Groupon exceeds top end of guidance range on
Revenue, Adjusted EBITDA and Non-GAAP Earnings per Share
- Fourth quarter gross billings of
$1.7 billion, $6.3 billion for the full year
- Fourth quarter revenue of $917.2
million, $3.1 billion for the full year
- Fourth quarter Adjusted EBITDA of
$67.0 million, $256.8 million for the full year
- Fourth quarter GAAP loss per share
of $0.08; non-GAAP earnings per share of $0.04
- Operating Cash Flow of $292.1
million for the trailing twelve month period; Free Cash Flow of
$208.1 million
- Affirmed fiscal year 2016 revenue
guidance of $2.75 billion to $3.05 billion and increased 2016
expected Adjusted EBITDA range to $80 million to $130
million
Groupon, Inc. (NASDAQ: GRPN) today announced financial results
for the quarter and fiscal year ended December 31, 2015.
“2015 saw sustained progress toward our vision of making Groupon
the daily habit in local commerce,” said CEO Rich Williams.
“Following a stronger than expected fourth quarter, we enter 2016
with a continued focus on streamlining our global operations,
reducing our reliance on low margin products in our shopping
business and rekindling our customer acquisition efforts to set the
stage for accelerated growth.”
Fourth Quarter 2015 Summary
- Gross billings, which reflect the total
dollar value of customer purchases of goods and services, was $1.71
billion in the fourth quarter 2015, compared with $1.72 billion in
the fourth quarter 2014. Gross billings declined 1% globally, but
grew 4% excluding the unfavorable impact from year-over-year
changes in foreign exchange rates throughout the quarter. On this
F/X neutral basis, North America billings increased 11%, EMEA
declined 2% and Rest of World declined 7%.
- Revenue was $917.2 million in the
fourth quarter 2015, compared with $883.2 million in the fourth
quarter 2014. Revenue increased 4% globally, or 9% excluding the
unfavorable impact from year-over-year changes in foreign exchange
rates throughout the quarter. On this F/X neutral basis, North
America revenue increased 13%, EMEA increased 3% and Rest of World
declined 8%.
- Gross profit was $371.7 million in the
fourth quarter 2015, compared with $378.1 million in the fourth
quarter 2014. Gross profit declined 2% globally, but grew 4%
excluding the unfavorable impact from year-over-year changes in
foreign exchange rates throughout the quarter.
- Adjusted EBITDA, a non-GAAP financial
measure, was $67.0 million in the fourth quarter 2015, compared
with $92.9 million in the fourth quarter 2014.
- Net loss attributable to common
stockholders was $46.5 million, or $0.08 per share. Non-GAAP
earnings attributable to common stockholders was $23.3 million, or
$0.04 per share.
- Operating cash flow for the trailing
twelve months ended December 31, 2015 was $292.1 million. Free cash
flow, a non-GAAP financial measure, was $233.5 million in the
fourth quarter 2015, bringing free cash flow for the trailing
twelve months ended December 31, 2015 to $208.1 million.
- Cash and cash equivalents as of
December 31, 2015 was $853.4 million and we had no outstanding
borrowings under our revolving credit facility.
Full Year 2015 Summary
- Gross billings was $6.3 billion in
2015, compared with $6.2 billion in 2014. Gross billings was
approximately flat, but grew 8% excluding the unfavorable impact
from year-over-year changes in foreign exchange rates throughout
the year. On this F/X neutral basis, North America billings
increased 12%, EMEA increased 3% and Rest of World was
approximately flat.
- Revenue was $3.1 billion in 2015,
compared with $3.0 billion in 2014. Revenue grew 3% globally, or 9%
excluding the unfavorable impact from year-over-year changes in
foreign exchange rates throughout the year. On this F/X neutral
basis, North America revenue increased 12%, EMEA increased 7% and
Rest of World declined 6%.
- Gross profit was $1.4 billion in 2015,
compared with $1.5 billion in 2014. Gross profit declined 5%, but
grew 2% excluding the unfavorable impact from year-over-year
changes in foreign exchange rates throughout the year.
- Adjusted EBITDA was $256.8 million in
2015, compared with $262.3 million in 2014.
- Net earnings attributable to common
stockholders were $20.7 million, or $0.03 per share. Earnings per
share includes $0.19 from discontinued operations, which was driven
by the gain on our sale of a controlling stake in Ticket Monster.
Non-GAAP earnings attributable to common stockholders was $91.0
million, or $0.14 per share.
Definitions and reconciliations of all non-GAAP financial
measures are included below in the section titled “Non-GAAP
Financial Measures” and in the accompanying tables.
Highlights
- Units: Global units, defined as
vouchers and products sold before cancellations and refunds, were
approximately flat year-over-year at 62 million for the fourth
quarter 2015. North America units increased 12%, EMEA units
declined 3% and Rest of World units declined 31%.
- Active deals: At the end of the
fourth quarter 2015, on average, active deals were approximately
650,000 globally, with nearly 350,000 in North America. Both
include approximately 70,000 Coupons.
- Active customers: Active
customers, or customers that have purchased a voucher or product
within the last twelve months, grew 3% year-over-year, to 48.9
million as of December 31, 2015, comprising 25.9 million in North
America, 15.4 million in EMEA, and 7.6 million in Rest of
World.
- Customer spend: Fourth quarter
2015 trailing twelve month billings per average active customer was
$130, compared with $137 in the fourth quarter 2014.
Share Repurchase
During the fourth quarter 2015, Groupon repurchased 35,326,954
shares of its Class A common stock for an aggregate purchase price
of $112.5 million, as of December 31, 2015. Up to $156.8 million of
Class A common stock remained available for repurchase under
Groupon’s share repurchase program through August 2017. The timing
and amount of any share repurchases are determined based on market
conditions, share price and other factors, and the programs may be
discontinued or suspended at any time.
Outlook
Groupon’s outlook for 2016 reflects current foreign exchange
rates, as well as expected marketing investments, continued
progress on increasing Shopping margins, and a reduction of our
international footprint. We continue to expect revenue of between
$2.75 and $3.05 billion for the full year, and we are increasing
the company’s expected 2016 adjusted EBITDA range to between $80
million and $130 million. Moving forward, we are only providing
annual Revenue and adjusted EBITDA guidance, which we will update
quarterly.
Conference Call
A conference call will be webcast live today at 4:00 p.m. CST /
5:00 p.m. EST, 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 Measures
In addition to financial results reported in accordance with
U.S. generally accepted accounting principles (U.S. GAAP), we have
provided the following non-GAAP financial measures in this release
and the accompanying tables: foreign exchange rate neutral
operating results, adjusted EBITDA, non-GAAP net income
attributable to common stockholders, non-GAAP earnings per share
and free cash flow. These non-GAAP financial measures, which are
presented on a continuing operations basis, are intended to aid
investors in better understanding Groupon's current financial
performance and its 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, 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: interest income, interest expense,
gains and losses related to minority investments, and foreign
currency gains and losses. 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.
Items That Are Unusual in Nature or Infrequently Occurring.
