Groupon, Inc. · NASDAQ:GRPN
Groupon — Q2 2021 Earnings Presentation
38 slides from Groupon's earnings presentation, Aug 5, 2021
Slide 1: GRPN Investor Presentation 2Q21
GRPN Investor Presentation 2Q21 August 5, 2021 1
Slide 2: Forward-looking statements and other information
Forward-looking statements and other information The statements contained in this presentation that refer to plans and expectations for the next quarter, the full year or the future are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Sectio
Slide 3: The destination for experiences
The destination for experiences. Where customers discover fun things to do & local businesses thrive 3
Slide 4: Leading local marketplace with proven profitability and long-term growth opportunity
Beloved global brand that connects millions of customers with merchants, known for providing unbeatable value A leader in the fragmented $1T Local Market, leveraging our scale and focusing on where we are most differentiated ● Strong competitive position with Local merchants and a low/no-risk, trans
Slide 5: Making big changes to become the destination for experiences
Merchant Value Pre-2021 Now Proposition High Effort to Launch and Easy to Launch and Manage Ease Manage Deals Listings with Self-Service Making big changes to Reach No Merchant Control Merchant Control with Sponsored Listings become the destination for Monetization One Product at Multiple Products a
Slide 6: Our Large Addressable Market Opportunity
Our Large Addressable Market Opportunity 6
Slide 7: A leading local marketplace with room to grow
1 Million+ Merchants worked with to date ● Large and growing addressable market in local ● Groupon’s two-sided marketplace 1.5 Billion+ has massive global scale A leading local Groupons sold to date marketplace with ● Nearly 60% of our customer base has been shopping Groupon for 3+ room to grow year
Slide 8: Positioned to grow wallet share with customers
Our customers... ● We believe there are 80+ Grouponable moments in a single year... have an average household income of $75K1 ● ...and Groupon is only capturing 4% of Positioned to those experiences grow wallet live in a city ● Executing on our strategic priorities creates opportunity to increase sh
Slide 9: Our Strategy for Growth
Our Strategy for Growth SROUPON | 2
Slide 10: The destination for experiences
The destination for experiences. ● By putting our new customer and merchant value propositions front and center we believe we can build a new destination marketplace experience to complement our inspiration marketplace ● Strategy is laser-focused on addressing disconnect between our large market opp
Slide 11: Groupon can unlock a powerful marketplace flywheel
Right Inventory in the Right Markets Merchant Self-Service Location and Tools Personalization Groupon can unlock a powerful marketplace Amazing Mobile flywheel Amazing Merchant Exp Growth CX Customer and Traffic New Search, Relevance & Scale Navigation Features Frictionless Exp; Bookable Inventory 1
Slide 12: Expand Inventory
Expand Inventory SROUPON | 2
Slide 13: Expanding inventory is critical to our growth
Expanding inventory is critical to our growth 3 key inventory products: Deals, Offers, and Market Rate Our goal is to provide value to merchants at any stage of their growth cycle and encourage them to list more inventory with Groupon ● Deals: remove restrictions on deeply-discounted inventory to dr
Slide 14: Portfolio of complementary inventory listing options
Portfolio of complementary inventory listing options gives merchants more ways to monetize their relationship with Groupon Deals Deals now have fewer restrictions, broadening their consumer appeal ● Our customers want fewer repeat restrictions so they can try a Deal more than once ● By relaxing Deal
Slide 15: Expanding Inventory: scaling in North America now
Expanding Inventory: Remove repeat purchase restrictions on Deals in all verticals scaling in North ● 2021 goal: increase the percent of Deal inventory available for repeat purchase to 80% America now ● Progress to-date: More than 70% of Deal inventory is now repeatable Expected to increase amount o
Slide 16: Improve the Merchant & Customer Experiences
Improve the Merchant & Customer Experiences 16
Slide 17: Prioritize our merchants' success
Prioritize our merchants’ success Partner with our merchants to help them grow their businesses Roadmap focused on merchant tools that allow them to build, grow and scale their businesses on the Groupon marketplace Shift Groupon from high-touch model to one where merchants use proven self-service to
Slide 18: Then vs Now
Then vs Now THEN Providing merchants with a full-service platform ● Phone interaction required to join the marketplace that they can leverage to build and grow their ● Launching a Deal? Another labor intensive interaction businesses required ● Just want to change content? Another labor intensive int
Slide 19: Deliver an amazing customer experience
