit) for income taxes
|
|
|
2,531
|
|
|
|
1,690
|
|
|
|
11,001
|
|
|
|
461
|
|
|
|
Income (loss) from continuing operations
|
|
|
3,802
|
|
|
|
(34,447
|
)
|
|
|
(22,470
|
)
|
|
|
(126,754
|
)
|
|
|
Income (loss) from discontinued operations, net of tax
|
|
|
(862
|
)
|
|
|
(1,345
|
)
|
|
|
(1,751
|
)
|
|
|
(6,365
|
)
|
|
|
Net income (loss)
|
|
|
2,940
|
|
|
|
(35,792
|
)
|
|
|
(24,221
|
)
|
|
|
(133,119
|
)
|
|
|
Net income attributable to noncontrolling interests
|
|
|
(2,881
|
)
|
|
|
(2,184
|
)
|
|
|
(9,460
|
)
|
|
|
(8,880
|
)
|
|
|
Net income (loss) attributable to Groupon, Inc.
|
|
$
|
59
|
|
|
$
|
(37,976
|
)
|
|
$
|
(33,681
|
)
|
|
$
|
(141,999
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted net income (loss) per share (1):
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
0.00
|
|
|
$
|
(0.06
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.23
|
)
|
|
|
Discontinued operations
|
|
|
(0.00
|
)
|
|
|
(0.01
|
)
|
|
|
(0.00
|
)
|
|
|
(0.02
|
)
|
|
|
Basic and diluted net income (loss) per share
|
|
$
|
0.00
|
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.25
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding (1)
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
557,221,040
|
|
|
|
575,216,191
|
|
|
|
559,726,154
|
|
|
|
578,290,291
|
|
|
|
Diluted
|
|
|
566,669,049
|
|
|
|
575,216,191
|
|
|
|
559,726,154
|
|
|
|
578,290,291
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
The structure of the Company's common stock changed during the year
ended December 31, 2016. For additional information, refer to Note
8, Stockholders' Equity and Compensation Arrangements, and
Note 12, Income (Loss) per Share, in the Company's Quarterly
Report on Form 10-Q for the quarter ended September 30, 2017.
|
|
|
|
|
|
|
|
|
|
Groupon, Inc.
|
Condensed Consolidated Statements of Cash Flows
|
(in thousands)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Operating activities
|
|
|
|
|
|
|
|
|
Net income (loss)
|
|
$
|
2,940
|
|
|
$
|
(35,792
|
)
|
|
$
|
(24,221
|
)
|
|
$
|
(133,119
|
)
|
Less: Income (loss) from discontinued operations, net of tax
|
|
|
(862
|
)
|
|
|
(1,345
|
)
|
|
|
(1,751
|
)
|
|
|
(6,365
|
)
|
Income (loss) from continuing operations
|
|
|
3,802
|
|
|
|
(34,447
|
)
|
|
|
(22,470
|
)
|
|
|
(126,754
|
)
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities:
|
|
|
|
|
|
|
|
|
Depreciation and amortization of property, equipment and software
|
|
|
29,192
|
|
|
|
28,489
|
|
|
|
86,355
|
|
|
|
87,585
|
|
Amortization of acquired intangible assets
|
|
|
6,039
|
|
|
|
4,408
|
|
|
|
17,622
|
|
|
|
13,643
|
|
Stock-based compensation
|
|
|
19,177
|
|
|
|
25,757
|
|
|
|
60,318
|
|
|
|
92,360
|
|
Restructuring-related long-lived asset impairments
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
45
|
|
Gains on business dispositions
|
|
|
-
|
|
|
|
(2,060
|
)
|
|
|
-
|
|
|
|
(11,399
|
)
|
Gain on sale of intangible assets
|
|
|
(17,149
|
)
|
|
|
-
|
|
|
|
(17,149
|
)
|
|
|
-
|
|
Gain on sale of investment
|
|
|
(7,624
|
)
|
|
|
-
|
|
|
|
(7,624
|
)
|
|
|
-
|
|
Deferred income taxes
|
|
|
86
|
|
|
|
(1,320
|
)
|
|
|
845
|
|
|
|
(6,468
|
)
|
(Gain) loss, net from changes in fair value of contingent
consideration
|
|
|