During the twelve months ended December 31, 2015, items that we
believe to be unusual in nature or infrequently occurring were (a)
charges related to our restructuring program, (b) the gain on our
disposition of Groupon India, (c) the write-off of a prepaid asset
related to a marketing program that was discontinued because the
counterparty ceased operations and (d) the expense related to a
significant increase in the contingent liability for our securities
litigation matter. We exclude items that are unusual in nature or
infrequently occurring because we believe that excluding those
items provides meaningful supplemental information about our core
operating performance and facilitates comparisons to our historical
results.
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 financial 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 items that are unusual in nature or
infrequently occurring. 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 results in the same manner as our management and
Board of Directors.
Non-GAAP net income (loss) attributable to common stockholders
and non-GAAP earnings (loss) per share 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,
- items that are unusual in nature or
infrequently occurring,
- 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,
- income (loss) from discontinued
operations and
- the income tax effect of those
items.
We believe that excluding these 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 financial 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.
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. The risks and
uncertainties that could cause our results to differ materially
from those included in the forward-looking statements 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 and the
impact of our shift away from lower margin products in our Goods
category; effectively dealing with challenges arising from our
international operations, including fluctuations in currency
exchange rates; retaining existing customers and adding new
customers, including as we increase our marketing spend and shift
away from lower margin products in our Goods category; 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. 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 ended December 31,
2015 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 February 11, 2016. 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 a global leader of local commerce and
the place you start when you want to buy just about anything,
anytime, anywhere. By leveraging the company’s global relationships
and scale, Groupon offers consumers a vast marketplace of
unbeatable deals all over the world. Shoppers discover the best a
city has to offer on the web or on mobile with Groupon Local, enjoy
vacations with Groupon Getaways, and find a curated selection of
electronics, fashion, home furnishings and more with Groupon
Goods.
Groupon is redefining how traditional small businesses attract,
retain and interact with customers by providing merchants with a
suite of products and services, including customizable deal
campaigns, credit card payment processing capabilities, and
point-of-sale solutions that help businesses grow and operate more
effectively. To search for great deals or subscribe to Groupon
emails, visit www.Groupon.com. To download Groupon's top-rated
mobile apps, visit www.groupon.com/mobile. To learn more about the
company’s merchant solutions and how to work with Groupon, visit
www.GrouponWorks.com
Groupon, Inc. Summary Consolidated and Segment
Results (in thousands, except share and per share
amounts) (unaudited) The financial results of
Ticket Monster, including the gain on disposition and related tax
effects, are presented as discontinued operations in the
accompanying condensed consolidated financial statements and tables
for the three months and year ended December 31, 2015.
Additionally, the assets and liabilities of Ticket Monster are
presented as held for sale in the accompanying condensed
consolidated balance sheet as of December 31, 2014. All prior
period financial information and operational metrics have been
retrospectively adjusted to reflect this presentation.
Three Months Ended
Year Ended December 31, December 31, Y/Y %
Growth Y/Y % Growth FX Effect excluding
FX Effect excluding 2015
2014 Y/Y % Growth
(2)
FX (2)
2015 2014 Y/Y %
Growth
(2)
FX (2)
Gross Billings(1): North America $ 1,050,361 $ 948,579 10.7 % $
(1,511 ) 10.9 % $ 3,709,797 $ 3,303,479 12.3 % $ (5,415 ) 12.5 %
EMEA 487,147 560,541 (13.1 ) (61,482 ) (2.1 ) 1,794,354 2,046,807
(12.3 ) (317,640 ) 3.2 Rest of World 169,484
215,549 (21.4 ) (31,574 ) (6.7 ) 751,389
887,546 (15.3 ) (132,679 ) (0.4 )
Consolidated gross billings $ 1,706,992 $ 1,724,669
(1.0 ) % $ (94,567 ) 4.5 % $ 6,255,540 $ 6,237,832
0.3 % $ (455,734 ) 7.6 % Revenue: North America $ 622,647 $
550,974 13.0 % $ (408 ) 13.1 % $ 2,047,742 $ 1,824,461 12.2 % $
(1,351 ) 12.3 % EMEA 248,326 272,475 (8.9 ) (33,198 ) 3.3 867,880
961,130 (9.7 ) (157,892 ) 6.7 Rest of World 46,197
59,779 (22.7 ) (8,785 ) (8.0 ) 203,894
256,532 (20.5 ) (36,932 ) (6.1 )
Consolidated revenue $ 917,170 $ 883,228 3.8 % $
(42,391 ) 8.6 % $ 3,119,516 $ 3,042,123 2.5 % $
(196,175 ) 9.0 % Income (loss) from operations $ (5,423 ) $
33,640 (116.1 ) % $ (2,742 ) (108.0 ) % $ (79,777 ) $ 30,701 (359.9
) % $ (2,064 ) (353.1 ) % Income (loss) from continuing
operations (32,552 ) 26,566 (89,171 ) (18,473 ) Income
(loss) from discontinued operations, net of tax (3) (10,613 )
(15,182 ) 122,850 (45,446 ) Net income (loss) attributable
to Groupon, Inc. $ (46,528 ) $ 8,788 $ 20,668 $ (73,090 )
Basic net income (loss) per share: Continuing operations $
(0.06 ) $ 0.04 $ (0.16 ) $ (0.04 ) Discontinued operations
(0.02 ) (0.03 ) 0.19 (0.07 )
Basic
net income (loss) per share $ (0.08 ) $ 0.01 $ 0.03
$ (0.11 )
Diluted net income (loss) per share:
Continuing operations $ (0.06 ) $ 0.04 $ (0.16 ) $ (0.04 )
Discontinued operations (0.02 ) (0.03 ) 0.19
(0.07 )
Diluted net income (loss) per share $
(0.08 ) $ 0.01 $ 0.03 $ (0.11 )
Weighted
average number of shares outstanding Basic 607,517,010
671,885,967 650,106,225 674,832,393 Diluted 607,517,010 681,543,847
650,106,225 674,832,393
(1)
Represents the total dollar value of customer purchases of
goods and services, excluding applicable taxes and net of estimated
refunds.
(2)
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 during the three months and year ended
December 31, 2014.
(3)
The $10.6 million loss presented within income (loss) from
discontinued operations, net of tax, for the three months ended
December 31, 2015 represents additional income tax expense
attributed to discontinued operations, which resulted from the
valuation allowance that was recognized during the period against
the Company's net deferred tax assets in the United States.
