Groupon Posts Upbeat Q3 Earnings, But Sales Miss Views

Groupon Inc GRPN reported better-than-expected earnings for the third quarter, but the company's sales missed analysts' estimates. The company also issued a weak forecast for the current quarter. The company named Chief Operating Officer Rich Williams as new Chief Executive Officer. The Chicago, Illinois-based company reported a quarterly net loss of $27.6 million, or $0.04 per share, compared to a year-ago loss of $21.2 million, or $0.03 per share, in the year-ago period. Excluding items, the company's adjusted earnings came in at $0.05 per share. Its revenue slipped to $713.6 million from $714.3 million. However, analysts were expecting earnings of $0.02 per share on revenue of $732.7 million. The average estimate among 127 Estimize users was for earnings of $0.01 per share and revenue of $729.44 million. Gross billings declined to $1.47 billion in the third quarter, from $1.49 billion in the year-ago quarter. Gross profit declined to $328.9 million from $355.3 million, while adjusted EBITDA slipped to $56.3 million from $63.9 million. As of September 30, 2015, the company had $963.6 million in cash and cash equivalents. "We delivered a solid third quarter and one that was largely in line with our expectations," said Groupon interim CFO Brian Kayman. "Our fourth quarter guidance reflects increased investments in marketing, and a tighter focus on margin improvement, both domestically and abroad." For the fourth quarter, Groupon expects earnings between negative $0.01 per share and positive $0.01 per share, versus analysts' estimates of positive $0.07 per share. The company also projects revenue of $815 million to $865 million, versus analysts' expectations of $956.83 million. Groupon shares rose 0.74 percent to $4.06 in the after-hours trading session.