-
|
|
|
|
(162
|
)
|
|
|
48
|
|
|
|
4,130
|
|
(Gain) loss from changes in fair value of investments
|
|
|
3,955
|
|
|
|
1,594
|
|
|
|
5,100
|
|
|
|
7,301
|
|
Amortization of debt discount on convertible senior notes
|
|
|
2,722
|
|
|
|
2,458
|
|
|
|
7,964
|
|
|
|
4,854
|
|
Change in assets and liabilities, net of acquisitions and
dispositions:
|
|
|
|
|
|
|
|
|
Restricted cash
|
|
|
2,089
|
|
|
|
363
|
|
|
|
2,637
|
|
|
|
(332
|
)
|
Accounts receivable
|
|
|
(15,442
|
)
|
|
|
(1,960
|
)
|
|
|
787
|
|
|
|
(2,460
|
)
|
Prepaid expenses and other current assets
|
|
|
8,025
|
|
|
|
45,195
|
|
|
|
(3,114
|
)
|
|
|
8,295
|
|
Accounts payable
|
|
|
5,107
|
|
|
|
3,083
|
|
|
|
(5,616
|
)
|
|
|
(2,610
|
)
|
Accrued merchant and supplier payables
|
|
|
(14,882
|
)
|
|
|
(48,315
|
)
|
|
|
(197,836
|
)
|
|
|
(168,944
|
)
|
Accrued expenses and other current liabilities
|
|
|
2,095
|
|
|
|
(53,278
|
)
|
|
|
(39,396
|
)
|
|
|
(48,323
|
)
|
Other, net
|
|
|
(3,331
|
)
|
|
|
(9,684
|
)
|
|
|
(21,538
|
)
|
|
|
(16,588
|
)
|
Net cash provided by (used in) operating activities from continuing
operations
|
|
|
23,861
|
|
|
|
(39,879
|
)
|
|
|
(133,067
|
)
|
|
|
(165,665
|
)
|
Net cash provided by (used in) operating activities from
discontinued operations
|
|
|
-
|
|
|
|
(943
|
)
|
|
|
(2,195
|
)
|
|
|
(5,892
|
)
|
Net cash provided by (used in) operating activities
|
|
|
23,861
|
|
|
|
(40,822
|
)
|
|
|
(135,262
|
)
|
|
|
(171,557
|
)
|
Investing activities
|
|
|
|
|
|
|
|
|
Purchases of property and equipment and capitalized software
|
|
|
(14,255
|
)
|
|
|
(12,682
|
)
|
|
|
(43,716
|
)
|
|
|
(49,033
|
)
|
Cash derecognized upon dispositions of subsidiaries
|
|
|
-
|
|
|
|
(776
|
)
|
|
|
-
|
|
|
|
(1,128
|
)
|
Proceeds from sale of intangible assets
|
|
|
18,333
|
|
|
|
-
|
|
|
|
18,333
|
|
|
|
-
|
|
Proceeds from sales and maturities of investments
|
|
|
14,718
|
|
|
|
1,685
|
|
|
|
16,561
|
|
|
|
1,685
|
|
Acquisitions of businesses, net of acquired cash
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(940
|
)
|
Acquisitions of intangible assets and other investing activities
|
|
|
(566
|
)
|
|
|
(129
|
)
|
|
|
(750
|
)
|
|
|
(2,121
|
)
|
Net cash provided by (used in) investing activities from continuing
operations
|
|
|
18,230
|
|
|
|
(11,902
|
)
|
|
|
(9,572
|
)
|
|
|
(51,537
|
)
|
Net cash provided by (used in) investing activities from
discontinued operations
|
|
|
-
|
|
|
|
(186
|
)
|
|
|
(9,548
|
)
|
|
|
(182
|
)
|
Net cash provided by (used in) investing activities
|
|
|
18,230
|
|
|
|
(12,088
|
)
|
|
|
(19,120
|
)
|
|
|
(51,719
|
)
|
Financing activities
|
|
|
|
|
|
|
|
|
Proceeds from issuance of convertible senior notes
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
250,000
|
|
Issuance costs for convertible senior notes and revolving credit
agreement
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(8,097
|
)
|
Purchase of convertible note hedges
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(59,163
|
)
|
Proceeds from issuance of warrants
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
35,495
|
|
Payments for purchases of treasury stock
|
|
|
(9,720
|
)
|
|
|
(25,170
|
)
|
|
|
(61,233
|
)
|
|
|
(115,619
|
)
|
