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Groupon surprises by failing to net a profit

Groupon employees celebrate the company's IPO last November.

By msnbc.com staff and wire

Groupon has surprised Wall Street by failing to make a profit since becoming a publicly-traded company in late 2011.

The daily deals website’s first earnings report has revealed its saw a fourth-quarter net loss of $42.7 million. That’s better than one year ago, when it saw a loss of $378.6 million, but still disappointing to analysts who had expected a small profit.

Groupon shares fell sharply on the news.

Earnings were dented by a huge tax bill worth $35 million following the opening of an international headquarters in Switzerland, the company said.

While the tax bill caught Wall Street's eye, analysts were more unsettled by signs that Groupon's breakneck pace of growth from recent quarters may be slowing, especially in North America, its most mature market.

Several other new technology companies have gone public in recent months, including Zynga, Pandora and LinkedIn. Some analysts have raised questions about the viability of these companies.

Social media giant Facebook filed documents last week for a $5 billion initial public offering of stock that’s expected to be one of the biggest and most talked about share offerings in recent memory.

Reuters contributed to this report.

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