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COMMITMENTS AND CONTINGENCIES | 6 Months Ended
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Jun. 30, 2026
Commitments and Contingencies Disclosure [Abstract] |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Our contractual obligations and commitments as of June 30, 2026 and through the date of this report, did not materially change from the amounts set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, except as discussed below. Purchase Obligations During the six months ended June 30, 2026 and through the date of this report, we entered into non-cancellable arrangements with third parties, primarily related to cloud computing and other information technology services. Future payments under these new contractual obligations are as follows (in thousands):
Remaining in 2026 | $ | 1,067 |
2027 | 11,800
2028 | 10,600
2029 | 10,000
2030 | — |
Thereafter | — |
Total | $ | 33,467 |
Legal Matters and Other Contingencies From time to time, we are party to various legal proceedings incident to the operation of our business. For example, we currently are involved in proceedings brought by merchants, employment and related matters, intellectual property infringement suits, customer lawsuits, stockholder claims relating to U.S. securities law, consumer class actions and suits alleging, among other things, violations of state consumer protection or privacy laws. We have two separate Portugal VAT assessments outstanding covering different periods. The 2011 to 2012 Portugal VAT assessment, totaling up to $4.8 million inclusive of penalties and interest through June 30, 2026, remains under appeal. We lodged our initial appeal in the Portuguese courts in 2015. During 2024, we received a negative ruling at the lowest-level court to assert factual and legal challenges. Based on this ruling and consideration of relevant facts and circumstances, we concluded an adverse outcome was probable and recorded a $4.6 million contingent liability, which is presented in Accrued expenses and other current liabilities in our Condensed Consolidated Balance Sheets as of June 30, 2026. There have been no updates during the current quarter related to the appeal or the status of this contingent liability. We have a bank guarantee of $4.2 million in place relating to this assessment, classified as restricted cash in our Condensed Consolidated Balance Sheets as of June 30, 2026. The 2013 to 2015 Portugal VAT assessment, totaling approximately $4.5 million inclusive of penalties and interest through June 30, 2026, is a separate matter that is now final. On October 31, 2024, we learned that Portugal's highest-level court declined to hear our appeal. The assessment was final and became due during the fourth quarter of 2024. A formal demand notice was received and payment was made in July 2026. The related obligation is presented in Accrued expenses and other current liabilities in our Condensed Consolidated Balance Sheets as of June 30, 2026. We have a bank guarantee of $4.0 million in place relating to this assessment, classified as restricted cash in our Condensed Consolidated Balance Sheets as of June 30, 2026. In July 2026, in connection with the payment of the assessment, the bank guarantee was drawn down to fund the settlement. The Company has been named as a defendant in putative class action complaints alleging violations of the Telephone Consumer Protection Act of 1991 ("TCPA") and related state telemarketing laws in connection with the Company's SMS marketing program. These matters are in an early stage in the litigation process and no class has been certified in any of the actions. The Company believes it has meritorious defenses to the allegations in these matters and intends to defend itself vigorously. Because these proceedings are at a preliminary stage, the Company is currently unable to predict their ultimate outcome or estimate the amount or range of possible loss, if any. Accordingly, no amounts have been accrued in the accompanying financial statements. While the Company cannot provide assurance as to the ultimate resolution of these matters, it does not currently believe an unfavorable outcome in any of these cases is probable. In addition, third parties have from time to time claimed, and others may claim in the future, that we have infringed their intellectual property rights. We are subject to intellectual property disputes, including patent infringement claims, and expect that we will continue to be subject to intellectual property infringement claims as our services expand in scope and complexity. In the past and/or at present, we have litigated patent infringement and other intellectual property-related claims, including pending litigation or trademark disputes relating to, for example, our Goods category, some of which involved or could have involved potentially substantial claims for damages or injunctive relief. We may also become more vulnerable to third-party claims as laws such as the Digital Millennium Copyright Act are interpreted by the courts, and we become subject to laws in jurisdictions where the underlying laws with respect to the potential liability of online intermediaries are either unclear or less favorable. We believe that additional lawsuits alleging that we have violated patent, copyright or trademark laws may be filed against us. Intellectual property claims, whether meritorious or not, are time-consuming and often costly to resolve, could require expensive changes in our methods of doing business or the goods we sell, or could require us to enter into costly royalty or licensing agreements. We also are subject to consumer claims, lawsuits, and arbitrations relating to alleged violations of consumer protection or privacy rights and statutes, some of which could involve potentially substantial claims for damages, including statutory or punitive damages. Consumer and privacy-related claims, lawsuits, and arbitrations, whether meritorious or not, could be time-consuming, result in costly litigation, damage awards, fines and penalties, injunctive relief or increased costs of doing business through adverse judgment or settlement, or require us to change our business practices, sometimes in expensive ways. In