What happened Shares of Groupon (NASDAQ: GRPN) have plunged today, down by 11% as of 12:05 p.m. EDT, after the company released a presentation last Friday to give investors an update on its transition to a new model in North America. Groupon had previously announced the move when it reported second-quarter results last month. So what In early August, Groupon said it would be transitioning its North American business from selling products directly to a third-party marketplace model. The e-commerce tech company has already exited its warehouse operations, which will significantly reduce its cost structure, interim CEO Aaron Cooper had said. Image source: Groupon. The update on Friday clarified that the change would impact how Groupon reports its financial results. Revenue will be recognized on a net basis instead of a gross basis going forward, but gross profit dollars will be unchanged. The transition will increase the company's reported gross margin percentage but decrease revenue take rate. Now what As a result of the changes, Groupon expects consolidated goods revenue in the third quarter to be approximately $155 million. The consensus estimate currently calls for $340.6 million in revenue but analysts have not yet updated their models to reflect the new reporting structure. Groupon says it is making "good progress" with the transition and it should be "largely complete" by the end of Q3. Cooper had noted that the company will then begin to transition its international goods business to the same third-party marketplace model starting in the fourth quarter. 10 stocks we like better than GrouponWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Groupon wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of August 1, 2020 Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.Source