Taxes paid related to net share settlements of stock-based
compensation awards
|
|
|
(7,984
|
)
|
|
|
(6,792
|
)
|
|
|
(23,340
|
)
|
|
|
(23,327
|
)
|
Proceeds from stock option exercises and employee stock purchase plan
|
|
|
3,009
|
|
|
|
2,929
|
|
|
|
5,486
|
|
|
|
4,976
|
|
Distributions to noncontrolling interest holders
|
|
|
(2,548
|
)
|
|
|
(2,024
|
)
|
|
|
(8,974
|
)
|
|
|
(9,151
|
)
|
Payment of contingent consideration related to acquisitions
|
|
|
(2,101
|
)
|
|
|
-
|
|
|
|
(7,790
|
)
|
|
|
(285
|
)
|
Payments of capital lease obligations
|
|
|
(8,628
|
)
|
|
|
(7,285
|
)
|
|
|
(25,298
|
)
|
|
|
(21,961
|
)
|
Other financing activities
|
|
|
-
|
|
|
|
-
|
|
|
|
(473
|
)
|
|
|
-
|
|
Net cash provided by (used in) financing activities
|
|
|
(27,972
|
)
|
|
|
(38,342
|
)
|
|
|
(121,622
|
)
|
|
|
52,868
|
|
Effect of exchange rate changes on cash and cash equivalents,
including cash classified within current assets of discontinued
operations
|
|
|
5,988
|
|
|
|
867
|
|
|
|
22,818
|
|
|
|
6,793
|
|
Net increase (decrease) in cash and cash equivalents, including
cash classified within current assets of discontinued operations
|
|
|
20,107
|
|
|
|
(90,385
|
)
|
|
|
(253,186
|
)
|
|
|
(163,615
|
)
|
Less: Net increase (decrease) in cash classified within current
assets of discontinued operations
|
|
|
-
|
|
|
|
(2,790
|
)
|
|
|
(28,866
|
)
|
|
|
(1,388
|
)
|
Net increase (decrease) in cash and cash equivalents
|
|
|
20,107
|
|
|
|
(87,595
|
)
|
|
|
(224,320
|
)
|
|
|
(162,227
|
)
|
Cash and cash equivalents, beginning of period
|
|
|
618,550
|
|
|
|
749,675
|
|
|
|
862,977
|
|
|
|
824,307
|
|
Cash and cash equivalents, end of period
|
|
$
|
638,657
|
|
|
$
|
662,080
|
|
|
$
|
638,657
|
|
|
$
|
662,080
|
|
|
Groupon, Inc.
|
Supplemental Financial Information and Business Metrics
(1)
|
(financial data in thousands; active customers in millions)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2016
|
|
Q4 2016
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America Segment:
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2017
|
|
|
|
|
|
Gross Billings (2):
|
|
|
|
|
|
|
|
|
|
|
|
Y/Y Growth
|
|
|
|
|
|
Local
|
|
$
|
530,768
|
|
|
$
|
590,684
|
|
|
$
|
587,766
|
|
|
$
|
615,833
|
|
|
$
|
606,184
|
|
|
14.2
|
|
%
|
|
|
|
|
|
Travel
|
|
|
93,564
|
|
|
|
90,059
|
|
|
|
114,163
|
|
|
|
112,670
|
|
|
|
93,186
|
|
|
(0.4
|
)
|
|
|
|
|
|
|
Goods
|
|
|
296,630
|
|
|
|
431,388
|
|
|
|
262,588
|
|
|
|
245,924
|
|
|
|
229,479
|
|
|
(22.6
|
)
|
|
|
|
|
|
|
Total Gross Billings
|
|
$
|
920,962
|
|
|
$
|
1,112,131
|
|
|
$
|
964,517
|
|
|
$
|
974,427
|
|
|
$
|
928,849
|
|
|
0.9
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
176,223
|
|
|
$
|
209,799
|
|
|
$
|
200,545
|
|
|
$
|
207,534
|
|
|
$
|
194,090
|
|
|
10.1
|
|
%
|
|
|
|
|
|
Travel
|
|
|
21,239
|
|
|
|
19,023
|
|
|
|
20,462
|
|
|
|
22,320
|
|
|
|
18,300
|
|
|
(13.8
|
)
|
|
|
|
|
|
|
Goods
|
|
|
285,819
|
|
|
|
421,931
|
|
|
|
252,350
|
|
|
|
222,058
|
|
|
|
201,824
|
|
|
(29.4
|
)
|
|
|
|
|
|
|
Total Revenue
|
|
$
|
483,281
|
|
|
$
|
650,753
|
|
|
$
|
473,357
|
|
|
$
|
451,912
|
|
|
$
|
414,214
|
|
|
(14.3
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
152,873
|
|
|
$
|
185,280
|
|
|
$
|
169,342
|
|
|
$
|
179,609
