Groupon, Inc.
Feb 20, 2014
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Groupon Announces Fourth Quarter and Fiscal Year 2013 Results

CHICAGO--(BUSINESS WIRE)-- Groupon, Inc. (NASDAQ: GRPN) today announced financial results for the quarter and fiscal year ended December 31, 2013.

"Our record performance in the quarter was led by strength in Goods, as shoppers increasingly looked to Groupon to fill their holiday needs," said Eric Lefkofsky, CEO of Groupon. "Our mobile business continued to gain momentum as our worldwide mobile transaction mix increased more than 10% in the quarter, to nearly 50% in December. With another 9 million downloads this quarter, we now have nearly 70 million app downloads to date."

"We're also excited to welcome Ticket Monster and ideeli to the Groupon family. The acquisitions bring scale, relationships, and category expertise, making Groupon an even better place to start when you want to do or buy just about anything, anytime, anywhere."

Fourth Quarter 2013 Summary

Gross billings, which reflect the total dollar value of customer purchases of goods and services, excluding applicable taxes and net of estimated refunds, increased 5% globally to $1.6 billion in the fourth quarter 2013, compared with $1.5 billion in the fourth quarter 2012. North America growth of 10% and EMEA growth of 6% was offset by an 11% decline in Rest of World.

Revenue increased 20% to $768.4 million in the fourth quarter 2013, compared with $638.3 million in the fourth quarter 2012. North America revenue growth of 18% and EMEA growth of 43% was offset by a 15% decline in Rest of World.

Gross profit increased 6%, to $378.2 million in the fourth quarter 2013, compared with $355.8 million in the fourth quarter 2012.

Adjusted EBITDA, a non-GAAP financial measure, was $72.0 million in the fourth quarter 2013, compared with $29.7 million in the fourth quarter 2012.

Operating income was $13.4 million in the fourth quarter 2013, compared with an operating loss of $12.9 million in the fourth quarter 2012.

Operating income excluding stock compensation and acquisition-related costs, net, a non-GAAP financial measure, was $47.9 million in the fourth quarter 2013, compared with $13.7 million in the fourth quarter 2012.

Fourth quarter 2013 net loss attributable to common stockholders was $81.2 million, or $0.12 per share, including stock compensation and acquisition-related costs, net, of $34.5 million ($31.0 million net of tax). Fourth quarter 2013 results include a pre-tax non-operating loss of $85.5 million ($77.8 million net of tax) related to the impairment of a minority investment in China. Earnings per share excluding this impairment charge, stock compensation and acquisition-related costs, net of tax, a non-GAAP financial measure, was $0.04 per share.

Operating cash flow for the trailing twelve months ended December 31, 2013 was $218.4 million. Free cash flow, a non-GAAP financial measure, was $158.3 million in the fourth quarter 2013, bringing free cash flow for the trailing twelve months ended December 31, 2013 to $154.9 million.

At the end of the quarter, Groupon had $1.2 billion in cash and cash equivalents.

Full Year 2013 Summary

Gross billings increased 7% globally to $5.8 billion in 2013, compared with $5.4 billion in 2012. North America growth of 20% and EMEA growth of 3% was offset by a 14% decline in Rest of World.

Revenue increased 10% to $2.6 billion in 2013, compared with $2.3 billion in 2012. North America revenue growth of 31% was offset by an 8% decline in EMEA and a 15% decline in Rest of World.

Gross profit decreased 7%, to $1.5 billion in 2013, compared with $1.6 billion in 2012.

Adjusted EBITDA, a non-GAAP financial measure, was $286.7 million in 2013, compared with $259.5 million in 2012.

Operating income was $75.8 million in 2013, compared with $98.7 million in 2012.

Operating income excluding stock compensation and acquisition-related costs, net, a non-GAAP financial measure, was $197.2 million in 2013, compared with $203.7 million in 2012.

Full year 2013 net loss attributable to common stockholders was $95.4 million, or $0.14 per share, including stock compensation and acquisition-related costs, net, of $121.5 million ($90.7 million net of tax). 2013 results include a pre-tax non-operating loss of $85.5 million ($77.8 million net of tax) related to the impairment of a minority investment in China in the fourth quarter. Earnings per share excluding this impairment charge, stock compensation and acquisition-related costs, net of tax, a non-GAAP financial measure, was $0.11 per share.

Definitions and reconciliations of all non-GAAP financial measures are included below in the section titled "Non-GAAP Financial Measures" and in the accompanying tables.

Operating Highlights

Share Repurchase Program

During the fourth quarter 2013, Groupon repurchased 3,661,900 shares of Class A common stock under its share repurchase authorization at an average price of $10.26 per share, for an aggregate purchase price of $37.6 million. During the full year 2013, Groupon repurchased 4,432,800 shares at an average price of $10.51 per share, for an aggregate purchase price of $46.6 million. Groupon is authorized to repurchase up to approximately $253.4 million of Class A common stock under the August 2013 share repurchase authorization. The program, which is intended to partially offset dilution from employee stock grants, terminates in August 2015.

Subsequent Events

On January 2, 2014, Groupon completed the acquisition of LivingSocial Korea, Inc., the holding company that owns Ticket Monster, for $100 million in cash and $163 million in Groupon Class A common stock. Ticket Monster is a leading Korean ecommerce company, with a broad range of local, travel, and product offers, and is one of the fastest growing ecommerce companies in the region.

On January 13, 2014, Groupon completed the acquisition of Ideeli, Inc. for $43 million in cash. Ideeli is a leading online flash fashion retailer, further extending Groupon's presence in fashion apparel.

Outlook

In the first quarter 2014, Groupon expects one-time costs related to the integration of its recent acquisitions, specifically as it consolidates Ticket Monster with its Korean business, and makes investments to drive ideeli growth and profitability. Together, in the first quarter, they are expected to contribute approximately $50 million to revenue, and have an approximately $20 million negative impact on Adjusted EBITDA. In addition, Groupon anticipates approximately $25 million of additional investment in marketing and other growth initiatives to drive adoption of the marketplace. As a result, for the first quarter 2014, the Company expects revenue of between $710 million and $760 million, Adjusted EBITDA of between $20 million and $40 million, and earnings per share excluding stock compensation, amortization of acquired intangibles, and acquisition-related expenses, net of tax, of between negative $0.04 and negative $0.02.

As a result of growth investments anticipated in 2014, Groupon expects Adjusted EBITDA for the full year to be slightly above 2013 levels.

Conference Call

A conference call will be webcast live today at 4:00 p.m. CT / 5:00 p.m. ET, and will be available on Groupon's investor relations website at http://investor.groupon.com. This call will contain forward-looking statements and other material information regarding the Company's financial and operating results.

Groupon encourages investors to use its investor relations website as a way of easily finding information about the company. Groupon promptly makes available on this website, free of charge, the reports that the company files or furnishes with the SEC, corporate governance information (including Groupon's Global Code of Conduct), and select press releases and social media postings.

Non-GAAP Financial Measures

In addition to financial results reported in accordance with U.S. generally accepted accounting principles (U.S. GAAP), we have provided the following non-GAAP financial measures in this release and the accompanying tables: foreign exchange rate neutral operating results, operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net, Adjusted EBITDA, free cash flow and earnings per share excluding stock-based compensation, acquisition-related expense (benefit), net, and the impairment of a minority investment in China. These non-GAAP financial measures are presented to aid investors in better understanding Groupon's performance and to facilitate comparisons to many of our peers who present similar measures. However, these measures are not intended to be a substitute for those reported in accordance with U.S. GAAP. These measures may be different from non-GAAP financial measures used by other companies, even when similar terms are used to identify such measures. For reconciliations of these measures to the most applicable financial measures under U.S. GAAP, see "Non-GAAP Reconciliation Schedules" and "Supplemental Financial Information and Business Metrics" included in the tables accompanying this release.

