TripAdvisor TRIP reported second-quarter 2024 non-GAAP earnings of 39 cents per share, which rose 15% from the prior-year quarter. The figure also beat the Zacks Consensus Estimate by 2.6%.
Revenues of $497 million increased 1% year over year. The figure missed the Zacks Consensus Estimate of $505.5 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.
TripAdvisor, Inc. Price, Consensus and EPS Surprise
TripAdvisor, Inc. price-consensus-eps-surprise-chart | TripAdvisor, Inc. Quote
Quarterly Details
Brand Tripadvisor: Revenues summed $250 million (accounting for 50.3% of the total revenues) for the segment, down 10% year over year. The figure lagged the consensus mark of $264 million. Media and advertising revenues fell 2% year over year to $41 million. Revenues from experiences and dining were $48 million, decreasing 4% year over year. Revenues from branded hotels decreased 14% year over year to $150 million. Other revenues within the segment were $11 million, which declined 15% year over year.
Viator: The segment’s revenues totaled $244 million (49.1%). The figure increased 13% year over year and surpassed the Zacks Consensus Estimate of $240 million.
TheFork: Revenues for the segment came in at $42 million (8.4%), increasing 11% year over year. The figure came below the consensus mark of $43.6 million.
Operating Results
TripAdvisor’s selling and marketing costs decreased 3% year over year to $263 million. As a percentage of revenues, the figure contracted 200 basis points (bps) year over year.
General and administrative costs were up 19% 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 $75 million increased 6% on a year-over-year basis. As a percentage of revenues, the figure rose 100 bps year over year.
TRIP reported an operating margin of 7.2% in the quarter under review, which contracted 170 bps year over year.
In the reported quarter, the total adjusted EBITDA margin was 20%, which expanded 180 bps on a year-over-year basis.
Balance Sheet & Cash Flow
As of Jun 30, 2024, cash and cash equivalents were $1.18 billion compared with $1.17 billion as of Mar 31, 2024.
The long-term debt stood at $841 million at the end of the second quarter compared with the previous quarter’s $840 million.
Tripadvisor generated $53 million of cash from operations in the reported quarter, down from $139 million reported in the prior quarter.
The free cash flow was $37 million in the second quarter.
Zacks Rank & Stocks to Consider
Currently, TripAdvisor carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are Badger Meter BMI, Arista Networks ANET and PayPal PYPL. All the three stocks sport a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Badger Meter shares have gained 32.7% in the year-to-date period. The long-term earnings growth rate for BMI is projected at 17.92%.
Arista Networks shares have gained 41.5% in the year-to-date period. The long-term earnings growth rate for ANET is expected to be 17.2%.
PayPal shares have gained 5.3% in the year-to-date period. The long-term earnings growth rate for AAPL is anticipated to be 15.9%.
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