Groupon reduced its workforce by 23% and raised earnings guidance, prompting a 10% stock gain amid mixed quarterly results.
Groupon (NASDAQ: GRPN) announced the layoff of 400 employees, or 23% of its workforce, attributing the move to AI-driven efficiencies. The company also revised its earnings outlook upward for the year.
First-quarter revenue remained flat at $117 million, while the company reported a net loss of $13 million, compared to a $7 million profit in the same period last year. The stock surged 10% following the announcement, continuing a trend where layoffs are linked to short-term stock gains.
The move follows a broader pattern of companies reducing headcounts while citing AI adoption as a cost-saving measure, though critics question the long-term impact on growth and morale.