We exclude the following items from one or more of our non-GAAP financial measures:

Stock-based compensation. We exclude stock-based compensation because it is primarily non-cash in nature and we believe that non-GAAP financial measures excluding this item provide meaningful supplemental information about our operating performance and liquidity.

Acquisition-related expense (benefit), net. Acquisition-related expense (benefit), net is comprised of the change in the fair value of contingent consideration arrangements and, beginning in 2013, also includes external transaction costs related to business combinations, primarily consisting of legal and advisory fees. External transaction costs were not material for the prior periods presented in this release and the accompanying tables. The composition of our contingent consideration arrangements and the impact of those arrangements on our operating results vary over time based on a number of factors, including the terms of our business combinations and the timing of those transactions. We exclude acquisition-related expense (benefit), net because we believe that non-GAAP financial measures excluding this item provide meaningful supplemental information about our operating performance and facilitate comparisons to our historical operating results.

Depreciation and amortization. We exclude depreciation and amortization because it is non-cash in nature and we believe that non-GAAP financial measures excluding these items provide meaningful supplemental information about our operating performance and liquidity.

Impairment of a minority investment in China. For the three months ended December 31, 2013, we recognized an $85.5 million other-than-temporary impairment of our minority investment in Life Media Limited ("F-tuan"), an entity with operations in China. This impairment reduced the carrying value of the investment to zero as of December 31, 2013. We have excluded this impairment from our non-GAAP earnings per share measure, described below, because we believe that excluding this item provides meaningful supplemental information about our core operating performance on a per share basis and facilitates comparisons to our historical operating results.

Descriptions of the non-GAAP financial measures included in this release and the accompanying tables are as follows:

Foreign exchange rate neutral operating results show our current period operating results as if foreign currency exchange rates had remained the same as those in effect in the comparable period.

Operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net is a non-GAAP financial measure that comprises the consolidated total of the segment operating income (loss) of our three segments, North America, EMEA, and Rest of World. We have used consolidated operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net to allocate resources and evaluate performance internally. However, in recent periods, our management and Board of Directors have increasingly focused on Adjusted EBITDA, described below, as the primary non-GAAP measure for evaluating our consolidated operating results. Accordingly, we do not expect to continue to report Operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net on a consolidated basis in future periods.

Adjusted EBITDA is a non-GAAP financial measure that we define as net income (loss) excluding income taxes, interest and other non-operating items, depreciation and amortization, stock-based compensation, and acquisition-related expense (benefit), net. Adjusted EBITDA is similar to Operating income (loss) excluding stock-based compensation and acquisition-related expense (benefit), net, except Adjusted EBITDA also excludes depreciation and amortization. Our definition of Adjusted EBITDA may differ from similar measures used by other companies, even when similar terms are used to identify such measures. Adjusted EBITDA is a key measure used by our management and Board of Directors to evaluate operating performance, generate future plans and make strategic decisions regarding the allocation of capital. Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our management and Board of Directors.

Earnings per share excluding stock-based compensation, acquisition-related expense (benefit), net and the impairment of a minority investment in China is a non-GAAP financial measure that adjusts our earnings (loss) per share to exclude the impact of stock-based compensation expense, acquisition-related expense (benefit), net and the impairment of a minority investment in China, and the income tax effect of those items. We believe that this non-GAAP financial measure provides useful supplemental information for evaluating our operating performance.

Beginning in the first quarter 2014, we will be changing our non-GAAP earnings per share measure to exclude amortization of acquired intangible assets, net of tax, in addition to stock compensation and acquisition-related expenses, which we have excluded historically. Given the significant acquisition activity in January 2014 and potential acquisition activity in the future, we believe that excluding non-cash amortization of acquired intangible assets from our non-GAAP earnings per share measure in future periods will enable more meaningful comparisons with our historical results.

Free cash flow is a non-GAAP financial measure that comprises net cash provided by operating activities less purchases of property and equipment and capitalized software. We use free cash flow, and ratios based on it, to conduct and evaluate our business because, although it is similar to cash flow from operations, we believe that it typically represents a more useful measure of cash flows because purchases of fixed assets, software developed for internal use and website development costs are necessary components of our ongoing operations. Free cash flow is not intended to represent the total increase or decrease in Groupon's cash balance for the applicable period.

Note on Forward-Looking Statements

The statements contained in this release that refer to plans and expectations for the next quarter or the future are forward-looking statements that involve a number of risks and uncertainties, and actual results could differ materially from those discussed. The risks and uncertainties that could cause our results to differ materially from those included in the forward-looking statements include, but are not limited to, volatility in our revenue and operating results; risks related to our business strategy; responding to changes in the market; effectively dealing with challenges arising from our international operations; retaining existing customers and adding new customers; retaining existing merchant partners and adding new merchant partners; incurring expenses as we expand our business; competing against competitors with more financial resources than us; maintaining favorable terms with our business partners; maintaining a strong brand; managing inventory and order fulfillment; integrating our technology platforms; managing refund risks; retaining our executive team; litigation; regulations, including the CARD Act and regulation of the Internet; tax liabilities; tax legislation; maintaining our information technology infrastructure; security breaches; protecting our intellectual property; handling acquisitions, joint ventures and strategic investments effectively; seasonality; payment-related risks; customer and merchant partner fraud; global economic uncertainty; compliance with rules and regulations associated with being a public company; and our ability to raise capital if necessary. We urge you to refer to the factors included under the headings ''Risk Factors'' and ''Management's Discussion and Analysis of Financial Condition and Results of Operations'' in the company's most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, copies of which may be obtained by visiting the company's Investor Relations web site at http://investor.groupon.com or the SEC's web site at www.sec.gov. Groupon's actual results could differ materially from those predicted or implied and reported results should not be considered an indication of future performance.

You should not rely upon forward-looking statements as predictions of future events. Although Groupon believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee that the future results, levels of activity, performance or events and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, neither the company nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. The forward-looking statements reflect Groupon's expectations as of February 20, 2014. Groupon undertakes no obligation to update publicly any forward-looking statements for any reason after the date of this release to conform these statements to actual results or to changes in its expectations.

About Groupon

Groupon (NASDAQ: GRPN) is a global leader of local commerce and the place you start when you want to buy just about anything, anytime, anywhere. By leveraging the company's global relationships and scale, Groupon offers consumers a vast marketplace of unbeatable deals all over the world. Shoppers discover the best a city has to offer on the web or on mobile with Groupon Local, enjoy vacations with Groupon Getaways, and find a curated selection of electronics, fashion, home furnishings and more with Groupon Goods.

Groupon is redefining how traditional small businesses attract, retain and interact with customers by providing merchants with a suite of products and services, including customizable deal campaigns, credit card payment processing capabilities, and point-of-sale solutions that help businesses grow and operate more effectively. To search for great deals or subscribe to Groupon emails, visit www.Groupon.com. To download Groupon's five-star mobile apps, visit www.groupon.com/mobile. To learn more about the company's merchant solutions and how to work with Groupon, visit www.GrouponWorks.com.

