Groupon's Q4 loss widened slightly to US$81.2M from US$81.1M a year ago as revenue climbed 20.4% to US$768.4M; for 2013, loss widened to US$95.4M from US$67.4M, revenue rose 10% to US$2.6B

CHICAGO , February 21, 2014 (press release) –

  • Fourth quarter gross billings of $1.6 billion, $5.8 billion for the full year
  • Fourth quarter revenue of $768.4 million, $2.6 billion for the full year
  • Fourth quarter Adjusted EBITDA of $72.0 million, $286.7 million for the full year
  • Operating income excluding stock compensation and acquisition costs of $47.9 million, $197.2 million for the full year
  • Fourth quarter GAAP loss per share of $0.12; earnings per share of positive $0.04 excluding stock compensation, acquisition costs and the impairment of a minority investment in China
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

  • Units: Global units, defined as vouchers and products sold before cancellations and refunds, increased 11% year-over-year to 56 million in the fourth quarter 2013. North America units increased 17%, EMEA units increased 9%, and Rest of World units decreased 1% year-over-year.
  • Active deals: At the end of the fourth quarter 2013, on average, active deals in North America were approximately 80,000, compared with more than 65,000 at the end of the third quarter 2013. Globally, active deals exceeded 140,000 at the end of the fourth quarter 2013.
  • Active customers: Active customers, or customers that have purchased a voucher or product within the last twelve months, grew 9% year-over-year, to 44.9 million as of December 31, 2013, comprising 20.8 million in North America, 14.2 million in EMEA, and 9.9 million in Rest of World.
  • Customer spend: Fourth quarter 2013 trailing twelve month billings per average active customer was $134, compared with $137 in the third quarter 2013.
  • Mobile: In December 2013, nearly 50% of global transactions were completed on mobile devices. Nearly 70 million people have now downloaded Groupon mobile apps worldwide, with approximately 9 million people downloading them in the fourth quarter alone.
  • Marketplace: The rollout of Groupon's marketplace ("Pull") continued to gain traction. In December 2013, approximately 8% of total traffic in North America searched, with customers that searched spending over 50% more than those that did not.

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    
% of Total Consolidated Revenue     55.7   %   63.0   %   63.2   %   60.4   %   49.2   %
% of Total Consolidated Gross Billings     23.4   %   26.9   %   27.2   %   26.8   %   23.7   %
                       
Operating Income Excl SBC, Acq-Related   $ 13,703     $ 51,153     $ 59,043     $ 39,153     $ 47,856    
Year-over-year growth     (24 ) %   (24 ) %   (18 ) %   (22 ) %   249   %
Operating Margin Excl SBC, Acq-Related (% of Total Consolidated revenue)     2.1   %   8.5   %   9.7   %   6.6   %   6.2   %
Year-over-year growth (bps)     (150 )     (360 )     (300 )     (230 )     410    
Operating Income TTM Excl SBC, Acq-Related   $ 203,715     $ 187,278     $ 174,387     $ 163,052     $ 197,205    
Operating Margin TTM Excl SBC, Acq-Related (% of Total Consolidated TTM revenue)     8.7   %   7.9   %   7.2   %   6.7   %   7.7   %
Year-over-year growth (bps)     1,770       680       (40 )     (280 )     (100 )  
                       
Operating (Loss) Income   $ (12,861 )   $ 21,178     $ 27,412     $ 13,812     $ 13,352    
Year-over-year growth     14   %   (47 ) %   (41 ) %   (46 ) %   204   %
Operating Margin (% of Total Consolidated revenue)     (2.0 ) %   3.5   %   4.5   %   2.3   %   1.7   %
Year-over-year growth (bps)     100       (360 )     (370 )     (220 )     370    
Operating Income TTM   $ 98,701     $ 80,240     $ 61,167     $ 49,541     $ 75,754    
Operating Margin TTM (% of Total Consolidated TTM revenue)     4.2   %   3.4   %   2.5   %   2.0   %   2.9   %
Year-over-year growth (bps)     1,870       750       (100 )     (240 )     (130 )  
                       
Net Loss Attributable to Common Stockholders     (81,089 )     (3,992 )     (7,574 )     (2,580 )     (81,247 )  
Weighted Average Basic Shares Outstanding     655,678       658,800       662,361       666,433       668,046    
Weighted Average Diluted Shares Outstanding (7)     655,678       658,800       662,361       666,433       668,046    
Net Loss per Share:                      
Basic   $ (0.12 )   $ (0.01 )   $ (0.01 )   $ (0.00 )   $ (0.12 )  
Diluted   $ (0.12 )   $ (0.01 )   $ (0.01 )   $ (0.00 )   $ (0.12 )  
                       
