Core Insights - Consumers are increasing spending on travel and local experiences while reducing purchases of retail products [1][2] - Groupon's North American segment, excluding the Goods business, experienced an 8% year-over-year growth, while gross billings from Goods declined by 36% [1] - The company is focusing on enhancing local experiences and services under the leadership of newly appointed CEO Dusan Senkypl [2] Financial Performance - Gross billings for local experiences in North America rose by 4%, and travel gross billings increased by 3% [2] - Groupon reported four consecutive quarters of positive Adjusted EBITDA, indicating a stabilization in topline performance [2] Consumer Behavior Trends - A significant portion of consumers, particularly across income levels, are cutting back on nonessential spending due to rising retail product prices [1] - There is a generational trend where younger consumers allocate more income towards recreation, leisure, and entertainment activities [3] Strategic Initiatives - Groupon is leveraging digital innovations to enhance consumer experience, including fraud prevention, improved search capabilities, and the use of artificial intelligence to enhance deal quality [3] - The company is actively removing low-quality deals and helping quality merchants curate their offerings to drive demand [3]

Q1 2024 Financial Highlights & Management Commentary [First Quarter 2024 Highlights](index=1&type=section&id=First%20Quarter%202024%20Highlights) Groupon reported Q1 2024 results that surpassed the high-end of its guidance, marking the first consolidated revenue growth since 2016, while achieving its fourth consecutive quarter of positive Adjusted EBITDA and significantly narrowing its net loss Q1 2024 Key Financial Metrics | Metric | Value (USD) | | :--- | :--- | | Global Revenue | $123.1 million | | Global Billings | $381.1 million | | Net Loss | $11.5 million | | Adjusted EBITDA | $19.5 million | | Quarter-End Cash | $158.7 million | - The company reported its first consolidated revenue growth since **2016**[1](index=1&type=chunk)[2](index=2&type=chunk) - Dusan Senkypl has been named the permanent Chief Executive Officer[1](index=1&type=chunk) [Management Commentary](index=1&type=section&id=Management%20Commentary) CEO Dusan Senkypl highlighted the solid start to the year, with results exceeding guidance and a return to consolidated revenue growth, expressing confidence in restarting growth and establishing Groupon as a key destination for local experiences, while acknowledging that the business is not yet operating at full capacity - CEO Dusan Senkypl stated, "Our business is back on its feet and momentum is in the right direction, but not yet firing on all cylinders"[2](index=2&type=chunk) - The company's mission is to become the "ultimate destination for local experiences and services"[2](index=2&type=chunk) Detailed Financial Performance [Consolidated Performance](index=1&type=section&id=Consolidated%20Performance) Consolidated revenue for Q1 2024 increased by 1% year-over-year to $123.1 million, driven by a 4% rise in Local revenue, with gross profit growing 6% to $110.6 million, and profitability improving significantly as net loss narrowed to $11.5 million from $28.6 million, and Adjusted EBITDA turned positive at $19.5 million compared to a loss of $4.9 million in the prior year, aided by a substantial reduction in SG&A expenses Q1 2024 Consolidated Results vs. Q1 2023 (YoY) | Metric | Q1 2024 (USD) | Q1 2023 (USD) | Change | | :--- | :--- | :--- | :--- | | Revenue | $123.1 million | $121.6 million | +1% | | Gross Profit | $110.6 million | $104.7 million | +6% | | SG&A | $74.3 million | $101.6 million | -27% | | Net Loss | -$11.5 million | -$28.6 million | +59.8% | | Adjusted EBITDA | $19.5 million | -$4.9 million | N/A | - The decrease in SG&A was primarily driven by a reduction in payroll costs[3](index=3&type=chunk) - Operating cash outflow was **$10.1 million**, and free cash flow was negative **$13.8 million**[4](index=4&type=chunk) [Segment Performance](index=2&type=section&id=Segment%20Performance) The North America segment drove the company's growth with a 6% revenue increase, while the International segment saw an 11% revenue decline, with active customers decreasing in both segments, showing a more pronounced 19% drop internationally [North America](index=2&type=section&id=North%20America) The North America segment reported a 6% increase in revenue to $94.1 million, primarily driven by strong demand in the Travel category, with revenue excluding Goods growing by 8%, and gross profit increasing by 11% to $84.1 million, despite active customers declining by 6% year-over-year to 10.2 million North America Q1 2024 Performance (YoY) | Metric | Q1 2024 | Change (YoY) | | :--- | :--- | :--- | | Revenue | $94.1 million | +6% | | Revenue (ex-Goods) | $91.1 million | +8% | | Gross Profit | $84.1 million | +11% | | Active Customers | 10.2 million | -6% | - The revenue increase was primarily due to higher demand in the Travel category and favorable refund rates in the Local category[5](index=5&type=chunk) [International](index=2&type=section&id=International) The International segment faced challenges, with revenue declining 11% (12% FX-neutral) to $29.0 million due to decreased demand across all categories, gross profit falling 8% to $26.4 million, and the active customer base seeing a significant contraction, falling 19% year-over-year to 5.9 million International Q1 2024 Performance (YoY) | Metric | Q1 2024 | Change (YoY) | Change (FX-Neutral) | | :--- | :--- | :--- | :--- | | Revenue | $29.0 million | -11% | -12% | | Gross Profit | $26.4 million | -8% | -10% | | Active Customers | 5.9 million | -19% | N/A | - The decrease in revenue is primarily attributable to an overall decline in demand for Local, Goods, and Travel categories[6](index=6&type=chunk) Key Operating Metrics [Customer and Unit Trends](index=12&type=section&id=Customer%20and%20Unit%20Trends) Total active customers continued to decline, reaching 16.1 million in Q1 2024, down from 18.2 million in the prior year, with the decline observed in both North America (down to 10.2 million) and International (down to 5.9 million) segments, and consolidated units sold also decreasing year-over-year from 10.5 million to 9.1 million Active Customers (in millions) | Region | Q1 2024 | Q1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | North America | 10.2 | 10.9 | -6.4% | | International | 5.9 | 7.3 | -19.2% | | **Total** | **16.1** | **18.2** | **-11.5%** | Consolidated Units Sold (in thousands) | Category | Q1 2024 | Q1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Local | 7,990 | 8,470 | -5.7% | | Goods | 978 | 1,819 | -46.2% | | Travel | 157 | 170 | -7.6% | | **Total** | **9,125** | **10,459** | **-12.8%** | [Headcount](index=12&type=section&id=Headcount) The company continued to reduce its workforce, with total headcount decreasing to 2,058 in Q1 2024 from 2,778 in Q1 2023, representing a 26% year-over-year reduction, and the sales team was reduced to 628 employees from 746 a year prior Headcount Trend | Category | Q1 2024 | Q1 2023 | YoY Change | | :--- | :--- | :--- | :--- | | Sales | 628 | 746 | -15.8% | | Other | 1,430 | 2,032 | -29.6% | | **Total** | **2,058** | **2,778** | **-25.9%** | Financial Statements [Condensed Consolidated Statements of Operations](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the first quarter of 2024, Groupon reported revenue of $123.1 million, a slight increase from $121.6 million in the prior-year period, with gross profit improving to $110.6 million, and a significant reduction in operating expenses, particularly SG&A, leading to income from operations of $7.4 million, a strong turnaround from an operating loss of $30.6 million in Q1 2023, resulting in a net loss attributable to Groupon, Inc. of $12.3 million, or ($0.33) per share, a notable improvement from a net loss of $29.1 million, or ($0.95) per share, a year ago Q1 2024 Statement of Operations (in thousands USD, except per share data) | Line Item | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Revenue | $123,084 | $121,611 | | Gross Profit | $110,557 | $104,711 | | Total Operating Expenses | $103,187 | $135,276 | | Income (Loss) from Operations | $7,370 | $(30,565) | | Net Loss Attributable to Groupon, Inc. | $(12,271) | $(29,147) | | Diluted Net Loss Per Share | $(0.33) | $(0.95) | [Condensed Consolidated Balance Sheets](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2024, Groupon's balance sheet showed total assets of $580.5 million and total liabilities of $539.1 million, with cash and cash equivalents standing at $158.7 million, an increase from $141.6 million at the end of 2023, and total equity turning positive to $41.4 million from a deficit of $40.3 million at year-end 2023, primarily due to an increase in additional paid-in capital Balance Sheet Summary (in thousands USD) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $158,717 | $141,563 | | Total current assets | $276,896 | $255,583 | | Total assets | $580,526 | $570,956 | | Total current liabilities | $297,306 | $369,154 | | Total liabilities | $539,101 | $611,268 | | Total equity (deficit) | $41,425 | $(40,312) | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) In the first quarter of 2024, Groupon used $10.1 million in cash from operating activities, a significant improvement from the $76.3 million used in the same period last year, with investing activities using $3.9 million, and financing activities providing $35.3 million in cash, largely due to $79.6 million in net proceeds from a Rights Offering, which offset the repayment of borrowings, resulting in a net increase in