Mereja

Author: Serkadis

  • Deranged UK mother forces 14-year-old daughter to get pregnant from donor sperm just to gain fourth child

    An American divorcee living abroad in the U.K. has been sentenced to five years in prison for child cruelty after she reportedly forced her oldest daughter, who was a minor at the time, to get pregnant from donor sperm in order to provide her mother with the fourth child…

  • CPS takes baby from mother to ‘protect against’ parents seeking a second opinion

    After controversially taking a five-month old baby out of the custody of his parents at gun-point for seeking a second medical opinion on flu-like symptoms, Child Protective Services (CPS) sent a letter to a State Assemblyman of California, Tim Donnelly (R). In the letter…

  • Seven steps for easy and painless lifestyle spring cleaning

    As the ice continues to melt, the flowers start to bloom, and winter fully eclipses into spring, perhaps it is time to get your life into alignment with the changing seasons by doing a little spring cleaning of your own, both physically and emotionally. Here are seven…

  • Downloadable, 3D printed guns now a reality

    What do you get when you combine the infinite technology of the internet, the creativity of 3D printing, and a principled Second Amendment belief? You get 3-D printed guns, downloadable to anyone around the world. This kind of thinking has rendered the gun debate…

  • Exposed: Biggest US honey supplier admits to laundering, mislabeling Chinese honey

    Two large honey packers, including one of the nation’s biggest – Groeb Farms of Onsted, Mich. – have admitted to purchasing millions of dollars’ worth of honey that was falsely labeled. National Public Radio reports that the goal of this mislabeling, which has been…

  • Food stamps arming terrorists? USDA food stamps routinely used to purchase weapons and drugs

    Shortly after the Boston Marathon terrorist attack, a local newspaper – The Boston Herald – reported that the family of the alleged bombers, and the bombers themselves, had been receiving state and federal welfare benefits. In its initial report within several days…

  • DHS helping fund militarization of local police departments

    If you paid any attention to the news surrounding the terrorist attacks at the Boston Marathon – and in particular the house-to-house searches that took place in the hours following the attacks – you witnessed a growing trend in law enforcement that should be very concerning…

  • FDA warns public about fitness supplement allegedly linked to five deaths, but says nothing about pharmaceuticals that kill 100,000

    The U.S. Food and Drug Administration (FDA) has issued a new safety warning about an ingredient sometimes added to fitness supplements that it claims could cause health problems in certain individuals. According to a recent public announcement, the FDA has received complaints…

  • False statements about fluoridation in the Portland election campaign

    Portland Oregon voters are now voting to decide if they want to start adding fluoride to their pristine water supply. “Health Kids, Health Portland” is the campaign website designed to convince voters they should vote for fluoridation. These are some of the false statements…

  • Study proves that the Paleo diet can improve health

    The Paleo diet is a way of eating that revolves around keeping food and lifestyle choices in line with what our Paleolithic ancestors would have eaten. As with any diet or food plan, there are the supporters, and then there are those who simply just don’t agree. Among…

  • How to beat food cravings with a loving attitude and lasting results

    Food cravings can ruin any attempt to lose weight or ease into a healthy diet while weaning off SAD (standard American Diet). Slow and steady with gentle persistence while tolerating occasional short setbacks will deliver lasting results. If losing weight is the primary…

  • Boycott the enemies of the people updated (opinion)

    (NaturalNews)When Proposition 37 got defeated by the Biotech and Big Food pimps and their hooker subsidiaries, NaturalNews was gracious enough to print my article naming them. Recently though, I came across a similar article written by Daisy Luther, a freelance writer and editor…

  • Multivitamin breakthrough delivers nutrients from food, not isolated chemicals; many multivitamins now obsolete

    It’s one of the biggest cover-ups in the history of nutrition: Those “conventional” multivitamins sold at grocery stores, pharmacies and big-box stores are filled with synthetic chemicals that are fraudulently called “vitamins.” Ascorbic acid, pyridoxine (B6), niacin…

  • Tesla shares soar almost 30% in after hours on profit news

    Tesla’s shares are soaring — even more than they already did this week — on news that the company has hit the milestone of delivering the first quarterly profit in the company’s history.

    Tesla after hours trading

    Tesla’s shares rose at one point almost 30 percent in after hour trading to over $70 per share. Earlier this week Tesla’s shares had hit an all-time high of over $60 per share.

    When Tesla held its IPO and started trading back in the summer of 2010, it went public at $17 per share. It’s $70-per-share milestone in after hours trading is more than four times that initial IPO price.

    Tesla and CEO Elon Musk have ambitions far higher than this current marketcap and stock price. Musk has a payout package that allocates shares when Tesla’s marketcap adds $4 billion up until it reaches $43.2 billion, along with accompanying operating milestones.

    Related research and analysis from GigaOM Pro:
    Subscriber content. Sign up for a free trial.

        

  • John Maeda on how better design can lead to better health

    Rhode Island School of Design President (RISD) John Maeda, a well known author of popular and influential books such as Redesigning Leadership (Simplicity: Design, Technology, Business, Life) and The Laws of Simplicity, believes that health and medicine are going to change for the better because of design-oriented thinking.

    In a presentation at the TEDMED 2013 conference last month, he talked about how design principles lead to more discovery and better treatment. Maeda (a speaker at our RoadMap 2012 conference) is persuasive, to say the least. Enjoy the video, and make sure to check out our RoadMap 2013 conference in November in San Francisco, as Maeda is working with us on the event (tickets will go on sale in the summer).


        

  • Tesla delivers 1st profit, record revenue and boosts Model S guidance to 21K

    Electric car maker Tesla Motors delivered Wednesday on its promise that it would turn its first profit ever in the first quarter of 2013 and also generated a record amount of revenue, giving it the confidence to increase the guidance for its annual Model S sales by 1,000 cars. At the same time, Tesla admitted that $68 million, or 12 percent, of its revenue for the quarter came from selling ZEV credits, something which has been riling other auto makers.

    For the quarter, Tesla generated $11.25 million in income, compared to a net loss of $89.87 million for the year for the first quarter of 2012. On a non-GAAP basis Tesla said net income for the quarter was $15.42 million.

    Ten-year-old Tesla also set a revenue record for the quarter, which isn’t surprising given this was the first quarter where it had a full three months of full-scale Model S production. Tesla generated $561.8 million in revenue for the quarter, compared with revenue of just $30.17 million for the first quarter of 2012.

    Tesla Model S

    There’s been a lot of talk about how much of Tesla’s revenue and profit for this quarter would come from the sales of zero emission vehicle (ZEV) credits to automakers. The LA Times reported that Tesla can make $35,000 per Model S car sold in ZEV credits, which could generate up to $250 million for Tesla this year.

    Tesla addressed that point in its shareholder letter and said that Tesla generated $68 million from ZEV credits for the quarter, or 12 percent of revenues. If Tesla generated that amount for each quarter it could bring in $272 million from ZEV credits for the year. However, Tesla said that it expects its use of ZEV credits to decline because the ZEV credits only apply to a sixth of international sales, compared to half of U.S. sales.

    Tesla is so confident of its manufacturing capabilities this quarter that it raised its guidance for the year by 1,000 cars. Tesla now says it expects to ship 21,000 Model S cars, instead of 20,000. Tesla says it is receiving orders of over 20,000 cars per year.

    Tesla’s margins are also improving significantly, and the company has a target of 25 percent gross margin by the end of 2013. This quarter Tesla delivered 17 percent gross margin, up from 8 percent in the last quarter of 2012. That 25 percent margin is without ZEV credit, Tesla noted.

    Tesla shares jumped almost 30 percent in after hours trading on Wednesday to over $70 per share.

    Tesla CEO Elon Musk said in the call with analyst and media:

    • On ZEV credits: Musk said he expects a decline of ZEV credits in Q2, and Q3 and potentially no ZEV credits in Q4.
    • Tesla plans to spend $200 million in capital expenses in 2013, and that includes things like Model S factory tooling, new product development, and building out the Super Charger Network.
    • Musk said Tesla has no plans right now to raise more funding.
    • Tesla has a seen a meaningful improvement on demand because of the financing product.
    • 10,000 Model S sales are expected from Europe, 5,000 are expected in Asia. “China is a wild card,” said Musk. Up until the second quarter of 2013, all of Model S sales have been in the U.S.
    • Tesla’s top focus this year is on improving the efficiency of production of the Model S.

    Updated at 3:10PM PST, with information from Tesla’s call and the stock price.

    Related research and analysis from GigaOM Pro:
    Subscriber content. Sign up for a free trial.

