Is Groupon’s Profit-before-Revenue Strategy Working?
In its 3Q17 results, Groupon (GRPN) repeated its strategy that its priority is maximizing profits. It added that its focus on improving profitability may come at the expense of revenue.
Groupon’s balance sheet reflects a short-term debt and long-term debt of $25 million and $204 million, respectively.
Groupon added 600,000 new active shoppers in North America in 3Q17, which helped the company close the quarter with 32.5 million active shoppers in that region.
Groupon’s operating expenses were $635.7 million in 3Q17 compared with $711.4 million in 3Q16.
Groupon (GRPN) returns value to its shareholders through share repurchases. It’s a program in which the company allocates a portion of its cash to buy back some of its shares.
Groupon’s (GRPN) revenue fell in 3Q17, a consequence of the adverse impacts of natural disasters and management’s execution approach that prioritizes profitability over growth.
Facebook and Alphabet (GOOGL), the parent of Google, generate more than 50% of their revenues abroad.
Facebook (FB) announced plans to overhaul its international advertising revenue reporting, a process that the company plans to embark on next year and hopefully complete in the first half of 2019.
In 3Q17, Twitter’s advertising revenues totaled $503.0 million.
While Twitter posted a net loss of $21.1 million in 3Q17, Snap (SNAP) recorded $443.2 million loss in the same quarter.
Estimates by Accenture and Wells Fargo Securities show that AI could add $14 trillion to the economies of 12 developed countries by 2035.
In addition to hiring more human reviewers for YouTube, the company is also leveraging machine learning technology (QQQ) to help with vetting the platform.
Alphabet’s (GOOGL) Google is launching a training program aimed at spreading artificial intelligence (or AI) competence.
According to the UNWTO (United Nations World Tourism Organization), China sent 135 million tourists abroad in 2016.
Baidu funnels roughly 15.0% of its annual revenues, or about $1.5 billion per year, to research and development.
In China, 82% of those surveyed said they would like to ride in a self-driving car.
According to Boston Consulting Group, 18 million partially autonomous vehicles could be sold annually worldwide by 2035, compared with 12 million fully autonomous vehicles sold annually.
A 2014 study by Peking University estimated that traffic congestion costs Beijing ~$11.3 billion per year. Self-driving vehicles could see rapid adoption in major cities if they can ease traffic congestion.
Amazon (AMZN) has recently announced a deal with Comcast’s (CMCSA) NBCUniversal.
Amazon (AMZN) has been looking at different areas like pharma, brick-and-mortar stores, and grocery for revenue diversification.