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Are the days of "daily deal" coupons about to expire? Shares of email coupon company Groupon are down nearly 80 percent since going public last year. And its smaller rival, Living Social, plans to lay off as many as 400 employees, after reporting a net loss of more than $560 million in the third quarter.

Those struggles have raised questions about the future of the daily deal strategy, and whether a company like Groupon can stay in business.

"It's ... an evolution of the company that's happening," says Arvind Bhatia, managing director of equity research for the investment firm Sterne Agee, in an interview with NPR's David Greene. "They have a decent balance sheet," Bhatia says of Groupon. "As long as they continue to generate profitability, I think the business can survive."

Interview Highlights:

On the coupon business model

"I think fundamentally, the model can work. But it needs scale. Keep in mind that Groupon was born out of the recession ... at a time when people wanted to see deals. So they were right in the sweet spot of what people really wanted. And they've grown really fast.

"But ... the daily deal business seems to be peaking. And in some ways, Groupon is a victim of its own success. It's hard for them to continue to grow the daily deal business the way they did before."

On the need for scale

"Both Living Social and Groupon — Groupon, in particular — have spent tons and tons of money in acquiring these customers. They have something like 160 million people whose email list that they have. That is what is attractive to merchants. So, you need scale to succeed."

On complaints about deals

"The deals that merchants offer are deeply discounted deals. And those are meant to be deals that bring customers in. And hopefully, customers like the product and keep coming back.

"Sometimes what happens is, the merchants that are using this product maybe don't know how to use it appropriately. And maybe their service isn't good enough — and they were hoping this would be this one last desperate move to get customers in before they go out of business. So, it depends on the merchant itself."

On the evolving "daily deal" business

"In the beginning, it was all about, let's acquire customers at all costs. Now, particularly for Groupon, it's OK, you've got the customers. Now show us how you can make money with this business model.

"So one thing they have to do is slow down on their spending. And they're doing exactly that."

On moving past email

"What they've talked about is tapping into, perhaps, search engines like Google and Bing to attract more customers. And that's a pretty significant move. Keep in mind that 25 percent of all searches ... are for local products.

"But right now, they're driving very little business from these search engines. So that's an opportunity for them to now go after customers that are looking for deals in general, not just through the emails."

Iran's state TV said Tuesday that the country's Revolutionary Guard has captured a U.S. drone after it entered Iranian airspace over the Persian Gulf.

The report quoted the Guard's navy chief, Gen. Ali Fadavi, as saying that the Iranian forces caught the "intruding" drone, which had apparently taken off from a U.S. aircraft carrier.

Fadavi said the unmanned Scan Eagle aircraft was now in Iran's possession.

"The U.S. drone, which was conducting a reconnaissance flight and gathering data over the Persian Gulf in the past few days, was captured by the Guard's navy air defense unit as soon as it entered Iranian airspace," Fadavi said. "Such drones usually take off from large warships."

He didn't provide any further details nor said when the incident happened. There was no immediate comment from the U.S. Navy's 5th Fleet, based in Bahrain.

If true, the seizure of the drone would be the third reported incident involving Iran and U.S. drones in the past two years.

Last month, Iran claimed that a U.S. drone had violated its airspace. Pentagon said the unmanned aircraft came under fire — at least twice but was not hit — and that the Predator was over international waters.

The Nov. 1 shooting in the Gulf was unprecedented, and further escalated tensions between the United States and Iran, which is under international sanctions over its suspect nuclear program. Tehran denies it's pursuing a nuclear weapon and insists its program is for peaceful purposes only.

In 2011, Iran claimed it brought down a CIA spy drone after it entered Iranian airspace from its eastern borders with Afghanistan and Pakistan. The RQ-170 Sentinel drone, which is equipped with stealth technology, was captured almost intact. Tehran later said it recovered data from the top-secret drone.

In the case of the Sentinel, after initially saying only that a drone had been lost near the Afghan-Iran border, American officials eventually confirmed the plane was monitoring Iran's military and nuclear facilities. Washington asked for it back but Iran refused, and instead released photos of Iranian officials studying the aircraft.

The U.S and its allies believe Iran is pursuing a nuclear weapon. Iran denies the charge, saying its nuclear activities are for peaceful purposes only, such as power generation and cancer treatment.

Negotiations between the White House and Republican leaders have reached a stalemate over how best to avoid going off the so-called fiscal cliff. Robert Kuttner, founder and co-director of the American Prospect, argues that the president should hold his ground in this debate, even if it means triggering the tax hikes and spending cuts.

David Letterman's "stupid human tricks" and Top 10 lists vaulted into the ranks of cultural acclaim Sunday night as the late-night comedian received this year's Kennedy Center Honors with rock band Led Zeppelin, an actor, a ballerina and a bluesman.

Stars from New York, Hollywood and the music world joined President Obama at the White House on Sunday night to salute the honorees, whose ranks also included actor Dustin Hoffman, Chicago bluesman Buddy Guy and ballerina Natalia Makarova.

The honors are the nation's highest award for those who influenced American culture through the arts. The recipients were later saluted by fellow performers at the Kennedy Center Opera House in a show to be broadcast Dec. 26 on CBS.

Obama drew laughs from his guests when he described the honorees as "some extraordinary people who have no business being on the same stage together."

Noting that Guy made his first guitar strings using the wire from a window screen, he quipped, "That worked until his parents started wondering how all the mosquitoes were getting in."

Enlarge Drew Angerer/AFP/Getty Images

Honoree Natalia Makarova arrives at the event at the Kennedy Center in Washington, D.C., Sunday.