        

  • Google Tech Talk Focuses On Organizing World’s Scientific Knowledge

    Google uploaded a recent Google Tech Talk called, “Organizing Organizing the World’s Scientific Knowledge to make it Universally Accessible: Building the Breakthrough Machine”.

    As you probably know, Google’s own mission is to organize the world’s information and make it universally accessible.

    This particular talk is presented by Gully Burns of the Information Sciences Institute at USC.

    More recent Google Tech Talks here.

  • Groupon Earnings Beat Expectations, Stock On The Rise

    Groupon just released its first earnings report since CEO Andrew Mason was fired. Unlike last time, Groupon actually beat Wall Street expectations this time, and the stock is currently on the rise.

    The company reported gross billings of $1.41 billion, revenue of $601.4 million, and GAAP operating income of $21.2 million.

    Active customers are up 13% year-over-year.

    Eric Lefkofsky, Chairman and co-CEO, said, “We are encouraged by our results, as our local revenues accelerated and our margins improved over the prior quarter. We had record mobile performance as 45% of our North American transactions came from mobile in March, and more than 7 million people downloaded our apps in the quarter.”

    Meanwhile the hunt for Mason’s replacement continues.

    Here’s the earnings report in its entirety:

    CHICAGO–(BUSINESS WIRE)–Groupon, Inc. (NASDAQ: GRPN) today announced financial results for the quarter ended March 31, 2013:

    “Management’s Discussion and Analysis of Financial Condition and Results of Operations”

    • Gross billings of $1.41 billion
    • Revenue of $601.4 million
    • GAAP operating income of $21.2 million, or $51.2 million excluding stock compensation
    • GAAP loss per share of $0.01, or earnings per share of $0.03 excluding stock compensation

    “We are encouraged by our results, as our local revenues accelerated and our margins improved over the prior quarter,” said Eric Lefkofsky, Chairman and co-CEO of Groupon. “We had record mobile performance as 45% of our North American transactions came from mobile in March, and more than 7 million people downloaded our apps in the quarter.”

    First Quarter 2013 Summary

    Gross billings, which reflect the total dollar value of customer purchases of goods and services, excluding any applicable taxes and net of estimated refunds, increased 4% to $1.41 billion in the first quarter 2013, compared with $1.35 billion in the first quarter 2012. North America growth of 23% was offset by a decline of 9% in the International segment on a year-over-year basis.

    Revenue increased 8% to $601.4 million in the first quarter 2013, compared with $559.3 million in the first quarter 2012. North America revenue growth of 42% was offset by a decline of 18% in the International segment on a year-over-year basis.

    Gross profit was $379.0 million in the first quarter 2013, compared with $439.8 million in the first quarter 2012.

    Operating income was $21.2 million in the first quarter 2013, compared with $39.6 million in the first quarter 2012. Operating income increased $34.0 million compared with fourth quarter 2012.

    Operating income excluding stock compensation and acquisition-related costs, a non-GAAP financial measure, was $51.2 million in the first quarter 2013, compared with $67.6 million in the first quarter 2012. Operating income excluding stock compensation and acquisition-related costs increased $37.4 million compared with fourth quarter 2012.

    First quarter 2013 net loss attributable to common stockholders was $4.0 million, or $0.01 per share, including stock compensation and acquisition-related costs of $30.0 million, or $20.9 million net of tax. Earnings per share excluding stock compensation and acquisition-related costs, net of tax, a non-GAAP financial measure, was $0.03 per share.

    Operating cash flow for the trailing twelve months ended March 31, 2013 was $191.9 million. Free cash flow, a non-GAAP financial measure, was negative $5.7 million in the first quarter 2013, bringing free cash flow for the trailing twelve months ended March 31, 2013 to $94.7 million.

    At the end of the quarter, Groupon had $1.2 billion in cash and cash equivalents.

    Definitions and reconciliations of all non-GAAP financial measures are included below in the section titled “Non-GAAP Financial Measures” and in the accompanying tables.

    First Quarter Operating Highlights

    • Global units: Consolidated units, defined as vouchers and products ordered before cancellations and refunds, increased 4% year-over-year to 45 million. North America units increased 37%, and International units decreased 18%.
    • Active deals: As of March 31, 2013, the number of active deals in North America increased to nearly 40,000, compared with nearly 37,000 at the end of the fourth quarter 2012.
    • Active customers: Active customers, or customers that have purchased a Groupon within the last twelve months, grew 13% year-over-year, to 41.7 million as of March 31, 2013, comprising 18.2 million in North America, and 23.5 million in International.
    • Customer spend: Trailing twelve month billings per average active customer decreased to $138 from $144 in the fourth quarter 2012, related primarily to seasonal strength in the fourth quarter holiday period.
    • Mobile: In March 2013, 45% of North American transactions were completed on mobile devices, compared with nearly 30% in March 2012. In the first quarter 2013, more than 7 million people downloaded Groupon mobile apps worldwide.
    • Marketplace: The rollout of Groupon’s marketplace (”Pull”) continued to gain momentum, as email accounted for less than 45% of North American transactions in the first quarter 2013.

    Outlook

    Groupon anticipates incremental investments of between $15 million and $30 million in customer incentives and marketing in the second quarter 2013. As a result, for the second quarter 2013, revenue is expected to be between $575 million and $625 million, and operating income excluding stock compensation and acquisition-related expenses is expected to be between $20 million and $40 million. Stock compensation is expected to be approximately $30 million, and tax expense is expected to be approximately $25 million. This outlook assumes no acquisitions or investments, or material changes in foreign exchange rates.

    Groupon reaffirms its guidance that full year 2013 GAAP operating income will exceed $100 million.

    Conference Call

    A conference call will be webcast live today at 4:00 p.m. CT / 5:00 p.m. ET, and will be available on Groupon’s investor relations website at http://investor.groupon.com. This call will contain forward-looking statements and other material information regarding the Company’s financial and operating results.

    Non-GAAP Financial Measures

    In addition to financial results reported in accordance with U.S. generally accepted accounting principles (U.S. GAAP), we have provided the following non-GAAP financial measures in this release and the accompanying tables: foreign exchange rate neutral operating results, operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net, Adjusted EBITDA, earnings per share excluding stock-based compensation and acquisition-related expense (benefit), net, and free cash flow. These non-GAAP financial measures are presented to aid investors in better understanding Groupon’s performance and to facilitate comparisons to many of our peers who present similar measures. However, these measures are not intended to be a substitute for those reported in accordance with U.S. GAAP. These measures may be different from non-GAAP financial measures used by other companies, even when similar terms are used to identify such measures. For reconciliations of these measures to the most applicable financial measures under U.S. GAAP, see “Non-GAAP Reconciliation Schedules” and “Supplemental Financial Information and Business Metrics” included in the tables accompanying this release.

    We exclude the following items from one or more of our non-GAAP financial measures:

    Stock-based compensation. We exclude stock-based compensation because it is primarily non-cash in nature and we believe that non-GAAP financial measures excluding this item provide meaningful supplemental information about our operating performance and liquidity.

    Acquisition-related expense (benefit), net. Acquisition-related expense (benefit), net represents the change in the fair value of contingent consideration arrangements related to business combinations. The composition of our contingent consideration arrangements and the impact of those arrangements on our operating results vary over time based on a number of factors, including the terms of our business combinations and the timing of those transactions. We exclude acquisition-related expense (benefit), net because we believe that non-GAAP financial measures excluding this item provide meaningful supplemental information about our operating performance and facilitate comparisons to our historical operating results.

    Depreciation and amortization. We exclude depreciation and amortization because it is non-cash in nature and we believe that non-GAAP financial measures excluding these items provide meaningful supplemental information about our operating performance and liquidity.

    Descriptions of the non-GAAP financial measures included in this release and the accompanying tables are as follows:

    Foreign exchange rate neutral operating results show our current period operating results as if foreign currency exchange rates had remained the same as those in effect in the comparable period.

    Operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net is a non-GAAP financial measure that comprises the consolidated total of the segment operating income (loss) of our two segments, North America and International. We use consolidated operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net to allocate resources and evaluate performance internally.

    Adjusted EBITDA is a non-GAAP financial measure that we define as net income (loss) excluding income taxes, interest and other non-operating items, depreciation and amortization, stock-based compensation, and acquisition-related expense (benefit), net. Adjusted EBITDA is similar to Operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net, except Adjusted EBITDA also excludes depreciation and amortization. Our definition of Adjusted EBITDA may differ from similar measures used by other companies, even when similar terms are used to identify such measures. We believe that Adjusted EBITDA is a meaningful measure for evaluating our operating performance and liquidity.

