Groupon shares slump on disappointing revenue

Groupon Inc Cl A

Last Updated at 23 Jul 2014, 16:00 ET *Chart shows local time Groupon Inc Cl A intraday chart
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Shares in US voucher firm Groupon have slumped 26% after revenue figures reported on Monday evening disappointed Wall Street.

Although the company swung to profit in the three months and reported a jump in revenue, analysts had expected more.

As a result, some brokerage houses downgraded on the stock on Tuesday.

The company's shares have now lost almost three-quarters of their value since launching on the stockmarket in November last year.

'Deteriorating business'

On Monday, Groupon reported net income for the second quarter of $28.4m (£18.1m), against a loss of $107.4m a year ago.

Revenue rose 45% to $568.3m, and would have been higher but for a $32.4m hit on exchange rates, the company said.

It also said it now had 38 million active customers, an increase of 65% on a year earlier.

However, analysts highlighted that billings fell from the previous quarter

"A sequential decline implies a rapidly deteriorating core business - ie the daily deals business - and Groupon needs to act fast to fill up this hole with new initiatives," said Mark Mahaney at Citi Investment Research.

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