This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration. Need a new registration confirmation email? Click here
NEW YORK (
Groupon(GRPN - Get Report) shares surged to their highest level in a year after the daily deals site reported better-than-forecast earnings and strong mobile purchasing among its North American users.
After the market close on Wednesday, Groupon reported adjusted earnings of 2 cents a share and revenue of $608.7 million, as its topline slightly beat Wall Street consensus estimates compiled by
Bloomberg. Groupon also said its Board of Directors had named Eric Leftofsky chief executive and Ted Leonsis as chairman, firming up the company's leadership ranks after the firing of founder Andrew Mason earlier this year.
Groupon shares were surging over 17% in after-hours trading to $10.20, adding to year-to-date gains in excess of 75%.
The earnings report indicated Groupon is relying on its 50 million user strong smartphone application to drive purchases in North America.
Sharply falling international revenue indicates that the company is focusing its attention on its North American business. Groupon had been criticized by investors for an expensive push overseas that drove operating losses in some recent quarters.
Overall, Groupon reported 7% growth in revenue, bolstered by a 45% increase in North American sales and greater-than-20% declines in international sales. The company also said 50% of North American sales were made on a mobile device.
"We significantly exceeded our operating income expectations, and delivered our strongest quarter ever in North America, due in part to accelerated billings growth of 30%," Eric Lefkofsky, CEO of Groupon, said in a statement. "We continue to gain traction in mobile, with nearly 50% of our North American transactions coming from mobile in June. To date, more than 50 million people have downloaded Groupon apps worldwide."
Groupon also said on Wednesday its Board of Directors has authorized a share repurchase program of up to $300 million of its outstanding Class A shares in the next 24 months. The program is intended to offset the annual dilution from employee stock grants, Groupon said.
In the second quarter, Groupon reported a net loss of a penny a share as a result of stock compensation costs. Operating income was $27.4 million on a GAAP basis and $59 million excluding stock based compensation.
For the third quarter, Groupon now forecasts revenue between $585 million and $635 million, and EPS between negative $0.01 and positive $0.01.
-- Written by Antoine Gara in New York