Groupon Changes Its Revenue Accounting
By MICHAEL J. DE LA MERCED
New York Times
September 23, 2011, 5:51 pm
Groupon has changed the way that it accounts for revenue, the online coupon giant disclosed in an amended prospectus on Friday. The figure — called “net revenue” — now counts the money Groupon reaps after it pays out its merchant partners, a much smaller number than before.
The change is one of the biggest included in the latest version of Groupon’s prospectus, which has been amended several times since May. Groupon’s earlier way of reporting revenue has now been labeled “gross billings.”
For example, in a version of the prospectus filed last month, Groupon reported $1.52 billion in revenue for the first six months of the year. In Friday’s filing, that number is now called net revenue and is $688.11 million.
Groupon’s amended filing also includes portions of a letter sent to employees by Groupon’s chief executive, Andrew Mason, that was subsequently leaked to media outlets. That memorandum had sparked some concern from the Securities and Exchange Commission, which has been conducting a customary review of the company’s initial public offering filings.
DealBook reported earlier this month that the company had reached an accord with the S.E.C., which included incorporating elements of Mr. Mason’s memo in an updated prospectus.
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