Shares of Groupon fell below $3 a share for the first time in early trading Friday following the company's disappointing earnings report.
Groupon reported a net loss of $2.98 million -- breaking even on a per share basis -- on revenues of $568.6 million, missing Wall Street's estimates for earnings of $0.03 per share on revenue of $591 million. The company also announced that it laid off 80 employees from its sales department -- a small fraction of its total staff of more than 10,000 -- in an effort to begin cutting costs.
The stock closed at $3.92 Thursday and declined by more than 20% in pre-market trading before opening at $3.01 a share Friday. The stock quickly dropped to $2.99 a share and was hovering around the $3 mark as of publication.
Even before the earnings report, Groupon's stock had been plagued in recent weeks by concerns that Hurricane Sandy would impact sales from the company's vendors and renewed doubts about the viability of the daily deals industry after Amazon revealed it was taking a big loss for its stake in LivingSocial.
Groupon went public at $20 a share and has since seen its stock price decline of about 85%. The company's market cap is now just more than $2.5 billion, less than half what Google was rumored to be willing to pay for the daily deals site in late 2010.
Groupon isn't the only hyped tech stock to plummet into the $2 range. Zynga is trading at around $2.13 a share. It's now a race to the bottom to see which of these two stocks falls below $2 first.