|
|
|
$
|
162,914
|
|
|
6.6
|
|
%
|
|
|
|
|
|
Travel
|
|
|
17,257
|
|
|
|
15,052
|
|
|
|
15,165
|
|
|
|
17,755
|
|
|
|
14,060
|
|
|
(18.5
|
)
|
|
|
|
|
|
|
Goods
|
|
|
31,531
|
|
|
|
50,437
|
|
|
|
36,430
|
|
|
|
36,496
|
|
|
|
30,934
|
|
|
(1.9
|
)
|
|
|
|
|
|
|
Total Gross Profit
|
|
$
|
201,661
|
|
|
$
|
250,769
|
|
|
$
|
220,937
|
|
|
$
|
233,860
|
|
|
$
|
207,908
|
|
|
3.1
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$
|
(24,470
|
)
|
|
$
|
12,265
|
|
|
$
|
(14,783
|
)
|
|
$
|
(12,033
|
)
|
|
$
|
(6,995
|
)
|
|
71.4
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International Segment:
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2017
|
Gross Billings:
|
|
|
|
|
|
|
|
|
|
|
|
Y/Y Growth
|
|
FX Effect(3)
|
|
Y/Y Growth excluding FX(3)
|
Local
|
|
$
|
184,068
|
|
|
$
|
221,337
|
|
|
$
|
191,219
|
|
|
$
|
189,408
|
|
|
$
|
202,991
|
|
|
10.3
|
|
%
|
|
(3.2
|
)
|
|
7.1
|
|
%
|
Travel
|
|
|
58,964
|
|
|
|
60,099
|
|
|
|
53,161
|
|
|
|
45,981
|
|
|
|
49,837
|
|
|
(15.5
|
)
|
|
|
(3.4
|
)
|
|
(18.9
|
)
|
|
Goods
|
|
|
158,965
|
|
|
|
211,963
|
|
|
|
149,079
|
|
|
|
154,417
|
|
|
|
159,820
|
|
|
0.5
|
|
|
|
(4.8
|
)
|
|
(4.3
|
)
|
|
Total Gross Billings
|
|
$
|
401,997
|
|
|
$
|
493,399
|
|
|
$
|
393,459
|
|
|
$
|
389,806
|
|
|
$
|
412,648
|
|
|
2.6
|
|
%
|
|
(3.8
|
)
|
|
(1.2
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
64,282
|
|
|
$
|
68,900
|
|
|
$
|
63,575
|
|
|
$
|
66,108
|
|
|
$
|
71,574
|
|
|
11.3
|
|
%
|
|
(3.3
|
)
|
|
8.0
|
|
%
|
Travel
|
|
|
13,524
|
|
|
|
12,141
|
|
|
|
11,002
|
|
|
|
10,796
|
|
|
|
9,801
|
|
|
(27.5
|
)
|
|
|
(3.0
|
)
|
|
(30.5
|
)
|
|
Goods
|
|
|
125,468
|
|
|
|
173,071
|
|
|
|
125,692
|
|
|
|
133,803
|
|
|
|
138,877
|
|
|
10.7
|
|
|
|
(5.5
|
)
|
|
5.2
|
|
|
Total Revenue
|
|
$
|
203,274
|
|
|
$
|
254,112
|
|
|
$
|
200,269
|
|
|
$
|
210,707
|
|
|
$
|
220,252
|
|
|
8.4
|
|
%
|
|
(4.7
|
)
|
|
3.7
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
59,257
|
|
|
$
|
63,987
|
|
|
$
|
59,194
|
|
|
$
|
62,303
|
|
|
$
|
67,860
|
|
|
14.5
|
|
%
|
|
(3.5
|
)
|
|
11.0
|
|
%
|
Travel
|
|
|
12,378
|
|
|
|
11,087
|
|
|
|
10,036
|
|
|
|
9,996
|
|
|
|
8,922
|
|
|
(27.9
|
)
|
|
|
(3.1
|
)
|
|
(31.0
|
)
|
|
Goods
|
|
|
19,972
|
|
|
|
26,063
|
|
|
|
19,284
|
|
|
|
21,908
|
|
|
|
24,735
|
|
|
23.8
|
|
|
|
(5.9
|
)
|
|
17.9
|
|
|
Total Gross Profit
|
|
$
|
91,607
|
|
|
$
|
101,137
|
|
|
$
|
88,514
|
|
|
$
|
94,207
|
|
|
$
|
101,517
|
|
|
10.8
|
|
%
|
|
(3.9
|
)
|
|
6.9
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$
|
(370
|
)
|
|
$
|
(2,762
|
)
|
|
$
|
3,103
|
|
|
$
|
4,635
|
|
|
$
|
5,782
|
|
|
1,662.7
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Results of Operations:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Billings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
714,836
|
|
|
$
|
812,021
|
|
|
$
|
778,985
|
|
|
$
|
805,241
|
|
|
$
|
809,175
|
|
|
13.2
|
|
%
|
|
(0.8
|
)
|
|
12.4
|
|
%
|
Travel
|
|
|
152,528
|
|
|
|
150,158
|
|
|
|
167,324
|
|
|
|
158,651
|
|
|
|
143,023
|
|
|
(6.2
|
)
|
|
|
(1.4
|
)
|
|
(7.6
|
)
|
|
Goods
|
|
|
455,595
|
|
|
|
643,351
|
|
|
|
411,667
|
|
|
|
400,341
|
|
|
|
389,299
|
|
|
(14.6
|
)
|
|
|
(1.6
|
)
|
|
(16.2
|
)
|
|
Total Gross Billings
|
|
$
|
1,322,959
