Groupon (NASDAQ:GRPN) management highlighted a return to growth in 2025 but acknowledged a fourth-quarter shortfall driven by specific channel issues, while outlining a 2026 plan centered on product improvements, marketing changes, and a push toward what CEO Dušan Senkypl described as an “AI-native operating model.”
2025 results: Return to billings and revenue growth
Senkypl called 2025 a “milestone year,” noting that Groupon returned to both billings and revenue growth for the first time in a decade. He said full-year global billings rose 7% to approximately $1.76 billion, and the company delivered a second consecutive year of positive free cash flow, exiting the year with about $296 million in cash.
Q4 miss: Enterprise channel and organic/owned marketing underperformed
Management was direct that the company did not finish the year as planned. Senkypl said fourth-quarter global billings grew 4% year-over-year but came in below guidance, and revenue and adjusted EBITDA also missed the company’s expectations.
He attributed the shortfall to two areas:
- Enterprise channel deceleration in North America
- Underperformance in organic and owned marketing channels
Senkypl said the issues were “well understood,” with clear root causes and action plans, and pointed investors to the company’s earnings commentary for more detail.
Enterprise: Partner expectations, shifting market needs, and a longer sales cycle
In response to analyst questions, Senkypl provided additional context on enterprise weakness. He said Groupon made a bet last year on a partner to serve as a channel for new customer acquisition, but that partnership has performed below expectations in terms of bringing new partners onto the platform.
He also described a market shift that is affecting how larger brands want to participate. Senkypl said the company is iterating its product toward “closed-loop transactions,” where pricing may not be visible publicly without registration or app installation, reflecting brand concerns about public price comparisons between Groupon and a brand’s own site.
Senkypl emphasized that enterprise recovery can take time because of a “long cycle” for negotiations, sometimes lasting multiple months or quarters, including potential alignment with partners’ annual planning.
He also noted the enterprise sales team was reorganized to align around vertical-focused category expertise. The intent, he said, is to tailor go-to-market approaches by category rather than relying on a single generic playbook.
Product and platform: App migration milestone, new CDP, and conversion focus
On product execution, Senkypl said the product and engineering organization is “shipping more, faster, and with better quality” than at any point in recent memory. He highlighted platform migration progress, with 50% of iOS North America users now on the new mobile app and an expectation to migrate all iOS North America app users by the end of the first quarter.
Senkypl said early results show stronger monetization per user on the updated platform compared with the legacy app. As the migration completes, he said engineering capacity can shift toward new functionality aimed at improving user experience and purchase frequency, including investments in search and relevance and personalization.
Management also discussed a customer data platform (CDP), which Senkypl said is now live in North America. He described the CDP as a foundational tool that enables faster experimentation and more granular customer targeting—such as setting up automated push notification journeys or tailoring offers based on browsing behavior. He also said improved data on customer engagement could help optimize paid marketing by avoiding spend on users already responding through owned channels.
On conversion rate improvements, Senkypl attributed gains to a more consumer-friendly interface, better search and relevance, a greater focus on merchant and offer quality, and tighter targeting in paid marketing toward higher-converting traffic, even if that means “buying slightly less eyeballs.”
AI strategy: Board committee, agentic commerce, and internal productivity goals
Senkypl repeatedly framed AI as Groupon’s top strategic priority for 2026. He said the company plans to make its inventory “discoverable and transactable by AI agents and platforms,” and is targeting technical readiness for AI agents to initiate transactions by mid-2026.
To support the effort, Groupon announced the formation of a dedicated AI committee of the board. Senkypl said Amit Shah was appointed as a new independent director to chair the committee, describing Shah as the founder and CEO of Instantly AI and a former president of 1-800-Flowers.com. Senkypl told analysts the committee is intended to be deeply integrated with management rather than a quarterly formality, with Shah providing feedback on products and management’s AI fluency.
In a written Q&A, Senkypl also described a broader internal shift toward an “agentic-based approach,” citing tools such as Claude Code, and said his goal is for 100% of code to be written by AI by the end of the year. He also said he expects roles to evolve toward employees “managing AI agents or orchestrating them.”
On 2026 outlook, Senkypl said growth improvement is expected to continue but at a more moderate pace given the time needed to address enterprise and organic/owned channel headwinds. He provided the company’s 2026 guidance: 3% to 5% billings growth, 3% to 5% revenue growth, adjusted EBITDA of $70 million to $75 million, and at least $60 million in free cash flow.
CFO Rana Kashyap said fourth-quarter SG&A came in lower than expected due to some one-time benefits, and she encouraged investors to take a full-year view for 2026, with SG&A (excluding D&A and stock-based compensation) expected to be “flattish” year-over-year.
On marketing, Kashyap said the company expects marketing expense to grow year-over-year in the high single digits—faster than revenue growth—while improving the relationship between marketing spend growth and revenue growth compared with 2025. Senkypl added that Groupon began a brand campaign in the second half of Q4 with the motto “Turn your life on,” and said early responses varied significantly by city, with the company working to understand where to allocate brand dollars most effectively.
About Groupon (NASDAQ:GRPN)
Groupon, Inc operates an online marketplace that connects subscribers with local merchants offering discounted goods, services and experiences. Through its website and mobile applications, Groupon provides time-limited deals across categories such as restaurants, travel, beauty and wellness, home services, and consumer products. Merchants partner with Groupon to attract new customers and drive foot traffic, leveraging the platform’s targeted marketing tools and large subscriber base to promote special offers and vouchers.
Founded in Chicago in 2008 by Andrew Mason, Eric Lefkofsky and Brad Keywell, Groupon pioneered the daily-deals model, quickly growing its user community and merchant network.
