As Revenue Soars, Groupon Inc. Appoints Eric Lefkofsky the New CEO

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As Revenue Soars, Groupon Inc. Appoints Eric Lefkofsky the New CEO
As Revenue Soars, Groupon Inc. Appoints Eric Lefkofsky the New CEO

As Revenue Soars, Groupon Inc. Appoints Eric Lefkofsky the New CEO

Groupon Inc.’s shares rose as much as 19 percent in extended trading. The company announced that in the second quarter sales climbed 7.1 percent and it earned $608.7 million. Earlier, Groupon had lost 87 percent of its value in the year after going through the IPO route in 2011. However, once Lefkofsky and Ted Leonsis took the charge, the company came on track to record a better performance.

Eric Lefkofsky May Turnaround the Business

Amidst the news of a better performance, Groupon Inc. also announced that it is appointing Eric Lefkofsky as the new CEO of the company. He was earlier a board member of the company. Later on he started working as interim-CEO along with Ted Leonsis who together ousted Andrew Mason as CEO in February, as the company was not faring well under the latter.

Eric Lefkofsky’s candidacy got more validity when Groupon’s stock though still well below its $20 IPO price fared better since he became interim co-CEO. Ted Leonsis even said that the Board is encouraged by Groupon’s performance under Eric’s leadership and is pleased to appoint him as the CEO so that he can lead the company through this important stage of its evolution.

Eric Lefkofsky will be looking into new areas of growth that may include inter alia deals sold via smart phones and tablets. Many of the analysts who on average are projecting a second-quarter net loss are now pleased that Groupon rose in extended trading to $10.34 and the shares advanced less than 1% to $8.72 at the close in New York, that is, 79 percent higher this year.

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Mobile Users Contributing to the Revenue Growth

The company release admits that almost 50% of North American transactions in June came from mobile devices which is 30 percent more than what it was a year earlier. It also claimed that more than 50 million users downloaded mobile applications globally. In its release the company also reported that billings, an indicator of future sales, rose 9.9 percent to $1.41 billion during the latest quarter.

Groupon Inc. estimates that the third-quarter revenue will be $585 million to $635 million. Rally time for Groupon shares started in June this year when analysts at Deutsche Bank AG upgraded them and considered them the most mobile penetrated e-commerce company they had tracked. They were also bullish that the company’s mobile application can boost sales, which later on came true.

To contact the reporter of this story: Jonathan Millet at john@forexminute,com