By RTT News, October 23, 2013, 05:24:00 PM EDT
(RTTNews.com) - Online travel company TripAdvisor Inc. ( TRIP ), Wednesday reported a drop in profit for the third quarter, hurt mainly by higher operating costs that offset a 20 percent revenue growth. Nevertheless, earnings for the quarter were in line with analysts' estimates, while revenues fell short of expectations.
Newton, Massachusetts-based TripAdvisor's third-quarter profit dropped to $55.9 million or $0.38 per share from $59.4 million or $0.41 per share last year.
Adjusted earnings for the quarter slipped to $0.45 per share from $0.46 per share a year ago. On average, 23 analysts polled by Thomson Reuters expected earnings of $0.45 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the three-month period grew 20 percent to $255.1 million from $212.7 million last year. Twenty-one analysts on a consensus, estimated revenue of $256.04 million for the quarter.
TripAdvisor, the online travel-research company, was spun off from Expedia Inc. ( EXPE ) in December 2011.
TripAdvisor's click-based advertising revenue for the quarter grew 13 percent from the year-ago period and represented 74 percent of total revenues. Display-based advertising revenue increased 29 percent, while subscription, transaction and other surged 68 percent.
However, TripAdvisor's bottom line was eroded by higher spending on sales and marketing. Selling and marketing costs rose about 45 percent to $98.2 million. Technology and content expenses rose to $34.4 million from $23.5 million a year ago.
The company said average monthly unique visitors to its sites rose about 60 percent to a record 260 million in the third quarter.
Chief Executive Steve Kaufer said, "Total traffic to TripAdvisor, member count and our valuable user-generated content continue to grow rapidly off a large, global base, driving powerful network effects and making the site better for every user."
TRIP closed Wednesday's trading at $75.21, down $0.29 or 0.38%, on the Nasdaq. The stock, however, gained $2.30 or 3.06% in the after-hours trade.
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