A company desperate for good news finally has reason to cheer.
Online daily deals website Groupon (Nasdaq: GRPN) reported better-than-expected first-quarter earnings today, sending the embattled tech stock up 35% including after-hours trading. Excluding items, the company posted earnings of 2 cents a share – ahead of the penny per share analysts were looking for.
Groupon’s revenue of $559 million also beat estimates of $531 million. That nearly doubled the sales numbers of $295.5 million from the first quarter a year ago.
The company still isn’t profitable – it never has been. But it’s getting closer. Including items, Groupon reported a net loss of $11.7 million, or 2 cents a share. That’s a vast improvement from the $146.5 million, or 48 cents a share, the company lost a year earlier.
Much of today’s bounce came before the earnings announcement. Groupon’s stock rose 18% before the market closed and trading volumes rose suspiciously high to 13 million shares – well ahead of the average daily volume of 2.5 million. Clearly somebody knew something.
Today’s earnings announcement is a rare bright spot for one of the most beaten down tech stocks on the market. Groupon’s tenure as a publicly traded company has been a disaster since raising $700 million in its initial public offering last November – at the time, the largest IPO by a tech stock since Google (Nasdaq: GOOG).
Even with today’s big gains, Groupon shares are still trading at 31% below their IPO price of $20. Year-to-date, the stock has declined 34%.
So today’s earnings are at least bringing the stock back to respectability.