Groupon Slumps As Boss Leaves And Losses Widen

Shares (Berlin: DI6.BE - news) in deals website Groupon (NasdaqGS: GRPN - news) have fallen by as much as 30% after it posted a dismal set of quarterly results and ditched its chief executive.

The slump meant the company’s value dropped to less than $2bn (£1.3bn), exactly four years after it was valued at $13bn (£8.5bn) on its stock market debut.

Groupon said co-founder Eric Lefkofsky was stepping down as chief executive and returning to the role of chairman with immediate effect, to be succeeded by chief operating officer Rich Williams.

The company reported third quarter revenue flat at $714m (£465m) missing analysts’ expectations, while losses for the period widened to $28m (£18m) and its outlook worsened.

Groupon was once the leader in the online coupons market but has been struggling to boost sales as deals on web marketplaces operated by Amazon and eBay make it less attractive for shoppers.

It (Other OTC: ITGL - news) has nearly 50 million active users while more than 800,000 businesses offer deals on its website. But growth in its active customer base slowed to 4% in the third quarter from 6% in the previous period.

Groupon is trying to transform itself into an online marketplace and said the change in focus was expected to lower its revenue in the current quarter by as much as $100m (£65m).

In September, the company said it was cutting about 1,100 jobs globally as it restructures (Other OTC: UBGXF - news) .