Groupon (GRPN) Q1 2026 earnings summary

Executive summary

• Q1 2026 global billings were $383 million, down 1% year-over-year, with revenue flat at $117.2 million and a net loss of $12.9 million compared to net income in Q1 2025.

• Project Foundry launched to transform operations into an AI-native model, embedding AI agents across all functions and planning a 15% global headcount reduction in Q2 2026.

• Active customers grew to 16.2 million, up 5% year-over-year, but unit sales declined 5% due to softer North America transactions.

• April performance improved, with North America Local re-accelerating and managed channels recovering.

• Net loss from continuing operations was $12.6 million, with negative free cash flow and increased operating expenses.

Financial highlights

• Adjusted EBITDA was $12.8 million, down from $15.3 million in Q1 2025, including $2 million in severance costs.

• Gross profit was $106.0 million, nearly unchanged year-over-year, with gross margin stable at 90.5%.

• Free cash flow was negative $13.5 million, compared to negative $3.8 million in Q1 2025.

• Share repurchases totaled 2.8 million shares for $29.7 million since March 10, with $215 million remaining under the buyback program.

• Cash and cash equivalents stood at $225.5 million as of March 31, 2026.

Outlook and guidance

• Full-year 2026 guidance reaffirmed: billings growth of 3%-5%, revenue of $513-$523 million, adjusted EBITDA of $70-$75 million, and free cash flow of at least $60 million.

• Q2 2026 guidance: revenue of $126M–$128M (flat to +2%), adjusted EBITDA of $13M–$15M.

• Management expects further cost-reduction and automation actions in 2026 as part of the AI-native transformation.

• Sufficient liquidity is expected to support ongoing operations and the 2027 Notes repayment.

• The aggregate financial impact of AI initiatives is not yet reasonably estimable.