Groupon, Inc. Condensed Consolidated
Statements of Cash Flows (in thousands)
(unaudited)
Three Months Ended December 31, Year Ended
December 31, 2015 2014 2015 2014
Operating activities Net income (loss) $ (43,165 ) $ 11,384
$ 33,679 $ (63,919 ) Less: Income (loss) from discontinued
operations, net of tax (10,613 ) (15,182 )
122,850 (45,446 ) Income (loss) from continuing
operations (32,552 ) 26,566 (89,171 ) (18,473 ) Adjustments to
reconcile net income (loss) to net cash provided by operating
activities: Depreciation and amortization of property, equipment
and software 28,807 25,414 113,048 94,145 Amortization of acquired
intangible assets 4,956 4,708 19,922 20,896 Stock-based
compensation 32,865 29,961 142,069 115,290 Restructuring-related
long-lived asset impairments 6,922 — 7,267 — Gain on disposition of
business — — (13,710 ) — Deferred income taxes 6,267 (9,168 )
(8,985 ) (11,124 ) Excess tax benefits on stock-based compensation
(1,431 ) (3,407 ) (7,629 ) (15,980 ) Loss on equity method
investments — — — 459 Gain (loss) from changes in fair value of
contingent consideration 508 (1,385 ) 240 (2,444 ) Loss from
changes in fair value of investments 829 — 2,943 — Impairments of
investments — — — 2,036 Change in assets and liabilities, net of
acquisitions: Restricted cash 75 (491 ) 4,630 7,195 Accounts
receivable 6,960 10,280 13,313 (16,277 ) Prepaid expenses and other
current assets 61,358 36,816 21,545 13,933 Accounts payable 9,545
(1,073 ) 8,601 (14,046 ) Accrued merchant and supplier payables
142,069 155,991 40,217 54,921 Accrued expenses and other current
liabilities (1,174 ) 11,117 56,040 (9,986 ) Other, net
(16,980 ) (12,057 ) (18,222 ) 31,952
Net cash provided by (used in) operating activities from continuing
operations 249,024 273,272 292,118 252,497 Net cash provided by
(used in) operating activities from discontinued operations
(670 ) 13,550 (37,248 ) 36,327
Net cash provided by (used in) operating activities
248,354 286,822 254,870
288,824 Net cash provided by (used in) investing
activities from continuing operations (31,238 ) (35,175 ) (177,250
) (152,818 ) Net cash provided by (used in) investing activities
from discontinued operations — (714 )
244,470 (76,638 )
Net cash provided by (used in)
investing activities (31,238 ) (35,889 )
67,220 (229,456 )
Net
cash provided by (used in) financing activities (322,166
) (21,088 ) (508,156 ) (194,156 )
Effect of exchange rate changes on cash and cash equivalents,
including cash classified within current assets held for sale
(5,147 ) (13,100 ) (32,485 ) (33,771 )
Net increase (decrease) in cash and cash equivalents, including
cash classified within current assets held for sale (110,197 )
216,745 (218,551 ) (168,559 ) Less: Net increase (decrease) in cash
classified within current assets held for sale —
11,955 (55,279 ) 55,279
Net
increase (decrease) in cash and cash equivalents (110,197 )
204,790 (163,272 ) (223,838 ) Cash and cash equivalents, beginning
of period 963,559 811,844
1,016,634 1,240,472 Cash and cash equivalents,
end of period $ 853,362 $ 1,016,634 $ 853,362
$ 1,016,634
Groupon, Inc.
Condensed Consolidated Statements of Operations (in
thousands, except share and per share amounts)
(unaudited) Three Months Ended December 31,
Year Ended December 31, 2015 2014
2015 2014 Revenue: Third party and other $ 345,260 $
367,902 $ 1,372,533 $ 1,501,011 Direct 571,910
515,326 1,746,983 1,541,112
Total revenue 917,170 883,228
3,119,516 3,042,123 Cost of revenue: Third
party and other 43,640 49,725 188,932 203,058 Direct 501,790
455,394 1,545,519
1,373,756 Total cost of revenue 545,430
505,119 1,734,451 1,576,814
Gross profit 371,740 378,109
1,385,065 1,465,309 Operating expenses:
Marketing 83,208 59,812 254,335 241,954 Selling, general and
administrative 287,976 285,466 1,192,792 1,191,385 Restructuring
charges 5,422 — 29,568 — Gain on disposition of business — —
(13,710 ) — Acquisition-related expense (benefit), net 557
(809 ) 1,857 1,269 Total
operating expenses 377,163 344,469
1,464,842 1,434,608
Income (loss)
from operations (5,423 ) 33,640 (79,777 ) 30,701 Other income
(expense), net (1) (3,393 ) (11,531 ) (28,539
) (33,450 )
Income (loss) from continuing operations
before provision (benefit) for income taxes (8,816 ) 22,109
(108,316 ) (2,749 ) Provision (benefit) for income taxes
23,736 (4,457 ) (19,145 ) 15,724
Income (loss) from continuing operations (32,552 ) 26,566
(89,171 ) (18,473 )
Income (loss) from discontinued operations,
net of tax (10,613 ) (15,182 ) 122,850
(45,446 )
Net income (loss) (43,165 ) 11,384
33,679 (63,919 ) Net income (loss) attributable to noncontrolling
interests (3,363 ) (2,596 ) (13,011 )
(9,171 )
Net income (loss) attributable to Groupon, Inc. $
(46,528 ) $ 8,788 $ 20,668 $ (73,090 )
Basic net income (loss) per share: Continuing operations $
(0.06 ) $ 0.04 $ (0.16 ) $ (0.04 ) Discontinued operations
(0.02 ) (0.03 ) 0.19 (0.07 )
Basic
net income (loss) per share $ (0.08 ) $ 0.01 $ 0.03
$ (0.11 )
Diluted net income (loss) per share:
Continuing operations $ (0.06 ) $ 0.04 $ (0.16 ) $ (0.04 )
Discontinued operations (0.02 ) (0.03 ) 0.19
(0.07 )
Diluted net income (loss) per share $
(0.08 ) $ 0.01 $ 0.03 $ (0.11 )
Weighted
average number of shares outstanding Basic 607,517,010
671,885,967 650,106,225 674,832,393 Diluted 607,517,010 681,543,847
650,106,225 674,832,393
(1)
Other income (expense), net includes foreign currency losses
of $1.7 million and $11.4 million for the three months ended
December 31, 2015 and 2014, respectively, and foreign currency
losses of $23.8 million and $31.5 million for the year ended
December 31, 2015 and 2014, respectively.
Groupon, Inc.
