Groupon, Inc. ( NASDAQ: GRPN ) stock slid on Tuesday after the company posted a stark decline in revenue and reportedly reduced its headcount significantly.
The Chicago-based online marketplace reported an adjusted EPS loss of $0.34 alongside a 42.4% decline in revenue from the prior year to $153.2M. While the former figure was actually better than expected, the company could not provide forward guidance due to the “uncertain macroeconomic environment.”
"Our overall business performance is not at the levels we anticipated and we are taking decisive actions to improve our trajectory,” CEO Kedar Deshpande said. “We are significantly reducing costs, and based on the progress we're making on our initiatives to drive customer purchase frequency, we are now ready to begin reinvesting in marketing to drive growth.”
He added that the company’s current turnaround plan is projected to generate positive cash flow by the end of 2022 and improve customer retention. The company anticipates $50M in savings by the end of 2023 via its cost-cutting programs.
In terms of already apparent cost-cutting, TechCruch reported that the company laid off more than 500 of its employees on earnings day. As of its latest 10-K filing, Groupon ( GRPN ) employed 3,675 individuals, making the reduction a significant cut to overall headcount.
Shares fell 3.03% in premarket trading on Tuesday.
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Groupon stock slips on slumping revenue, staff cuts