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TripAdvisor (TRIP - Free Report) reported non-GAAP third-quarter 2023 earnings of 52 cents per share, beating the Zacks Consensus Estimate by 8.3%. The bottom line was up 37% year over year.
Revenues of $533 million surged 16% year over year and surpassed the Zacks Consensus Estimate of $506 million.
Top-line growth was driven by growing demand for travel industry-related services. Strong momentum across Viator contributed well to the top line.
A well-performing TheFork segment benefited the company.
However, weakness in hotel meta offerings, primarily due to sluggishness in Europe, was a concern.
TRIP has lost 0.5% on a year-to-date basis against the industry’s gain of 41.8%.
TripAdvisor, Inc. Price, Consensus and EPS Surprise
TripAdvisor reports revenues under three segments: Tripadvisor Core, Viator and TheFork.
Tripadvisor Core: Revenues summed $290 million (accounting for 54.4% of revenues), up 2% year over year. The figure came above the consensus mark of $278 million. Tripadvisor-branded display and platform revenues jumped 15% year over year to $38 million. Revenues from Tripadvisor experiences and dining were $55 million, increasing by 22% year over year.
However, revenues from Tripadvisor-branded hotels decreased 4% from the prior-year quarter’s level to $181 million. Other revenues consisting of rentals, flights, cars and cruise revenues were $16 million, down 11% year over year.
Viator: Revenues totaled $245 million (46% of the top line). The figure increased by 41% from the year-ago quarter’s level and surpassed the Zacks Consensus Estimate of $229 million.
TheFork: Revenues came in at $42 million (7.9% of revenues), increasing 20% year over year. The figure came slightly below the consensus mark of $42.05 million.
Operating Results
TripAdvisor’s selling and marketing costs increased 16% year over year to $272 million.
General and administrative costs were up 9% from the year-ago quarter’s level to $49 million.
Technology and content costs of $66 million increased by 20% on a year-over-year basis.
TRIP reported an operating margin that contracted 320 basis points (bps) year over year to 12% in the third quarter.
In the reported quarter, the total adjusted EBITDA margin was 23.8%, which contracted 130 bps on a year-over-year basis.
Balance Sheet & Cash Flow
As of Sep 30, 2023, cash and cash equivalents were $1.12 billion compared with $1.14 billion as of Jun 30, 2023.
Long-term debt stood at $839 million at the end of the third quarter compared with $838 million at the end of the previous quarter.
Cash generated from operations was $14 million in the reported quarter, significantly down from $105 million in the prior quarter.
Free cash flow was an outflow of $2 million in the third quarter.
Zacks Rank & Other Stocks to Consider
Currently, TripAdvisor carries a Zacks Rank #2 (Buy).
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TripAdvisor (TRIP) Q3 Earnings & Revenues Beat, Rise Y/Y
TripAdvisor (TRIP - Free Report) reported non-GAAP third-quarter 2023 earnings of 52 cents per share, beating the Zacks Consensus Estimate by 8.3%. The bottom line was up 37% year over year.
Revenues of $533 million surged 16% year over year and surpassed the Zacks Consensus Estimate of $506 million.
Top-line growth was driven by growing demand for travel industry-related services. Strong momentum across Viator contributed well to the top line.
A well-performing TheFork segment benefited the company.
However, weakness in hotel meta offerings, primarily due to sluggishness in Europe, was a concern.
TRIP has lost 0.5% on a year-to-date basis against the industry’s gain of 41.8%.
TripAdvisor, Inc. Price, Consensus and EPS Surprise
TripAdvisor, Inc. price-consensus-eps-surprise-chart | TripAdvisor, Inc. Quote
Quarterly Details
TripAdvisor reports revenues under three segments: Tripadvisor Core, Viator and TheFork.
Tripadvisor Core: Revenues summed $290 million (accounting for 54.4% of revenues), up 2% year over year. The figure came above the consensus mark of $278 million. Tripadvisor-branded display and platform revenues jumped 15% year over year to $38 million. Revenues from Tripadvisor experiences and dining were $55 million, increasing by 22% year over year.
However, revenues from Tripadvisor-branded hotels decreased 4% from the prior-year quarter’s level to $181 million. Other revenues consisting of rentals, flights, cars and cruise revenues were $16 million, down 11% year over year.
Viator: Revenues totaled $245 million (46% of the top line). The figure increased by 41% from the year-ago quarter’s level and surpassed the Zacks Consensus Estimate of $229 million.
TheFork: Revenues came in at $42 million (7.9% of revenues), increasing 20% year over year. The figure came slightly below the consensus mark of $42.05 million.
Operating Results
TripAdvisor’s selling and marketing costs increased 16% year over year to $272 million.
General and administrative costs were up 9% from the year-ago quarter’s level to $49 million.
Technology and content costs of $66 million increased by 20% on a year-over-year basis.
TRIP reported an operating margin that contracted 320 basis points (bps) year over year to 12% in the third quarter.
In the reported quarter, the total adjusted EBITDA margin was 23.8%, which contracted 130 bps on a year-over-year basis.
Balance Sheet & Cash Flow
As of Sep 30, 2023, cash and cash equivalents were $1.12 billion compared with $1.14 billion as of Jun 30, 2023.
Long-term debt stood at $839 million at the end of the third quarter compared with $838 million at the end of the previous quarter.
Cash generated from operations was $14 million in the reported quarter, significantly down from $105 million in the prior quarter.
Free cash flow was an outflow of $2 million in the third quarter.
Zacks Rank & Other Stocks to Consider
Currently, TripAdvisor carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the retail-wholesale sector are American Eagle Outfitters (AEO - Free Report) , Best Buy (BBY - Free Report) and Amazon (AMZN - Free Report) . While American Eagle Outfitters currently sports a Zacks Rank #1 (Strong Buy), Best Buy and Amazon each carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters’ shares have risen 37.3% year to date. It has a long-term earnings growth rate of 15.76%.
Best Buy’s shares have risen 15.9% on a year-to-date basis. The company has a long-term earnings growth rate of 6.14%.
Amazon’s shares have rallied 47.6% on a year-to-date basis. AMZN has a long-term earnings growth rate of 28.5%.