Groupon’s fourth-quarter financial results surpassed analyst expectations, but the deals company’s outlook for the current quarter was softer than analysts expected, sending shares down about 2 percent in after-market trading.
The company said it was forecasting first-quarter revenue of between $790 million and $840 million, below analyst estimates of $857.8 million. Groupon also forecast first-quarter earnings slightly below what analysts were projecting. Groupon blamed weakening international currencies for the revenue projections and also increased investment in its Korean deals business, Ticket Monster, for the earnings shortfall.
In a call with Re/code, CEO Eric Lefkofsky said the company is spending more on its Korean business to help it compete in a discounting war with competitors. He also acknowledged that Groupon is contemplating selling off some or all of the Ticket Monster business, which it bought from competitor Living Social just a little more than a year ago.
Despite the first-quarter outlook, Groupon had a strong fourth quarter with earnings per share, excluding some items, of three cents on revenue of $925 million. Revenue growth was driven by the increased sale of physical products in its Goods business and a greater percentage of revenue from customers who are buying deals after searching for them on the site. A year ago, 19 percent of revenue came from people searching on the site; that number was 26 percent in the fourth quarter, Lefkofsky told Re/code. That kind of increase is critical as Groupon attempts to overcome a drop in customers who find out about deals from emails.
This article originally appeared on Recode.net.