Good Times Are Over, Groupon to Lay Off 1100 Employees

As the company has matured, it has made multiple adjustments to its worldwide portfolio.

The streamlining aims “to realize the efficiencies we’ve been working so hard to gain, to further improve the way we operate around the world and – most importantly – continue to channel more and more of our resources toward long-term growth”, chief operating officer Rich Williams said in a blog post.

Groupon is shutting operations in Morocco, Panama, the Philippines, Puerto Rico, Taiwan, Thailand and Uruguay after exiting Greece and Turkey, the company said in a separate blog post on Tuesday. Groupon has also stated that the money that they have saved from this cost-cutting measure will be reinvested in the business. “Yet just as our business has evolved from a largely hand-managed daily deal site to a true ecommerce technology platform, our operational model has to evolve”. In addition to this, the company also sold off a stake in Groupon India to Sequoia India, which is part of the venture capital firm based in Menlo Park. “Substantially all of the pre-tax charges are expected to be paid in cash and will relate to employee severance and compensation benefits, with an immaterial amount of the charges relating to asset impairments and other exit costs”. The reason cited for this step taken by the company was that it failed to meet the financial expectations in these countries. “So we chose to leave a number of countries where the required investments do not match the potential of the market”, says Rich Williams.

Groupon, Inc. (NASDAQ:GRPN) witnessed a decline in the market cap on Wednesday as its shares dropped 8.58% or 0.35 points.

Next noteworthy mover is New York Mortgage Trust Inc (NASDAQ:NYMT) with a loss of -2.10%, moving its past 5-day performance to 0.62%. The company has a market capitalization of $2.73 billion. After the session commenced at $4.05, the stock reached the higher end at $4.08 while it hit a low of $3.7. As per the latest research report, the brokerage house lowers the price target to $6.25 per share from a prior target of $7. Year-to-date, shares have plunged 51.52%, underperforming the S&P 500 index by a wide margin. Customers purchase Groupons from the Company and redeem them with its merchants.