|
|
|
$
|
1,605,530
|
|
|
$
|
1,357,976
|
|
|
$
|
1,364,233
|
|
|
$
|
1,341,497
|
|
|
1.4
|
|
%
|
|
(1.2
|
)
|
|
0.2
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
240,505
|
|
|
$
|
278,699
|
|
|
$
|
264,120
|
|
|
$
|
273,642
|
|
|
$
|
265,664
|
|
|
10.5
|
|
%
|
|
(0.9
|
)
|
|
9.6
|
|
%
|
Travel
|
|
|
34,763
|
|
|
|
31,164
|
|
|
|
31,464
|
|
|
|
33,116
|
|
|
|
28,101
|
|
|
(19.2
|
)
|
|
|
(1.1
|
)
|
|
(20.3
|
)
|
|
Goods
|
|
|
411,287
|
|
|
|
595,002
|
|
|
|
378,042
|
|
|
|
355,861
|
|
|
|
340,701
|
|
|
(17.2
|
)
|
|
|
(1.6
|
)
|
|
(18.8
|
)
|
|
Total Revenue
|
|
$
|
686,555
|
|
|
$
|
904,865
|
|
|
$
|
673,626
|
|
|
$
|
662,619
|
|
|
$
|
634,466
|
|
|
(7.6
|
)
|
%
|
|
(1.3
|
)
|
|
(8.9
|
)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Local
|
|
$
|
212,130
|
|
|
$
|
249,267
|
|
|
$
|
228,536
|
|
|
$
|
241,912
|
|
|
$
|
230,774
|
|
|
8.8
|
|
%
|
|
(0.9
|
)
|
|
7.9
|
|
%
|
Travel
|
|
|
29,635
|
|
|
|
26,139
|
|
|
|
25,201
|
|
|
|
27,751
|
|
|
|
22,982
|
|
|
(22.4
|
)
|
|
|
(1.3
|
)
|
|
(23.7
|
)
|
|
Goods
|
|
|
51,503
|
|
|
|
76,500
|
|
|
|
55,714
|
|
|
|
58,404
|
|
|
|
55,669
|
|
|
8.1
|
|
|
|
(2.3
|
)
|
|
5.8
|
|
|
Total Gross Profit
|
|
$
|
293,268
|
|
|
$
|
351,906
|
|
|
$
|
309,451
|
|
|
$
|
328,067
|
|
|
$
|
309,425
|
|
|
5.5
|
|
%
|
|
(1.2
|
)
|
|
4.3
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income (loss)
|
|
$
|
(24,840
|
)
|
|
$
|
9,503
|
|
|
$
|
(11,680
|
)
|
|
$
|
(7,398
|
)
|
|
$
|
(1,213
|
)
|
|
95.1
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities from continuing
operations
|
|
$
|
(39,879
|
)
|
|
$
|
294,593
|
|
|
$
|
(136,233
|
)
|
|
$
|
(20,695
|
)
|
|
$
|
23,861
|
|
|
159.8
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash Flow
|
|
$
|
(52,561
|
)
|
|
$
|
275,339
|
|
|
$
|
(150,309
|
)
|
|
$
|
(36,080
|
)
|
|
$
|
9,606
|
|
|
118.3
|
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2016
|
|
|
Q4 2016
|
|
|
Q1 2017
|
|
|
Q2 2017
|
|
|
Q3 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Metrics:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Active Customers (4)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
29.1
|
|
|
|
|
31.1
|
|
|
|
|
31.6
|
|
|
|
|
31.9
|
|
|
|
|
32.5
|
|
|
|
International
|
|
|
16.6
|
|
|
|
|
16.8
|
|
|
|
|
16.7
|
|
|
|
|
16.4
|
|
|
|
|
16.6
|
|
|
|
Total Active Customers
|
|
|
45.7
|
|
|
|
|
47.9
|
|
|
|
|
48.3
|
|
|
|
|
48.3
|
|
|
|
|
49.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TTM Gross Billings / Average Active Customer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
$
|
142
|
|
|
|
$
|
138
|
|
|
|
$
|
136
|
|
|
|
$
|
133
|
|
|
|
$
|
129
|
|
|
International
|
|
|
103
|
|
|
|
|
102
|
|
|
|
|
101
|
|
|
|
|
101
|
|
|
|
|
102
|
|
|
Consolidated
|
|
|
127
|
|
|
|
|
124
|
|
|
|
|
123
|
|
|
|
|
121
|
|
|
|
|
120
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TTM Gross Profit / Average Active Customer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
$
|
31
|
|
|
|
$
|
31
|
|
|
|
$
|
30
|
|
|
|
$
|
30
|
|
|
|
$
|
30
|
|
|
International
|
|
|
25
|
|
|
|
|
23
|
|
|
|
|
22
|
|
|
|
|
23
|
|
|
|
|
23
|
|
|
Consolidated
|
|
|
29
|
|
|
|
|
28
|
|
|
|
|
27
|
|
|
|
|
28
|
|
|
|
|
27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Units
|
|
|
44.4