The following is a quarterly reconciliation of Adjusted EBITDA to the most comparable U.S. GAAP financial measure, "Net loss." (8)
Net loss   $ (80,047 )   $ (3,242 )   $ (5,551 )   $ (1,292 )   $ (78,861 )  
Adjustments:                      
Stock-based compensation     26,411       29,907       32,446       26,870       32,239    
Acquisition-related expense (benefit), net     153       68       (815 )     (1,529 )     2,265    
Depreciation and amortization     15,965       20,700       21,468       23,149       24,132    
Non-operating items:                      
Loss (income) on equity method investments     1,231       19       14       25       (14 )  
Other expense (income), net     48,279       5,064       5,565       (857 )     84,847    
Provision for income taxes     17,676       19,337       27,384       15,936       7,380    
Total adjustments     109,715       75,095       86,062       63,594       150,849    
Adjusted EBITDA   $ 29,668     $ 71,853     $ 80,511     $ 62,302     $ 71,988    
                       
The following is a quarterly reconciliation of Operating income, excluding stock-based compensation and acquisition-related (expense) benefit, net, to the most comparable U.S. GAAP financial measure, "Operating (loss) income." (8)
Operating income, excluding stock-based compensation and acquisition-related (expense) benefit, net   $ 13,703     $ 51,153     $ 59,043     $ 39,153     $ 47,856    
Stock-based compensation     (26,411 )     (29,907 )     (32,446 )     (26,870 )     (32,239 )  
Acquisition-related (expense) benefit, net     (153 )     (68 )     815       1,529       (2,265 )  
Operating (loss) income   $ (12,861 )   $ 21,178     $ 27,412     $ 13,812     $ 13,352    
                       
The following is a trailing twelve months reconciliation of Operating income, excluding stock-based compensation and acquisition-related (expense) benefit, net, to the most comparable U.S. GAAP financial measure, "Operating Income." (8)
Operating income, excluding stock-based compensation and acquisition-related (expense) benefit, net TTM   $ 203,715     $ 187,278     $ 174,387     $ 163,052     $ 197,205    
Stock-based compensation     (104,117 )     (106,021 )     (111,383 )     (115,634 )     (121,462 )  
Acquisition-related (expense) benefit, net     (897 )     (1,017 )     (1,837 )     2,123       11    
Operating income TTM   $ 98,701     $ 80,240     $ 61,167     $ 49,541     $ 75,754    
                       
The following is a quarterly reconciliation of foreign exchange rate neutral Gross Billings growth from the comparable quarterly periods of the prior year to reported Gross Billings growth from the comparable quarterly periods of the prior year.(9)
                       
EMEA Gross Billings growth, excluding FX     4   %   (9 ) %   4   %   9   %   3   %
FX Effect     (2 ) %   1   %   -   %   3   %   3   %
EMEA Gross Billings growth     2   %   (8 ) %   4   %   12   %   6   %
                       
Rest of World Gross Billings growth, excluding FX     20   %   (6 ) %   (16 ) %   (4 ) %   (2 ) %
FX Effect     (3 ) %   (5 ) %   (5 ) %   (9 ) %   (9 ) %
Rest of World Gross Billings growth     17   %   (11 ) %   (21 ) %   (13 ) %   (11 ) %
                       
Consolidated Gross Billings growth, excluding FX     25   %   5   %   11   %   11   %   5   %
FX Effect     (1 ) %   (1 ) %   (1 ) %   (1 ) %   -   %
Consolidated Gross Billings growth     24   %   4   %   10   %   10   %   5   %
                       
The following is a quarterly reconciliation of foreign exchange rate neutral Revenue growth from the comparable quarterly periods of the prior year to reported Revenue growth from the comparable quarterly periods of the prior year.(9)
                       
EMEA Revenue growth, excluding FX     (25 ) %   (20 ) %   (25 ) %   (23 ) %   38   %
FX Effect     (2 ) %   -   %   1   %   2   %   5   %
EMEA Revenue growth     (27 ) %   (20 ) %   (24 ) %   (21 ) %   43   %
                       
Rest of World Revenue growth, excluding FX     23   %   (8 ) %   (21 ) %   7   %   (6 ) %
FX Effect     (3 ) %   (6 ) %   (5 ) %   (11 ) %   (9 ) %
Rest of World Revenue growth     20   %   (14 ) %   (26 ) %   (4 ) %   (15 ) %
                       
Consolidated Revenue growth, excluding FX     31   %   8   %   8   %   6   %   20   %
FX Effect     (1 ) %   -   %   (1 ) %   (1 ) %   -   %
Consolidated Revenue growth     30   %   8   %   7   %   5   %   20   %
                       
The following is a reconciliation of free cash flow to the most comparable U.S. GAAP financial measure, "Net cash provided by (used in) operating activities."
Net cash provided by (used in) operating activities   $ 65,717     $ 8,760     $ 43,302     $ (11,905 )   $ 178,275    
Purchases of property and equipment and capitalized software     (40,034 )     (14,468 )     (14,042 )     (15,064 )     (19,931 )  
Free cash flow (10)   $ 25,683     $ (5,708 )   $ 29,260     $ (26,969 )   $ 158,344    
                       
