Groupon(US:GRPN)2025-05-07 20:11Financial Performance - Gross billings for the three months ended March 31, 2025, were $386,476 thousand, a 1.0% increase from $381,146 thousand in 2024[142] - Total revenue for the three months ended March 31, 2025, was $117,187 thousand, down 4.8% from $123,084 thousand in 2024[145] - Total gross profit for North America decreased by 1.5% to $82,872 thousand for the three months ended March 31, 2025[154] - Total revenue for the international segment decreased by $2.9 million, from $28.95 million in Q1 2024 to $26.07 million in Q1 2025, a decline of 9.9%[160] - Adjusted EBITDA for the three months ended March 31, 2025 was $15.33 million, down from $19.52 million in Q1 2024, a decrease of 21.5%[176] - Revenue for the same period was $117.2 million, reflecting a decrease of $583 thousand from prior rates[180] - The company reported a gross profit of $106.3 million, down by $512 thousand due to exchange rate fluctuations[180] Customer Metrics - Active customers for the trailing twelve months ended March 31, 2025, were 15,472 thousand, a decrease of 4.1% from 16,130 thousand in 2024[142] - TTM active customers in the international segment fell by 15.1%, from 5,896 thousand in Q1 2024 to 5,006 thousand in Q1 2025[158] Segment Performance - North America segment gross billings increased by $13.6 million, or 5.0%, to $286,519 thousand for the three months ended March 31, 2025[153] - The Local category in North America saw gross billings increase by 10.6% to $255,656 thousand for the three months ended March 31, 2025[153] - The Goods category in North America experienced a significant decline in gross billings, down 42.4% to $8,621 thousand for the three months ended March 31, 2025[153] - International segment total gross billings decreased by $8.3 million, from $108.2 million in Q1 2024 to $99.9 million in Q1 2025, representing a 7.6% decline[158] Expenses - Marketing expenses in North America increased by 21.5% to $26,474 thousand, representing 29.1% of revenue for the three months ended March 31, 2025[156] - International marketing expenses increased by 13.3%, from $7.03 million in Q1 2024 to $7.96 million in Q1 2025, representing 30.5% of revenue[162] - Consolidated operating expenses rose by 1.2%, from $103.19 million in Q1 2024 to $104.41 million in Q1 2025[165] Profitability - Contribution profit in North America decreased by 9.5% to $56,398 thousand for the three months ended March 31, 2025[156] - International contribution profit decreased by 20.3%, from $19.4 million in Q1 2024 to $15.5 million in Q1 2025, primarily due to increased marketing expenses[162] Cash Flow and Liquidity - Free cash flow for the three months ended March 31, 2025, was $(3,759) thousand, an improvement from $(13,820) thousand in 2024[145] - The company experienced a net cash used in operating activities of $22 thousand for Q1 2025, a significant improvement from $10.1 million in Q1 2024[189] - Free cash flow for the three months ended March 31, 2025, was reported at $(3.8) million, compared to $(13.8) million in the prior year[187] - As of March 31, 2025, the company had a cash balance of $226.8 million, with sufficient liquidity to support operational needs and repay 2026 Notes upon maturity[182] - As of March 31, 2025, the company had $85.4 million in cash held by international subsidiaries, primarily in various foreign currencies[199] Other Financial Metrics - Other income improved significantly, with a net gain of $7.57 million in Q1 2025 compared to a loss of $12.68 million in Q1 2024, reflecting a $21.9 million favorable change in foreign currency gains[168] - The provision for income taxes decreased by 76.9%, from $6.19 million in Q1 2024 to $1.43 million in Q1 2025[169] - The company raised $80.0 million through a Rights Offering, selling 7,079,646 shares at $11.30 each[192] - The 2026 Notes have a principal amount of $230.0 million with a fixed interest rate of 1.125% per annum[195] Market Conditions - Approximately 22.2% of the company's revenue was derived from international operations, exposing it to foreign currency exchange risks[205] - The business is affected by changes in merchants' and customers' discretionary spending, which is expected to continue[209] - Increased inflation could negatively impact the business by driving up operating costs[209] - The company may struggle to offset higher costs through price increases or cost efficiency measures if inflationary pressures become significant[209]