|
|
|
|
|
57.9
|
|
|
|
|
45.7
|
|
|
|
|
44.5
|
|
|
|
|
44.1
|
|
|
|
Year-over-year unit growth:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
North America
|
|
|
6.4
|
|
%
|
|
|
3.2
|
|
%
|
|
|
(0.4
|
)
|
%
|
|
|
(1.9
|
)
|
%
|
|
|
(0.1
|
)
|
%
|
|
International
|
|
|
(18.5
|
)
|
|
|
|
(0.3
|
)
|
|
|
|
(8.7
|
)
|
|
|
|
(7.8
|
)
|
|
|
|
(1.5
|
)
|
|
|
Consolidated
|
|
|
(2.9
|
)
|
|
|
|
2.0
|
|
|
|
|
(3.1
|
)
|
|
|
|
(3.8
|
)
|
|
|
|
(0.5
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Headcount (5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales (6)
|
|
|
2,695
|
|
|
|
|
2,626
|
|
|
|
|
2,624
|
|
|
|
|
2,485
|
|
|
|
|
2,457
|
|
|
|
Other
|
|
|
4,389
|
|
|
|
|
4,641
|
|
|
|
|
4,496
|
|
|
|
|
4,176
|
|
|
|
|
4,159
|
|
|
|
Total Headcount
|
|
|
7,084
|
|
|
|
|
7,267
|
|
|
|
|
7,120
|
|
|
|
|
6,661
|
|
|
|
|
6,616
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
We disposed of our operations in 11 countries, primarily based in
Asia and Latin America, between November 2016 and March 2017. The
financial results of our operations in those 11 countries are
presented as discontinued operations in the accompanying condensed
consolidated financial statements and tables. All prior period
financial information and operational metrics have been
retrospectively adjusted to reflect this presentation.
|
(2)
|
|
Represents the total dollar value of customer purchases of goods and
services.
|
(3)
|
|
Represents the change in financial measures that would have resulted
had average exchange rates in the reporting periods been the same as
those in effect in the prior year periods.
|
(4)
|
|
Reflects the total number of unique user accounts that have made a
purchase during the TTM either through one of our online
marketplaces or directly with a merchant for which we earned a
commission. North America active customers for the quarter ended
September 30, 2017 includes approximately 0.7 million incremental
active customers from the fourth quarter 2016 acquisition of
LivingSocial, Inc.
|
(5)
|
|
Including employees of discontinued operations, our headcount
decreased by 1,758 employees, or 21%, year-over-year in the third
quarter of 2017, from 8,374 total employees in the prior year period.
|
(6)
|
|
Includes merchant sales representatives, as well as sales support
personnel from our continuing operations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Groupon, Inc.
|
Non-GAAP Reconciliation Schedules
|
(in thousands, except share and per share amounts)
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA, non-GAAP earnings attributable to common
stockholders and non-GAAP earnings per share are non-GAAP
performance measures. The Company reconciles Adjusted EBITDA to the
most comparable U.S. GAAP performance measure, "Net income (loss)
from continuing operations" for the periods presented and the
Company reconciles non-GAAP earnings per share to the most
comparable U.S. GAAP performance measure, "Diluted net income (loss)
per share," for the periods presented.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is a quarterly reconciliation of Adjusted EBITDA to
the most comparable U.S. GAAP performance measure, "Income (loss)
from continuing operations."
