Revenue for the quarter ending 30 September reached $568.6 million, an increase of 32% year-on-year, Groupon said in a statement on Thursday.
However, the figure drastically fell short of analysts’ targets of $590 million, as was predicted by Thomson Reuters I/B/E/S, sending shares plummeting by 17% to a record low of $3.25 in after-hours trading.
Overall, Groupon recorded a net loss of $3 million for the third quarter, compared with a $54 million loss during the same quarter one year ago.
Groupon’s third-quarter results suggest that its daily deal offerings and internet voucher model is declining in popularity with consumers. The four-year-old company has found it difficult to appeal to consumers outside the US.
The company posted comparatively positive results from its e-commerce site, Groupon Goods, which the company started last year and said has reached close to $500 million in annual sales.
"Our solid performance was offset by continued challenges in Europe," said Andrew Mason, Groupon’s CEO. "Groupon Goods has evolved into a second major category that our customers clearly love. With deals on everything from designer sunglasses to big-screen televisions to most-wanted toys, we think it will be a great gifting destination this holiday season."
In 2011, Groupon raised $700 million when it launched on the NASDAQ stock exchange in the largest internet-related initial public offering (IPO) since Google’s. However, according to Reuters, Groupon has now lost four-fifths of its value since its public trading debut.
Last week, the Independent reported that the jobs of around 300 Groupon workers in the UK were under threat.
“As discussed with the Independent on Friday, we have made a ‘small’ number of redundancies," Groupon said in a statement sent to Information Age.
"For clarity, this number represents fewer than 5% of our UK workforce and is nowhere near the 300 number cited in the piece. Most of the impacted positions are within the customer service division and as stated we are working to redeploy some employees to other roles within the business," it said.
According to a message acquired by the Washington Post in October, internet voucher company LivingSocial, a Groupon competitor owned by Amazon, also performed poorly during the quarter by recording a net loss of $566 million.