Net cash provided by operating activities (TTM)   $ 266,834     $ 191,880     $ 159,867     $ 105,874     $ 218,432    
Purchases of property and equipment and capitalized software (TTM)     (95,836 )     (97,221 )     (84,554 )     (83,608 )     (63,505 )  
Free cash flow (TTM)   $ 170,998     $ 94,659     $ 75,313     $ 22,266     $ 154,927    
                       
Net cash used in investing activities   $ (52,753 )   $ (30,679 )   $ (15,862 )   $ (26,444 )   $ (23,330 )  
Net cash used in financing activities   $ (6,495 )   $ (9,342 )   $ (7,941 )   $ (8,970 )   $ (55,444 )  
                       
Net cash used in investing activities (TTM)   $ (194,979 )   $ (179,214 )   $ (134,923 )   $ (125,738 )   $ (96,315 )  
Net cash provided by (used in) financing activities (TTM)   $ 12,095     $ 11,028     $ (21,071 )   $ (32,748 )   $ (81,697 )  
                       
Other Metrics                      

Active Customers (11)

                     
North America     17.2       18.2       19.1       19.9       20.8    
EMEA     14.3       14.0       13.9       14.0       14.2    
Rest of World     9.5       9.5       9.6       9.6       9.9    
Total Active Customers     41.0       41.7       42.6       43.5       44.9    
                       
TTM Gross Billings / Average Active Customer (12)                      
North America   $ 152     $ 151     $ 156     $ 155     $ 150    
EMEA   $ 146     $ 137     $ 135     $ 137     $ 139    
Rest of World   $ 126     $ 116     $ 108     $ 102     $ 95    
Consolidated   $ 144     $ 138     $ 138     $ 137     $ 134    
                       
Headcount                      
Sales (13)     4,677       4,566       4,679       4,801       4,834    
% North America     25   %   28   %   26   %   28   %   29   %
% EMEA     42   %   38   %   39   %   37   %   37   %
% Rest of World     33   %   34   %   35   %   35   %   34   %
Other     6,717       6,433       6,306       6,453       6,449    
Total Headcount     11,394       10,999       10,985       11,254       11,283    
(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) Local represents deals from local merchants, deals with national merchants, and deals through local events.
(3) Third party revenue is related to sales for which the Company acts as a marketing agent for the merchant. This revenue is recorded on a net basis. Direct revenue is primarily related to the sale of products for which the Company is the merchant of record. These revenues are accounted for on a gross basis, with the cost of inventory included in cost of revenue.
(4) Cost of revenue is comprised of direct and certain indirect costs incurred to generate revenue. Direct cost of revenue includes the cost of inventory, shipping and fulfillment costs and inventory markdowns. Third party cost of revenue includes estimated refunds for which the merchant's share is not recoverable. Other costs incurred to generate revenue are allocated to cost of third party and other revenue and direct revenue for each of our categories (Local, Goods, and Travel and other) in proportion to gross billings during the period.
(5) 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 in the prior year period.
(6) International operating margin information broken out between EMEA and Rest of World is not readily available for quarterly periods during the year ended December 31, 2010. Therefore, the Company is presenting year-over-year basis point (bps) growth for operating margin TTM excluding stock-based compensation and acquisition-related expense (benefit), net beginning in the first quarter of 2013.
(7) The weighted-average diluted shares outstanding is calculated using the weighted-average number of common shares and, if dilutive, potential common shares outstanding during the period. Potential common shares consist of the incremental common shares issuable upon the exercise of stock options and vesting of restricted stock units and restricted shares, as calculated using the treasury stock method.
(8) Adjusted EBITDA and Operating income excluding stock-based compensation and acquisition-related (expense) benefit, net are non-GAAP financial measures. The Company reconciles Adjusted EBITDA to the most comparable U.S. GAAP financial measure, "Net loss" for the periods presented, and the Company reconciles Operating income excluding stock-based compensation and acquisition-related (expense) benefit, net to the most comparable U.S. GAAP financial measure, "Operating (loss) income," for the periods presented.
(9) Foreign Exchange Rate neutral operating results are non-GAAP financial measures. The Company reconciles "foreign exchange rate neutral Gross Billings growth" and "foreign exchange rate neutral Revenue growth" to year-over-year growth rates for the most comparable U.S. GAAP financial measures, "Gross Billings" and "Revenue," respectively, for the periods presented.
(10) Free cash flow is a non-GAAP financial measure. The Company reconciles this measure to the most comparable U.S. GAAP financial measure, "Net cash provided by (used in) operating activities," for the periods presented.
(11) Reflects the total number of unique user accounts who have purchased a voucher or product from us during the trailing twelve months.
(12) Reflects the total gross billings generated in the trailing twelve months per average active customer over that period.
(13) Includes merchant sales representatives, as well as sales support.  
(14) The definition, methodology, and appropriateness of each of our supplemental metrics is reviewed periodically. As a result, metrics are subject to removal and/or change.

 

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