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2016
|
|
Q4 2016
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
|
Income (loss) from continuing operations
|
|
$
|
(34,447
|
)
|
|
$
|
(39,455
|
)
|
|
$
|
(20,869
|
)
|
|
$
|
(5,403
|
)
|
|
$
|
3,802
|
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation (1)
|
|
|
25,457
|
|
|
|
22,563
|
|
|
|
19,650
|
|
|
|
21,392
|
|
|
|
18,235
|
|
|
|
Depreciation and amortization
|
|
|
32,897
|
|
|
|
34,681
|
|
|
|
34,067
|
|
|
|
34,679
|
|
|
|
35,231
|
|
|
|
Acquisition-related expense (benefit), net
|
|
|
(9
|
)
|
|
|
1,345
|
|
|
|
12
|
|
|
|
36
|
|
|
|
-
|
|
|
|
Restructuring charges
|
|
|
1,163
|
|
|
|
12,060
|
|
|
|
2,731
|
|
|
|
4,584
|
|
|
|
11,503
|
|
|
|
Gain on sale of intangible assets
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(17,149
|
)
|
|
|
Gains on business dispositions
|
|
|
(2,060
|
)
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
Non-operating expense (income), net
|
|
|
7,917
|
|
|
|
54,737
|
|
|
|
4,602
|
|
|
|
(5,878
|
)
|
|
|
(7,546
|
)
|
|
|
Provision (benefit) for income taxes
|
|
|
1,690
|
|
|
|
(5,779
|
)
|
|
|
4,587
|
|
|
|
3,883
|
|
|
|
2,531
|
|
|
|
Total adjustments
|
|
|
67,055
|
|
|
|
119,607
|
|
|
|
65,649
|
|
|
|
58,696
|
|
|
|
42,805
|
|
|
|
Adjusted EBITDA
|
|
$
|
32,608
|
|
|
$
|
80,152
|
|
|
$
|
44,780
|
|
|
$
|
53,293
|
|
|
$
|
46,607
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Represents stock-based compensation recorded within "Selling,
general and administrative," "Cost of Revenue" and "Marketing".
Non-operating expense (income), net, includes $0.3 million, $0.2
million, $0.1 million, $0.0 million and $0.1 million of additional
stock-based compensation for the three months ended September 30,
2016, December 31, 2016, March 31, 2017, June 30, 2017, and
September 30, 2017 respectively. Restructuring charges include $0.8
million of additional stock-based compensation for the three months
ended September 30, 2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is a reconciliation of the Company's annual outlook
for Adjusted EBITDA to the Company's outlook for the most comparable
U.S. GAAP performance measure, "Income (loss) from continuing
operations."
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ending December 31, 2017
|
|
|
|
|
|
|
|
|
Expected income (loss) from continuing operations range
|
|
$(2,000) to $7,000
|
|
|
|
|
|
|
|
|
Expected adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock-based compensation
|
|
82,000 to 88,000
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
138,000
|
|
|
|
|
|
|
|
|
|
Restructuring charges
|
|
19,000
|
|
|
|
|
|
|
|
|
|
Gain on sale of intangible assets
|
|
(17,000
|
)
|
|
|
|
|
|
|
|
|
Non-operating expense (income), net
|
|
(4,000
|
)
|
|
|
|
|
|
|
|
|
Provision (benefit) for income taxes
|
|
9,000 to 14,000
|
|
|
|
|
|
|
|
|
Total expected adjustments
|
|
$227,000 to $238,000
|
|
|
|
|
|
|
|
|
Expected Adjusted EBITDA range
|
|
$225,000 to $245,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The outlook provided above does not reflect the potential impact of
any business or asset acquisitions or dispositions, changes in the
fair values of investments or contingent consideration, foreign
currency gains or losses or unusual or infrequently occurring items
that may occur during the remainder of 2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following is a reconciliation of net income (loss) attributable
to common stockholders to non-GAAP net income (loss) attributable to
common stockholders and a reconciliation of diluted net income
(loss) per share to non-GAAP net income (loss) per share for the
three and nine months ended September 30, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
September 30, 2017
|
|
Nine Months Ended
September 30, 2017
|
|
|
|
|
|
|
|
|