 
Groupon, Inc.
Summary Consolidated and Segment Results
(in thousands, except share and per share amounts)
(unaudited)
                   

Three Months Ended

Y/Y %

Year Ended

Y/Y %

December 31,

Growth

December 31,

Growth
Y/Y % excluding Y/Y % excluding
2013 2012 Growth

FX Effect (2)

FX(2)

2013 2012 Growth

FX Effect (2)

FX(2)

Gross Billings (1):
North America $ 788,721 $ 718,952 9.7 % $ (564 ) 9.8 % $ 2,847,244 $ 2,373,153 20.0 % $ (1,115 ) 20.0 %
EMEA 565,713 532,481 6.2 % 18,424 2.8 % 1,983,599 1,928,508 2.9 % 37,588 0.9 %
Rest of World   238,673     269,019   (11.3 ) %   (25,873 ) (1.7 ) %   926,487     1,078,523   (14.1 ) %   (76,742 ) (7.0 ) %
Consolidated gross billings $ 1,593,107   $ 1,520,452   4.8 % $ (8,013 ) 5.3 % $ 5,757,330   $ 5,380,184   7.0 % $ (40,269 ) 7.8 %
 
Revenue:
North America $ 443,784 $ 375,351 18.2 % $ (189 ) 18.3 % $ 1,521,358 $ 1,165,700 30.5 % $ (380 ) 30.5 %
EMEA 251,205 176,278 42.5 % 8,839 37.5 % 742,915 805,476 (7.8 ) % 16,114 (9.8 ) %
Rest of World   73,458     86,673   (15.2 ) %   (8,059 ) (5.9 ) %   309,382     363,296   (14.8 ) %   (27,455 ) (7.3 ) %
Consolidated revenue $ 768,447   $ 638,302   20.4 % $ 591   20.3 % $ 2,573,655   $ 2,334,472   10.2 % $ (11,721 ) 10.7 %
 
Income (loss) from operations $ 13,352 $ (12,861 ) 203.8 % $ 3,306 178.1 % $ 75,754 $ 98,701 (23.2 ) % $ 4,042 (27.3 ) %
 
Net loss attributable to common stockholders $ (81,247 ) $ (81,089 ) $ (95,393 ) $ (67,377 )
 
Net loss per share:
Basic $ (0.12 ) $ (0.12 ) $ (0.14 ) $ (0.10 )
Diluted $ (0.12 ) $ (0.12 ) $ (0.14 ) $ (0.10 )
 
Weighted average number of shares outstanding:
Basic 668,046,073 665,678,123 663,910,194 650,214,119
Diluted 668,046,073 665,678,123 663,910,194 650,214,119
 
(1) Represents the total dollar value of customer purchases of goods and services, excluding any applicable taxes and net of estimated refunds. Includes direct billings and third party and other billings.
(2) Represents the change in financial measures that would have resulted had average exchange rates in the reporting period been the same as those in effect during the three months and year ended December 31, 2012.
 
Groupon, Inc.
Condensed Consolidated Statements of Cash Flows
(in thousands)
(unaudited)
           
Three Months Ended Year Ended
December 31,   December 31,
2013 2012 2013 2012
Operating activities
Net loss $ (78,861 ) $ (80,047 ) $ (88,946 ) $ (51,031 )
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization 24,132 15,965 89,449 55,801
Stock-based compensation 32,239 26,411 121,462 104,117
Deferred income taxes (16,830 ) (17,259 ) (18,055 ) (7,651 )
Excess tax benefits on stock-based compensation (8,338 ) (2,403 ) (20,454 ) (27,023 )
(Income) loss on equity method investments (14 ) 1,231 44 9,925
(Gain) loss, net from changes in fair value of contingent consideration (895 ) 153 (3,171 ) 897
Gain on E-Commerce transaction - - - (56,032 )
Impairment of investments 85,925 50,553 85,925 50,553
Change in assets and liabilities, net of acquisitions:
Restricted cash 2,264 (2,517 ) 2,183 (4,372 )
Accounts receivable 1,990 12,723 10,989 10,534
Prepaid expenses and other current assets (76,052 ) (45,922 ) (62,906 ) (70,859 )
Accounts payable (5,421 ) 5,537 (31,288 ) 18,711
Accrued merchant and supplier payables 160,758 96,029 88,468 149,918
Accrued expenses and other current liabilities 31,843 (20,268 ) 4,053 47,742
Other, net   25,535     25,531     40,679     35,604  
Net cash provided by operating activities 178,275 65,717 218,432 266,834
 
Net cash used in investing activities (23,330 ) (52,753 ) (96,315 ) (194,979 )
 
Net cash (used in) provided by financing activities (55,444 ) (6,495 ) (81,697 ) 12,095
 
Effect of exchange rate changes on cash and cash equivalents   1,114     1,809     (9,237 )   2,404  
Net increase in cash and cash equivalents 100,615 8,278 31,183 86,354
Cash and cash equivalents, beginning of period   1,139,857     1,201,011     1,209,289     1,122,935  
Cash and cash equivalents, end of period $ 1,240,472   $ 1,209,289   $ 1,240,472   $ 1,209,289  
 
Groupon, Inc.
Consolidated Statements of Operations
(in thousands, except share and per share amounts)
(unaudited)
           
Three Months Ended December 31, Year Ended December 31,
2013 2012 2013 2012
Revenue:
Third party and other $ 401,688 $ 413,127 $ 1,654,654 $ 1,879,729
Direct   366,759     225,175     919,001     454,743  
Total revenue   768,447     638,302     2,573,655     2,334,472  
Cost of revenue:
Third party and other 52,538 63,905 232,062 297,739
Direct   337,701     218,567     840,060     421,201  
Total cost of revenue   390,239     282,472     1,072,122     718,940  
Gross profit   378,208     355,830     1,501,533     1,615,532  
Operating expenses:
Marketing 56,505 60,913 214,824 336,854
Selling, general and administrative 306,086 307,625 1,210,966 1,179,080
Acquisition-related expense (benefit), net   2,265     153     (11 )   897  
Total operating expenses   364,856     368,691     1,425,779     1,516,831  
Income (loss) from operations 13,352 (12,861 ) 75,754 98,701
Income (loss) on equity method investments 14 (1,231 ) (44 ) (9,925 )
Other (expense) income, net   (84,847 )   (48,279 )   (94,619 )   6,166  
(Loss) income before provision for income taxes (71,481 ) (62,371 ) (18,909 ) 94,942
Provision for income taxes   7,380     17,676     70,037     145,973  
Net loss (78,861 ) (80,047 ) (88,946 ) (51,031 )
Net income attributable to noncontrolling interests   (2,386 )   (936 )   (6,447 )   (3,742 )
Net loss attributable to Groupon, Inc. (81,247 ) (80,983 ) (95,393 ) (54,773 )
Adjustment of redeemable noncontrolling interests to redemption value   -     (106 )   -     (12,604 )
Net loss attributable to common stockholders $ (81,247 ) $ (81,089 ) $ (95,393 ) $ (67,377 )
 
Net loss per share
Basic $ (0.12 ) $ (0.12 ) $ (0.14 ) $ (0.10 )
Diluted $ (0.12 ) $ (0.12 ) $ (0.14 ) $ (0.10 )
 
Weighted average number of shares outstanding
Basic 668,046,073 665,678,123 663,910,194 650,214,119
Diluted 668,046,073 665,678,123 663,910,194 650,214,119
 
Groupon, Inc.
Consolidated Balance Sheets
(in thousands, except share and per share amounts)
       
