Groupon Goods’ revenue grows 11% in Q2
August 7, 2015 01:13 PM
While Groupon Inc.’s overall revenue inched up 3.1% in the second quarter, sales of physical products through its Groupon Goods division grew 11.2%. Groupon Goods generated $420.5 million in sales during the quarter, accounting for 56.9% of companywide revenue.
Though Groupon’s revenue growth was minimal, CEO Eric Lefkofsky says he is optimistic about the company’s evolution into an online marketplace. In April, Groupon launched Groupon Stores, which lets brands and retailers establish a Groupon storefront at Groupon.com/stores. The program requires that products sold on the marketplace be at least 5% cheaper than elsewhere online. Groupon takes a 15% cut of marketplace sales.
“Q2 marked continued progress in Groupon’s evolution from our daily deal email roots into predominately mobile, local commerce marketplace," Lefkofsky said today during a conference call with analysts. "While our turnaround is not yet complete, we’re making headway."
In particular, Groupon aims to make its Goods business operate more efficiently by optimizing its logistics and supply chain processes, as well as its vendor relationships and operations to enable it deliver items more quickly and reduce its costs, said Rich Williams, chief operating officer.
For the second quarter ended June 30, Groupon reported:
- Revenue increased 3.1% to $738.4 from $716.2 million a year earlier.
- North American revenue of $481.3 million up 13.5% from $423.9 million.
- International sales of $257.1 million, a 12.0% dip from $292.3 million.
- Revenue for Groupon Goods of $420.5 million, an 11.2% increase from $378.1 million.
- Operating loss of $15.3 million compared to a $10.7 million loss.
- A net profit of $109.1 million compared with a year-ago loss of $22.9 million.
- Gross billings, which reflects the total amount consumers paid for Groupon vouchers, excluding applicable taxes and refunds, stood at $1.529 billion, a 1.8% increase from $1.502 billion in 2013.
For the first half of the year, Groupon reported:
- Revenue increased to $1.489 billion, up 3.0% compared with $1.445 billion in the same period in 2014.
- North American revenue of $961.2 million, a 12.4% jump from $855.0 million.
- International sales of $528.0 million, a 10.4% decline from $589.6 million.
- Groupon Goods revenue of $836.0 million, up 12.5% from $743.1 million.
- Operating loss of $32.0 million compared to a $32.5 million loss a year ago.
- A net profit of $94.8 million compared with a year-ago loss of $60.7 million.
- Gross billings stood at $3.081 billion, up 1.9% from $3.023 billion.