Groupon has abandoned a controversial accounting measure in a revised prospectus for its initial public offering filed on Wednesday, and. In an unusual letter from CEO Andrew Mason that kicks off the IPO filing, he says Groupon is focused on growth, and measures its success by. Groupon is out with the fourth update to its IPO prospectus.
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They also threw in another 5 million shares, up from the previous offering estimate of 30 million shares. That flurry of interest from buyers was the latest twist in the roller-coaster-like IPO process that has enveloped one of the tech industry’s most controversial ventures.
Since the moment Groupon filed its paperwork, it’s been hit with criticism for unorthodox accounting measures, which led to several downward revisions of its financials. Groupon’s initial filing in June drew heavy scrutiny for the company’s reliance on a nonstandard metric called “adjusted grooupon segment operating income.
Groupon IPO prices at $20 a share
Under pressure from regulators, Groupon re-filed in August to instead use only standard accounting procedures. As a result, the operating profits that Groupon cited in its first filing became operating losses.
Then, in late September, Groupon revised its reported revenue to “correct for an error” — namely, including in its revenue the cash it has to hand back to merchants for their share of the coupons Groupon sells.
Tech IPOs this year: Several other online companies have gone public in — and while they’ve generally done well on their first trading days, their longer term performance is mixed. Professional networking site LinkedIn’s LNKD shares more than doubled in its May IPOeven though the company turned only slight profits in andand has otherwise has been in the red every year since its inception.
The stock is still trading well above its IPO price. In August, LinkedIn announced it turned a profit on its first quarter as a public company.
After the bell Thursday, the company reported third-quarter earnings of 6 cents a share, beating analyst estimates of breakeven. Other tech IPOs posted gains on their first day and then fizzled. Internet radio service Pandora P performed well in its IPOeven though the unprofitable company had warned investors that it expected to continue losing money “through at least fiscal Groupon’s IPO could set the stage for Zynga — the gaming company filed in June and is rumored to start trading this month — and serve as an indicator of the overall IPO market.
Groupon IPO: It’s Here!
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