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TripAdvisor (TRIP) Beats Q1 Earnings and Revenue Estimates

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TripAdvisor Inc. (TRIP - Free Report) reported adjusted first-quarter 2018 earnings of 9 cents per share, surpassing the Zacks Consensus Estimate by 5 cents.

Also, earnings increased sequentially but decreased 44% from the year-ago quarter.

Revenues in the first quarter were $378 million, above the Zacks Consensus Estimate of $361 million.

Following the better-than-expected results in the first quarter, the share price was up 22%. However, over the past year, the stock has underperformed the industry it belongs to. It has lost 0.77% as against the industry’s rally of 49.19%.

 

Revenues

TripAdvisor’s quarterly revenues reflect an increase of 17.8% sequentially and 1.6% year over year.

Revenue Segments

TripAdvisor reports revenues under two segments: Hotel and Other.

Revenues of $299 million in the Hotel segment dipped 4.8%, year over year, and accounted for 79% of the total revenues. This segment includes click, display, subscription and transaction-based revenues from hotels, air and cruise, also including sales from the company’s largest subsidiary, SmarterTravel, as well as from operations in China.

Revenues of $79 million from the Non-Hotel segment increased 37% year over year and contributed to the remaining 21% of the total revenues. This segment includes revenues from attractions, restaurants and vacation rental businesses.

Revenues by Source

Revenues of $189 million from Click-based advertising decreased 10.4% from the year-ago quarter and accounted for 50% of the total revenues. Revenues from Display-based advertising increased 9.2% year over year to $71 million and brought home 19% of the total revenues. The other hotel revenue component contributed $39 million, up 2.6% from the year-ago quarter. However, it accounted for 11% of the total revenues.

Important Metrics

User reviews and opinions reached 630 in the quarter and grew 26% year over year

Average monthly unique visitors grew 12% from the prior-year quarter to approximately 433 million.

Average monthly unique hotel shoppers remained flat year over year at approximately 149 million.

Operating Results

TripAdvisor’s adjusted operating expenses of $307 million increased 2% from the prior-year quarter. Adjusted operating margin of 6.1% was down 120 bps from the year ago-quarter.

On a GAAP basis, TripAdvisor’s net income was $5 million or 4 cents per share compared with net profit of $13 million or earnings of 9 cents per share.

Balance Sheet & Cash Flow

TripAdvisor exited the quarter with cash, cash equivalents and short-term investments of roughly $650 million, down from $708 million in recorded in the last reported quarter. Accounts receivables were $281 million, up from $230 million in the fourth quarter.

Cash flow from operations was $174 million, increasing from $18 million in the last reported quarter. Capex was $15 million, flat with the fourth quarter.

 

TripAdvisor, Inc. Price, Consensus and EPS Surprise

 

TripAdvisor, Inc. Price, Consensus and EPS Surprise | TripAdvisor, Inc. Quote

 

Zacks Rank and Stocks to Consider

TripAdvisor has a Zacks Rank #4 (Sell).

Some better-ranked stocks in the technology sector are Littelfuse, Inc. (LFUS - Free Report) , sporting a Zacks Rank #1 (Strong Buy), while Etsy, Inc. (ETSY - Free Report) and SMC Corporation (SMCAY - Free Report) , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings per share growth rate forLittelfuse, Etsy and SMC Corporation is projected at 12%, 18% and 13.7%, respectively.

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