cash of $20.8 million for the quarter Q1 2024 Cash Flow Summary (in thousands USD) | Cash Flow Category | Three Months Ended Mar 31, 2024 | Three Months Ended Mar 31, 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(10,111) | $(76,320) | | Net cash used in investing activities | $(3,931) | $(9,013) | | Net cash provided by (used in) financing activities | $35,341 | $(29,197) | | **Net increase (decrease) in cash** | **$20,805** | **$(114,678)** | - Financing activities included **$79.6 million** in proceeds from a Rights Offering, net of issuance costs[26](index=26&type=chunk) Non-GAAP Financial Measures & Reconciliations [Explanation of Non-GAAP Measures](index=2&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Groupon utilizes several non-GAAP financial measures, including Adjusted EBITDA and free cash flow, to provide investors with management's perspective on the company's core operating performance, excluding items such as stock-based compensation, depreciation and amortization, certain non-operating items, and special charges like restructuring costs, believing these metrics facilitate historical and peer comparisons but are not a substitute for U.S. GAAP reporting - Key non-GAAP measures provided include Foreign currency exchange rate neutral operating results, Adjusted EBITDA, and free cash flow[8](index=8&type=chunk)[9](index=9&type=chunk) - Adjusted EBITDA is defined as Net income (loss) excluding income taxes, interest, depreciation and amortization, stock-based compensation, and other special charges[12](index=12&type=chunk) - Free cash flow is defined as Net cash from operating activities less purchases of property, equipment, and capitalized software[15](index=15&type=chunk) [Adjusted EBITDA Reconciliation](index=14&type=section&id=Adjusted%20EBITDA%20Reconciliation) For Q1 2024, Groupon reported a positive Adjusted EBITDA of $19.5 million, reconciled from a net loss of $11.5 million by adding back items such as stock-based compensation ($2.4 million), depreciation & amortization ($9.7 million), net other expense ($12.7 million), and provision for income taxes ($6.2 million), marking a significant improvement from the negative $4.9 million Adjusted EBITDA in Q1 2023 Reconciliation of Net Loss to Adjusted EBITDA (in thousands USD) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income (loss) | $(11,506) | $(28,613) | | Stock-based compensation | 2,374 | 2,363 | | Depreciation and amortization | 9,677 | 14,505 | | Restructuring and related charges | 96 | 8,794 | | Other (income) expense, net | 12,682 | (3,070) | | Provision for income taxes | 6,194 | 1,118 | | **Adjusted EBITDA** | **$19,517** | **$(4,903)** | [Free Cash Flow Reconciliation](index=15&type=section&id=Free%20Cash%20Flow%20Reconciliation) Groupon's free cash flow for Q1 2024 was negative $13.8 million, calculated by taking the net cash used in operating activities of $10.1 million and subtracting $3.7 million for purchases of property, equipment, and capitalized software, representing an 83.9% improvement from the negative $85.9 million free cash flow in Q1 2023 Reconciliation to Free Cash Flow (in thousands USD) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash used in operating activities | $(10,111) | $(76,320) | | Purchases of property, equipment and capitalized software | $(3,709) | $(9,544) | | **Free cash flow** | **$(13,820)** | **$(85,864)** |

PART I. Financial Information [Financial Statements and Supplementary Data (unaudited)](index=5&type=section&id=Item%201.%20Financial%20Statements%20and%20Supplementary%20Data%20(unaudited)) Groupon's unaudited Q1 2024 financial statements show improved revenue, a narrowed net loss, and strengthened equity from a recent Rights Offering Condensed Consolidated Statements of Operations (Q1 2024 vs Q1 2023) | Financial Metric | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :--- | :--- | :--- | | **Revenue** | **$123,084** | **$121,611** | | Gross profit | $110,557 | $104,711 | | Income (loss) from operations | $7,370 | $(30,565) | | **Net income (loss) attributable to Groupon, Inc.** | **$(12,271)** | **$(29,147)** | | Basic and diluted net income (loss) per share | $(0.33) | $(0.95) | Condensed Consolidated Balance Sheet Highlights | Balance Sheet Item | March 31, 2024 (in thousands) | December 31, 2023 (in thousands) | | :--- | :--- | :--- | | Cash and cash equivalents | $158,717 | $141,563 | | Total current assets | $276,896 | $255,583 | | Total liabilities | $539,101 | $611,268 | | **Total equity (deficit)** | **$41,425** | **$(40,312)** | Condensed Consolidated Statements of Cash Flows Highlights | Cash Flow Activity | Three Months Ended March 31, 2024 (in thousands) | Three Months Ended March 31, 2023 (in thousands) | | :--- | :--- | :--- | | Net cash used in operating activities | $(10,111) | $(76,320) | | Net cash used in investing