December 31, 2013 December 31, 2012
(unaudited)
Assets
Current assets:
Cash and cash equivalents $ 1,240,472 $ 1,209,289
Accounts receivable, net 83,673 96,713
Deferred income taxes 27,938 31,211
Prepaid expenses and other current assets   210,415     150,573  
Total current assets 1,562,498 1,487,786
Property, equipment and software, net 134,423 121,072
Goodwill 220,827 206,684
Intangible assets, net 28,443 42,597
Investments 20,652 84,209
Deferred income taxes, non-current 35,941 29,916
Other non-current assets   39,226     59,210  
Total Assets $ 2,042,010   $ 2,031,474  
Liabilities and Equity
Current liabilities:
Accounts payable $ 27,573 $ 59,865
Accrued merchant and supplier payables 752,943 671,305
Accrued expenses 226,986 246,924
Deferred income taxes 47,558 53,700
Other current liabilities   132,718     136,647  
Total current liabilities 1,187,778 1,168,441
Deferred income taxes, non-current 10,853 20,860
Other non-current liabilities   131,697     100,072  
Total Liabilities   1,330,328     1,289,373  
Commitments and contingencies
Stockholders' Equity
Class A common stock, par value $0.0001 per share, 2,000,000,000 shares authorized, 670,149,976 shares issued and 665,717,176 shares outstanding at December 31, 2013 and 654,523,706 shares issued and outstanding at December 31, 2012 67 65
Class B common stock, par value $0.0001 per share, 10,000,000 shares authorized, 2,399,976 shares issued and outstanding at December 31, 2013 and December 31, 2012 - -
Common stock, par value $0.0001 per share, 2,010,000,000 shares authorized, no shares issued and outstanding at December 31, 2013 and December 31, 2012 - -
Additional paid-in capital 1,584,211 1,485,006
Treasury stock, at cost, 4,432,800 shares at December 31, 2013 and no shares at December 31, 2012 (46,587 ) -
Accumulated deficit (848,870 ) (753,477 )
Accumulated other comprehensive income   24,830     12,446  
Total Groupon, Inc. Stockholders' Equity 713,651 744,040
Noncontrolling interests   (1,969 )   (1,939 )
Total Equity   711,682     742,101  
Total Liabilities and Equity $ 2,042,010   $ 2,031,474  
 
Groupon, Inc.
Segment Information
(in thousands)
(unaudited)
         
Three Months Ended December 31, Year Ended December 31,
2013 2012 2013 2012
North America

Gross Billings (1)

$ 788,721 $ 718,952 $ 2,847,244 $ 2,373,153
Revenue $ 443,784 $ 375,351 $ 1,521,358 $ 1,165,700
Segment cost of revenue and operating expenses(2)(3)   418,214     358,319     1,380,746     1,025,974  
Segment operating income(2)(3) $ 25,570 $ 17,032 $ 140,612 $ 139,726
Segment operating income as a percent of segment revenue 5.8 % 4.5 % 9.2 % 12.0 %
 
EMEA
Gross Billings (1) $ 565,713 $ 532,481 $ 1,983,599 $ 1,928,508
Revenue $ 251,205 $ 176,278 $ 742,915 $ 805,476
Segment cost of revenue and operating expenses(2)(3)   214,187     167,502     631,409     699,470  
Segment operating income(2)(3) $ 37,018 $ 8,776 $ 111,506 $ 106,006
Segment operating income as a percent of segment revenue 14.7 % 5.0 % 15.0 % 13.2 %
 
Rest of World
Gross Billings (1) $ 238,673 $ 269,019 $ 926,487 $ 1,078,523
Revenue $ 73,458 $ 86,673 $ 309,382 $ 363,296
Segment cost of revenue and operating expenses(2)   88,190     98,778     364,295     405,313  
Segment operating loss(2) $ (14,732 ) $ (12,105 ) $ (54,913 ) $ (42,017 )
Segment operating loss as a percent of segment revenue (20.1 ) % (14.0 ) % (17.7 ) % (11.6 ) %
 
Consolidated
Gross Billings (1) $ 1,593,107 $ 1,520,452 $ 5,757,330 $ 5,380,184
Revenue $ 768,447 $ 638,302 $ 2,573,655 $ 2,334,472
Segment cost of revenue and operating expenses(2)   720,591     624,599     2,376,450     2,130,757  
Segment operating income(2) $ 47,856 $ 13,703 $ 197,205 $ 203,715
Segment operating income as a percent of segment revenue 6.2 % 2.1 % 7.7 % 8.7 %
 
Stock-based compensation 32,239 26,411 121,462 104,117
Acquisition-related expense (benefit), net   2,265     153     (11 )   897  
Income (loss) from operations 13,352 (12,861 ) 75,754 98,701
(Income) loss on equity method investments (14 ) 1,231 44 9,925
Other expense (income), net   84,847     48,279     94,619     (6,166 )
(Loss) income before provision for income taxes (71,481 ) (62,371 ) (18,909 ) 94,942
Provision for income taxes   7,380     17,676     70,037     145,973  
Net loss $ (78,861 ) $ (80,047 ) $ (88,946 ) $ (51,031 )
 
(1) Represents the total dollar value of customer purchases of goods and services, excluding any applicable taxes and net of estimated refunds. Includes direct billings and third party and other billings.
(2) Segment cost of revenue and operating expenses and segment operating income (loss) exclude stock-based compensation and acquisition-related expense (benefit), net.
(3) We record intercompany cross-charges every period for services provided by the United States to our international subsidiaries. We updated our intercompany allocations for those charges during the fourth quarter of 2012, which resulted in a one-time $8.5 million decrease to EMEA Segment operating expenses (increase to EMEA Segment operating income) and a corresponding increase to North America Segment operating expenses (reduction to North America Segment operating income).
 
Groupon, Inc.
Non-GAAP Reconciliation Schedules
(in thousands, except share and per share amounts)
(unaudited)
 
The following are reconciliations of diluted earnings per share excluding stock-based compensation, acquisition-related expense (benefit), net and the impairment of a minority investment in China and foreign exchange rate neutral operating results to the most comparable U.S. GAAP financial measures. See "Supplemental Financial Information and Business Metrics" for reconciliations of Adjusted EBITDA, operating income excluding stock-based compensation and acquisition-related (expense) benefit, net and free cash flow to the most comparable U.S. GAAP financial measures.
 
 
The following is a reconciliation of diluted net loss per share to diluted earnings per share excluding stock-based compensation, acquisition-related expense (benefit), net and the impairment of Life Media Limited (F-tuan), a minority investment in China, for the three months and year ended December 31, 2013:
    Three Months Ended     Year Ended
December 31, 2013 December 31, 2013
Net loss attributable to common stockholders $ (81,247 ) $ (95,393 )
Stock-based compensation 32,239 121,462
Acquisition-related expense (benefit), net 2,265 (11 )
Impairment of investment in F-tuan 85,521 85,521
Income tax effect of adjustments   (11,301 )   (38,504 )
Net income attributable to common stockholders excluding stock-based compensation,
acquisition-related expense (benefit), net and impairment of investment in F-tuan $ 27,477   $ 73,075  
 
Diluted shares 668,046,073 663,910,194
Incremental diluted shares (1)   16,685,634     15,501,759  
Adjusted diluted shares   684,731,707     679,411,953  
 
Diluted net loss per share $ (0.12 ) $ (0.14 )
Impact of stock-based compensation, acquisition-related expense
(benefit), net and impairment of investment in F-tuan and the related income tax effects   0.16     0.25  
Diluted earnings per share excluding stock-based compensation,
acquisition-related expense (benefit), net and impairment of investment in F-tuan $ 0.04   $ 0.11  
(1) Outstanding equity awards are not reflected in the diluted net loss per share calculation for the three months and year ended December 31, 2013 because the effect would be antidilutive. However, those awards have been reflected in the calculation of diluted earnings per share excluding stock-based compensation, acquisition-related expense (benefit), net and the impairment of a minority investment in China for the three months and year ended December 31, 2013 because they have a dilutive effect on that calculation.
 
 
The following are reconciliations of foreign exchange rate neutral operating results to the most comparable U.S. GAAP financial measures, "Gross Billings," "Revenue" and "Income from operations," for the three months and year ended December 31, 2013.
 
