Groupon reported higher revenue and billings for the third quarter, with growth in international local deals offsetting flat North American local revenue. The company also nearly eliminated its loss from continuing operations, though adjusted EBITDA declined and cash flow remained negative.
Alongside the results, Groupon highlighted its shift toward AI-enabled operations and commerce. It relaunched LivingSocial in October as an online marketplace designed to help customers discover and book local experiences through AI agents.
Key details
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Revenue and billings grew: Global revenue rose 2% year over year, while billings increased 6%—also 6% on a currency-neutral basis.
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International local business led growth: International local revenue increased 12%, and local billings rose 11% (12% excluding currency effects). Groupon attributed the gains to more seasonally relevant offerings in major cities, particularly in health, beauty and wellness and things to do, as well as growth in paid and organic channels.
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North American local revenue was flat: Local billings in the region increased 4%, supported by things to do, enterprise customers, and paid and organic channels.
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Customers were broadly steady, but transactions fell: Groupon had 16.2 million active customers, roughly unchanged from a year earlier. International customers grew 4%, offsetting a 1% decline in North America. Unit sales fell 2% to 9.0 million, while average order value rose 8% as customers bought higher-value offerings.
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The continuing-operations loss narrowed sharply: Groupon recorded a loss of $0.8 million, compared with a $117.8 million loss in the year-earlier quarter. Adjusted EBITDA was positive $14.7 million, down from $17.5 million a year earlier.
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Cash flow was negative: Operating cash outflow from continuing operations was $43.2 million, and free cash flow was negative $45.8 million. Cash and cash equivalents totaled $177.4 million at September 30.
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Restructuring is expected to reduce costs: Payroll actions under the 2026 restructuring plan are estimated to produce $20 million to $25 million in annualized savings. Groupon expects $7 million to $10 million in related pretax charges; most of the associated headcount reductions had occurred by the end of the quarter.
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The company is reorganizing work around AI: Groupon launched FoundryAI, an internal platform intended to bring company data, tools and AI capabilities together. A majority of employees had moved onto the platform by the end of the quarter, and the company expects it to become the default way teams work by the end of 2026.
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LivingSocial returned with an AI-commerce focus: On October 15, Groupon opened a public preview of LivingSocial as an “agent-first” experience marketplace, featuring more than 50,000 local experiences in the United States. The company describes it as both a marketplace and a test bed for commerce conducted through AI agents.
Plain-English implications
Groupon’s results show modest top-line growth, led by international markets, alongside a much smaller reported loss. But lower adjusted EBITDA and substantial cash outflow show that the improvement in the quarterly loss did not translate into positive cash generation. The restructuring plan and AI initiatives represent efforts to lower costs and reshape how Groupon operates and connects customers with local businesses.