Groupon, Inc. Q1 FY2026 earnings call

Management emphasized the impact of AI on changing the company's operation mode, with projects like SEO, SCM, Mobile Next accelerating significantly with AI. Discussed SG&A spending related to restructuring and cost reduction, noting that cost savings are not the primary motivation but an opportunity for growth. Mentioned international business has strong underlying performance, with sales teams in international being stronger and focused on individual countries, having wins like with Emirates.

Not providing specific numbers on SG&A savings, but seeing opportunities for growth along with cost reductions. Optimistic about international markets with strong sales teams and focus on individual countries.

Q: What's up with the taxes in the quarter and why not add back severance for adjusted ebitda?

A: Regarding taxes, quarter-to-quarter movements due to business planning, expecting cash tax benefits from last year's legislature but no structural change. For severance, it's part of ongoing activities not part of board-approved Q1 restructuring, so disclosed in SG&A commentary.

Q: How are you personally using AI day-to-day and what's changed in six months?

A: Six months ago was experimenting with AI for small tasks, now in agentic mode with AI Chief of Staff, seeing significant productivity boost, AI providing answers faster.

Q: Conviction on where AI and local commerce goes in 18 - 24 months and where Groupon needs to be?

A: Position Groupon to help small businesses with AI toolkit, build solutions for merchants using data, and be a platform connected to AI agents for consumers.

Q: How to track if AI-native operating model is working beyond P&L?

A: Focus on being AI first inside, how employees operate with AI, and whether Groupon is used by AI platforms for discovery.

Q: What's most surprising about AI inside the company since Project Foundry?

A: Biggest surprise is quality of AI voice agents, progress in last five months making it hard to distinguish from human.

Q: Thoughts on SumUp IPO and use of cash if monetized?

A: SumUp is a valuable asset, if monetized, will allocate cash opportunistically, looking at share buybacks and investment needs.

Q: Color on marketing channels, leaning into Meta and away from Google?

A: Groupon should be disciplined on marketing channels, sees bigger opportunity on Meta with AI-generated ads and videos, experimenting with AI-driven content creation for Meta and TikTok.