SAN FRANCISCO — One day after Groupon Inc. delivered a disappointing quarterly report and forecast, the online daily deal company fired Chief Executive Andrew Mason.
Shortly after the close of trading Thursday, Groupon said it had replaced Mason with Executive Chairman Eric Lefkofsky and Vice Chairman Ted Leonsis in the newly created Office of the Chief Executive. Groupon said its board has already begun the search for a new CEO.
In a message that Mason put out to Groupon's employees, Mason joked that after 41/2; "intense and wonderful years as CEO of Groupon," he was leaving to spend more time with his family. Mason then got to the real reason at hand. "I was fired today," Mason said. "If you're wondering why, you haven't been paying attention."
Mason went on to own up to the matters that have dragged on Groupon for the past year-and-a-half, such as "controversial metrics in our S1 (statement to go public) to our material weakness to two quarters of missing our own expectations and a stock price that is hovering around one quarter of our listing price.
"As CEO, I am accountable."
In another statement, Leonsis thanked Mason for his work with Groupon and said, "We are confident that with our deep management team and market-leading position, the company is well-positioned for the future."
Groupon's shares rose in after-hours trading following the announcement of Mason's firing.
Mason had been under pressure for months to do something to improve Groupon's earnings and turn around its stock price after it went public at $20 a share in November 2011. At the time, it was the biggest IPO of a U.S. Internet company since Google Inc. went public in 2004.
But earnings and sales quickly failed to pass muster and turned many investors off. The company's stock fell to a post-IPO low of $2.60 a share on Nov. 12, 2012. The company also came under fire last year when it had to restate 2011 fourth-quarter results because of factors such as funds it had to set aside for returns on higher-priced items such as vacation packages.
In November, Mason addressed the challenges facing Groupon when, at a tech conference, he said he would "fire myself" if he didn't feel he was the right CEO.
Arvind Bhatia, who covers Groupon for Sterne Agee, had recently raised his rating on company's stock to buy, with a price target of $9 a share. Bhatia said it appears Groupon's board decided it couldn't wait any longer to make a change in the CEO office.
"The board was cognizant of what was going on and felt the company needed a change," Bhatia said. "We were thinking this would happen if things didn't turn around in the next couple of quarters. There were probably a lot of pressures on the board after things didn't turn around in the fourth quarter."