    Earnings per share excluding stock-based compensation and acquisition-related expense (benefit), net is a non-GAAP financial measure that adjusts our earnings (loss) per share to exclude the impact of stock-based compensation expense, acquisition-related expense (benefit), net and the income tax effect of those items. We believe that this non-GAAP financial measure provides meaningful supplemental information for evaluating our operating performance.

    Free cash flow is a non-GAAP financial measure that comprises net cash provided by operating activities less purchases of property and equipment and capitalized software. We use free cash flow, and ratios based on it, to conduct and evaluate our business because, although it is similar to cash flow from operations, we believe that it typically represents a more useful measure of cash flows because purchases of fixed assets, software developed for internal use and website development costs are necessary components of our ongoing operations. Free cash flow is not intended to represent the total increase or decrease in Groupon’s cash balance for the applicable period.

    Note on Forward-Looking Statements

    The statements contained in this release that refer to plans and expectations for the next quarter or the future are forward-looking statements that involve a number of risks and uncertainties, and actual results could differ materially from those discussed. The risks and uncertainties that could cause our results to differ materially from those included in the forward-looking statements include, but are not limited to, volatility in our revenue and operating results; risks related to our business strategy; responding to changes in the market; effectively dealing with challenges arising from our international operations; retaining existing customers and adding new customers; retaining existing merchant partners and adding new merchant partners; incurring expenses as we expand our business; competing against competitors with more financial resources than us; maintaining favorable terms with our business partners; maintaining a strong brand; managing inventory and order fulfillment; integrating our technology platforms; managing refund risks; retaining our executive team; litigation; regulations, including the CARD Act and regulation of the Internet; tax liabilities; tax legislation; maintaining our information technology infrastructure; security breaches; protecting our intellectual property; handling acquisitions, joint ventures and strategic investments effectively; seasonality; payment-related risks; customer and merchant partner fraud; global economic uncertainty; compliance with rules and regulations associated with being a public company; and our ability to raise capital if necessary. We urge you to refer to the factors included under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the company’s Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, copies of which may be obtained by visiting the company’s Investor Relations web site at http://investor.groupon.com or the SEC’s web site at www.sec.gov. Groupon’s actual results could differ materially from those predicted or implied and reported results should not be considered an indication of future performance.

    You should not rely upon forward-looking statements as predictions of future events. Although Groupon believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, neither the company nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. The forward-looking statements reflect Groupon’s expectations as of May 8, 2013. Groupon undertakes no obligation to update publicly any forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in its expectations.

    Groupon encourages investors to use its investor relations website as a way of easily finding information about the company. Groupon promptly makes available on this website, free of charge, the reports that the company files or furnishes with the SEC, corporate governance information (including Groupon’s Global Code of Conduct), and select press releases and social media postings.

    About Groupon

    Groupon (NASDAQ: GRPN) is a global leader in local commerce, making it easy for people around the world to search and discover great businesses at unbeatable prices. Groupon is reinventing the traditional small business world by providing merchants with a suite of products and services, including customizable deals, payments processing capabilities and point-of-sale solutions to help them attract more customers and run their operations more effectively. By leveraging the company’s global relationships and scale, Groupon offers consumers incredible deals on the best stuff to eat, see, do, and buy in 48 countries. With Groupon, shoppers discover the best a city has to offer with Groupon Local, enjoy vacations with GrouponGetaways, and find a curated selection of electronics, fashion, home furnishings and more with Groupon Goods. To subscribe to Groupon emails, visit www.Groupon.com. To learn more about the company’s merchant solutions and how to work with Groupon, visit www.GrouponWorks.com.

    Groupon, Inc.
    Summary Consolidated and Segment Results
    (in thousands, except share and per share amounts)
    (unaudited)
       
    Three Months Ended 
    March 31,    		 Y/Y %

    Growth
    2013 2012 Y/Y %
    Growth    		 FX Effect (2) excluding
    FX(2)
    Gross Billings (1)
    North America $ 681,319 $ 553,557 23.1 % $ (59 ) 23.1 %
    International 726,450 801,243 (9.3 ) % (12,460 ) (7.8 ) %
    Consolidated gross billings $ 1,407,769 $ 1,354,800 3.9 % $ (12,519 ) 4.8 %
    Revenue
    North America $ 339,554 $ 238,565 42.3 % $ (27 ) 42.3 %
    International 261,848 320,718 (18.4 ) % (4,540 ) (16.9 ) %
    Consolidated revenue $ 601,402 $ 559,283 7.5 % $ (4,567 ) 8.3 %
    Income from operations $ 21,178 $ 39,639 (46.6 ) % $ 2,377 (52.6 ) %
    Net loss attributable to common stockholders $ (3,992 ) $ (11,695 ) 65.9 % $ 2,614 43.5 %
    Net loss per share
    Basic $ (0.01 ) $ (0.02 )
    Diluted $ (0.01 ) $ (0.02 )
    Weighted average basic shares outstanding 658,800,417 644,097,375
    Weighted average diluted shares outstanding 658,800,417 644,097,375
    (1) Represents the total dollar value of customer purchases of goods and services, excluding applicable taxes and net of estimated refunds. Includes direct billings and third party and other billings.
    (2) Represents change in financial measures that would have resulted had average exchange rates in the reporting period been the same as those in effect during the three months ended March 31, 2012.
    Groupon, Inc.
    Condensed Consolidated Statements of Cash Flows
    (in thousands)
    (unaudited)
    Three Months Ended 