The effect on the Company's gross billings, revenue and income from operations from changes in exchange rates versus the U.S. Dollar for the three months ended December 31, 2013 was as follows:
    Three Months Ended December 31, 2013     Three Months Ended December 31, 2013
At Avg.   Exchange   At Avg.   Exchange  
Q4 2012 Rate As Q3 2013 Rate As

Rates (1)

Effect (2)

Reported

Rates (3)

Effect (2)

Reported
Gross billings $ 1,601,120 $ (8,013 ) $ 1,593,107 $ 1,578,913 $ 14,194 $ 1,593,107
Revenue $ 767,856 $ 591 $ 768,447 $ 762,153 $ 6,294 $ 768,447
Income from operations $ 10,046 $ 3,306 $ 13,352 $ 12,184 $ 1,168 $ 13,352
 
The effect on the Company's gross billings, revenue and income from operations from changes in exchange rates versus the U.S. Dollar for the year ended December 31, 2013 was as follows:
 
Year Ended December 31, 2013 Year Ended December 31, 2013
At Avg. Exchange At Avg. Exchange
2012 Rate As Q4'12 - Q3'13 Rate As

Rates (1)

Effect (2)

Reported

Rates (3)

Effect (2)

Reported
Gross billings $ 5,797,599 $ (40,269 ) $ 5,757,330 $ 5,765,679 $ (8,349 ) $ 5,757,330
Revenue $ 2,585,376 $ (11,721 ) $ 2,573,655 $ 2,574,687 $ (1,032 ) $ 2,573,655
Income from operations $ 71,712 $ 4,042 $ 75,754 $ 75,009 $ 745 $ 75,754
(1) Represents the financial statement balances that would have resulted had average exchange rates in the reported period been the same as those in effect during the three months and year ended December 31, 2012.
(2) Represents the increase or decrease in reported amounts resulting from changes in exchange rates from those in effect in the comparable period.
(3) Represents the financial statement balances that would have resulted had average exchange rates in the reported period been the same as those in effect during the three and twelve months ended September 30, 2013.
 
Groupon, Inc.
Supplemental Financial Information and Business Metrics(14)
(financial data in thousands, except per share data; active customers in millions)
(unaudited)
 
Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013
Segments
North America Segment

Gross Billings (1)

Local (2) Gross Billings
Third Party $ 430,255 $ 450,140 $ 449,770 $ 401,756 $ 436,705
Direct   -     -     693     1,040     39  
Total Local Gross Billings $ 430,255 $ 450,140 $ 450,463 $ 402,796 $ 436,744
Goods Gross Billings
Third Party $ 31,270 $ 17,294 $ 15,501 $ 12,650 $ 23,373
Direct   209,575     148,065     181,377     181,915     262,666  
Total Goods Gross Billings $ 240,845 $ 165,359 $ 196,878 $ 194,565 $ 286,039
Travel and Other Gross Billings
Third Party and Other $ 47,852 $ 65,820 $ 64,864 $ 67,638 $ 65,938
Direct   -     -     -     -     -  
Total Travel and Other Gross Billings $ 47,852 $ 65,820 $ 64,864 $ 67,638 $ 65,938
Total Gross Billings
Third Party and Other $ 509,377 $ 533,254 $ 530,135 $ 482,044 $ 526,016
Direct   209,575     148,065     182,070     182,955     262,705  
Total Gross Billings $ 718,952 $ 681,319 $ 712,205 $ 664,999 $ 788,721
Year-over-year growth 51 % 23 % 30 % 20 % 10 %
% of Consolidated Gross Billings 47 % 48 % 50 % 50 % 50 %
Gross Billings Trailing Twelve Months (TTM) $ 2,373,153 $ 2,500,915 $ 2,664,845 $ 2,777,475 $ 2,847,244
 
Revenue (3)
Local Revenue
Third Party $ 142,454 $ 171,593 $ 174,117 $ 158,189 $ 159,175
Direct   -     -     693     1,040     39  
Total Local Revenue $ 142,454 $ 171,593 $ 174,810 $ 159,229 $ 159,214
Goods Revenue
Third Party $ 11,877 $ 3,144 $ 4,651 $ 3,999 $ 5,615
Direct   209,575     148,065     181,377     181,915     262,666  
Total Goods Revenue $ 221,452 $ 151,209 $ 186,028 $ 185,914 $ 268,281
Travel and Other Revenue
Third Party and Other $ 11,445 $ 16,752 $ 16,344 $ 15,695 $ 16,289
Direct   -     -     -     -     -  
Total Travel and Other Revenue $ 11,445 $ 16,752 $ 16,344 $ 15,695 $ 16,289
Total Revenue
Third Party and Other Revenue $ 165,776 $ 191,489 $ 195,112 $ 177,883 $ 181,079
Direct Revenue   209,575     148,065     182,070     182,955     262,705  
Total Revenue $ 375,351 $ 339,554 $ 377,182 $ 360,838 $ 443,784
Year-over-year growth 109 % 42 % 45 % 24 % 18 %
% of Consolidated Revenue 59 % 56 % 62 % 61 % 58 %
Revenue TTM $ 1,165,700 $ 1,266,689 $ 1,383,690 $ 1,452,925 $ 1,521,358
 
Cost of Revenue (4)
Local Cost of Revenue
Third Party $ 23,203 $ 25,915 $ 19,818 $ 18,985 $ 17,918
Direct   -     -     636     1,887     31  
Total Local Cost of Revenue $ 23,203 $ 25,915 $ 20,454 $ 20,872 $ 17,949
Goods Cost of Revenue
Third Party $ 1,935 $ 475 $ 522 $ 480 $ 613
Direct   196,789     138,278     158,529     163,825     246,638  
Total Goods Cost of Revenue $ 198,724 $ 138,753 $ 159,051 $ 164,305 $ 247,251
Travel and Other Cost of Revenue
Third Party and Other $ 1,864 $ 2,530 $ 3,091 $ 4,092 $ 4,258
Direct   -     -     -     -     -  
Total Travel and Other Cost of Revenue $ 1,864 $ 2,530 $ 3,091 $ 4,092 $ 4,258
Total Cost of Revenue
Third Party and Other Cost of Revenue $ 27,002 $ 28,920 $ 23,431 $ 23,557 $ 22,789
Direct Cost of Revenue   196,789     138,278     159,165     165,712     246,669  
Total Cost of Revenue $ 223,791 $ 167,198 $ 182,596 $ 189,269 $ 269,458
% of North America Total Revenue 60 % 49 % 48 % 52 % 61 %
 
Gross Profit
Local Gross Profit
Third Party $ 119,251 $ 145,678 $ 154,299 $ 139,204 $ 141,257
Direct   -     -     57     (847 )   8  
Total Local Gross Profit $ 119,251 $ 145,678 $ 154,356 $ 138,357 $ 141,265
% of North America Total Local Revenue 83.7 % 84.9 % 88.3 % 86.9 % 88.7 %
% of North America Total Local Gross Billings 27.7 % 32.4 % 34.3 % 34.3 % 32.3 %
Goods Gross Profit
Third Party $ 9,942 $ 2,669 $ 4,129 $ 3,519 $ 5,002
Direct   12,786     9,787     22,848     18,090     16,028  
Total Goods Gross Profit $ 22,728 $ 12,456 $ 26,977 $ 21,609 $ 21,030
% of North America Total Goods Revenue 10.3 % 8.2 % 14.5 % 11.6 % 7.8 %
% of North America Total Goods Gross Billings 9.4 % 7.5 % 13.7 % 11.1 % 7.4 %
Travel and Other Gross Profit
Third Party and Other $ 9,581 $ 14,222 $ 13,253 $ 11,603 $ 12,031
Direct   -     -     -     -     -  
Total Travel and Other Gross Profit $ 9,581 $ 14,222 $ 13,253 $ 11,603 $ 12,031
% of North America Total Travel and Other Revenue 83.7 % 84.9 % 81.1 % 73.9 % 73.9 %
% of North America Total Travel and Other Gross Billings 20.0 % 21.6 % 20.4 % 17.2 % 18.2 %
Total Gross Profit
Third Party and Other $ 138,774 $ 162,569 $ 171,681 $ 154,326 $ 158,290
Direct   12,786     9,787     22,905     17,243     16,036  
Total Gross Profit $ 151,560 $ 172,356 $ 194,586 $ 171,569 $ 174,326
% of North America Total Revenue 40.4 % 50.8 % 51.6 % 47.5 % 39.3 %
% of North America Total Gross Billings 21.1 % 25.3 % 27.3 % 25.8 % 22.1 %
 
