CHICAGO - Groupon, Inc. (NASDAQ: NASDAQ:GRPN) reported a significant beat on its fourth quarter earnings, posting an adjusted EPS of $0.30, which was $0.40 higher than the analyst estimate of -$0.10. The company's revenue for the quarter also surpassed expectations, coming in at $137.7 million against the consensus estimate of $136.71 million.
This performance marks a robust end to the year for Groupon, with the stock price soaring over 8% in response to the positive financial results and the resolution of liquidity concerns that had previously cast doubt on the company's future.
Interim CEO Dusan Senkypl expressed satisfaction with the quarter's outcomes, attributing the success to the company's ongoing transformation plan, particularly noting improvements in the North America local and travel categories. Despite a 3% decline in North America segment revenues excluding the Goods category compared to the previous year, the company's overall financial health has improved. Groupon has addressed its going concern issue through enhanced financial performance and increased liquidity, including an operating cash flow of $55 million and free cash flow of $51 million for the fourth quarter.
The company's proactive measures to improve liquidity, such as the sale of a portion of its equity interest in SumUp and a successful Rights Offering that raised $80 million, have contributed to a more stable financial position. Additionally, Groupon preemptively terminated its credit facility in February 2024, further solidifying its balance sheet.
"I am pleased to report another quarter of progress. Significant improvement in our North America local and travel categories is a positive indicator that our transformation plan is working. In addition, our improved financial performance and increased liquidity resolves our going concern issue," said Senkypl. He also thanked the Groupon team for their efforts during the transformation phase and reiterated the company's commitment to becoming the ultimate destination for local experiences and services.
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