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Groupon CEO Andrew Mason prepares for the opening bell ceremony celebrating his company's IPO at the Nasdaq Market in New York Nov. 4, 2011.


Groupon Inc. reported second-quarter revenue that missed Wall Street expectations on Monday, sending shares of the world's largest daily deal website down 20 per cent to a record low.

Groupon chief financial officer Jason Child said Europe's weak economy and currency fluctuations dented results. He also said the company is working to improve the company's performance in that region.

Revenue was $568.3-million, compared with $392.6-million in the second quarter of 2011, the Chicago-based company said.

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Wall Street expected Groupon to report revenue of $573-million, according to Thomson Reuters I/B/E/S.

Earlier this year, Groupon forecast second-quarter revenue of $550-million to $590-million.

Groupon shares fell to a lifetime low of $6.05 each in after-hours trading. The company's stock has tanked since going public last November.

"Revenue was at the lower end of where they guided," said Herman Leung, an analyst at Susquehanna Financial Group.

Groupon's profit forecast was weaker than expected, Mr. Leung added.

Groupon said third-quarter income from operations would be $45 -million to $65-million, excluding stock-based compensation costs. Wall Street was looking for profit of about $70-million to $80-million on that basis, Mr. Leung noted.

Gross billings, which reflects the money Groupon collects from consumers who buy its daily deals, totaled $1.29-billion in the second quarter. That was down from $1.35-billion in the first quarter.

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"Europe was really the driver there," Groupon's Mr. Child said. "That was macro headwinds and currency."

Groupon recently changed management in Europe and it is rolling out new technology in the region to make its daily deals more relevant and get them closer to potential customers, the CFO said.

Still, Mr. Child said the introduction of the new technology will take "the balance of this year."

He also said Groupon plans to reduce the size of the discounts it offers to consumers in Europe.

"In the past, we've given a little more of a discount to the consumer, versus the merchant," Mr. Child said. "We will be changing that."

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