Condensed Consolidated Balance Sheets (in thousands,
except share and per share amounts) December
31, 2015 2014 Assets Current assets: Cash
and cash equivalents $ 853,362 $ 1,016,634 Accounts receivable, net
68,175 90,597 Prepaid expenses and other current assets 153,705
192,382 Current assets held for sale — 85,445
Total current assets 1,075,242 1,385,058 Property, equipment
and software, net 198,897 176,004 Goodwill 287,332 236,756
Intangible assets, net 36,483 30,609 Investments (including $163.7
million and $7.4 million at December 31, 2015 and December 31,
2014, respectively, at fair value) 178,236 24,298 Deferred income
taxes 3,454 57,594 Other non-current assets 16,620 16,173
Non-current assets held for sale — 301,105
Total Assets $ 1,796,264 $ 2,227,597
Liabilities and Equity Current liabilities: Accounts payable
$ 24,590 $ 13,822 Accrued merchant and supplier payables 776,211
772,156 Accrued expenses and other current liabilities 402,724
341,381 Current liabilities held for sale —
166,239 Total current liabilities 1,203,525 1,293,598
Deferred income taxes 8,612 32,771 Other non-current liabilities
113,540 129,531 Non-current liabilities held for sale —
6,753
Total Liabilities
1,325,677 1,462,653 Commitments and
contingencies (see Note 10)
Stockholders' Equity Class A
common stock, par value $0.0001 per share, 2,000,000,000 shares
authorized, 717,387,446 shares issued and 588,919,281 shares
outstanding at December 31, 2015 and 699,008,084 shares issued and
671,768,980 shares outstanding at December 31, 2014 72 70 Class B
common stock, par value $0.0001 per share, 10,000,000 shares
authorized, 2,399,976 shares issued and outstanding at December 31,
2015 and December 31, 2014 — — Common stock, par value $0.0001 per
share, 2,010,000,000 shares authorized, no shares issued and
outstanding at December 31, 2015 and December 31, 2014 — —
Additional paid-in capital 1,964,453 1,847,420 Treasury stock, at
cost, 128,468,165 shares at December 31, 2015 and 27,239,104 shares
at December 31, 2014 (645,041 ) (198,467 ) Accumulated deficit
(901,292 ) (921,960 ) Accumulated other comprehensive income (loss)
51,206 35,763
Total Groupon, Inc.
Stockholders' Equity 469,398 762,826 Noncontrolling interests
1,189 2,118
Total Equity
470,587 764,944
Total Liabilities and
Equity $ 1,796,264 $ 2,227,597
Groupon, Inc. Segment Information
(in thousands) (unaudited) Three Months
Ended December 31, Year Ended December 31, 2015
2014 2015 2014 North America Gross
billings (1) $ 1,050,361 $ 948,579 $ 3,709,797 $ 3,303,479 Revenue
622,647 550,974 2,047,742 1,824,461 Segment cost of revenue and
operating expenses (2)(3)(4) 625,171 520,140
2,029,643 1,755,113 Segment
operating income (loss) (2) $ (2,524 ) $ 30,834 $ 18,099 $ 69,348
Segment operating income (loss) as a percent of segment gross
billings (0.2 )% 3.3 % 0.5 % 2.1 % Segment operating income (loss)
as a percent of segment revenue (0.4 )% 5.6 % 0.9 % 3.8 %
EMEA Gross billings (1) $ 487,147 $ 560,541 $ 1,794,354 $
2,046,807 Revenue 248,326 272,475 867,880 961,130 Segment cost of
revenue and operating expenses (2)(4)(5) 211,443
237,468 797,786 857,062
Segment operating income (2) $ 36,883 $ 35,007 $ 70,094 $ 104,068
Segment operating income as a percent of segment gross billings 7.6
% 6.2 % 3.9 % 5.1 % Segment operating income as a percent of
segment revenue 14.9 % 12.8 % 8.1 % 10.8 %
Rest of
World Gross billings (1) $ 169,484 $ 215,549 $ 751,389 $
887,546 Revenue 46,197 59,779 203,894 256,532 Segment cost of
revenue and operating expenses (2)(4) 52,731
62,828 228,273 282,688 Segment
operating loss (2) $ (6,534 ) $ (3,049 ) $ (24,379 ) $ (26,156 )
Segment operating loss as a percent of segment gross billings (3.9
)% (1.4 )% (3.2 )% (2.9 )% Segment operating loss as a percent of
segment revenue (14.1 )% (5.1 )% (12.0 )% (10.2 )%
(1)
Represents the total dollar value of customer purchases of
goods and services, excluding applicable taxes and net of estimated
refunds.
(2)
Segment cost of revenue and operating expenses and segment
operating income (loss) exclude stock-based compensation and
acquisition-related expense (benefit), net.
(3)
Segment cost of revenue and operating expenses for North America
for the year ended December 31, 2015 includes a $37.5 million
expense related to an increase in the Company's contingent
liability for its securities litigation matter.
(4)
Segment cost of revenue and operating expenses for the three months
ended December 31, 2015 includes restructuring charges (credits) of
$9.1 million in North America, $(3.6) million in EMEA and $(0.1)
million in Rest of World. Segment cost of revenue and operating
expenses for the year ended December 31, 2015 includes
restructuring charges of $10.5 million in North America, $16.1
million in EMEA and $3.0 million in Rest of World.
(5)
Segment cost of revenue and operating expenses for EMEA for the
year ended December 31, 2015 includes a $6.7 million expense for
the write-off of a prepaid asset related to a marketing program
that was discontinued because the counterparty ceased 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 financial measures. The Company reconciles Adjusted
EBITDA to the most comparable U.S. GAAP financial 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 financial 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 financial measure, "Income (loss) from continuing
operations."
Q4
2014 Q1 2015 Q2 2015 Q3 2015 Q4
2015 Income (loss) from continuing operations $ 26,566 $
(16,739) $ (15,267) $ (24,613) $ (32,552) Adjustments: Stock-based
compensation (1) 29,961 35,144 38,467 35,432 32,691 Depreciation
and amortization 30,122 32,200 31,372 35,635 33,763
Acquisition-related expense (benefit), net (809) (269) 505 1,064
557 Restructuring charges — — — 24,146 5,422 Gain on disposition of
business — — — (13,710) — Prepaid marketing write-off — — — 6,690 —
Securities litigation expense — — — 37,500 — Non-operating expense
(income), net 11,531 19,927 (2,941) 8,160 3,393 Provision (benefit)
for income taxes (4,457) 2,107 8,982 (53,970) 23,736 Total
adjustments 66,348 89,109 76,385 80,947 99,562
Adjusted
EBITDA $ 92,914 $ 72,370 $ 61,118 $ 56,334 $ 67,010
(1)
Includes stock-based compensation recorded within cost of
revenue, marketing expense, and selling, general and administrative
expense. Non-operating expense (income), net, includes $0.02
million, $0.1 million and $0.2 million of additional stock-based
compensation for the three months ended June 30, 2015, three months
ended September 30, 2015 and three months ended December 31, 2015,
respectively. The following is a reconciliation of Adjusted
EBITDA to the most comparable U.S. GAAP financial measure, "Net
income (loss) from continuing operations" for the years ended
December 31, 2015 and 2014:
Year Ended December
31, 2015 2014 Income (loss) from
continuing operations $ (89,171 ) $ (18,473 ) Adjustments:
Stock-based compensation (1) 141,734 115,290 Depreciation and
amortization 132,970 115,041 Acquisition-related expense (benefit),
net 1,857 1,269 Restructuring charges 29,568 — Gain on disposition
of business (13,710 ) — Prepaid marketing write-off 6,690 —
Securities litigation expense 37,500 — Non-operating expense
(income), net 28,539 33,450 Provision (benefit) for income taxes
(19,145 ) 15,724 Total adjustments
346,003 280,774
Adjusted EBITDA $
256,832 $ 262,301
(1)
Includes stock-based compensation recorded within cost of
revenue, marketing expense, and selling, general and administrative
expense. Non-operating expense (income), net, includes $0.3 million
of additional stock-based compensation for the year ended December
31, 2015. 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 months and year ended December 31, 2015:
Three Months Ended Year Ended
December 31, 2015 December 31, 2015 Net income (loss)
attributable to common stockholders $ (46,528 ) $ 20,668
Stock-based compensation 32,865 142,069 Amortization of acquired
intangible assets 4,956 19,922 Acquisition-related expense
(benefit), net 557 1,857 Restructuring charges 5,422 29,568 Gain on
disposition of business — (13,710 ) Prepaid marketing write-off —
6,690 Securities litigation expense — 37,500 Intercompany foreign
currency losses (gains) and reclassifications of translation
adjustments to earnings (1) (400 ) 20,266 Loss from changes in fair
value of investments 829 2,943 Income tax effect of above
adjustments 14,979 (53,953 ) Loss (income) from discontinued
operations, net of tax 10,613 (122,850 )
Non-GAAP net income (loss) attributable to common stockholders $
23,293 $ 90,970 Diluted shares 607,517,010
650,106,225 Incremental diluted shares 6,367,291
6,854,909 Adjusted diluted shares 613,884,301
656,961,134 Diluted net income (loss)
per share (2) $ (0.08 ) $ 0.03 Impact of stock-based compensation,
amortization of acquired intangible assets, acquisition-related
expense (benefit), net, intercompany foreign currency losses
(gains), items that are unusual in nature and infrequently
occurring, income (loss) from discontinued operations and related
tax effects 0.12 0.11 Non-GAAP net
income (loss) per share $ 0.04 $ 0.14
(1)
For the three months and year ended December 31, 2015, a
$3.7 million net cumulative translation adjustment gain was
reclassified to earnings as a result of the Company's exit from
certain countries as part of its restructuring plan. For the year
ended December 31, 2015, a $4.4 million loss related to the
cumulative translation adjustment from the Company's legacy
business in the Republic of Korea was reclassified to earnings as a
result of the Ticket Monster disposition.
