Groupon says sales half earlier figure, loses COO
Groupon Inc. chopped its stated revenue by more than half in an updated SEC filing Friday as it corrected the way it accounts for money it receives selling coupons. The online deal site also said that its chief operating officer, Margo Georgiadis, has gone back to Google, where she worked before joining Groupon in May.
Groupon, which offers consumers a variety of deals each day targeted for their preferences and city, has been preparing for its initial public offering. It first filed registration papers with the Securities and Exchange Commission in June.
The company's restatement Friday indicates it is still planning on an IPO, though it's uncertain when that will occur. A media report this month indicated the company may delay its plans due to the stock market's volatility.
In the revision, instead of giving the total amount its customers pay for coupons as its revenue, Groupon now uses the amount it actually keeps. That's is because Groupon always gives a cut of its total take to the merchants where coupons will be redeemed — most often restaurants or spas.
Groupon is now saying its 2010 revenue was $312.9, instead of $713.4 million. And its revenue in this year's second quarter was $392.6 million, it now says, not $878 million, as it reported before. The change barely affects Groupon's reported losses.
The amended filing also included most of a memo Groupon CEO Andrew Mason sent to employees last month that was leaked to the press. The SEC imposes a "quiet period" on companies before an IPO, limiting what they can say publicly.
In the memo, Mason spoke positively about the company and defended Groupon's use of an unusual profit metric in its initial IPO registration, a move it reversed in August. The original filing used a metric that excluded the site's large costs for marketing and subscriber-acquisition. Groupon later removed the metric, known as "adjusted consolidated segment operating income," or ACSOI.
Mason announced Georgiadis' departure Friday on Groupon's blog, saying she will become president of Google's Americas region. He said Groupon's sales, channels, international and marketing teams will now report to him.
Google Inc. confirmed that Georgiadis had been re-hired to take over for Dennis Woodside, who will now lead the search company's integration of Motorola Mobility Holdings Inc., which it said in August that it plans to buy for $12.5 billion.
In the blog, Mason quoted Georgiadis as saying in a note that the decision to leave was "hard" and she has "complete confidence in the team's ability to realize its mission."