Gold prices steady ahead of Fed decision, Trump’s tariff deadline
Investing.com -- Groupon (NASDAQ:GRPN) shares tumbled 8% following a critical report by short-seller Captain’s Log, which cast doubt on the company’s recent performance and questioned the sustainability of its business model. The report alleges that Groupon’s purported turnaround, particularly in its North America Local segment, is misleading and accuses the company of engaging in questionable accounting practices.
According to the short-seller’s report, Groupon’s stock price increase from $12.00 to $32.94 year-to-date has been largely driven by two temporary trends: the proliferation of GLP-1 affiliate marketing and a boost from the latest Microsoft (NASDAQ:MSFT) Office release. With these trends now past their peak, Groupon faces significant challenges ahead. The report suggests that Groupon’s growth in the North America Local business segment is not as robust as it appears, claiming that it is largely a result of reclassifying semaglutide/GLP-1 telehealth sales and Microsoft Office product licenses as "Local" offerings rather than "Goods."
The report also criticizes Groupon’s business practices, asserting that the company has shifted its focus from selling discounted deals for restaurants and entertainment to becoming a leading affiliate marketer for medical treatments and software licenses. It argues that this pivot is unsustainable and potentially harmful to consumers and businesses alike.
The short-seller’s investigation raises concerns about the quality of providers featured on Groupon’s platform, the consumer behavior it promotes, and the cyclical nature of the software license sales. The report concludes by predicting a downfall for Groupon’s stock as the reality of its business practices comes to light.
Groupon, headquartered in Chicago, is known for offering coupons and discounts on a variety of services and products. In 2023, the company underwent a management change with Czech private equity firm Pale Fire Capital taking the helm, installing Dusan Senkypl as CEO and Jiri Ponrt as CFO. Although Groupon’s stock has surged 174% through June 6, 2025, driven by investor confidence in the new management’s turnaround strategy, the short-seller’s report casts doubt on the legitimacy and longevity of this recovery.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.