Operating Income Excl Stock-Based Compensation (SBC), Acquisition-Related Expense (Benefit), net $ 17,032 $ 41,366 $ 48,508 $ 25,168 $ 25,570
Year-over-year growth (7 ) % 3 % 12 % (36 ) % 50 %
% of Consolidated Operating Income Excl SBC, Acq-Related 124 % 81 % 82 % 64 % 53 %
Operating Margin Excl SBC, Acq-Related (% of North America Total revenue) 4.5 % 12.2 % 12.9 % 7.0 % 5.8 %
Year-over-year growth (bps) (570 ) (460 ) (380 ) (640 ) 130
Operating Income TTM Excl SBC, Acq-Related $ 139,726 $ 140,920 $ 145,999 $ 132,074 $ 140,612
Operating Margin TTM Excl SBC, Acq-Related (% of North America Total TTM revenue) 12.0 % 11.1 % 10.6 % 9.1 % 9.2 %
Year-over-year growth (bps) 1,120 200 (380 ) (540 ) (280 )
EMEA Segment
Gross Billings
Local Gross Billings
Third Party $ 239,944 $ 259,423 $ 241,108 $ 207,110 $ 276,670
Direct   -     -     -     -     -  
Total Local Gross Billings $ 239,944 $ 259,423 $ 241,108 $ 207,110 $ 276,670
Goods Gross Billings
Third Party $ 195,582 $ 141,742 $ 165,413 $ 160,578 $ 122,902
Direct   9,020     7,451     2,181     9,271     96,978  
Total Goods Gross Billings $ 204,602 $ 149,193 $ 167,594 $ 169,849 $ 219,880
Travel and Other Gross Billings
Third Party and Other $ 87,935 $ 83,702 $ 73,548 $ 66,359 $ 69,163
Direct   -     -     -     -     -  
Total Travel and Other Gross Billings $ 87,935 $ 83,702 $ 73,548 $ 66,359 $ 69,163
Total Gross Billings
Third Party and Other $ 523,461 $ 484,867 $ 480,069 $ 434,047 $ 468,735
Direct   9,020     7,451     2,181     9,271     96,978  
Total Gross Billings $ 532,481 $ 492,318 $ 482,250 $ 443,318 $ 565,713
Year-over-year growth 2 % (8 ) % 4 % 12 % 6 %
Year-over-year growth, excluding FX (5) 4 % (9 ) % 4 % 9 % 3 %
% of Consolidated Gross Billings 35 % 35 % 34 % 33 % 36 %
Gross Billings TTM $ 1,928,507 $ 1,883,265 $ 1,903,136 $ 1,950,367 $ 1,983,599
 
Revenue
Local Revenue
Third Party $ 98,668 $ 110,715 $ 109,481 $ 91,448 $ 115,259
Direct   -     -     -     -     -  
Total Local Revenue $ 98,668 $ 110,715 $ 109,481 $ 91,448 $ 115,259
Goods Revenue
Third Party $ 49,173 $ 45,875 $ 32,938 $ 32,008 $ 22,296
Direct   9,020     7,451     2,181     9,271     96,978  
Total Goods Revenue $ 58,193 $ 53,326 $ 35,119 $ 41,279 $ 119,274
Travel and Other Revenue
Third Party and Other $ 19,417 $ 19,757 $ 15,362 $ 15,223 $ 16,672
Direct   -     -     -     -     -  
Total Travel and Other Revenue $ 19,417 $ 19,757 $ 15,362 $ 15,223 $ 16,672
Total Revenue
Third Party and Other Revenue $ 167,258 $ 176,347 $ 157,781 $ 138,679 $ 154,227
Direct Revenue   9,020     7,451     2,181     9,271     96,978  
Total Revenue $ 176,278 $ 183,798 $ 159,962 $ 147,950 $ 251,205
Year-over-year growth (27 ) % (20 ) % (24 ) % (21 ) % 43 %
Year-over-year growth, excluding FX(5) (25 ) % (20 ) % (25 ) % (23 ) % 38 %
% of Consolidated Revenue 28 % 31 % 26 % 25 % 33 %
Revenue TTM $ 805,476 $ 758,918 $ 707,325 $ 667,988 $ 742,915
 
Cost of Revenue
Local Cost of Revenue
Third Party $ 10,622 $ 14,192 $ 10,898 $ 10,254 $ 10,374
Direct   -     -     -     -     -  
Total Local Cost of Revenue $ 10,622 $ 14,192 $ 10,898 $ 10,254 $ 10,374
Goods Cost of Revenue
Third Party $ 5,294 $ 5,880 $ 4,705 $ 3,972 $ 2,203
Direct   14,550     7,472     3,306     8,364     83,545  
Total Goods Cost of Revenue $ 19,844 $ 13,352 $ 8,011 $ 12,336 $ 85,748
Travel and Other Cost of Revenue
Third Party and Other $ 2,090 $ 2,533 $ 1,522 $ 1,679 $ 1,890
Direct   -     -     -     -     -  
Total Travel and Other Cost of Revenue $ 2,090 $ 2,533 $ 1,522 $ 1,679 $ 1,890
Total Cost of Revenue
Third Party and Other Cost of Revenue $ 18,006 $ 22,605 $ 17,125 $ 15,905 $ 14,467

Direct Cost of Revenue

  14,550     7,472     3,306     8,364     83,545  
Total Cost of Revenue $ 32,556 $ 30,077 $ 20,431 $ 24,269 $ 98,012
% of EMEA Total Revenue 18 % 16 % 13 % 16 % 39 %
 
Gross Profit
Local Gross Profit
Third Party $ 88,046 $ 96,523 $ 98,583 $ 81,194 $ 104,885
Direct   -     -     -     -     -  
Total Local Gross Profit $ 88,046 $ 96,523 $ 98,583 $ 81,194 $ 104,885
% of EMEA Total Local Revenue 89.2 % 87.2 % 90.0 % 88.8 % 91.0 %
% of EMEA Total Local Gross Billings 36.7 % 37.2 % 40.9 % 39.2 % 37.9 %
Goods Gross Profit
Third Party $ 43,879 $ 39,995 $ 28,233 $ 28,036 $ 20,093
Direct   (5,530 )   (21 )   (1,125 )   907     13,433  
Total Goods Gross Profit $ 38,349 $ 39,974 $ 27,108 $ 28,943 $ 33,526
% of EMEA Total Goods Revenue 65.9 % 75.0 % 77.2 % 70.1 % 28.1 %
% of EMEA Total Goods Gross Billings 18.7 % 26.8 % 16.2 % 17.0 % 15.2 %
Travel and Other Gross Profit
Third Party and Other $ 17,327 $ 17,224 $ 13,840 $ 13,544 $ 14,782
Direct   -     -     -     -     -  
Total Travel and Other Gross Profit $ 17,327 $ 17,224 $ 13,840 $ 13,544 $ 14,782
% of EMEA Total Travel and Other Revenue 89.2 % 87.2 % 90.1 % 89.0 % 88.7 %
% of EMEA Total Travel and Other Gross Billings 19.7 % 20.6 % 18.8 % 20.4 % 21.4 %
Total Gross Profit
Third Party and Other $ 149,252 $ 153,742 $ 140,656 $ 122,774 $ 139,760
Direct   (5,530 )   (21 )   (1,125 )   907     13,433  
Total Gross Profit $ 143,722 $ 153,721 $ 139,531 $ 123,681 $ 153,193