activities | $(3,931) | $(9,013) | | **Net cash provided by (used in) financing activities** | **$35,341** | **$(29,197)** | - The company completed an **$80.0 million Rights Offering** in January 2024, significantly improving its equity position and providing cash for debt repayment[17](index=17&type=chunk)[87](index=87&type=chunk)[88](index=88&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) These notes detail asset sales, debt termination, a significant $119.3 million Italian tax assessment, restructuring charges, and segment performance - In March 2024, the company agreed to sell certain intangible assets for **$10.0 million**, classified as held-for-sale as of March 31, 2024, with the sale completed in April 2024[36](index=36&type=chunk) - In February 2024, the company prepaid **$43.1 million** to terminate its Credit Agreement using Rights Offering proceeds, eliminating **$42.8 million** in outstanding borrowings[55](index=55&type=chunk)[57](index=57&type=chunk) - A subsidiary in Italy is litigating a **$119.3 million tax assessment**, with an appeal hearing set for July 9, 2024, despite the company believing it is without merit[62](index=62&type=chunk)[112](index=112&type=chunk) - The 2022 Restructuring Plan is expected to cost **$22.0 million to $24.1 million**, with **$21.2 million** in pre-tax charges incurred since inception, involving approximately **1,150 position reductions**[99](index=99&type=chunk) Contribution Profit by Segment (Q1 2024 vs Q1 2023) | Segment | Q1 2024 Contribution Profit (in thousands) | Q1 2023 Contribution Profit (in thousands) | | :--- | :--- | :--- | | North America | $62,346 | $60,639 | | International | $19,402 | $19,224 | | **Consolidated** | **$81,748** | **$79,863** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strategy, operating metrics, and financial performance, highlighting improved Adjusted EBITDA and bolstered liquidity despite customer declines - The company's strategy focuses on becoming the trusted marketplace for local services and experiences by strengthening merchant inventory and enhancing customer experience[135](index=135&type=chunk) Key Operating Metrics (Q1 2024 vs Q1 2023) | Operating Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Gross billings (in thousands) | $381,146 | $396,425 | | Units (in thousands) | 9,125 | 10,459 | | TTM active customers (in thousands) | 16,130 | 18,225 | Key Financial Metrics (Q1 2024 vs Q1 2023) | Financial Metric | Q1 2024 (in thousands) | Q1 2023 (in thousands) | | :--- | :--- | :--- | | Revenue | $123,084 | $121,611 | | Gross profit | $110,557 | $104,711 | | **Adjusted EBITDA** | **$19,517** | **$(4,903)** | | Free cash flow | $(13,820) | $(85,864) | - SG&A expenses decreased **26.9%** year-over-year to **$74.3 million**, primarily due to lower payroll costs from restructuring efforts[173](index=173&type=chunk)[174](index=174&type=chunk) - The company believes it has sufficient liquidity for the next 12 months, bolstered by the Rights Offering and debt prepayment, despite a pending tax assessment in Italy[188](index=188&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=40&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section details market risks, including foreign currency exposure, limited interest rate risk from fixed-rate debt, and potential impacts of inflation - **23.5%** of revenue from the International segment exposes the company to foreign currency risk, with a hypothetical **10%** adverse FX change impacting working capital deficit by **$0.3 million**[205](index=205&type=chunk)[207](index=207&type=chunk) - Interest rate risk is limited as the **$230.0 million** 2026 Notes have a fixed interest rate[208](index=208&type=chunk) - Inflation risk could impact consumer and merchant discretionary spending and increase operating costs[209](index=209&type=chunk) [Controls and Procedures](index=41&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective due to a material weakness, but financial statements are fairly presented, with remediation ongoing - The CEO and CFO concluded that disclosure controls and procedures were **not effective** as of March 31, 2024, due to an unremediated material weakness[210](index=210&type=chunk) - A remediation plan is in progress to address the material weakness through automation, enhanced review controls, and improved reconciliation procedures[211](index=211&type=chunk) - Despite the material weakness, management concluded that the financial statements are **fairly presented** in all material respects in accordance with GAAP[210](index=210&type=chunk) PART II. Other Information [Legal Proceedings](index=42&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 6 for material legal proceedings, primarily a $119.3 million tax dispute in Italy - The report refers to Note 6 of the Condensed Consolidated Financial Statements for details