addition, plaintiffs’ firms have increasingly used mass arbitration tactics, in which large numbers of substantially similar individual arbitration demands are filed simultaneously, often seeking to impose significant upfront filing, administrative, or settlement costs regardless of the merits of the underlying claims. The use of such tactics could increase our dispute resolution costs, divert management attention, and adversely affect our results of operations, even if the claims asserted are not ultimately successful. We are also subject to, or in the future may become subject to, a variety of regulatory inquiries, audits, and investigations across the jurisdictions where we conduct our business, including, for example, inquiries related to consumer protection, employment matters and/or hiring practices, marketing practices, tax, unclaimed property and privacy rules and regulations. Any regulatory actions against us, whether meritorious or not, could be time-consuming, result in costly litigation, damage awards, fines and penalties, injunctive relief or increased costs of doing business through adverse judgment or settlement, require us to change our business practices in expensive ways, require significant amounts of management time, result in the diversion of significant operational resources, materially damage our brand or reputation, or otherwise harm our business. We establish an accrued liability for loss contingencies related to legal, regulatory and indirect tax matters when the loss is both probable and reasonably estimable. Those accruals represent management's best estimate of probable losses, and in such cases, there may be an exposure to loss in excess of the amounts accrued. For certain of the matters described above, there are inherent and significant uncertainties based on, among other factors, the stage of the proceedings, developments in the applicable facts of law, or the lack of a specific damage claim. However, we believe that the amount of reasonably possible losses in excess of the amounts accrued for those matters would not have a material adverse effect on our business, consolidated financial position, results of operations or cash flows. Our accrued liabilities for loss contingencies related to legal, regulatory and indirect tax matters may change in the future as a result of new developments, including, but not limited to, the occurrence of new legal matters, changes in the law or regulatory environment, adverse or favorable rulings, newly discovered facts relevant to the matter, or changes in the strategy for the matter. Regardless of the outcome, litigation and other regulatory matters can have an adverse impact on us because of defense and settlement costs, diversion of management resources and other factors. Indemnifications In connection with the disposition of our operations in Latin America in 2017, we recorded $5.4 million in indemnification liabilities for certain tax and other matters upon the closing of the transactions within discontinued operations. We estimated the indemnification liabilities using a probability-weighted expected cash flow approach. In 2020 and 2019, we decreased our indemnification liabilities due to the expiration of certain indemnification obligations. Our remaining indemnification liabilities were $2.8 million as of December 31, 2024. After negative rulings at the first and second tier courts in March 2024 and April 2025 for the majority of the assessed amounts, the Company filed a special appeal to the second-level court requesting the court to revisit certain aspects of its decision. The second-level court denied the special appeal and Groupon filed an appeal with the third tier court. For one of the matters appealed, in the first quarter of 2025, the Company concluded an adverse outcome is probable based on the second tier court findings specific to that case. The Company therefore determined it is probable a loss has been incurred for this individual matter and recorded additional liability of $0.5 million, including interest and penalties, presented within Income (loss) from discontinued operations in the Condensed Consolidated Statement of Operations during the six months ended June 30, 2025. Our total remaining indemnification liabilities were $3.4 million as of June 30, 2026, inclusive of the contingent liability and related interest and penalties incurred to date of $0.6 million. There have been no updates during the current quarter related to the appeal or the status of this indemnification liability. We estimate that the total amount of obligations that are reasonably possible to arise under the indemnifications should not exceed our bank guarantee of $10.2 million for these assessments. Our bank guarantee is classified as restricted cash in our Condensed Consolidated Balance Sheets as of June 30, 2026. In the normal course of business to facilitate transactions related to our operations, we indemnify certain parties, including employees, lessors, service providers, merchants and counterparties to investment agreements and asset and stock purchase agreements with respect to various matters. We have agreed to hold certain parties harmless against losses arising from a breach of representations or covenants, or other claims made against those parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. We are also subject to increased exposure to various claims as a result of our divestitures and acquisitions. We may also become more vulnerable to claims as we expand the range and scope of our services and are subject to laws in jurisdictions where the underlying laws with respect to potential liability are either unclear or less favorable. In addition, we have entered into indemnification agreements with our officers, directors and underwriters, and our bylaws contain similar indemnification obligations that cover officers, directors, employees and other agents. Except as noted above, it is not possible to determine the maximum potential amount under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, any payments that we have made under these agreements have not had a material impact on our operating results, financial position or cash flows.

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