% of EMEA Total Revenue

81.5 % 83.6 % 87.2 % 83.6 % 61.0 %
% of EMEA Total Gross Billings 27.0 % 31.2 % 28.9 % 27.9 % 27.1 %
 
Operating Income Excl SBC, Acq-Related $ 8,776 $ 34,176 $ 24,708 $ 15,604 $ 37,018
Year-over-year growth (77 ) % (6 ) % (22 ) % (46 ) % 322 %
% of Consolidated Operating Income Excl SBC, Acq-Related 64 % 67 % 42 % 40 % 77 %
Operating Margin Excl SBC, Acq-Related (% of EMEA Total revenue) 5.0 % 18.6 % 15.4 % 10.5 % 14.7 %
Year-over-year growth (bps) (1,073 ) 282 40 (500 ) 970
Operating Income TTM Excl SBC, Acq-Related $ 106,005 $ 103,853 $ 96,767 $ 83,264 $ 111,506
Operating Margin TTM Excl SBC, Acq-Related (% of EMEA Total TTM revenue) 13.2 % 13.7 % 13.7 % 12.5 % 15.0 %
Year-over-year growth (bps)(6) N/A (13 ) (132 ) (300 ) 180
Rest of World Segment
Gross Billings
Local Gross Billings
Third Party $ 128,954 $ 119,990 $ 114,630 $ 118,325 $ 116,291
Direct   -     -     -     -     -  
Total Local Gross Billings $ 128,954 $ 119,990 $ 114,630 $ 118,325 $ 116,291
Goods Gross Billings
Third Party $ 89,475 $ 70,994 $ 66,774 $ 71,127 $ 82,375
Direct   6,581     6,778     5,625     7,846     7,076  
Total Goods Gross Billings $ 96,056 $ 77,772 $ 72,399 $ 78,973 $ 89,451
Travel and Other Gross Billings
Third Party and Other $ 44,009 $ 36,370 $ 32,322 $ 37,033 $ 32,931
Direct   -     -     -     -     -  
Total Travel and Other Gross Billings $ 44,009 $ 36,370 $ 32,322 $ 37,033 $ 32,931
Total Gross Billings
Third Party and Other $ 262,438 $ 227,354 $ 213,726 $ 226,485 $ 231,597
Direct   6,581     6,778     5,625     7,846     7,076  
Total Gross Billings $ 269,019 $ 234,132 $ 219,351 $ 234,331 $ 238,673
Year-over-year growth 17 % (11 ) % (21 ) % (13 ) % (11 ) %
Year-over-year growth, excluding FX 20 % (6 ) % (16 ) % (4 ) % (2 ) %
% of Consolidated Gross Billings 18 % 17 % 16 % 17 % 15 %
Gross Billings TTM $ 1,078,524 $ 1,048,973 $ 992,302 $ 956,833 $ 926,487
 
Revenue
Local Revenue
Third Party $ 46,166 $ 45,085 $ 43,323 $ 51,507 $ 40,314
Direct   -     -     -     -     -  
Total Local Revenue $ 46,166 $ 45,085 $ 43,323 $ 51,507 $ 40,314
Goods Revenue
Third Party $ 25,529 $ 18,062 $ 14,985 $ 17,215 $ 19,082
Direct   6,580     6,778     5,625     7,846     7,076  
Total Goods Revenue $ 32,109 $ 24,840 $ 20,610 $ 25,061 $ 26,158
Travel and Other Revenue
Third Party and Other $ 8,398 $ 8,125 $ 7,670 $ 9,703 $ 6,986
Direct   -     -     -     -     -  
Total Travel and Other Revenue $ 8,398 $ 8,125 $ 7,670 $ 9,703 $ 6,986
Total Revenue
Third Party and Other Revenue $ 80,093 $ 71,272 $ 65,978 $ 78,425 $ 66,382
Direct Revenue   6,580     6,778     5,625     7,846     7,076  
Total Revenue $ 86,673 $ 78,050 $ 71,603 $ 86,271 $ 73,458
Year-over-year growth 20 % (14 ) % (26 ) % (4 ) % (15 ) %
Year-over-year growth, excluding FX 23 % (8 ) % (21 ) % 7 % (6 ) %
% of Consolidated Revenue 14 % 13 % 12 % 14 % 10 %
Revenue TTM $ 363,296 $ 350,984 $ 325,988 $ 322,597 $ 309,382
 
Cost of Revenue
Local Cost of Revenue
Third Party $ 9,801 $ 5,923 $ 7,962 $ 7,403 $ 7,158
Direct   -     -     -     -     -  
Total Local Cost of Revenue $ 9,801 $ 5,923 $ 7,962 $ 7,403 $ 7,158
Goods Cost of Revenue
Third Party $ 7,264 $ 11,501 $ 5,569 $ 5,685 $ 6,890
Direct   7,228     6,627     6,075     7,360     7,487  
Total Goods Cost of Revenue $ 14,492 $ 18,128 $ 11,644 $ 13,045 $ 14,377
Travel and Other Cost of Revenue
Third Party and Other $ 1,832 $ 1,067 $ 1,420 $ 1,451 $ 1,234
Direct   -     -     -     -     -  
Total Travel and Other Cost of Revenue $ 1,832 $ 1,067 $ 1,420 $ 1,451 $ 1,234
Total Cost of Revenue
Third Party and Other Cost of Revenue $ 18,897 $ 18,491 $ 14,951 $ 14,539 $ 15,282

Direct Cost of Revenue

  7,228     6,627     6,075     7,360     7,487  
Total Cost of Revenue $ 26,125 $ 25,118 $ 21,026 $ 21,899 $ 22,769
% of Rest of World Total Revenue 30 % 32 % 29 % 25 % 31 %
 
Gross Profit
Local Gross Profit
Third Party $ 36,365 $ 39,162 $ 35,361 $ 44,104 $ 33,156
Direct   -     -     -     -     -  
Total Local Gross Profit $ 36,365 $ 39,162 $ 35,361 $ 44,104 $ 33,156
% of Rest of World Total Local Revenue 78.8 % 86.9 % 81.6 % 85.6 % 82.2 %
% of Rest of World Total Local Gross Billings 28.2 % 32.6 % 30.8 % 37.3 % 28.5 %
Goods Gross Profit
Third Party $ 18,265 $ 6,561 $ 9,416 $ 11,530 $ 12,192
Direct   (648 )   151     (450 )   486     (411 )
Total Goods Gross Profit $ 17,617 $ 6,712 $ 8,966 $ 12,016 $ 11,781
% of Rest of World Total Goods Revenue 54.9 % 27.0 % 43.5 % 47.9 % 45.0 %
% of Rest of World Total Goods Gross Billings 18.3 % 8.6 % 12.4 % 15.2 % 13.2 %
Travel and Other Gross Profit
Third Party and Other $ 6,566 $ 7,058 $ 6,250 $ 8,252 $ 5,752
Direct   -     -     -     -     -  
Total Travel and Other Gross Profit $ 6,566 $ 7,058 $ 6,250 $ 8,252 $ 5,752
% of Rest of World Total Travel and Other Revenue 78.2 % 86.9 % 81.5 % 85.0 % 82.3 %
% of Rest of World Total Travel and Other Gross Billings 14.9 % 19.4 % 19.3 % 22.3 % 17.5 %
Total Gross Profit
Third Party and Other $ 61,196 $ 52,781 $ 51,027 $ 63,886 $ 51,100
Direct   (648 )   151     (450 )   486     (411 )
Total Gross Profit $ 60,548 $ 52,932 $ 50,577 $ 64,372 $ 50,689
% of Rest of World Total Revenue 69.9 % 67.8 % 70.6 % 74.6 % 69.0 %
% of Rest of World Total Gross Billings 22.5 % 22.6 % 23.1 % 27.5 % 21.2 %
 
