Groupon Inc. revised its fourth-quarter results after finding it needed to increase the amount of money it sets aside for refunds.
Its share price plunged in after-hours trading on the news.
Groupon said Friday that it was selling online deals at higher prices during the period and that put it on the hook for larger refunds. (Any user unhappy with a deal can get a refund, a part of the company's business model that has made it so popular.)
The adjustment lowered the company's revenue for the period by $14.3 million.
It wasn't a good sign for Groupon as this was its first quarterly report since it went public in November.
The company started strong in its market debut, raising $700 million in its offering, with shares soaring 31 percent in its first day of trading. But investors have seen less of a deal since then, with shares dropping 30 percent, closing regular trading Friday at $18.38.
Groupon has faced intense competition from other daily deal sites, and loud complaints by merchants after they've been overwhelmed by customers using, and sometimes abusing, the company's offers.
The company's auditor Ernst & Young also flagged a weakness in the Groupon's internal controls over its financial statement. The Chicago company says it is working to address the underlying causes.
Groupon stood by its first-quarter expectations of revenue of $510 million to $550 million, but that would be a slowing over its double-digit growth last year.
"We remain confident in the fundamentals of our business, as our performance continues to highlight the value that we provide to customers and merchants," Groupon's Chief Financial Officer Jason Child said in a statement.
The Associated Press contributed to this report.