(2)
The sum of per share amounts for quarterly periods may not equal
year-to-date amounts due to rounding. Foreign exchange rate
neutral operating results are non-GAAP financial measures. The
Company reconciles foreign exchange rate neutral operating results
to the most comparable U.S. GAAP financial measures, "Gross
billings," "Revenue" and "Income (loss) from continuing
operations," respectively, for the periods presented. The Company
reconciles "foreign exchange rate neutral Gross billings growth"
and "foreign exchange rate neutral Revenue growth" to
year-over-year growth rates for the most comparable U.S. GAAP
financial measures, "Gross billings growth" and "Revenue growth,"
respectively, for the periods presented. The effect on the
Company's gross billings, revenue and income (loss) from changes in
exchange rates versus the U.S. Dollar for the three months ended
December 31, 2015 was as follows:
Three Months Ended
December 31, 2015 Three Months Ended December 31,
2015 At Avg. Q4 2014 Exchange Rate
As At Avg. Q3 2015 Exchange Rate
As
Rates (1)
Effect (2)
Reported
Rates (3)
Effect (2)
Reported Gross billings $ 1,801,559 $ (94,567 ) $ 1,706,992
$ 1,721,580 $ (14,588 ) $ 1,706,992 Revenue 959,561 (42,391 )
917,170 923,903 (6,733 ) 917,170 Income (loss) from operations $
(2,681 ) $ (2,742 ) $ (5,423 ) $ (4,620 ) $ (803 ) $ (5,423 ) The
effect on the Company's gross billings, revenue and income (loss)
from operations from changes in exchange rates versus the U.S.
Dollar for the year ended December 31, 2015 was as follows:
Year Ended December 31, 2015 Year Ended December
31, 2015 At Avg. Q4 At Avg. Q4'14-
2014 YTD Exchange Rate As
Q3'15 Exchange Rate As
Rates (1)
Effect (2)
Reported
Rates (3)
Effect (2)
Reported Gross billings $ 6,711,274 $ (455,734 ) $ 6,255,540
$ 6,346,012 $ (90,472 ) $ 6,255,540 Revenue 3,315,691 (196,175 )
3,119,516 3,158,228 (38,712 ) 3,119,516 Income (loss) from
operations $ (77,713 ) $ (2,064 ) $ (79,777 ) $ (78,679 ) $ (1,098
) $ (79,777 )
(1)
Represents the financial statement balances that would have
resulted had average exchange rates in the reporting periods been
the same as those in effect during the three months and year ended
December 31, 2014.
(2)
Represents the increase or decrease in reported amounts resulting
from changes in exchange rates from those in effect in the
comparable prior periods.
(3)
Represents the financial statement balances that would have
resulted had average exchange rates in the reporting periods been
the same as those in effect during the three and twelve months
ended September 30, 2015. The following is a quarterly
reconciliation of foreign exchange rate neutral Gross billings
growth from the comparable quarterly periods of the prior year to
reported Gross billings growth from the comparable quarterly
periods of the prior year.
Q4 2014 Q1
2015 Q2 2015 Q3 2015 Q4
2015 EMEA Gross billings growth, excluding FX 8 % 7 % 9 % (1 )
% (2 ) % FX Effect (9 ) (18 ) (19 ) (14 )
(11 ) EMEA Gross billings growth (1 ) % (11 ) % (10 ) % (15
) % (13 ) % Rest of World Gross billings growth, excluding
FX — % (1 ) % 6 % — % (7 ) % FX Effect (10 ) (11 ) (15 )
(19 ) (14 ) Rest of World Gross billings
growth (10 ) % (12 ) % (9 ) % (19 ) % (21 ) % Consolidated
Gross billings growth, excluding FX 13 % 10 % 10 % 6 % 4 % FX
Effect (5 ) (8 ) (8 ) (8 ) (5 )
Consolidated Gross billings growth 8 % 2 % 2 % (2 ) % (1 ) % The
following is a quarterly reconciliation of foreign exchange rate
neutral Revenue growth from the comparable quarterly periods of the
prior year to reported Revenue growth from the comparable quarterly
periods of the prior year.
