LivingSocial earned a net profit of $100 million in 2014 thanks almost entirely to successfully selling off its Asian operations. The company actually had a $73 million loss if the $260 million sale of South Korean company TicketMonster and the sale of its Southeast Asian assets for $18.5 million are discounted. It may need every bit of loose cash it has to make its recent reorganization work under new CEO Gautam Thakar.
Since Thakar was hired, LivingSocial has laid off about a fifth of its work force, including much of its D.C. sales team. In the last quarter, it closed its sales office in California and put a lot of investment into new kind of technology platform, called Connect, where businesses can talk more directly to customers.
“We made some tough decisions in Q4 designed to simplify our organization,” said Dan Federico, vice president of finance at LivingSocial in a statement. “On the sales side, we built momentum over the holiday period and we are starting the year focused on continuing to deliver new features for both our customers and merchant partners.”
LivingSocial is not publicly traded but releases some of its number because of its relationship with Amazon, which owns about a third of the company. There are some interesting trends in the details released, such as how close to 80 percent of all LivingSocial purchases during the holidays were by women, and big increases in mobile sales on Black Friday and Cyber Monday compared to the year before.
Despite the somewhat bleak core business numbers, the fact that first-time customers were a fifth of all customers in the last quarter is at least a positive sign there will be some growth coming for LivingSocial. And the fact that it has $21 million assets, compared to $91 million in liabilities last year, is a cause for some optimism.