on material legal proceedings[216](index=216&type=chunk) - The key legal matter is a **$119.3 million tax assessment** being litigated by a subsidiary in Italy[62](index=62&type=chunk) [Risk Factors](index=43&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors were reported from the Annual Report on Form 10-K for the year ended December 31, 2023 - No material changes were reported from the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2023[218](index=218&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=44&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) No unregistered equity securities were issued, nor were shares repurchased, though shares were withheld for employee tax obligations - No unregistered equity securities were issued during the three months ended March 31, 2024[220](index=220&type=chunk) - **15,130 shares** were withheld from employees to satisfy mandatory tax withholding requirements upon the vesting of stock-based awards[222](index=222&type=chunk) [Other Information](index=44&type=section&id=Item%205.%20Other%20Information) No officers or directors adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during the quarter - No officers or directors adopted or terminated a Rule 10b5-1 trading arrangement during the quarter ended March 31, 2024[223](index=223&type=chunk) [Exhibits](index=45&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including employment agreements, officer certifications, and XBRL data files - The report includes various exhibits, such as CEO and CFO employment and compensation agreements, Sarbanes-Oxley certifications, and a report on the Italy Income Tax Assessment Matter[225](index=225&type=chunk)

Core Viewpoint - Groupon, Inc. has announced the release date for its first quarter 2024 financial results, which will be available after market close on May 9, 2024, followed by a conference call to discuss the results [2]. Company Information - Groupon is described as a trusted local marketplace where consumers can purchase services and experiences that enhance their lives and provide significant value [2]. - The company operates under the ticker symbol GRPN on NASDAQ [2]. Event Details - The financial results will be discussed in a conference call scheduled for 5:00 PM ET on the same day as the results release [2]. - A live webcast of the conference call will be accessible at investor.groupon.com, with a replay available afterward [2].

Company Performance - Groupon's stock closed at $11.67, reflecting a +1.74% change from the previous trading day's close, outperforming the S&P 500's daily gain of 1.02% [1] - The stock has decreased by 14.02% over the past month, compared to a loss of 3.3% in the Retail-Wholesale sector and a 3.15% loss in the S&P 500 [1] - Upcoming earnings disclosure is anticipated, with projections of -$0.18 per share, indicating a year-over-year growth of 72.31%, and revenue expected at $118.37 million, down 2.66% from the prior year [1] Annual Estimates - For the full year, earnings are projected at $0.05 per share and revenue at $528.77 million, representing increases of +109.62% and +2.69% respectively from the previous year [2] - Recent revisions to analyst forecasts are crucial as they reflect short-term business trends, with positive changes indicating a favorable outlook on Groupon's business health and profitability [2] Valuation and Industry Ranking - Groupon has a Forward P/E ratio of 229.4, which is significantly higher than the industry's average Forward P/E of 21.13 [3] - The Internet - Commerce industry, part of the Retail-Wholesale sector, holds a Zacks Industry Rank of 40, placing it in the top 16% of over 250 industries [3] - The Zacks Rank system indicates Groupon is currently rated 1 (Strong Buy), with a historical average annual return of +25% for 1 stocks since 1988 [3]

jbk_photography/iStock Editorial via Getty Images Amid elevated market volatility, oftentimes the best way to beat the index movements is to invest in contrarian plays that have little correlation with the broader market. This means digging deep into unloved, forgotten names that may not be the flashiest of the day, but have solid fundamentals against a reasonable valuation. Surprisingly, one of the names that fits this criteria well is Groupon (NASDAQ:GRPN), the once-popular deals site that has now bec ...

A downtrend has been apparent in Groupon (GRPN) lately with too much selling pressure. The stock has declined 39.5% over the past four weeks. However, given the fact that it is now in oversold territory and Wall Street analysts are majorly in agreement about the company's ability to report better earnings than they predicted earlier, the stock could be due for a turnaround.How to Determine if a Stock is OversoldWe use Relative Strength Index (RSI), one of the most commonly used technical indicators, for spo ...