Q4 2014 Q1
2015 Q2 2015 Q3 2015 Q4
2015 EMEA Revenue growth, excluding FX 18 % 13 % 9 % 2 % 3 % FX
Effect (10 ) (19 ) (19 ) (15 ) (12 )
EMEA Revenue growth 8 % (6 ) % (10 ) % (13 ) % (9 ) % Rest
of World Revenue growth, excluding FX (9 ) % (8 ) % (4 ) % (5 ) %
(8 ) % FX Effect (10 ) (10 ) (14 ) (18 )
(15 ) Rest of World Revenue growth (19 ) % (18 ) % (18 ) %
(23 ) % (23 ) % Consolidated Revenue growth, excluding FX 19
% 10 % 11 % 7 % 9 % FX Effect (4 ) (7 ) (8 ) (7 )
(5 ) Consolidated Revenue growth 15 % 3 % 3 % — % 4 %
The effect on North America's gross billings by category from
changes in foreign exchange rates versus the U.S. Dollar for the
three months ended December 31, 2015 was as follows:
Exchange At Avg. Q4 Rate
December 31, 2015 December 31, 2014 Y/Y %
Y/Y% Growth
2014 Rates (1)
Effect (2)
As Reported As Reported Growth excluding
FX Local: Third party and other $ 532,015 $ (861 ) $ 531,154 $
499,250 6.4 % 6.6 % Travel: Third party 89,589
(200 ) 89,389 80,296 11.3 % 11.6 % Total services
621,604 (1,061 ) 620,543 579,546 7.1 % 7.3 % Goods: Third
party 13,401 (450 ) 12,951 8,277 56.5 % 61.9 % Direct
416,867 — 416,867 360,756 15.6 15.6
Total 430,268 (450 ) 429,818 369,033 16.5 % 16.6
Total gross billings $ 1,051,872 $ (1,511 ) $
1,050,361 $ 948,579 10.7 % 10.9 % The effect on EMEA's gross
billings by category from changes in foreign exchange rates versus
the U.S. Dollar for the three months ended December 31, 2015 was as
follows:
Exchange At
Avg. Q4 Rate December 31, 2015 December 31,
2014 Y/Y % Y/Y% Growth
2014 Rates (1)
Effect (2)
As Reported As Reported Growth excluding
FX Local: Third party and other $ 219,817 $ (22,372 ) $ 197,445
$ 242,119 (18.5 ) % (9.2 ) % Travel: Third party
68,439 $ (8,603 ) 59,836 72,710 (17.7 ) % (5.9 ) %
Total services 288,256 (30,975 ) 257,281 314,829 (18.3 ) % (8.4 ) %
Goods: Third party 92,612 (9,317 ) 83,295 99,710 (16.5 ) %
(7.1 ) % Direct 167,761 (21,190 ) 146,571
146,002 0.4 14.9
Total
260,373 (30,507 ) 229,866 245,712 (6.4 ) % 6.0 %
Total gross billings $ 548,629 $ (61,482 ) $ 487,147
$ 560,541 (13.1 ) % (2.1 ) % The effect on Rest of World's gross
billings by category from changes in foreign exchange rates versus
the U.S. Dollar for the three months ended December 31, 2015 was as
follows:
Exchange At
Avg. Q4 Rate December 31, 2015 December 31,
2014 Y/Y % Y/Y% Growth
2014 Rates (1)
Effect (2)
As Reported As Reported Growth excluding
FX Local: Third party and other $ 99,590 $ (16,160 ) $ 83,430 $
105,420 (20.9 ) % (5.5 ) % Travel: Third party 31,010
$ (5,641 ) 25,369 32,313 (21.5 ) % (4.0 ) %
Total services
130,600 (21,801 ) 108,799 137,733 (21.0 ) % (5.2 ) % Goods:
Third party 60,357 (8,144 ) 52,213 69,248 (24.6 ) % (12.8 ) %
Direct 10,101 (1,629 ) 8,472 8,568 (1.1
) 17.9 Total 70,458 (9,773 ) 60,685 77,816 (22.0 ) % (9.5 ) %
Total gross billings $ 201,058 $
(31,574 ) $ 169,484 $ 215,549 (21.4 ) % (6.7 ) % The effect on
consolidated gross billings by category from changes in foreign
exchange rates versus the U.S. Dollar for the three months ended
December 31, 2015 was as follows:
Exchange
At Avg. Q4 Rate December 31,
2015 December 31, 2014 Y/Y % Y/Y% Growth
2014 Rates (1)
Effect (2)
As Reported As Reported Growth excluding
FX Local: Third party and other $ 851,422 $ (39,393) $ 812,029
$ 846,789 (4.1) % 0.5 % Travel: Third party $ 189,038 $
(14,444) 174,594 185,319 (5.8) % 2.0 % Total services 1,040,460
(53,837) 986,623 1,032,108 (4.4) % 0.8 % Goods: Third party
166,370 (17,911) 148,459 177,235 (16.2) % (6.1) % Direct 594,729
(22,819) 571,910 515,326 11.0 15.4 Total 761,099 (40,730) 720,369
692,561 4.0 % 9.9 % Total gross
billings $ 1,801,559 $ (94,567) $ 1,706,992 $ 1,724,669 (1.0) % 4.5
%
(1)
Represents the financial statement balances that would have
resulted had average exchange rates in the reporting period been
the same as those in effect during the three months ended December
31, 2014.
(2)
Represents the increase or decrease in reported amounts resulting
from changes in exchange rates from those in effect in the
comparable prior year period.
Groupon, Inc. Supplemental
Financial Information and Business Metrics (9) (10)
(financial data in thousands; active customers in millions)
(unaudited) Q4 2014 Q1 2015
Q2 2015 Q3 2015 Q4 2015 Segments
North America Segment: Gross Billings (1): Local (2) Gross
Billings $ 499,250 $ 512,558 $ 499,378 $ 481,608 $ 531,154 Travel
Gross Billings 80,296 96,678
102,908 101,801 89,389 Gross
Billings - Services 579,546 609,236 602,286 583,409 620,543 Gross
Billings - Goods 369,033 284,741
293,970 285,794 429,818 Total
Gross Billings $ 948,579 $ 893,977 $ 896,256 $
869,203 $ 1,050,361 Year-over-year growth 20 % 14 %
12 % 12 % 11 % % Third Party and Other 62 % 69 % 68 % 68 % 60 % %
Direct 38 % 31 % 32 % 32 % 40 % Gross Billings Trailing Twelve
Months (TTM) $ 3,303,479 $ 3,415,687 $ 3,513,098 $ 3,608,015 $
3,709,797 Revenue (3): Local Revenue $ 170,946 $ 180,864 $
172,461 $ 163,786 $ 184,201 Travel Revenue 17,165
19,989 21,958 21,394
18,390 Revenue - Services 188,111 200,853 194,419
185,180 202,591 Revenue - Goods 362,863
279,029 286,863 278,751
420,056 Total Revenue $ 550,974 $ 479,882 $
481,282 $ 463,931 $ 622,647 Year-over-year
growth 24 % 11 % 14 % 11 % 13 % % Third Party and Other 35 % 42 %
41 % 40 % 33 % % Direct 65 % 58 % 59 % 60 % 67 % Revenue TTM $
1,824,461 $ 1,873,281 $ 1,930,632 $ 1,976,069 $ 2,047,742
Gross Profit (4): Local Gross Profit $ 147,582 $ 154,776 $ 147,574
$ 138,798 $ 159,745 % of North America Local Gross Billings 29.6 %
