Groupon Stock Collapsed This Week. Here's Why

(NASDAQ: GRPN) stock has seen its shares collapse this week, according to data from S&P Global Market Intelligence. After reporting weak growth and more losses in the second quarter, Wall Street sold off the digital coupon platform's stock by over 30%. As of market close on Thursday, Aug. 1, Groupon is down 32% this week. It is off 97% from all-time highs set over a decade ago.

Here's why Groupon stock was falling once again this week.

In its second-quarter earnings report on July 30, Groupon posted disappointing financial news for investors. Revenue fell 3% year over year to $124.6 million. Investors hate shrinking revenues, so this was a negative right off the bat. Further down the income statement, it gets even worse. Groupon spent $36.5 million on marketing in the quarter, or 32% of gross profit. This was a huge jump from 20% of gross profit a year ago. Even though it is spending more on marketing, Groupon's revenue is falling.

Continue reading

Source Fool.com