Groupon lost about $1 billion in value last night after its fourth-quarter performance disappointed investors.
Shares of the daily deals site tumbled almost 26 percent in extended trading after the Chicago company reported its quarterly loss widened to $81 million from $65 million last year.
Revenue rose 30 percent to $638 million but was still below expectations.
As if that weren’t enough, CEO Andrew Mason yesterday forecast sales in the current quarter would fall short of forecasts.
The trifecta of bad news sent Groupon shares plummeting sharply , wiping out in two hours all the gains posted over the last two months.
The loss of 12 cents a share — against Wall Street’s hope for a profit of 3 cents — refocused investor ire on Mason, whose tenure at Groupon has been pockmarked with trouble.
“Ouch,” said analyst Ken Sena with Evercore Partners. “They missed their guidance range two quarters in a row — and first quarter guidance was lower than expected. Also, operating cash flow was down 60 percent, and free cash flow was down 80 percent.”
Groupon, looking to push beyond its flagging daily deals business, is adding direct sales — but that has margins of roughly 8 percent versus 85-percent margins in its deals business.
In fact, the business is hardly the same one that went public in November 2011, when it was built on the fast-growing daily deals fad.
Last quarter, revenues grew 30 percent from the previous year — but its daily deals discounts, known as Groupons, declined from $478.5 million a year ago to $413 million.
Groupon said it would likely report another loss for the current quarter of $10 million.
Sales in the current period will be $560 million to $620 million — whereas analysts were expecting $647.7 million.