Groupon Shares Sink 60% in Three Months but CEO Sees 'Enormous Opportunity'

by Knowlton Thomas

After Groupon debuted on the public stock market at $20 per share, the somehwat controversial daily deals company surprised critics by growing its share price to a peak of $26. However, reality eventually sunk in: in the past three months, GRPN shares have plummeted more than 60%, reaching a low in the single digits last week before modest gains today placed the shares back above $10—still merely half of what the group buying company debuted at.

Even so, CEO Andrew Mason wrote a letter to shareholders noting that he sees "enormous opportunity" in Groupon's future. In particular, that opportunity appears to lie in mobile. 

Last month, 30% of transactions in North America were completed on mobile phones. This is up from 25% four months ago, Groupon says. And the typical mobile customer spends 50% more than customers who never purchase on phones, the company notes.

Still, there are plenty of reasons for investors to remain wary. The company reported a "material weakness" in financial controls in March and posted revenue below expectations—big red flags for a freshly public company that's supposed to still be in rapid-growth mode. Not to mention the fact that CNCB's Herb Greenberg recently hinted at Andrew as a potential candidate for 2012's worst CEO.

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Knowlton Thomas

Knowlton Thomas

Knowlton is the managing editor of Techvibes and author of Tempest Bound. Based in Vancouver, Knowlton has been published in national publications and has also appeared on television and radio. Previously he was an editor for New Westminster weekly The Other Press and served on its board of directors. When not working, Knowlton enjoys hiking, tennis, and martial arts. more

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