30.2 % 29.6 % 28.8 % 30.1 % Travel Gross Profit 14,187 15,791
18,385 17,644 15,207 % of North America Travel Gross Billings
17.7 % 16.3 % 17.9 %
17.3 % 17.0 % Gross Profit - Services
161,769 170,567 165,959 156,442 174,952 % of North America Services
Gross Billings 27.9 % 28.0 % 27.6 % 26.8 % 28.2 % Gross Profit -
Goods 34,404 23,923 30,598 34,801 44,329 % of North America Goods
Gross Billings 9.3 % 8.4 % 10.4
% 12.2 % 10.3 % Total Gross
Profit $ 196,173 $ 194,490 $ 196,557 $ 191,243
$ 219,281 Year-over-year growth 13 % 8 % 9 % 9 % 12 %
% Third Party and Other 83 % 88 % 85 % 83 % 81 % % Direct 17 % 12 %
15 % 17 % 19 % % of North America Total Gross Billings 20.7 % 21.8
% 21.9 % 22.0 % 20.9 %
EMEA Segment: Gross Billings:
Local Gross Billings $ 242,119 $ 217,598 $ 198,553 $ 182,540 $
197,445 Travel Gross Billings 72,710 65,065
59,544 64,916 59,836
Gross Billings - Services 314,829 282,663 258,097 247,456
257,281 Gross Billings - Goods 245,712 176,526
175,439 167,026 229,866
Total Gross Billings $ 560,541 $ 459,189 $
433,536 $ 414,482 $ 487,147 Year-over-year
growth (1 ) % (11 ) % (10 ) % (15 ) % (13 ) % Year-over-year
growth, excluding FX (5) 8 % 7 % 9 % (1 ) % (2 ) % % Third Party
and Other 74 % 77 % 76 % 75 % 70 % % Direct 26 % 23 % 24 % 25 % 30
%
Gross Billings TTM
$ 2,046,807 $ 1,992,408 $ 1,942,689 $ 1,867,748 $ 1,794,354
Revenue: Local Revenue $ 95,572 $ 82,536 $ 75,543 $ 70,781 $ 73,225
Travel Revenue 16,321 14,717
13,100 13,561 11,681 Revenue -
Services 111,893 97,253 88,643 84,342 84,906 Revenue - Goods
160,582 118,967 115,404
114,945 163,420 Total Revenue $ 272,475
$ 216,220 $ 204,047 $ 199,287 $ 248,326
Year-over-year growth 8 % (6 ) % (10 ) % (13 ) % 9 % Year-over-year
growth, excluding FX 18 % 13 % 9 % 2 % 3 % % Third Party and Other
46 % 51 % 48 % 48 % 41 % % Direct 54 % 49 % 52 % 52 % 59 % Revenue
TTM $ 961,130 $ 946,457 $ 922,814 $ 892,029 $ 867,880 Gross
Profit: Local Gross Profit $ 90,150 $ 77,356 $ 70,270 $ 66,288 $
68,966 % of EMEA Local Gross Billings 37.2 % 35.5 % 35.4 % 36.3 %
34.9 % Travel Gross Profit 15,226 12,400 11,939 12,323 10,732 % of
EMEA Travel Gross Billings 20.9 % 19.1
% 20.1 % 19.0 % 17.9 %
Gross Profit - Services 105,376 89,756 82,209 78,611 79,698 % of
EMEA Services Gross Billings 33.5 % 31.8 % 31.9 % 31.8 % 31.0 %
Gross Profit - Goods 38,154 25,481 21,878 24,905 43,026 % of EMEA
Goods Gross Billings 15.5 % 14.4 %
12.5 % 14.9 % 18.7 %
Total Gross Profit $ 143,530 $ 115,237 $ 104,087
$ 103,516 $ 122,724 Year-over-year growth (6 )
% (18 ) % (26 ) % (21 ) % (14 ) % % Third Party and Other 82 % 87 %
86 % 86 % 77 % % Direct 18 % 13 % 14 % 14 % 23 % % of EMEA Total
Gross Billings 25.6 % 25.1 % 24.0 % 25.0 % 25.2 %
Rest of
World Segment: Gross Billings: Local Gross Billings $ 105,420 $
99,735 $ 100,403 $ 92,972 $ 83,430 Travel Gross Billings
32,313 32,946 31,263
30,709 25,369 Gross Billings - Services
137,733 132,681 131,666 123,681 108,799 Gross Billings - Goods
77,816 66,154 67,555
60,168 60,685 Total Gross Billings $
215,549 $ 198,835 $ 199,221 $ 183,849 $
169,484 Year-over-year growth (10 ) % (12 ) % (9 ) % (19 ) %
(21 ) % Year-over-year growth, excluding FX — % (1 ) % 6 % — % (7 )
% % Third Party and Other 96 % 98 % 97 % 96 % 95 % % Direct 4 % 2 %
3 % 4 % 5 %
Gross Billings TTM
$ 887,546 $ 861,032 $ 840,243 $ 797,454 $ 751,389 Revenue:
Local Revenue $ 32,264 $ 30,281 $ 28,499 $ 26,372 $ 22,229 Travel
Revenue 5,757 6,495 6,363
6,135 5,098 Revenue - Services 38,021
36,776 34,862 32,507 27,327 Revenue - Goods 21,758
17,478 18,204 17,870
18,870 Total Revenue $ 59,779 $ 54,254
$ 53,066 $ 50,377 $ 46,197 Year-over-year
growth (19 ) % (18 ) % (18 ) % (23 ) % (23 ) % Year-over-year
growth, excluding FX (9 ) % (8 ) % (4 ) % (5 ) % (8 ) % % Third
Party and Other 86 % 91 % 87 % 86 % 82 % % Direct 14 % 9 % 13 % 14
% 18 % Revenue TTM $ 256,532 $ 244,326 $ 232,802 $ 217,476 $
203,894 Gross Profit: Local Gross Profit $ 27,175 $ 26,161 $
24,567 $ 22,568 $ 18,889 % of Rest of World Local Gross Billings
25.8 % 26.2 % 24.5 % 24.3 % 22.6 % Travel Gross Profit 3,815 4,906
5,012 4,859 4,040 % of Rest of World Travel Gross Billings
11.8 % 14.9 % 16.0 % 15.8
% 15.9 % Gross Profit - Services 30,990 31,067
29,579 27,427 22,929 % of Rest of World Services Gross Billings
22.5 % 23.4 % 22.5 % 22.2 % 21.1 % Gross Profit - Goods 7,416 6,612
6,784 6,726 6,806 % of Rest of World Goods Gross Billings
9.5 % 10.0 % 10.0 % 11.2
% 11.2 % Total Gross Profit $ 38,406 $
37,679 $ 36,363 $ 34,153 $ 29,735
Year-over-year growth (24 ) % (16 ) % (20 ) % (28 ) % (23 ) % %
Third Party and Other 96 % 99 % 99 % 99 % 99 % % Direct 4 % 1 % 1 %
1 % 1 % % of Rest of World Total Gross Billings 17.8 % 18.9 % 18.3
% 18.6 % 17.5 %
Consolidated Results of Operations:
Gross Billings: Local Gross Billings $ 846,789 $ 829,891 $ 798,334
$ 757,120 $ 812,029 Travel Gross Billings 185,319
194,689 193,715 197,426
174,594 Gross Billings - Services 1,032,108 1,024,580
992,049 954,546 986,623 Gross Billings - Goods 692,561
527,421 536,964 512,988
720,369 Total Gross Billings $ 1,724,669
$ 1,552,001 $ 1,529,013 $ 1,467,534 $
1,706,992 Year-over-year growth 8 % 2 % 2 % (2 ) % (1 ) %
Year-over-year growth, excluding FX 13 % 10 % 10 % 6 % 4 % % Third
Party and Other 70 % 75 % 74 % 74 % 66 % % Direct 30 % 25 % 26 % 26
% 34 % Gross Billings TTM $ 6,237,832 $ 6,269,127 $ 6,296,030 $
6,273,217 $ 6,255,540 Year-over-year growth 8 % 7 % 6 % 3 % — %
Revenue: Local Revenue $ 298,782 $ 293,681 $ 276,503 $
260,939 $ 279,655 Travel Revenue 39,243 41,201
