As earnings season draws to a close, the excitement surrounding remains alive and well. Following the market close on Wednesday a number of large companies reported market-moving earnings results. In this article I would like to give investors the key metrics from the results, while providing forward-looking guidance for the remainder of the year.
Oh wait, profitability matters?
Shares of Groupon (NASDAQ: GRPN) traded higher by more than 25% early Thursday morning as the company reported its earnings after the market close on Wednesday. While the company is well off the highs seen after its initial public offering near the end of 2011, shares have done exceptionally well over the last 6 months as fears of bankruptcy no longer weigh on the minds of investors.
Groupon reported a net loss of $7.6 million, or $0.01 a share, compared to net income of $28.4 million, or $0.04 a share reported in the second quarter of last year. Revenue increased 7.2% to $609 million from $568 million a year ago. The results came in largely in line with analyst expectations, excluding items of $0.02 a share on $606 million in revenue.
The Street has realized the daily deals space isn't all that profitable, and companies that derive the majority of their revenues from this business segment have been pushed by shareholders to leverage their brand across other revenue streams. Earlier in the month Groupon announced it would be looking to make its way in the increasingly competitive online dining arena through a hybrid service. The service, Groupon Reserve, is said to be "the premiere destination for the finest things to eat, see, do and buy." Customers were welcomed to steep discounts of almost 40% to some of the best local restaurants.