(Updates with restatement starting in first paragraph.)
Sept. 23 (Bloomberg) -- Groupon Inc., the largest daily- deal site, announced the departure of its second chief operating officer in six months and restated revenue figures, cutting sales to a fraction of their previous levels.
Margo Georgiadis, head of operations, is leaving to rejoin her former employer, Google Inc., the Chicago-based company said today in a filing. In restating sales, Groupon cited “an error in its presentation of revenue.”
Groupon has lost executives and had to delay its initial public offering amid a volatile stock market. Brad Williams, the former head of communications, and Rob Solomon, Georgiadis’s predecessor as operating chief, left the company earlier this year. It’s also drawn flak for the way it accounted for income, which critics said was masking its true costs.
The company restated 2010 sales to $312.9 million, down from a previous level of $713.4 million. In its earlier accounting, Groupon counted the total amount of its daily-deal sales as revenue, including fees paid to merchants. The company makes money by selling discounts -- known as Groupons -- from businesses such as restaurants and nail salons. It then splits the revenue with the businesses.
“The company restated its reporting of revenues from Groupons to be net of the amounts related to merchant fees,” Groupon said in the filing. “Historically, the company has reported the gross amounts billed to its subscribers as revenue.”
Revenue in the first half of 2011 is now $688.1 million, compared with an earlier figure of $1.52 billion.
The company also said JPMorgan Chase & Co. is no longer a lead underwriter on its planned $750 million IPO. Groupon made the change after people with knowledge of the matter said online-coupon competitor LivingSocial hired the bank to raise more than $200 million in a round of private funding.
Wells Fargo & Co. joined the list of underwriters on Groupon’s offering, the filing showed.
Georgiadis will become Google’s president for the Americas region. Before going to Groupon in April, she was Google’s vice president of global sales. Her Groupon contract gave her a $500,000 salary and 300,000 fully vested stock options. Based on the $25 billion valuation Groupon was said to have been contemplating in March, those options would be worth $25.2 million dollars in an IPO.
“Groupon is a great company and I feel privileged to have worked there even for a short time,” she said today in a statement published by Groupon. “It was a hard decision to leave as the company is on a terrific path. I have complete confidence in the team’s ability to realize its mission.”
The executive will have an expanded role in her new position at Google, said Nikesh Arora, senior vice president and chief business officer of Mountain View, California-based Google.
“I called a great colleague from the past and asked her if she’d like to come back,” Arora said. “I could not ask for a better person to come back and work with us.”
Her earlier experience included a stint as chief marketing officer at Discover Financial Services.
--With Cory Johnson and Brian Womack in San Francisco. Editors: Nick Turner, Lisa Rapaport
To contact the reporter on this story: Douglas MacMillan in New York at firstname.lastname@example.org
To contact the editor responsible for this story: Tom Giles at email@example.com Jennifer Sondag at firstname.lastname@example.org.