US group buys website LivingSocial layoffs 10%: Face profit pressure

News and technology information Beijing time November 30, the U.S. second largest group buying website LivingSocial Thursday confirmed that the company will cut 400 employees, accounting for about 10% of its staff, because the company is trying to become profitable.

LivingSocial spokesman confirmed that the company's employees had been informed of the news in the morning of Thursday local time. Of the 4,500 employees in LivingSocial, 400 have received redundancy notices, less than half of whom are in the company's Washington headquarters and the other half in international offices. Eric Eichmann, LivingSocial's International business unit, will also leave, as previously reported.

LivingSocial said that Washington's headquarters were mainly related to customer service, editorial and administrative functions, and that many customer service positions would be relocated to Tucson, Arizona, State (Tucson), which opened a local customer service center this summer. In addition, LivingSocial has cut some of its staff in other smaller local markets, but its regional offices in Seattle and San Francisco have not been closed.

Unlike Groupon, LivingSocial is still a privately held company, so it is not always necessary to disclose the company's internal information. But as Amazon holds a larger share of LivingSocial, some of its financial data will be released quarterly. LivingSocial is in a landslide trend, according to Amazon's third-quarter earnings release in October.

In the quarter, Amazon lost $274 million trillion and lost 60 cents per share, including a $169 million trillion in writedowns, about 37 cents a share. LivingSocial's third-quarter operating loss was $565 million trillion, with a revenue of $124 million and operating expenses of $193 million. LivingSocial's third-quarter losses are mostly related to Non-cash items related to last year's mergers and acquisitions. It is also worth noting that LivingSocial has achieved a positive operating cash flow for the first time since 2009.

But in terms of revenue and operating expenses alone, the LivingSocial wants to make ends meet with nearly a 70 million dollar gap, which needs to be achieved by raising revenue or cutting spending. A spokesman for the LivingSocial said the company was making layoffs after a global review of its operations, hoping to find a way to release resources, invest in areas such as marketing and mobile, and adjust the cost structure.

Meanwhile, LivingSocial's biggest rival, Groupon, is facing a problem that has plunged into a difficult position to continue its rapid growth, with shares falling 80% per cent since the IPO, a year ago, went public. Paul Taaffe, a Groupon spokesman, said in Thursday that after the board meeting, Mason (Andrew Mason) continued to Paul Taver as CEO. A previous source said Groupon's board would discuss the question of whether to replace Mason at a regular meeting in Thursday.