    March 31,
    2013 2012
    Operating activities
    Net loss $ (3,242 ) $ (3,593 )
    Adjustments to reconcile net loss to net cash provided by operating activities:
    Depreciation and amortization 20,700 11,716
    Stock-based compensation 29,907 28,003
    Deferred income taxes (258 ) (876 )
    Excess tax benefits on stock-based compensation (832 ) (2,881 )
    Loss on equity method investments 19 5,128
    Acquisition-related expense (benefit), net 68 (52 )
    Change in assets and liabilities, net of acquisitions:
    Restricted cash 2,523 (1,357 )
    Accounts receivable (7,684 ) (11,878 )
    Prepaid expenses and other current assets 12,527 (4,121 )
    Accounts payable (19,606 ) (1,821 )
    Accrued merchant and supplier payables (39,417 ) 46,000
    Accrued expenses and other current liabilities 13,302 13,420
    Other, net 753 6,026
    Net cash provided by operating activities 8,760 83,714
    Net cash used in investing activities (30,679 ) (46,444 )
    Net cash used in financing activities (9,342 ) (8,275 )
    Effect of exchange rate changes on cash and cash equivalents (12,378 ) 9,059
    Net (decrease) increase in cash and cash equivalents (43,639 ) 38,054
    Cash and cash equivalents, beginning of period 1,209,289 1,122,935
    Cash and cash equivalents, end of period $ 1,165,650 $ 1,160,989
    Groupon, Inc.
    Consolidated Statements of Operations
    (in thousands, except share and per share amounts)
    (unaudited)
    Three Months Ended March 31,
    2013 2012
    Revenue:
    Third party and other $ 439,108 $ 540,053
    Direct 162,294 19,230
    Total revenue 601,402 559,283
    Cost of revenue:
    Third party and other 70,016 102,629
    Direct 152,377 16,869
    Total cost of revenue 222,393 119,498
    Gross Profit 379,009 439,785
    Operating expenses:
    Marketing 49,557 116,615
    Selling, general and administrative 308,206 283,583
    Acquisition-related expense (benefit), net 68 (52 )
    Total operating expenses 357,831 400,146
    Income from operations 21,178 39,639
    Interest and other expense, net (5,064 ) (3,539 )
    Loss on equity method investments (19 ) (5,128 )
    Income before provision for income taxes 16,095 30,972
    Provision for income taxes 19,337 34,565
    Net loss (3,242 ) (3,593 )
    Less: Net income attributable to noncontrolling interests (750 ) (880 )
    Net loss attributable to Groupon, Inc. (3,992 ) (4,473 )
    Adjustment of redeemable noncontrolling interests to redemption value – (7,222 )
    Net loss attributable to common stockholders $ (3,992 ) $ (11,695 )
    Net loss per share
    Basic $ (0.01 ) $ (0.02 )
    Diluted $ (0.01 ) $ (0.02 )
    Weighted average number of shares outstanding
    Basic 658,800,417 644,097,375
    Diluted 658,800,417 644,097,375
    Groupon, Inc.
    Consolidated Balance Sheets
    (in thousands, except share and per share amounts)
    (unaudited)
    March 31, December 31,
    2013 2012
    Assets
    Current assets:
    Cash and cash equivalents $ 1,165,650 $ 1,209,289
    Accounts receivable, net 102,717 96,713
    Deferred income taxes 30,679 31,211
    Prepaid expenses and other current assets 132,324 150,573
    Total current assets 1,431,370 1,487,786
    Property, equipment and software, net of accumulated depreciation and amortization of $60,291 and $46,236, respectively 128,773 121,072
    Goodwill 205,466 206,684
    Intangible assets, net 36,838 42,597
    Investments 97,245 84,209
    Deferred income taxes, non-current 29,710 29,916
    Other non-current assets 52,855 59,210
    Total Assets $ 1,982,257 $ 2,031,474
    Liabilities and Equity
    Current liabilities:
    Accounts payable $ 40,898 $ 59,865
    Accrued merchant and supplier payables 620,485 671,305
    Accrued expenses 245,889 246,924
    Deferred income taxes 52,875 53,700
    Other current liabilities 140,433 136,647
    Total current liabilities 1,100,580 1,168,441
    Deferred income taxes, non-current 19,917 20,860
    Other non-current liabilities 97,791 100,072
    Total Liabilities 1,218,288 1,289,373
    Commitments and contingencies
    Stockholders’ Equity
    Class A common stock, par value $0.0001 per share, 2,000,000,000 shares authorized, 657,774,882 and 654,523,706 shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively 66 65
    Class B common stock, par value $0.0001 per share, 10,000,000 shares authorized, 2,399,976 shares issued and outstanding at March 31, 2013 and December 31, 2012 – –
    Common stock, par value $0.0001 per share, 2,010,000,000 shares authorized, no shares issued and outstanding at March 31, 2013, and December 31, 2012 – –
    Additional paid-in capital 1,508,972 1,485,006
    Accumulated deficit (757,469 ) (753,477 )
    Accumulated other comprehensive income 14,787 12,446
    Total Groupon, Inc. Stockholders’ Equity 766,356 744,040
    Noncontrolling interests (2,387 ) (1,939 )
    Total Equity 763,969 742,101
    Total Liabilities and Equity $ 1,982,257 $ 2,031,474
    Groupon, Inc.
    Segment Information
    (in thousands)
    (unaudited)
    Three Months Ended March 31,
    2013 2012
    North America
    Gross Billings (1) $ 681,319 $ 553,557
    Revenue $ 339,554 $ 238,565
    Segment cost of revenue and operating expenses(2) 298,188 198,393
    Segment operating income $ 41,366 $ 40,172
    Segment operating income as a percent of segment revenue 12.2 % 16.8 %
    International
    Gross Billings (1) $ 726,450 $ 801,243
    Revenue $ 261,848 $ 320,718
    Segment cost of revenue and operating expenses(2) 252,061 293,300
    Segment operating income $ 9,787 $ 27,418
    Segment operating income as a percent of segment revenue 3.7 % 8.5 %
    Consolidated
    Gross Billings (1) $ 1,407,769 $ 1,354,800
    Revenue $ 601,402 $ 559,283
    Segment cost of revenue and operating expenses(2) 550,249 491,693
    Segment operating income $ 51,153 $ 67,590
    Segment operating income as a percent of segment revenue 8.5 % 12.1 %
    Stock-based compensation 29,907 28,003
    Acquisition-related expense (benefit), net 68 (52 )
    Income from operations 21,178 39,639
    Interest and other expense, net 5,064 3,539
    Loss on equity method investments 19 5,128
    Income before provision for income taxes 16,095 30,972
    Provision for income taxes 19,337 34,565
    Net loss $ (3,242 ) $ (3,593 )
    (1) Represents the total dollar value of customer purchases of goods and services, excluding any applicable taxes and net of estimated refunds. Includes direct billings and third party and other billings.
    (2) Represents cost of revenue and operating expenses, excluding stock-based compensation and acquisition-related expense (benefit), net.
    Groupon, Inc.
    Non-GAAP Reconciliation Schedules
    (in thousands, except share and per share amounts)
    (unaudited)
    The following are reconciliations of earnings per share excluding stock-based compensation and acquisition-related expense (benefit), net and foreign exchange rate neutral operating results to the most comparable U.S. GAAP financial measures. See “Supplemental Financial Information and Business Metrics” for reconciliations of Adjusted EBITDA, operating income (loss), excluding stock-based compensation and acquisition-related benefit (expense), net and free cash flow to the most comparable U.S. GAAP financial measures.
    The following is a reconciliation of net loss per share to earnings per share excluding stock-based compensation and acquisition-related expense, net for the three months ended March 31, 2013:
    Three Months Ended
    March 31, 2013
    Net loss attributable to common stockholders $ (3,992 )
    Stock-based compensation 29,907
    Acquisition-related expense, net 68
    Income tax effect of adjustments (9,113 )
    Net income attributable to common stockholders excluding stock-based
    compensation and acquisition-related expense, net $ 16,870
    Diluted shares 658,800,417
    Incremental diluted shares (1) 12,175,734
    Adjusted diluted shares 670,976,151
    Diluted net loss per share $ (0.01 )
    Impact of stock-based compensation and acquisition-related
    expense, net and the related income tax effects 0.04
    Diluted earnings per share excluding stock-based compensation and
    acquisition-related expense, net $ 0.03
    (1) Outstanding equity awards are not reflected in the diluted loss per share calculation for the three months ended March 31, 2013 because the effect would be antidilutive. However, those awards have been reflected in the calculation of diluted earnings per share excluding stock-based compensation and acquisition-related expense, net for the three months ended March 31, 2013 because they have a dilutive effect on that calculation.
    The following is a reconciliation of foreign exchange rate neutral operating results to the most comparable U.S. GAAP financial measures, “Gross Billings,” “Revenue” and “Income from operations,” for the three months ended March 31, 2013. The effect on the Company’s gross billings, revenue and income from operations from changes in exchange rates versus the U.S. Dollar for the three months ended March 31, 2013 was as follows:
    Three Months Ended March 31, 2013 Three Months Ended March 31, 2013
    At Avg. Exchange At Avg. Exchange
    Q1 2012
    Rates (1)    		 Rate
    Effect (2)    		 As
    Reported    		 Q4 2012
    Rates (3)    		 Rate
    Effect (2)    		 As
    Reported
    Gross billings $ 1,420,288 $ (12,519 ) $ 1,407,769 $ 1,408,597 $ (828 ) $ 1,407,769
    Revenue $ 605,969 $ (4,567 ) $ 601,402 $ 601,584 $ (182 ) $ 601,402
    Income from operations $ 18,801 $ 2,377 $ 21,178 $ 21,698 $ (520 ) $ 21,178
    (1) Represents the outcome that would have resulted had average exchange rates in the reported period been the same as those in effect during the three months ended March 31, 2012.
    (2) Represents the increase or decrease in reported amounts resulting from changes in exchange rates from those in effect in the comparable period.
    (3) Represents the outcome that would have resulted had average exchange rates in the reported period been the same as those in effect during the three months ended December 31, 2012.
    Groupon, Inc.
    Supplemental Financial Information and Business Metrics(13)
    (financial data in thousands, except per share data; active customers in millions)
    (unaudited)
    Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
    Segments
    North America Segment
    Gross Billings (1)
    Local (2) Gross Billings
    Third Party and Other $ 424,124 $ 412,348 $ 349,293 $ 430,255 $ 450,140
    Direct 5,299 288 6,450 – –
    Total Local Gross Billings $ 429,423 $ 412,636 $ 355,743 $ 430,255 $ 450,140
    Goods Gross Billings
    Third Party and Other $ 75,908 $ 40,173 $ 25,508 $ 31,270 $ 17,294
    Direct 2,282 52,773 126,608 209,575 148,065
    Total Goods Gross Billings $ 78,190 $ 92,946 $ 152,116 $ 240,845 $ 165,359
    Travel and Other Gross Billings
    Third Party and Other $ 45,944 $ 42,693 $ 44,510 $ 47,852 $ 65,820
    Direct – – – – –
    Total Travel and Other Gross Billings $ 45,944 $ 42,693 $ 44,510 $ 47,852 $ 65,820
    Total Gross Billings
    Third Party and Other $ 545,976 $ 495,214 $ 419,311 $ 509,377 $ 533,254
    Direct 7,581 53,061 133,058 209,575 148,065
    Total Gross Billings $ 553,557 $ 548,275 $ 552,369 $ 718,952 $ 681,319
    Year-over-year growth 76 % 48 % 38 % 51 % 23 %
    % of Consolidated Gross Billings 41 % 43 % 45 % 47 % 48 %
    Gross Billings Trailing Twelve Months (TTM) $ 1,800,332 $ 1,978,617 $ 2,130,008 $ 2,373,153 $ 2,500,915
    Revenue (3)
    Local Revenue
    Third Party and Other $ 191,128 $ 184,189 $ 134,993 $ 142,454 $ 171,593
    Direct 5,299 288 6,450 – –
    Total Local Revenue $ 196,427 $ 184,477 $ 141,443 $ 142,454 $ 171,593
    Goods Revenue
    Third Party and Other $ 24,941 $ 10,387 $ 13,064 $ 11,877 $ 3,144
    Direct 2,282 52,774 126,608 209,575 148,065
    Total Goods Revenue $ 27,223 $ 63,161 $ 139,672 $ 221,452 $ 151,209
    Travel and Other Revenue
    Third Party and Other $ 14,915 $ 12,543 $ 10,488 $ 11,445 $ 16,752
    Direct – – – – –
    Total Travel and Other Revenue $ 14,915 $ 12,543 $ 10,488 $ 11,445 $ 16,752
    Total Revenue
    Third Party and Other $ 230,984 $ 207,119 $ 158,545 $ 165,776 $ 191,489
    Direct 7,581 53,062 133,058 209,575 148,065
    Total Revenue $ 238,565 $ 260,181 $ 291,603 $ 375,351 $ 339,554
    Year-over-year growth 75 % 66 % 81 % 109 % 42 %
    % of Consolidated Revenue 43 % 46 % 51 % 59 % 56 %
    Revenue TTM $ 736,933 $ 839,909 $ 969,987 $ 1,165,700 $ 1,266,689
    Cost of Revenue (4)
    Local Cost of Revenue
    Third Party and Other $ 51,782 $ 35,710 $ 13,176 $ 23,203 $ 25,915
    Direct 4,663 234 5,231 – –
    Total Local Cost of Revenue $ 56,445 $ 35,944 $ 18,407 $ 23,203 $ 25,915
    Goods Cost of Revenue
    Third Party and Other $ 6,757 $ 2,014 $ 1,275 $ 1,935 $ 475
    Direct 2,008 45,925 110,329 196,789 138,278
    Total Goods Cost of Revenue $ 8,765 $ 47,939 $ 111,604 $ 198,724 $ 138,753
    Travel and Other Cost of Revenue
    Third Party and Other $ 4,041 $ 2,431 $ 1,024 $ 1,864 $ 2,530
    Direct – – – – –
    Total Travel and Other Cost of Revenue $ 4,041 $ 2,431 $ 1,024 $ 1,864 $ 2,530
    Total Cost of Revenue
    Third Party and Other $ 62,580 $ 40,155 $ 15,475 $ 27,002 $ 28,920
    Direct 6,671 46,159 115,560 196,789 138,278
    Total Cost of Revenue $ 69,251 $ 86,314 $ 131,035 $ 223,791 $ 167,198
    % of North America Total Revenue 29 % 33 % 45 % 60 % 49 %
    Gross Profit
    Local Gross Profit
    Third Party and Other $ 139,346 $ 148,479 $ 121,817 $ 119,251 $ 145,678
    Direct 636 54 1,219 – –
    Total Local Gross Profit $ 139,982 $ 148,533 $ 123,036 $ 119,251 $ 145,678
    % of North America Total Local Revenue 71.3 % % 80.5 % % 87.0 % % 83.7 % % 84.9 % %
    % of North America Total Local Gross Billings 32.6 % % 36.0 % % 34.6 % % 27.7 % % 32.4 % %
    Goods Gross Profit
    Third Party and Other $ 18,184 $ 8,373 $ 11,789 $ 9,942 $ 2,669
    Direct 274 6,849 16,279 12,786 9,787
    Total Goods Gross Profit $ 18,458 $ 15,222 $ 28,068 $ 22,728 $ 12,456
    % of North America Total Goods Revenue 67.8 % % 24.1 % % 20.1 % % 10.3 % % 8.2 % %
    % of North America Total Goods Gross Billings 23.6 % % 16.4 % % 18.5 % % 9.4 % % 7.5 % %
    Travel and Other Gross Profit
    Third Party and Other $ 10,874 $ 10,112 $ 9,464 $ 9,581 $ 14,222
    Direct – – – – –
    Total Travel and Other Gross Profit $ 10,874 $ 10,112 $ 9,464 $ 9,581 $ 14,222
    % of North America Total Travel and Other Revenue 72.9 % % 80.6 % % 90.2 % % 83.7 % % 84.9 % %
    % of North America Total Travel and Other Gross Billings 23.7 % % 23.7 % % 21.3 % % 20.0 % % 21.6 % %
    Total Gross Profit
    Third Party and Other $ 168,404 $ 166,964 $ 143,070 $ 138,774 $ 162,569
    Direct 910 6,903 17,498 12,786 9,787
    Total Gross Profit $ 169,314 $ 173,867 $ 160,568 $ 151,560 $ 172,356
    % of North America Total Revenue 71.0 % % 66.8 % % 55.1 % % 40.4 % % 50.8 % %
    % of North America Total Gross Billings 30.6 % % 31.7 % % 29.1 % % 21.1 % % 25.3 % %
    Operating Income Excl Stock-Based Compensation (SBC), Acquisition-Related Expenses $ 40,172 $ 43,429 $ 39,093 $ 17,032 $ 41,366
    Year-over-year growth N/A N/A 108 % (7 ) % 3 %
    % of Consolidated Operating Income Excl SBC, Acq-Related 59 % 60 % 77 % 124 % 81 %
    Operating Margin Excl SBC, Acq-Related (% of North America Total revenue) 16.8 % 16.7 % 13.4 % 4.5 % 12.2 %
    Year-over-year growth (bps) 3,278 2,337 170 (570 ) (460 )
    Operating Income TTM Excl SBC, Acq-Related $ 66,746 $ 120,676 $ 140,933 $ 139,726 $ 140,920
    Operating Margin TTM Excl SBC, Acq-Related (% of North America Total TTM revenue) 9.1 % 14.4 % 14.5 % 12.0 % 11.1 %
    Year-over-year growth (bps) 2,197 2,601 2,100 1,120 200
    International Segment Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
    Gross Billings
    Local Gross Billings
    Third Party and Other $ 465,879 $ 423,313 $ 328,044 $ 368,898 $ 379,413
    Direct – – – – –
    Total Local Gross Billings $ 465,879 $ 423,313 $ 328,044 $ 368,898 $ 379,413
    Goods Gross Billings
    Third Party and Other $ 199,988 $ 186,899 $ 211,464 $ 285,057 $ 212,736
    Direct 7,396 12,288 11,930 15,601 14,229
    Total Goods Gross Billings $ 207,384 $ 199,187 $ 223,394 $ 300,658 $ 226,965
    Travel and Other Gross Billings
    Third Party and Other $ 123,727 $ 115,901 $ 114,449 $ 131,944 $ 120,072
    Direct 4,253 – – – –
    Total Travel and Other Gross Billings $ 127,980 $ 115,901 $ 114,449 $ 131,944 $ 120,072
    Total Gross Billings
    Third Party and Other $ 789,594 $ 726,113 $ 653,957 $ 785,899 $ 712,221
    Direct 11,649 12,288 11,930 15,601 14,229
    Total Gross Billings $ 801,243 $ 738,401 $ 665,887 $ 801,500 $ 726,450
    Year-over-year growth 127 % 32 % (12 ) % 6 % (9 ) %
    Year-over-year growth, excluding FX (5) 138 % 45 % (4 ) % 9 % (8 ) %
    % of Consolidated Gross Billings 59 % 57 % 55 % 53 % 52 %
    Gross Billings TTM $ 2,871,795 $ 3,050,937 $ 2,960,592 $ 3,007,031 $ 2,932,238
    Revenue
    Local Revenue
    Third Party and Other $ 213,166 $ 193,861 $ 164,184 $ 144,834 $ 155,800
    Direct – – – – –
    Total Local Revenue $ 213,166 $ 193,861 $ 164,184 $ 144,834 $ 155,800
    Goods Revenue
    Third Party and Other $ 60,365 $ 67,864 $ 71,310 $ 74,702 $ 63,937
    Direct 7,396 12,288 11,930 15,600 14,229
    Total Goods Revenue $ 67,761 $ 80,152 $ 83,240 $ 90,302 $ 78,166
    Travel and Other Revenue
    Third Party and Other $ 35,538 $ 34,141 $ 29,525 $ 27,815 $ 27,882
    Direct 4,253 – – – –
    Total Travel and Other Revenue $ 39,791 $ 34,141 $ 29,525 $ 27,815 $ 27,882
    Total Revenue
    Third Party and Other $ 309,069 $ 295,866 $ 265,019 $ 247,351 $ 247,619
    Direct 11,649 12,288 11,930 15,600 14,229
    Total Revenue $ 320,718 $ 308,154 $ 276,949 $ 262,951 $ 261,848
    Year-over-year growth 102 % 31 % 3 % (16 ) % (18 ) %
