Financial Data and Key Metrics Changes - In 2025, Groupon achieved a milestone with global billings growing 7% to approximately $1.76 billion, marking the first revenue growth in a decade [4][5] - The company reported a second consecutive year of positive free cash flow, ending the year with approximately $296 million in cash [5] - Global active customers reached 16.2 million, up more than 5% year-over-year, with North America local active customers growing 12% [5] Business Line Data and Key Metrics Changes - The core local marketplace, representing approximately 90% of billings, grew double digits for the full year in both North America and international markets, excluding Giftcloud [5] - However, Q4 saw global billings grow only 4% year-over-year, which was below guidance, primarily due to deceleration in the enterprise channel in North America and underperformance in organic and owned marketing channels [5][6] Market Data and Key Metrics Changes - International markets performed well, with the UK being a pilot for the new customer data platform (CDP) and showing good results in technology implementation [34][35] - The company is focusing on improving its sales organization and deal quality in international markets, which are performing on par or better than North America [34] Company Strategy and Development Direction - Groupon's strategic priority for 2026 is to shift towards an AI-native operating model, aiming to leverage autonomous systems for local experience discovery and transactions [9][12] - The company is building a proprietary AI personalization layer and targeting technical readiness for AI agent-initiated transactions by mid-2026 [9] - Groupon plans to host an investor event in the second half of 2026 to provide deeper insights into its strategy and growth path [11] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that while 2025 showed improvement, the pace of growth in 2026 will be more moderate due to headwinds in organic and enterprise channels [10] - The long-term opportunity in online experiences remains significant, with expectations to accelerate global billings growth to over 20% [11][12] - Management expressed confidence in the company's ability to capture growth through AI-driven discovery and transactions [12] Other Important Information - The company has formed a dedicated AI committee at the board level, appointing Amit Shah as chair, to focus on AI strategy and implementation [9][10] - Management emphasized the importance of user-generated content for future AI applications, positioning Groupon favorably in the evolving digital landscape [47] Q&A Session Summary Question: What drove the improvement in conversion rates across portals? - Management attributed the improvement to platform development, better quality of offers, and targeted marketing efforts [14][15] Question: What caused the weakness in the enterprise channel? - The weakness was linked to a partnership that did not meet expectations and a shift in market demand towards closed-loop transactions [18][19] Question: What trends are seen in travel revenue? - Travel is not a current focus, and revenue is primarily driven by a few partnerships [32] Question: What is the expectation for SG&A expenses? - SG&A came in lower than expected in Q4, but management does not anticipate this as a new baseline [36][38] Question: How will the new AI committee function? - The AI committee will work closely with management to formulate and implement AI strategies across the company [41][45] Question: What are the trends in redemption rates? - Redemption rates are stable, with ongoing efforts to improve customer experience and feedback mechanisms [75][76] Question: What are the expectations for marketing spending? - Marketing spending is expected to grow in the high single-digit range, slightly faster than revenue growth [78][80]

Financial Data and Key Metrics Changes - Global billings grew 11% year over year, marking the second consecutive quarter of double-digit growth [3][4] - Adjusted EBITDA reached $18 million, exceeding expectations, while trailing 12 months free cash flow reached $60 million [4] - Marketing spend increased by 14% year over year, accounting for 37% of gross profit [46] Business Line Data and Key Metrics Changes - The core local category, which represents 89% of billings, grew 18% year over year, with North America local up 18% and international local (excluding Giftcloud) up 15% [4][5] - The "Things to do" segment experienced its seventh consecutive quarter of strong double-digit growth [5] Market Data and Key Metrics Changes - All four major international markets delivered a second consecutive quarter of double-digit growth [5] - Chicago has become the largest city for Groupon, growing at nearly double the rate of North America local overall [5] Company Strategy and Development Direction - The company aims to accelerate supply and growth towards a goal of over 20% billings growth while generating strong adjusted EBITDA and free cash flow [5][6] - There is a focus on building a hyperlocal experience marketplace that combines trust, curation, quality, and unbeatable value [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the foundation being built for becoming a trusted destination for quality local experiences [6] - The company is optimistic about the impact of AI on sales processes and customer interactions, expecting to enhance lead generation and customer service [39][42] Other Important Information - The company is implementing a Customer Data Platform (CDP) to improve personalization and customer journey optimization [24][51] - Progress is being made on the Italian tax settlement, with a proposed settlement receiving several approvals [63] Q&A Session Summary Question: Growth in Chicago - Management confirmed that Chicago local billings are growing in the high 30s due to focused sales resources and a better understanding of the market [9][10] Question: Purchase Frequency Among New Cohorts - Management noted improvements in repurchase rates among new customers compared to previous cohorts, attributing this to ongoing technology enhancements [22][23] Question: Marketing Strategy Balance - The company plans to balance direct response marketing with brand advertising, with a focus on measuring ROI and adjusting budgets based on performance [26][27] Question: Impact of AI Initiatives - Management discussed the integration of AI in sales processes and customer service, expecting it to enhance conversion rates and customer interactions [39][42] Question: Travel Business Performance - The travel segment has seen growth due to partnerships with large enterprise brands and better offerings aligned with customer needs [55] Question: Italian Tax Settlement Update - The company is making progress on the Italian tax settlement, with a remaining amount owed of approximately $15 million [63]