41,421 41,090 35,169
Revenue - Services 338,025 334,882 317,924 302,029 314,824
Revenue - Goods 545,203 415,474
420,471 411,566 602,346 Total
Revenue $ 883,228 $ 750,356 $ 738,395 $
713,595 $ 917,170 Year-over-year growth 15 % 3 % 3 %
— % 4 % Year-over-year growth, excluding FX 19 % 10 % 11 % 7 % 9 %
% Third Party and Other 42 % 48 % 46 % 46 % 38 % % Direct 58 % 52 %
54 % 54 % 62 % Revenue TTM $ 3,042,123 $ 3,064,064 $ 3,086,248 $
3,085,574 $ 3,119,516 Year-over-year growth 18 % 13 % 10 % 5 % 3 %
Gross Profit: Local Gross Profit $ 264,907 $ 258,293 $
242,411 $ 227,654 $ 247,600 % of Consolidated Local Gross Billings
31.3 % 31.1 % 30.4 % 30.1 % 30.5 % Travel Gross Profit 33,228
33,097 35,336 34,826 29,979 % of Consolidated Travel Gross Billings
17.9 % 17.0 % 18.2 %
17.6 % 17.2 % Gross Profit - Services
298,135 291,390 277,747 262,480 277,579 % of Consolidated Services
Gross Billings 28.9 % 28.4 % 28.0 % 27.5 % 28.1 % Gross Profit -
Goods 79,974 56,016 59,260 66,432 94,161 % of Consolidated Goods
Gross Billings 11.5 % 10.6 %
11.0 % 13.0 % 13.1 % Total Gross
Profit $ 378,109 $ 347,406 $ 337,007 $ 328,912
$ 371,740 Year-over-year growth — % (5 ) % (8 ) % (7
) % (2 ) % % Third Party and Other 84 % 89 % 87 % 85 % 81 % %
Direct 16 % 11 % 13 % 15 % 19 % % of Total Consolidated Gross
Billings 21.9 % 22.4 % 22.0 % 22.4 % 21.8 % Marketing $
59,812 $ 52,533 $ 57,007 $ 61,587 $ 83,208 Selling, general and
administrative $ 285,466 $ 289,847 $ 288,721 $ 326,248 $ 287,976
Adjusted EBITDA $ 92,914 $ 72,370 $ 61,118 $ 56,334 $ 67,010 % of
Total Consolidated Gross Billings 5.4 % 4.7 % 4.0 % 3.8 % 3.9 % %
of Total Consolidated Revenue 10.5 % 9.6 % 8.3 % 7.9 % 7.3 % 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."
Q4
2014 Q1 2015 Q2 2015 Q3
2015 Q4 2015 Net cash provided by (used
in) operating activities from continuing operations $ 273,272 $
40,711 $ 9,995 $ (7,612 ) $ 249,024 Purchases of property and
equipment and capitalized software from continuing operations
(20,117 ) (18,294 ) (22,452 ) (27,735 )
(15,507 ) Free cash flow $ 253,155 $ 22,417 $ (12,457 ) $
(35,347 ) $ 233,517 Net cash provided by (used in) operating
activities from continuing operations (TTM) $ 252,497 $ 307,782 $
346,302 $ 316,366 $ 292,118 Purchases of property and equipment and
capitalized software from continuing operations (TTM)
(83,560 ) (85,761 ) (79,501 ) (88,598 )
(83,988 ) Free cash flow (TTM) $ 168,937 $ 222,021 $ 266,801 $
227,768 $ 208,130 Net cash provided by (used in) investing
activities from continuing operations $ (35,175 ) $ (19,443 ) $
(28,541 ) $ (98,028 ) $ (31,238 ) Net cash provided by (used in)
financing activities $ (21,088 ) $ (32,942 ) $ (138,227 ) $ (14,821
) $ (322,166 ) Net cash provided by (used in) investing
activities from continuing operations (TTM) $ (152,818 ) $ (105,821
) $ (102,205 ) $ (181,187 ) $ (177,250 ) Net cash provided by (used
in) financing activities (TTM) $ (194,156 ) $ (185,606 ) $ (209,080
) $ (207,078 ) $ (508,156 )
Other Metrics: Active
Customers (6) North America 24.1 24.6 24.9 25.2 25.9 EMEA 15.2 15.3
15.5 15.4 15.4 Rest of World 8.1 8.2
8.2 8.0 7.6 Total Active
Customers 47.4 48.1 48.6 48.6 48.9 TTM Gross Billings /
Average Active Customer (7) North America $ 147 $ 147 $ 148 $ 148 $
149 EMEA 139 134 130 123 117 Rest of World 105 101 98 99 96
Consolidated 137 135 133 132 130 Global headcount as of December
31, 2015 and 2014 was as follows:
Q4
2014 Q4 2015 Sales (8) 4,493 3,992 % North America 31 %
34 % % EMEA 42 % 41 % % Rest of World 27 % 25 % Other 6,256 5,880
Total Headcount 10,749 9,872
(1)
Represents the total dollar value of customer purchases of
goods and services, excluding applicable taxes and net of estimated
refunds.
(2)
Local represents deals with local and national merchants and
through local events. Other revenue transactions include
advertising, payment processing and commission revenue.
(3)
Includes third party revenue, direct revenue and other revenue.
Third party revenue is related to sales for which the Company acts
as a marketing agent for the merchant. This revenue is recorded on
a net basis. Direct revenue is primarily related to the sale of
merchandise for which the Company is the merchant of record. These
revenues are accounted for on a gross basis, with the cost of
inventory included in cost of revenue. Other revenue primarily
consists of commission revenue, payment processing revenue and
advertising revenue.
(4)
Represents third party revenue, direct revenue and other revenue
reduced by cost of revenue.
(5)
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.
(6)
Reflects the total number of unique user accounts who have
purchased a voucher or product from us during the trailing twelve
months.
(7)
Reflects the total gross billings
generated in the trailing twelve months per average active customer
over that period.
(8)
Includes merchant sales representatives, as well as sales support
from continuing operations.
(9)
Financial information and other metrics have been retrospectively
adjusted to exclude Ticket Monster, which has been classified as
discontinued operations.
(10)
The definition, methodology and appropriateness of each of our
supplemental metrics is reviewed periodically. As a result, metrics
are subject to removal and/or change.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160211006437/en/
Groupon, Inc.Investor RelationsTom Grant,
312-999-3098ir@groupon.comorPublic RelationsBill Roberts,
312-459-5191
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