Operating Loss Excl SBC, Acq-Related $ (12,105 ) $ (24,389 ) $ (14,173 ) $ (1,619 ) $ (14,732 )
Year-over-year growth (68 ) % 174 % (331 ) % 91 % (22 ) %
% of Consolidated Operating Income Excl SBC, Acq-Related (88 ) % (48 ) % (24 ) % (4 ) % (31 ) %
Operating Margin Excl SBC, Acq-Related (% of Rest of World Total revenue) (14.0 ) % (31.2 ) % (19.8 ) % (1.9 ) % (20.1 ) %
Year-over-year growth (bps) 3,848 (2,139 ) (1,640 ) 1,790 (610 )
Operating Loss TTM Excl SBC, Acq-Related $ (42,016 ) $ (57,495 ) $ (68,379 ) $ (52,286 ) $ (54,913 )
Operating Margin TTM Excl SBC, Acq-Related (% of Rest of World Total TTM revenue) (11.6 ) % (16.4 ) % (21.0 ) % (16.2 ) % (17.7 ) %
Year-over-year growth (bps)(6) N/A 3,590 788 330 (610 )
Consolidated Results of Operations
Gross Billings
Local Gross Billings
Third Party $ 799,153 $ 829,553 $ 805,508 $ 727,191 $ 829,666
Direct   -     -     693     1,040     39  
Total Local Gross Billings $ 799,153 $ 829,553 $ 806,201 $ 728,231 $ 829,705
Goods Gross Billings
Third Party $ 316,327 $ 230,030 $ 247,688 $ 244,355 $ 228,650
Direct   225,176     162,294     189,183     199,032     366,720  
Total Goods Gross Billings $ 541,503 $ 392,324 $ 436,871 $ 443,387 $ 595,370
Travel and Other Gross Billings
Third Party and Other $ 179,796 $ 185,892 $ 170,734 $ 171,030 $ 168,032
Direct   -     -     -     -     -  
Total Travel and Other Gross Billings $ 179,796 $ 185,892 $ 170,734 $ 171,030 $ 168,032
Total Gross Billings
Third Party and Other $ 1,295,276 $ 1,245,475 $ 1,223,930 $ 1,142,576 $ 1,226,348
Direct   225,176     162,294     189,876     200,072     366,759  
Total Gross Billings $ 1,520,452 $ 1,407,769 $ 1,413,806 $ 1,342,648 $ 1,593,107
Year-over-year growth 24 % 4 % 10 % 10 % 5 %
Year-over-year growth, excluding FX 25 % 5 % 11 % 11 % 5 %
Gross Billings (TTM) $ 5,380,184 $ 5,433,153 $ 5,560,283 $ 5,684,675 $ 5,757,330
Year-over-year growth 35 % 16 % 11 % 12 % 7 %
 
Revenue
Local Revenue
Third Party $ 287,288 $ 327,393 $ 326,921 $ 301,144 $ 314,748
Direct   -     -     693     1,040     39  
Total Local Revenue $ 287,288 $ 327,393 $ 327,614 $ 302,184 $ 314,787
Goods Revenue
Third Party $ 86,579 $ 67,081 $ 52,574 $ 53,222 $ 46,993
Direct   225,175     162,294     189,183     199,032     366,720  
Total Goods Revenue $ 311,754 $ 229,375 $ 241,757 $ 252,254 $ 413,713
Travel and Other Revenue
Third Party and Other $ 39,260 $ 44,634 $ 39,376 $ 40,621 $ 39,947
Direct   -     -     -     -     -  
Total Travel and Other Revenue $ 39,260 $ 44,634 $ 39,376 $ 40,621 $ 39,947
Total Revenue
Third Party and Other Revenue $ 413,127 $ 439,108 $ 418,871 $ 394,987 $ 401,688
Direct Revenue   225,175     162,294     189,876     200,072     366,759  
Total Revenue $ 638,302 $ 601,402 $ 608,747 $ 595,059 $ 768,447
Year-over-year growth 30 % 8 % 7 % 5 % 20 %
Year-over-year growth, excluding FX 31 % 8 % 8 % 6 % 20 %
Total Consolidated Revenue TTM $ 2,334,472 $ 2,376,591 $ 2,417,003 $ 2,443,510 $ 2,573,655
Year-over-year growth 45 % 27 % 18 % 12 % 10 %
 
Cost of Revenue
Local Cost of Revenue
Third Party $ 43,626 $ 46,030 $ 38,678 $ 36,642 $ 35,450
Direct   -     -     636     1,887     31  
Total Local Cost of Revenue $ 43,626 $ 46,030 $ 39,314 $ 38,529 $ 35,481
Goods Cost of Revenue
Third Party $ 14,493 $ 17,856 $ 10,796 $ 10,137 $ 9,706
Direct   218,567     152,377     167,910     179,549     337,670  
Total Goods Cost of Revenue $ 233,060 $ 170,233 $ 178,706 $ 189,686 $ 347,376
Travel and Other Cost of Revenue
Third Party and Other $ 5,786 $ 6,130 $ 6,033 $ 7,222 $ 7,382
Direct   -     -     -     -     -  
Total Travel and Other Cost of Revenue $ 5,786 $ 6,130 $ 6,033 $ 7,222 $ 7,382
Total Cost of Revenue
Third Party and Other Cost of Revenue $ 63,905 $ 70,016 $ 55,507 $ 54,001 $ 52,538

Direct Cost of Revenue

  218,567     152,377     168,546     181,436     337,701  
Total Cost of Revenue $ 282,472 $ 222,393 $ 224,053 $ 235,437 $ 390,239
% of Total Consolidated Revenue 44 % 37 % 37 % 40 % 51 %
 
Gross Profit
Local Gross Profit
Third Party $ 243,662 $ 281,363 $ 288,243 $ 264,502 $ 279,298
Direct   -     -     57     (847 )   8  
Total Local Gross Profit $ 243,662 $ 281,363 $ 288,300 $ 263,655 $ 279,306
% of Total Consolidated Local Revenue 84.8 % 85.9 % 88.0 % 87.2 % 88.7 %
% of Total Consolidated Local Gross Billings 30.5 % 33.9 % 35.8 % 36.2 % 33.7 %
Goods Gross Profit
Third Party $ 72,086 $ 49,225 $ 41,778 $ 43,085 $ 37,287
Direct   6,608     9,917     21,273     19,483     29,050  
Total Goods Gross Profit $ 78,694 $ 59,142 $ 63,051 $ 62,568 $ 66,337
% of Total Consolidated Goods Revenue 25.2 % 25.8 % 26.1 % 24.8 % 16.0 %
% of Total Consolidated Goods Gross Billings 14.5 % 15.1 % 14.4 % 14.1 % 11.1 %
Travel and Other Gross Profit
Third Party and Other $ 33,474 $ 38,504 $ 33,343 $ 33,399 $ 32,565
Direct   -     -     -     -     -  
Total Travel and Other Gross Profit $ 33,474 $ 38,504 $ 33,343 $ 33,399 $ 32,565
% of Total Consolidated Travel and Other Revenue 85.3 % 86.3 % 84.7 % 82.2 % 81.5 %
% of Total Consolidated Travel and Other Gross Billings 18.6 % 20.7 % 19.5 % 19.5 % 19.4 %
Total Gross Profit
Third Party and Other $ 349,222 $ 369,092 $ 363,364 $ 340,986 $ 349,150
Direct   6,608     9,917     21,330     18,636     29,058  
Total Gross Profit $ 355,830 $ 379,009 $ 384,694 $ 359,622 $ 378,208