Daily coupon website Groupon Inc's (GRPN.O) third-quarter profit beat analysts' estimates as strong growth in North America helped offset a decline in international revenue.
Groupon shares were up nearly 8 percent in extended trading after sliding more than 10 percent.
Revenue from North America, Groupon's fastest growing region, grew 24 percent, while revenue from EMEA (Europe, Middle East and Africa) fell 21 percent in the three months ended September 30.
Gross billings — a key metric that reflects the gross amounts collected from customers - increased 10 percent to $1.34 billion in the quarter.
More than half of Groupon's transactions in North America and more than 40 percent of global transactions were from mobile devices, the company said.
The company said that more than 60 million people have installed Groupon's application on their mobile devices by the end of third quarter. Active customers grew 10 percent year-over-year to 43.5 million.
With its core, emailed daily deals business model in steep decline over the past year, the Chicago-based company in recent months has re-invented itself as a more traditional e-commerce business that sells long-term deals through its smartphone app.
Co-founder and Chief Executive Eric Lefkofsky, who was formally appointed CEO in August, has focused on a mobile-centric strategy since he was named interim chief executive after the February ouster of former CEO Andrew Mason.
Groupon has also been building an online deal marketplace called Pull that lets people search for and buy deals in their area.
The Chicago-based company also said it agreed to buy rival e-commerce company LivingSocial Inc's South Korean unit, Ticket Monster, for $260 million in cash and stock.
"Ticket Monster has been successful building a mobile commerce business in one of the largest markets in the world. It will serve as the cornerstone of our Asian business, bringing scale and ecommerce expertise to that region," Lefkofsky said in a statement.
Ticket Monster's marketplace relies on traffic from mobile devices with email accounting for less than 10 percent of sales. The deal is expected to close in the first half of 2014.
"We intend to begin making investments again in Asia and Latin America in an effort to position those markets for growth...Our primary objective given how young those markets are is not to maximize profits but instead to drive sustainable growth there," Lefkofsky said in a conference call.
Revenue from Europe was down as the company invested more to expand the number of merchants the company partners with, Chief Financial Officer Jason Child told Reuters.
Child said he expects revenue from Europe to turn positive in the coming quarters.
Europe has been a particular problem for Groupon, partly because the sovereign debt crisis has dented demand for higher-priced deals.
Groupon has been trying to revive a sluggish European business, while juggling the fast-rising cost of ensnaring new customers, and merchants to partner on Internet coupons for everything from spa treatments to fine dining.
The company forecast fourth-quarter revenue of $690 million to $740 million, largely lower than analysts' expectations for $723.7 million.
The company said its revenue was hurt by a fall in open rates of its daily emails after Google introduced a promotions tab in its GMail service, which filters and displays promotions in a tab separate from the user's primary email inbox.
Groupon expects to report either a break even in the fourth quarter or a profit of 2 cents per share. Analysts had expected a profit of 6 cents per share.
Third-quarter loss narrowed to $2.6 million, or break even per share, from a loss of $3 million, or break even, a year earlier.
Excluding items, the company — which competes against LivingSocial, Amazon.com (AMZN.O), eBay (EBAY.O) and Google (GOOG.O) in a crowded and fiercely competitive e-commerce marketplace — earned 2 cents per share.
Revenue rose 5 percent to $595.1 million. Analysts had expected $615.69 million, according to Thomson Reuters I/B/E/S.
Shares of the company closed down 5 percent at $9.50 on Thursday on Nasdaq. They are up 93 percent so far this year.
(Reporting by Soham Chatterjee; Editing by Joyjeet Das and Bob Burgdorfer)