TripAdvisor (TRIP) Beats Q1 Earnings and Revenue Estimates

TripAdvisor Inc.TRIP 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%.


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 , sporting a Zacks Rank #1 (Strong Buy), while Etsy, Inc. ETSY and SMC Corporation SMCAY , 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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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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