Hefty increases in revenue and transactions over Q2 failed to help Coupons.com end its three-year absence from profit as the company slumped to a GAAP net loss of $6.9 million.
The online discount provider has endured a barren run of financial form since reporting a loss of $23 million in 2011. This rose to $59 million in 2012, but the $11 million decline recorded in 2012 did at least hint that change could be around the corner.
Recognised as a key player in the digital coupon arena, which has welcomed plenty of growth itself in recent years, Coupons.com does not fit the bill of a company struggling to make ends meet.
Financial readings from Q2 2014 reveal a 32% rise in total revenue year on year, up to $51.7 million, and a 22% rise in revenue-making transactions over the same period, up to 384 million. Turning such performances into profit just seems like a step too far for a company whose overall loss was represented chiefly by stock-based compensation.
Looking ahead
If there is one thing that could propel Coupons.com to growth, it is the company’s flourishing digital ad-selling business.
Money generated from display advertisements accounted for 26% of the firm’s total revenue over Q2, with its promotion of client discounts delivering the remainder.
Despite a $4 million rise in GAAP net loss compared to the same period in 2013, Coupons.com COO and CFO Mir Aamir appeared positive about the company’s future prospects.
“We’re pleased with our performance this quarter, as we delivered strong revenue growth of 32%,” he commented.
“We also demonstrated significant operating leverage in our model as compared to last year. As we enter the back half of this year, we’ll continue to invest in the business to drive both top and bottom-line growth.”
Increased investment
Coupons.com is not the only US voucher supplier with a topsy-turvy financial status.
The Texas-based RetailMeNot recently announced a $59.5 million (37%) rise in net revenue for Q2 compared to last year, only for a 16% slide in net income to overshadow its progression.
The figure did however take into account increased spend on product development, sales and marketing efforts. Meanwhile Coupons.com has made some investments of its own over the last few months.
In revealing its financial performance for Q2 the company also announced an acquisition for performance marketing firm Eckim. Early reports suggest the link-up will help Coupons.com provide better marketing opportunities for its partners and clients.
Steven Boal, the discount firm’s president and CEO, said the deal will also bring 60 new retailer relationships to his company.