Product roadmap focuses on increasing customer purchase frequency Leverage machine learning to produce rapid insights that power curation, search relevance and other UX improvements Position Groupon as a destination where consumers go to Deliver an amazing discover fun and memorable experiences thro
Slide 20: Reimagining the customer experience
Personalized customer Reimagining the customer experience journey Better search, browse and discover New customer experience intended to drive sell-through of our expanding inventory base, grow purchase frequency over time, and begin to bend the consumer perception of Groupon from inspiration-only t
Slide 21: Launched and scaled a new customer experience in NA
Discovery Buy it again Search & Ranking App + mweb launched in April Launched in April Launched in April Desktop launched in July Launched and scaled a new customer experience in NA Fundamentally changed the user experience; from concept to delivery in just six months 21
Slide 22: Product roadmap
Product roadmap Steady cadence of new features will improve the customer and merchant experiences H1 2021 (launched) H2 2021 ✔ Groupon Connect for Beauty & Wellness • Sponsored Listings ✔ Self-service: • Extend third-party connectivity & booking ● Intl expansion • Embedded self-service Merchant ● Re
Slide 23: Marketing
Marketing SROUPON | 23
Slide 24: 'Grab Life by the Groupon'
‘Grab Life by the Groupon’ Recently launched new brand repositioning campaign that brings our inventory and marketplace modernization work to life to help to shift our brand perception to the destination for Local 24
Slide 25: Resetting our Cost Structure
Resetting our Cost Structure 25
Slide 26: Resetting our cost structure
Multi-phase restructuring plan is now largely Resetting our complete cost structure On track to realize ~$225M of run rate savings from restructuring actions Committed to operational rigor: lower costs, improve Reduced cost structure expected to drive speed and leverage greater flow-through to Adjus
Slide 27: Second Quarter Results
Second Quarter Results SROUPON | 7
Slide 28: Key second quarter results
Key second quarter results Active Customers 25M Units 17M Billings $608M Revenue $266M Gross Profit $194M Adjusted EBITDA1 $41M Cash (as of 6/30)2 $565M 1. Adjusted EBITDA (AEBITDA) is a non-GAAP financial measure. See the appendix for a reconciliation to the most comparable U.S. GAAP financial meas
Slide 29: Additional insights on second quarter results
Continued to increase marketing Sold 17 million units in the second investment in the quarter as we quarter, demonstrating our scale aimed to further accelerate recovery and reshape our brand perception as the destination for Local Additional insights on second quarter results NA Local billings grew
Slide 30: 3Q21 and FY21 Perspective
3Q21 and FY21 Perspective SROUPON | 2
Slide 31: 3Q21 perspective
July 2021 Trends ● North America Local billings were tracking at ~62% of 2019 levels ● International Local billings were tracking at ~51%1 of 2019 levels Factors to Consider 3Q21 ● Revenue: International Goods transition to 3P model is ~60% complete perspective ● Global Goods: Expect to deliver less
Slide 32: FY21 outlook
Outlook ● Revenue expected to be $950 million to $990 million ● Adjusted EBITDA expected to be $115 million to $125 million Factors to Consider ● Outlook assumes Global Goods continues at July performance level (30% of 2019 Billings) and Int’l transition to FY21 outlook ● 3P model completed at the e
Slide 33: Unlocking the power of our financial model
Unlocking the power of our financial model ● Durable business model and solid balance sheet provide a foundation for growth ● Improving customer and merchant value propositions to capitalize on our large addressable market opportunity ● Executing on our priorities to Expand Inventory and Modernize t
Slide 34: Appendix
Appendix SROUPON | +
Slide 35: Goods revenue presentation 1P vs. 3P example
Goods revenue presentation 1P vs. 3P example1: $100 customer purchase First Party Goods Third Party Goods Billings don’t change; this is what our customer pays to Billings $100 $100 Groupon In 3P model, Groupon revenue is the commission from the Revenue $100 $17 sale (net of merchant payment) Gross
Slide 36: Non-GAAP Reconciliations: Adjusted EBITDA - Quarterly
Non-GAAP Reconciliations* Adjusted EBITDA - Quarterly (in thousands) *See Q2 2021 earnings release press release posted on our Investor Relations website for additional information regarding non-GAAP financial measures 36
Slide 37: Non-GAAP Reconciliations: Expected Adjusted EBITDA Range
Non-GAAP Reconciliations* Expected Adjusted EBITDA Range (in thousands) *See Q2 2021 earnings release press release posted on our Investor Relations website for additional information regarding non-GAAP financial measures 37
Slide 38: Non-GAAP Reconciliations: Free Cash Flow
Non-GAAP Reconciliations* Free Cash Flow (in thousands) *See Q2 2021 earnings release press release posted on our Investor Relations website for additional information regarding non-GAAP financial measures 38