Looks like somebody’s paying for those free yoga lessons, after all.
LivingSocial — the daily deals site whose market value has taken a steep markdown since Amazon became an investor in 2010 — lost a staggering $650 million in 2012 despite more than doubling revenue.
Indeed, the size of the loss, widened from a loss of $499 million a year earlier, outstripped the size of LivingSocial’s entire business.
Total revenue surged to $536 million from $250 million a year earlier, according to a regulatory filing yesterday by Amazon, which owns a 29-percent stake in the company.
Amazon values its stake in LivingSocial at $52 million, implying a total book value of $179 million.
That’s sorely short of the $1 billion valuation LivingSocial got last June. In September, Amazon said LivingSocial’s market value had plummeted to $324 million as the initial public offering of rival deals site Groupon flopped.
LivingSocial’s operating costs ballooned to $862 million from $669 million amid well-publicized November layoffs of 400 employees, or 10 percent of the Washington, DC-based company’s workforce, and the shrinking of its office space.
“Sounds like a lot of losses, right?” Chief Executive Officer Tim O’Shaughnessy told employees in a memo last fall, arguing that the massive writedowns obscured hopeful prospects for LivingSocial’s underlying business.
Shares of Amazon, which late Tuesday reported disappointing sales but better-than-expected margins in the US, rose 4.8 percent, or $12.41, to $272.76.