    Year-over-year growth, excluding FX 112 % 44 % 13 % (14 ) % (17 ) %
    % of Consolidated Revenue 57 % 54 % 49 % 41 % 44 %
    Revenue TTM $ 1,137,257 $ 1,210,034 $ 1,218,347 $ 1,168,772 $ 1,109,902
    Cost of Revenue
    Local Cost of Revenue
    Third Party and Other $ 27,622 $ 24,162 $ 23,729 $ 20,423 $ 20,115
    Direct – – – – –
    Total Local Cost of Revenue $ 27,622 $ 24,162 $ 23,729 $ 20,423 $ 20,115
    Goods Cost of Revenue
    Third Party and Other $ 7,822 $ 8,459 $ 10,702 $ 12,558 $ 17,381
    Direct 6,474 11,993 12,053 21,778 14,099
    Total Goods Cost of Revenue $ 14,296 $ 20,452 $ 22,755 $ 34,336 $ 31,480
    Travel and Other Cost of Revenue
    Third Party and Other $ 4,605 $ 4,256 $ 4,267 $ 3,922 $ 3,600
    Direct 3,724 – – – –
    Total Travel and Other Cost of Revenue $ 8,329 $ 4,256 $ 4,267 $ 3,922 $ 3,600
    Total Cost of Revenue
    Third Party and Other $ 40,049 $ 36,877 $ 38,698 $ 36,903 $ 41,096
    Direct 10,198 11,993 12,053 21,778 14,099
    Total Cost of Revenue $ 50,247 $ 48,870 $ 50,751 $ 58,681 $ 55,195
    % of International Total Revenue 16 % 16 % 18 % 22 % 21 %
    Gross Profit
    Local Gross Profit
    Third Party and Other $ 185,544 $ 169,699 $ 140,455 $ 124,411 $ 135,685
    Direct – – – – –
    Total Local Gross Profit $ 185,544 $ 169,699 $ 140,455 $ 124,411 $ 135,685
    % of International Total Local Revenue 87.0 % % 87.5 % % 85.5 % % 85.9 % % 87.1 % %
    % of International Total Local Gross Billings 39.8 % % 40.1 % % 42.8 % % 33.7 % % 35.8 % %
    Goods Gross Profit
    Third Party and Other $ 52,543 $ 59,405 $ 60,608 $ 62,144 $ 46,556
    Direct 922 295 (123 ) (6,178 ) 130
    Total Goods Gross Profit $ 53,465 $ 59,700 $ 60,485 $ 55,966 $ 46,686
    % of International Total Goods Revenue 78.9 % % 74.5 % % 72.7 % % 62.0 % % 59.7 % %
    % of International Total Goods Gross Billings 25.8 % % 30.0 % % 27.1 % % 18.6 % % 20.6 % %
    Travel and Other Gross Profit
    Third Party and Other $ 30,933 $ 29,885 $ 25,258 $ 23,893 $ 24,282
    Direct 529 – – – –
    Total Travel and Other Gross Profit $ 31,462 $ 29,885 $ 25,258 $ 23,893 $ 24,282
    % of International Total Travel and Other Revenue 79.1 % % 87.5 % % 85.5 % % 85.9 % % 87.1 % %
    % of International Total Travel and Other Gross Billings 24.6 % % 25.8 % % 22.1 % % 18.1 % % 20.2 % %
    Total Gross Profit
    Third Party and Other $ 269,020 $ 258,989 $ 226,321 $ 210,448 $ 206,523
    Direct 1,451 295 (123 ) (6,178 ) 130
    Total Gross Profit $ 270,471 $ 259,284 $ 226,198 $ 204,270 $ 206,653
    % of International Total Revenue 84.3 % % 84.1 % % 81.7 % % 77.7 % % 78.9 % %
    % of International Total Gross Billings 33.8 % % 35.1 % % 34.0 % % 25.5 % % 28.4 % %
    Operating Income (Loss) Excl SBC, Acq-Related $ 27,418 $ 28,505 $ 11,395 $ (3,329 ) $ 9,787
    Year-over-year growth N/A 155 N/A (1,060 ) % (64 ) %
    % of Consolidated Operating Income Excl SBC, Acq-Related 41 % 40 % 23 % (24 ) % 19 %
    Operating Margin Excl SBC, Acq-Related (% of International Total revenue) 8.5 % 9.3 % 4.1 % (1.3 ) % 3.7 %
    Year-over-year growth (bps) 5,669 3,126 1,170 (120 ) (480 )
    Operating (Loss) Income TTM Excl SBC, Acq-Related $ (45,205 ) $ 35,108 $ 67,031 $ 63,989 $ 46,358
    Operating Margin TTM Excl SBC, Acq-Related (% of International Total TTM revenue) (4.0 ) % 2.9 % 5.5 % 5.5 % 4.2 %
    Year-over-year growth (bps) 8,704 5,765 4,170 2,080 820
    Consolidated Results of Operations Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
    Gross Billings
    Local Gross Billings
    Third Party and Other $ 890,003 $ 835,661 $ 677,337 $ 799,153 $ 829,533
    Direct 5,299 288 6,450 – –
    Total Local Gross Billings $ 895,302 $ 835,949 $ 683,787 $ 799,153 $ 829,533
    Goods Gross Billings
    Third Party and Other $ 275,896 $ 227,072 $ 236,972 $ 316,327 $ 230,030
    Direct 9,678 65,061 138,538 225,176 162,294
    Total Goods Gross Billings $ 285,574 $ 292,133 $ 375,510 $ 541,503 $ 392,324
    Travel and Other Gross Billings
    Third Party and Other $ 169,671 $ 158,594 $ 158,959 $ 179,796 $ 185,892
    Direct 4,253 – – – –
    Total Travel and Other Gross Billings $ 173,924 $ 158,594 $ 158,959 $ 179,796 $ 185,892
    Total Gross Billings
    Third Party and Other $ 1,335,570 $ 1,221,327 $ 1,073,268 $ 1,295,276 $ 1,245,475
    Direct 19,230 65,349 144,988 225,176 162,294
    Total Gross Billings $ 1,354,800 $ 1,286,676 $ 1,218,256 $ 1,520,452 $ 1,407,769
    Year-over-year growth 103 % 38 % 5 % 24 % 4 %
    Year-over-year growth, excluding FX 108 % 47 % 11 % 25 % 5 %
    Gross Billings (TTM) $ 4,672,127 $ 5,029,554 $ 5,090,600 $ 5,380,184 $ 5,433,153
    Year-over-year growth 241 % 128 % 61 % 35 % 16 %
    Revenue
    Local Revenue
    Third Party and Other $ 404,294 $ 378,050 $ 299,177 $ 287,288 $ 327,393
    Direct 5,299 288 6,450 – –
    Total Local Revenue $ 409,593 $ 378,338 $ 305,627 $ 287,288 $ 327,393
    Goods Revenue
    Third Party and Other $ 85,306 $ 78,251 $ 84,374 $ 86,579 $ 67,081
    Direct 9,678 65,062 138,538 225,175 162,294
    Total Goods Revenue $ 94,984 $ 143,313 $ 222,912 $ 311,754 $ 229,375
    Travel and Other Revenue
    Third Party and Other $ 50,453 $ 46,684 $ 40,013 $ 39,260 $ 44,634
    Direct 4,253 – – – –
    Total Travel and Other Revenue $ 54,706 $ 46,684 $ 40,013 $ 39,260 $ 44,634
    Total Revenue
    Third Party and Other $ 540,053 $ 502,985 $ 423,564 $ 413,127 $ 439,108
    Direct 19,230 65,350 144,988 225,175 162,294
    Total Revenue $ 559,283 $ 568,335 $ 568,552 $ 638,302 $ 601,402
    Year-over-year growth 89 % 45 % 32 % 30 % 8 %
    Year-over-year growth, excluding FX 95 % 53 % 38 % 31 % 8 %
    Total Consolidated Revenue TTM $ 1,874,190 $ 2,049,943 $ 2,188,334 $ 2,334,472 $ 2,376,591
    Year-over-year growth 219 % 118 % 70 % 45 % 27 %
    Cost of Revenue
    Local Cost of Revenue
    Third Party and Other $ 79,404 $ 59,872 $ 36,905 $ 43,626 $ 46,030
    Direct 4,663 234 5,231 – –
    Total Local Cost of Revenue $ 84,067 $ 60,106 $ 42,136 $ 43,626 $ 46,030
    Goods Cost of Revenue
    Third Party and Other $ 14,579 $ 10,473 $ 11,977 $ 14,493 $ 17,856
    Direct 8,482 57,918 122,382 218,567 152,377
    Total Goods Cost of Revenue $ 23,061 $ 68,391 $ 134,359 $ 233,060 $ 170,233
    Travel and Other Cost of Revenue
    Third Party and Other $ 8,646 $ 6,687 $ 5,291 $ 5,786 $ 6,130
    Direct 3,724 – – – –
    Total Travel and Other Cost of Revenue $ 12,370 $ 6,687 $ 5,291 $ 5,786 $ 6,130
    Total Cost of Revenue
    Third Party and Other $ 102,629 $ 77,032 $ 54,173 $ 63,905 $ 70,016
    Direct 16,869 58,152 127,613 218,567 152,377
    Total Cost of Revenue $ 119,498 $ 135,184 $ 181,786 $ 282,472 $ 222,393
    % of Total Consolidated Revenue 21 % 24 % 32 % 44 % 37 %
    Gross Profit
    Local Gross Profit
    Third Party and Other $ 324,890 $ 318,178 $ 262,272 $ 243,662 $ 281,363
    Direct 636 54 1,219 – –
    Total Local Gross Profit $ 325,526 $ 318,232 $ 263,491 $ 243,662 $ 281,363
    % of Total Consolidated Local Revenue 79.5 % % 84.1 % % 86.2 % % 84.8 % % 85.9 % %
    % of Total Consolidated Local Gross Billings 36.4 % % 38.1 % % 38.5 % % 30.5 % % 33.9 % %
    Goods Gross Profit
    Third Party and Other $ 70,727 $ 67,778 $ 72,397 $ 72,086 $ 49,225
    Direct 1,196 7,144 16,156 6,608 9,917
    Total Goods Gross Profit $ 71,923 $ 74,922 $ 88,553 $ 78,694 $ 59,142
    % of Total Consolidated Goods Revenue 75.7 % % 52.3 % % 39.7 % % 25.2 % % 25.8 % %
    % of Total Consolidated Goods Gross Billings 25.2 % % 25.6 % % 23.6 % % 14.5 % % 15.1 % %
    Travel and Other Gross Profit
    Third Party and Other $ 41,807 $ 39,997 $ 34,722 $ 33,474 $ 38,504
    Direct 529 – – – –
    Total Travel and Other Gross Profit $ 42,336 $ 39,997 $ 34,722 $ 33,474 $ 38,504
    % of Total Consolidated Travel and Other Revenue 77.4 % % 85.7 % % 86.8 % % 85.3 % % 86.3 % %
    % of Total Consolidated Travel and Other Gross Billings 24.3 % % 25.2 % % 21.8 % % 18.6 % % 20.7 % %
    Total Gross Profit
    Third Party and Other $ 437,424 $ 425,953 $ 369,391 $ 349,222 $ 369,092
    Direct 2,361 7,198 17,375 6,608 9,917
    Total Gross Profit $ 439,785 $ 433,151 $ 386,766 $ 355,830 $ 379,009
    % of Total Consolidated Revenue 78.6 % % 76.2 % % 68.0 % % 55.7 % % 63.0 % %
    % of Total Consolidated Gross Billings 32.5 % % 33.7 % % 31.7 % % 23.4 % % 26.9 % %
    Operating Income Excl SBC, Acq-Related $ 67,590 $ 71,934 $ 50,488 $ 13,703 $ 51,153
    Year-over-year growth N/A N/A N/A (24 ) % (24 ) %
    Operating Margin Excl SBC, Acq-Related (% of Total Consolidated revenue) 12.1 % 12.7 % 8.9 % 2.1 % 8.5 %
    Year-over-year growth (bps) 4,534 2,853 930 (150 ) (360 )
    Operating Income TTM Excl SBC, Acq-Related $ 21,541 $ 155,784 $ 207,964 $ 203,715 $ 187,278
    Operating Margin TTM Excl SBC, Acq-Related (% of Total Consolidated TTM revenue) 1.1 % 7.6 % 9.5 % 8.7 % 7.9 %
    Year-over-year growth (bps) 5,011 4,229 3,320 1,770 680
    Operating Income (Loss) $ 39,639 $ 46,485 $ 25,438 $ (12,861 ) $ 21,178
    Year-over-year growth N/A N/A N/A 14 % (47 ) %
