Groupon Inc (GRPN) Plummets 12 Percent; Weak Outlook Disappoints Investors

Groupon, Inc (NASDAQ:GRPN) plummeted almost 12% to $9:08 per share after hours despite reporting fourth quarter earnings results that beat the consensus estimate of Wall Street analyst.

During the quarter, the online daily deals company generated earnings of $0.04 per share and $768.4 million revenue, an increase of 20% compared with its revenue in the year-ago quarter. Analysts estimated that Groupon, Inc (NASDAQ:GRPN) will deliver $0.02 earnings on $718 billion revenue.

According to the company, its billings increase 5% to $1.6 billion and its adjusted EBITDA was $72 million during the quarter. Its gross profit was $378.2 million, up by 6% from $355.8 million in the same period a year earlier while its operating income was $13.4 million compared with $12.9 million in the year-ago quarter.

“Our record performance in the quarter was led by strength in Goods, as shoppers increasingly looked to Groupon to fill their holiday needs. Our mobile business continued to gain momentum as our worldwide mobile transaction mix increased more than 10% in the quarter, to nearly 50% in December. With another 9 million downloads this quarter, we now have nearly 70 million app downloads to date,” said Eric Lefkofsky, Groupon CEO.

For the full year 2013, Groupon, Inc (NASDAQ:GRPN) posted $2.6 revenue, an increase of 13% year-over-year. Its adjusted EBITDA was $286.7 million, down by 7% from $259.5 million. Its operating income declined to $75.8 million from $98.7 million in the previous year.

The company said its gross billing increased by 7% globally to $5.8 billion. Groupon, Inc (NASDAQ:GRPN) recorded 20% growth in North America and 3% in EMEA. Those growth were offset a 14% decline in other countries worldwide where it has operations.

According to Lefkofsky, Ideeli and Ticket Monster are now part of the Groupon Family. He said the acquisition of the two companies “will bring scale, relationships, and category expertise, making Groupon an even better place to start when you want to do or buy just about anything, anytime, anywhere.”

Going forward, Groupon, Inc (NASDAQ:GRPN) estimated to achieve a revenue in the range of $710 million to $760 million , adjusted EBITDA of around $20 million to $40 million, and -$0.04 to -$0.02 losses per share (excluding stock compensation, amortization or acquired intangibles, and acquisition related expenses) for the first quarter this year. The weak outlook of the company spooked investors sending stock down.