Net income (loss) attributable to common stockholders
|
|
$
|
59
|
|
|
$
|
(33,681
|
)
|
|
|
|
|
|
|
|
|
Stock-based compensation (1)
|
|
|
18,301
|
|
|
|
59,442
|
|
|
|
|
|
|
|
|
|
Amortization of acquired intangible assets
|
|
|
6,039
|
|
|
|
17,622
|
|
|
|
|
|
|
|
|
|
Acquisition-related expense (benefit), net
|
|
|
-
|
|
|
|
48
|
|
|
|
|
|
|
|
|
|
Restructuring charges
|
|
|
11,503
|
|
|
|
18,818
|
|
|
|
|
|
|
|
|
|
Gain on sale of intangible assets
|
|
|
(17,149
|
)
|
|
|
(17,149
|
)
|
|
|
|
|
|
|
|
|
Gain on sale of investment
|
|
|
(7,624
|
)
|
|
|
(7,624
|
)
|
|
|
|
|
|
|
|
|
Losses (gains), net from changes in fair value of investments
|
|
|
3,955
|
|
|
|
5,100
|
|
|
|
|
|
|
|
|
|
Intercompany foreign currency losses (gains) and reclassifications
of translation adjustments to earnings
|
|
|
(5,843
|
)
|
|
|
(16,065
|
)
|
|
|
|
|
|
|
|
|
Non-cash interest expense on convertible senior notes
|
|
|
2,722
|
|
|
|
7,964
|
|
|
|
|
|
|
|
|
|
Income tax effect of above adjustments
|
|
|
(6,074
|
)
|
|
|
(12,348
|
)
|
|
|
|
|
|
|
|
|
Loss from discontinued operations, net of tax
|
|
|
862
|
|
|
|
1,751
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income (loss) attributable to common stockholders
|
|
$
|
6,751
|
|
|
$
|
23,878
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares of common stock - basic
|
|
|
557,221,040
|
|
|
|
559,726,154
|
|
|
|
|
|
|
|
|
|
Effect of dilutive securities
|
|
|
9,448,009
|
|
|
|
7,886,444
|
|
|
|
|
|
|
|
|
|
Weighted-average shares of common stock - diluted
|
|
|
566,669,049
|
|
|
|
567,612,598
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income (loss) per share
|
|
$
|
0.00
|
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
|
|
|
Impact of stock-based compensation, amortization of acquired
intangible assets, acquisition-related expense (benefit), net, gain
on sale of investment, intercompany foreign currency losses (gains),
special charges and credits, loss from discontinued operations and
related tax effects
|
|
|
0.01
|
|
|
|
0.10
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income (loss) per share
|
|
$
|
0.01
|
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Represents stock-based compensation expense recorded within
"Selling, general and administrative," "Cost of Revenue,"
"Marketing" and "Other (income) expense, net." "Restructuring
charges" includes $0.8 million of additional stock-based
compensation for the three and nine months ended September 30, 2017.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow is a non-GAAP financial measure. The following is a
reconciliation of free cash flow to the most comparable U.S. GAAP
financial measure, "Net cash provided by (used in) operating
activities from continuing operations."
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Q3 2016
|
|
Q4 2016
|
|
Q1 2017
|
|
Q2 2017
|
|
Q3 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) operating activities from continuing
operations
|
|
$
|
(39,879
|
)
|
|
$
|
294,593
|
|
|
$
|
(136,233
|
)
|
|
$
|
(20,695
|
)
|
|
$
|
23,861
|
|
|
|
Purchases of property and equipment and capitalized software from
continuing operations
|
|
|
(12,682
|
)
|
|
|
(19,254
|
)
|
|
|
(14,076
|
)
|
|
|
(15,385
|
)
|
|
|
(14,255
|
)
|
|
|
Free cash flow
|
|
$
|
(52,561
|
)
|
|
$
|
275,339
|
|
|
$
|
(150,309
|
)
|
|
$
|
(36,080
|
)
|
|
$
|
9,606
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in) investing activities from continuing
operations
|
|
$
|
(11,902
|
)
|
|
$
|
(4,049
|
)
|
|
$
|
(14,020
|
)
|
|
$
|
(13,782
|
)
|
|
$
|
18,230
|
|
|
|
Net cash provided by (used in) financing activities
|
|
$
|
(38,342
|
)
|
|
$
|
(67,533
|
)
|
|
$
|
(45,726
|
)
|
|
$
|
(47,924
|
)
|
|
$
|
(27,972
|
)
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20171101005941/en/
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|