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Key Takeaways
- Groupon reported a surprise second-quarter net loss after the closing bell Tuesday.
- The stock fell sharply in premarket trading Wednesday, as analysts had projected Groupon to start reporting profitable quarters starting in Q2.
- CEO Dusan Senkypl cited performance issues with the Groupon website as a reason for the results.
Groupon (GRPN) shares tumbled in premarket trading Wednesday, a day after the company reported an unexpected loss.
The e-commerce platform reported a net loss of $9.4 million for the second quarter, smaller than the $12 million loss Groupon reported a year ago. However, analysts had expected the company to start consistently producing profitable quarters starting with a projected $2 million profit in Q2, according to consensus estimates compiled by Visible Alpha.
Revenue of $124.6 million beat estimates but fell 3% year-over-year.
Road Ahead Has ‘Numerous Challenges’
“While our transformation still faces numerous challenges, including site reliability, I am confident we can restart the engines of growth and realize our mission to become the ultimate destination for local experiences and services,” Groupon Chief Executive Officer (CEO) Dusan Senkypl said.
Senkypl said in Tuesday’s earnings call that the company has had site reliability issues multiple times so far this year, including this month due to a “cloud migration project.”
Groupon shares were down 17% to $12.99 two hours before the opening bell. An opening price below $13 would put Groupon shares back around where they started the year.