    Operating Margin (% of Total Consolidated revenue) 7.1 % 8.2 % 4.5 % (2.0 ) % 3.5 %
    Year-over-year growth (bps) 4,673 3,391 457 100 (360 )
    Operating (Loss) Income TTM $ (76,599 ) $ 70,913 $ 96,590 $ 98,701 $ 80,240
    Operating Margin TTM (% of Total Consolidated TTM revenue) (4.1 ) % 3.5 % 4.4 % 4.2 % 3.4 %
    Year-over-year growth (bps) 8,875 6,824 4,740 1,870 750
    Net (Loss) Income Attributable to Common Stockholders (11,695 ) 28,386 (2,979 ) (81,089 ) (3,992 )
    Weighted Average Basic Shares Outstanding 644,097 647,150 653,224 655,678 658,800
    Weighted Average Diluted Shares Outstanding (6) 644,097 663,123 653,224 655,678 658,800
    Net (Loss) Earnings per Share
    Basic $ (0.02 ) $ 0.04 $ (0.00 ) $ (0.12 ) $ (0.01 )
    Diluted $ (0.02 ) $ 0.04 $ (0.00 ) $ (0.12 ) $ (0.01 )
    Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
    The following is a quarterly reconciliation of Adjusted EBITDA to the most comparable U.S. GAAP financial measure, “Net (loss) income” and a quarterly reconciliation of operating income, excluding stock-based compensation and acquisition-related benefit (expense), net, to the most comparable U.S. GAAP financial measure, “Operating income (loss).” (7)
    Adjusted EBITDA $ 79,306 $ 84,744 $ 65,798 $ 29,668 $ 71,853
    Depreciation and amortization (11,716 ) (12,810 ) (15,310 ) (15,965 ) (20,700 )
    Operating income, excluding stock-based compensation and acquisition-related benefit (expense), net 67,590 71,934 50,488 13,703 51,153
    Stock-based compensation (28,003 ) (27,084 ) (22,619 ) (26,411 ) (29,907 )
    Acquisition-related benefit (expense), net 52 1,635 (2,431 ) (153 ) (68 )
    Operating income (loss) 39,639 46,485 25,438 (12,861 ) 21,178
    Non Operating Items
    Interest and other (expense) income, net (3,539 ) 57,367 617 (48,279 ) (5,064 )
    Loss on equity method investments (5,128 ) (3,428 ) (138 ) (1,231 ) (19 )
    Provision for income taxes (34,565 ) (66,875 ) (26,857 ) (17,676 ) (19,337 )
    Net (loss) income $ (3,593 ) $ 33,549 $ (940 ) $ (80,047 ) $ (3,242 )
    The following is a trailing twelve months reconciliation of Operating income, excluding stock-based compensation and acquisition-related benefit (expense), net, to the most comparable U.S. GAAP financial measure, “Operating (loss) Income.” (7)
    Operating income, excluding stock-based compensation and acquisition-related benefit (expense), net TTM $ 21,541 $ 155,784 $ 207,964 $ 203,715 $ 187,278
    Stock-based compensation (102,729 ) (91,095 ) (110,374 ) (104,117 ) (106,021 )
    Acquisition-related benefit (expense), net 4,589 6,224 (1,000 ) (897 ) (1,017 )
    Operating (loss) income TTM $ (76,599 ) $ 70,913 $ 96,590 $ 98,701 $ 80,240
    The following is a quarterly reconciliation of foreign exchange rate neutral Gross Billings growth from the comparable quarterly periods of the prior year to reported Gross billings growth from the comparable quarterly periods of the prior year.(8)
    International Gross Billings growth, excluding FX 138 % 45 % (4 ) % 9 % (8 ) %
    FX Effect (11 ) % (13 ) % (8 ) % (3 ) % (1 ) %
    International Gross Billings growth 127 % 32 % (12 ) % 6 % (9 ) %
    Consolidated Gross Billings growth, excluding FX 108 % 47 % 11 % 25 % 5 %
    FX Effect (5 ) % (9 ) % (6 ) % (1 ) % (1 ) %
    Consolidated Gross Billings growth 103 % 38 % 5 % 24 % 4 %
    The following is a quarterly reconciliation of foreign exchange rate neutral Revenue growth from the comparable quarterly periods of the prior year to reported Revenue growth from the comparable quarterly periods of the prior year.(8)
    International Revenue growth, excluding FX 112 % 44 % 13 % (14 ) % (17 ) %
    FX Effect (10 ) % (13 ) % (10 ) % (2 ) % (1 ) %
    International Revenue growth 102 % 31 % 3 % (16 ) % (18 ) %
    Consolidated Revenue growth, excluding FX 95 % 53 % 38 % 31 % 8 %
    FX Effect (6 ) % (8 ) % (6 ) % (1 ) % – %
    Consolidated Revenue growth 89 % 45 % 32 % 30 % 8 %
    The following is a reconciliation of free cash flow to the most comparable U.S. GAAP financial measure, “Net cash provided by operating activities.”
    Net cash provided by operating activities $ 83,714 $ 75,315 $ 42,088 $ 65,717 $ 8,760
    Purchases of property, equipment and capitalized software (13,083 ) (26,709 ) (16,010 ) (40,034 ) (14,468 )
    Free cash flow (9) $ 70,631 $ 48,606 $ 26,078 $ 25,683 $ (5,708 )
    Net cash provided by operating activities (TTM) $ 356,221 $ 392,517 $ 370,194 $ 266,834 $ 191,880
    Purchases of property, equipment and capitalized software (TTM) (45,932 ) (62,401 ) (69,788 ) (95,836 ) (97,221 )
    Free cash flow (TTM) $ 310,289 $ 330,116 $ 300,406 $ 170,998 $ 94,659
    Net cash used in investing activities $ (46,444 ) $ (60,153 ) $ (35,629 ) $ (52,753 ) $ (30,679 )
    Net cash (used in) provided by financing activities $ (8,275 ) $ 24,158 $ 2,707 $ (6,495 ) $ (9,432 )
    Net cash used in investing activities (TTM) $ (149,583 ) $ (184,552 ) $ (177,133 ) $ (194,979 ) $ (179,214 )
    Net cash provided by financing activities (TTM) $ 746,824 $ 771,404 $ 765,503 $ 12,095 $ 11,028
    Other Metrics
    Active Customers (10)
    North America 14.9 15.1 16.0 17.2 18.2
    International 22.0 22.9 23.5 23.8 23.5
    Total Active Customers 36.9 38.0 39.5 41.0 41.7
    TTM Gross Billings / Average Active Customer (11)
    North America $ 156 $ 151 $ 148 $ 152 $ 151
    International $ 197 $ 175 $ 149 $ 138 $ 129
    Consolidated $ 179 $ 165 $ 149 $ 144 $ 138
    Headcount
    Sales (12) 5,735 5,587 5,087 4,677 4,566
    % North America 21 % 20 % 24 % 25 % 28 %
    % International 79 % 80 % 76 % 75 % 72 %
    Other 6,813 7,233 6,779 6,717 6,433
    Total Headcount 12,548 12,820 11,866 11,394 10,999
    (1) Represents the total dollar value of customer purchases of goods and services, excluding applicable taxes and net of estimated refunds. Includes direct billings and third party and other billings.
    (2) Local represents deals from local merchants, deals with national merchants, and through local events (i.e., GrouponLive deals).
    (3) Third party revenue is related to sales for which the company acts as a marketing agent for the merchant. This revenue is recorded on a net basis. Direct revenue is primarily related to the sale of products for which the Company is the merchant of record. These revenues are accounted for on a gross basis, with the cost of inventory included in cost of revenue.
    (4) Cost of revenue is comprised of direct and indirect costs incurred to generate revenue. Direct cost of revenue includes the purchase price of consumer products, warehousing, shipping costs and inventory markdowns. Third party cost of revenue includes estimated refunds for which the merchant’s share is not recoverable. Other costs incurred to generate revenue are allocated to cost of third party revenue, direct revenue and other revenue for each of our categories (Local, Goods, and Travel and Other) in proportion to relative gross billings during the period.
    (5) Represents change in financial measures that would have resulted had average exchange rates in the reporting period been the same as those in effect in the prior year period.
    (6) The weighted-average diluted shares outstanding is calculated using the weighted-average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and vesting of restricted stock units and restricted shares, as calculated using the treasury stock method.
    (7) Adjusted EBITDA and Operating income excluding stock-based compensation and acquisition-related expense (benefit), net are non-GAAP financial measures. The Company reconciles Adjusted EBITDA to the most comparable U.S. GAAP financial measure, “Net (loss) income” for the periods presented, and the Company reconciles Operating income excluding stock-based compensation and acquisition-related expense (benefit), net to the most comparable U.S. GAAP financial measure, “Operating income (loss),” for the periods presented.
    (8) Foreign Exchange Rate neutral operating results are non-GAAP financial measures. The Company reconciles these measures to the most comparable U.S. GAAP financial measures, ‘‘Gross Billings” and “Revenue,” for the periods presented.
    (9) Free cash flow is a non-GAAP financial measure. The Company reconciles this measure to the most comparable U.S. GAAP financial measure, ‘‘Net cash provided by operating activities,” for the periods presented.
    (10) Reflects the total number of unique accounts who have purchased Groupons during the trailing twelve months.
    (11) Reflects the total gross billings generated in the trailing twelve months per average active customer over that period.
    (12) Includes inside and outside merchant sales representatives, as well as sales support.
    (13) The definition, methodology, and appropriateness of each of our supplemental metrics is reviewed periodically. As a result, metrics are subject to removal and/or change.