Groupon (GRPN) reported non-GAAP earnings of 30 cents per share in fourth-quarter 2023, beating the Zacks Consensus Estimate of a loss of 11 cents per share. The company reported a non-GAAP loss of 38 cents per share in the year-ago quarter.Revenues of $137.72 million beat the consensus estimate of $135 million. The figure declined 7% on a year-over-year basis (down 8%, excluding the foreign exchange effect).Region-wise, North America revenues of $99.9 million beat the consensus mark by 2.9% but slumped 6% ...

Core Insights - Groupon is focusing on capturing the lucrative gift spending market despite overall revenue declines, with a significant increase in gift ordering noted in December [1] - A report indicates that consumers are prioritizing gift spending even while cutting back on other purchases, with a high percentage of shoppers taking measures to maintain their gift budgets [2] - The company plans to enhance its gifting business through improved marketing and features, aiming to reduce cart abandonment and improve the checkout experience [3][4] Group 1: Gifting Market Opportunity - Groupon's initial gifting offering led to a 50% year-over-year increase in gift orders in December [1] - The company believes gifting can evolve into a major business segment, positioning itself as a key destination for last-minute gifts [1] Group 2: Consumer Spending Behavior - A significant majority of holiday shoppers (94%) are actively ensuring they do not have to cut back on gift spending despite financial pressures [2] - The PYMNTS Intelligence report highlights that a large portion of consumers across income levels have reduced nonessential spending due to rising retail prices [2] Group 3: Strategic Enhancements - Groupon aims to improve its gifting features and marketing strategies, particularly in the U.S., while collaborating with merchants to highlight giftable products [3] - The company is focusing on enhancing the checkout process to reduce cart abandonment, which is a common challenge in eCommerce [3] - Reports indicate that 50% of consumers consider the ease of the checkout process when choosing a digital merchant, emphasizing its importance [3]

Financial Data and Key Metrics Changes - In Q4 2023, Groupon reported global billings of $436 million, a decrease of approximately 7% year-over-year, with revenue also declining by 7% year-over-year, but showing significant improvement compared to Q3 results [26][27] - Adjusted EBITDA was $27 million, marking the third consecutive quarter of positive adjusted EBITDA, while free cash flow was positive at $51 million, benefiting from Q4 holiday strengths [27][28] - The company ended the quarter with $142 million in cash and cash equivalents, including $42.8 million drawn on the revolver, alleviating previous going concern issues [28][36] Business Line Data and Key Metrics Changes - Local billings were $363 million, down 1% year-over-year, with North America local billings flat at $257 million, while international local billings decreased by 3% [29] - Travel category billings were $28 million, down 12% year-over-year, but North America travel showed growth of 4% year-over-year, indicating progress in the transformation strategy [29] - Goods category billings were $45 million, down 36% year-over-year, and this segment is becoming a smaller part of the business, now representing only 6% of Q4 revenues [30] Market Data and Key Metrics Changes - The company has approximately 16.5 million customers worldwide, a slight decrease of 0.5 million from the prior quarter [28] - The gifting initiative saw a significant increase, with December gift orders growing 67% year-over-year, indicating a strong market opportunity for last-minute giftable experiences [15][16] Company Strategy and Development Direction - Groupon is focusing on a transformation strategy aimed at becoming a leading destination for local experiences and services, with a strong emphasis on technology and customer experience [10][21] - The company is shifting from internal improvements to delivering projects that impact customers, including a new consumer front-end and enhanced gifting offerings [10][12] - There is a strategic focus on leveraging AI to improve sales efficiency and customer support, as well as enhancing the overall customer experience [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the transformation progress, noting that while challenges remain, the financial performance is expected to improve as new features and projects are rolled out [12][21] - The company anticipates a decline in revenues in the first half of 2024, with growth expected in the second half, contingent on the successful execution of ongoing projects [36][38] - Management emphasized the importance of building a sustainable business model that can thrive in various economic conditions, focusing on providing value to both consumers and merchant partners [24][25] Other Important Information - Groupon has successfully resolved its going concern issue through a combination of asset sales and a rights offering that raised $80 million, which was significantly oversubscribed [7][36] - The company is actively evaluating the monetization of non-core assets, which could generate additional liquidity [36] Q&A Session Summary Question: Thoughts on capital allocation priorities - Management indicated a focus on making the business sustainable and achieving long-term growth and positive cash flow [40][41] Question: User engagement and growth goals - Management highlighted the importance of the next-generation website and the potential for increased engagement through new features and gifting opportunities [42][43] Question: Supply side marketplace elements - Management discussed the focus on improving the onboarding process for suppliers and enhancing the sales process to grow business with existing merchants [47][49]