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TripAdvisor (TRIP) Q1 Earnings & Revenues Beat, Rise Y/Y

TripAdvisor TRIP reported non-GAAP first-quarter 2024 earnings of 12 cents per share, which significantly jumped from the prior-year quarter’s 5 cents. The figure also beat the Zacks Consensus Estimate, which was pegged at break even.

Revenues of $395 million increased 6% year over year and surpassed the Zacks Consensus Estimate of $390.9 million.

Top-line growth was driven by the strong momentum in the Viator segment. A well-performing TheFork segment also benefited the company.

However, softness across Tripadvisor-branded hotels was concerning.

TRIP has lost 15.7% year to date against the industry’s rally of 16.8%.

TripAdvisor, Inc. Price, Consensus and EPS Surprise

 

TripAdvisor, Inc. Price, Consensus and EPS Surprise
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.

Brand Tripadvisor: Revenues summed $240 million (accounting for 60.8% of the total revenues), down 2% year over year. The figure lagged the consensus mark of $244 million. Media and advertising revenues jumped 10% year over year to $33 million. Revenues from experiences and dining were $36 million, increasing 9% year over year.

However, revenues from branded hotels decreased 5% year over year to $159 million. Other revenues within the segment were $12 million, which declined 8% year over year.

Viator: Revenues totaled $141 million (35.7%). The figure increased 23% year over year and surpassed the Zacks Consensus Estimate of $135 million.

TheFork: Revenues came in at $41 million (10.4%), increasing 17% year over year. The figure beat the consensus mark of $38.9 million.

Operating Results

TripAdvisor’s selling and marketing costs increased 1% year over year to $221 million. As a percentage of revenues, the figure contracted 300 basis points (bps) year over year.

General and administrative costs were up 17% from the year-ago quarter to $56 million. As a percentage of revenues, the figure expanded 100 bps year over year.

Technology and content costs of $76 million increased 12% on a year-over-year basis. As a percentage of revenues, the figure rose 100 bps year over year.

TRIP reported an operating loss of $15 million in the quarter under review, which was wider than the loss of $14 million in the year-ago quarter.

In the reported quarter, the total adjusted EBITDA margin was 12%, which expanded 300 bps on a year-over-year basis.

Balance Sheet & Cash Flow

As of Mar 31, 2024, cash and cash equivalents were $1.17 billion compared with $1.07 billion as of Dec 31, 2023.

The long-term debt stood at $840 million at the end of the first quarter compared with the previous quarter’s $839 million.

Tripadvisor generated $139 million of cash from operations in the reported quarter against $19 million of cash used in operations in the prior quarter.

The free cash flow was $123 million in the first quarter.

Zacks Rank & Stocks to Consider

Currently, TripAdvisor carries a Zacks Rank #3 (Hold).

Investors interested in the broader retail-wholesale sector can consider some better-ranked stocks like The Gap GPS, Amazon AMZN and Target TGT. The Gap sports a Zacks Rank #1 (Strong Buy), and Amazon and Target carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Gap has lost 3.9% in the year-to-date period. The long-term earnings growth rate for GPS is estimated at 12%.

Shares of Amazon have gained 50.7% in the year-to-date period. The long-term earnings growth rate for AMZN is projected at 29.60%.

Target has gained 11.5% in the year-to-date period. The long-term earnings growth rate for TGT is anticipated to be 11.36%.

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