  • Amy Hood replaces Peter Klein as Microsoft CFO

    During last month’s fiscal third quarter 2013 earnings call, Microsoft revealed that Peter Klein would step down as chief financial officer. Today, the company announced his replacement: Amy Hood, who currently is CFO of the Business division. She assumed that role in January 2010.

    CEO Steve Ballmer describes Hood as an “instrumental leader” who helped “lead the transition to services with Office 365” and to bring strong financial results.

    “I’m excited to step into this role and look forward to working closely again with our investors and shareholders”, she says. “Peter has built a world-class finance team, and I am set up well to continue the company’s strong discipline around costs and focus on driving shareholder value”.

    Hood assumes the CFO position, effective immediately. However, Klein will remain at Microsoft through the end of June, which is the close of the fiscal year.

    Proven Record

    Microsoft currently operates five product groups, with Business being most successful. For example, the division generated $6.32 billion in revenue and $4.1 billion profit during fiscal Q3. Business brings in more sales than any other Microsoft division, even Windows. The point: Being CFO there is no less than many independent companies.

    During her tenure, Hood played pivotal roles in two big Business division acquisitions: Skype (May 2010; $8.5 billion) and Yammer (June 2010; $1.2 billion) — skills, among others, she will need in her new role.

    Microsoft also rolled out Office 365 on Hood’s watch. From a financial perspective, the subscription service risks much, while promising great rewards. Already about 60 percent of Business division revenue comes from annuity licensing contracts, which are like subscriptions in how they’re paid for.

    Subscribe for Life

    The move to the real deal will change how some small businesses acquire the productivity suite and companion server software, while moving the consumer market from discreet purchases every few years to paying Microsoft on regular schedules. Like annuity contracts, subscriptions promise to smooth out the company’s revenue and insulate against economic downturns or highs and lows between new product releases.

    Subscriptions are the software giant’s future. Microsoft’s Clint Patterson said as much yesterday: “We think subscription software-as-a-service is the future. The benefits to consumers are huge”.

    But subscriptions challenge some of the metrics Wall Street analysts typically use to gauge a company’s health, and they can mystify smaller investors. Already, Microsoft carries huge sums of “unearned revenue” on the balance sheet related to annuity licenses. Hood inherits responsibility for managing both categories and communicating context to investors.

    Great Timing

    Klein exits at a good time — ditto for Hood’s entrance. At close of market today, Microsoft’s stock was up about 25 percent from January, reaching a 52-week high of $33.91 on Monday. Recent results are strong, too. For the first nine months of fiscal 2013, the company generated $58.1 billion revenue and $16.91 billion net profit.

  • Michelle Knight Photo Finally Surfaces

    Earlier, we looked at photos of two of the three women – Amanda Berry and Gina DeJesus – who were kidnapped a decade ago in Cleveland, and rescued this week. There had been no photos of third woman Michelle Knight circulating.

    Now, the first photo of Knight has come out (above), and was shown in this ABC News report:


    US News | Syria News| More ABC News Videos

    According to Cleveland.com, the photo was reportedly taken in 1999.

    Knight is reportedly recovering in the hospital, as the other women (and Berry’s kid) have returned home.

    Knight was 21 years old when she was kidnapped. She had last been seen in August of 2002 until the rescue this week.