GROUPON’S stock tumbled 17 per cent yesterday as the company was forced to re-issue its quarterly results following a deluge of disgruntled customers demanding a refund on bargain vouchers purchased online.
The discount deals website admitted to the US financial regulator that it was a further $22.6m (£14.10m) in the red in addition to the quarterly loss of $42.7m reported in its first ever results in February.
Groupon’s fourth quarter net loss is now marked at $65.4m.
Admitting to a “material weakness in its internal controls”, Groupon cut its quarterly revenues by $14.3m to $492.2m. It also downgraded its operating income – which hit positive figures last quarter for the first time since Groupon expanded overseas in mid-2010 – by $30m to a loss of $15m.
The Chicago-based company put the earnings revisions down to its recent pricier offers, which have higher refund rates.
Last year the Securities and Exchange Commission instructed Groupon to cut its reported revenues in half. The daily discount firm had previously counted the full price of a deal sale as revenue, overlooking the 50-50 income split with the local merchant.