TRIP Q3 2024 Earnings

Call Details

• Call Title: TripAdvisor, Inc. Q3 2024 Earnings Call
• Date: November 6, 2024 at 9:30 PM UTC
• Management Team:
  • Angela White (Vice President of Investor Relations)
  • Matt Goldberg (President and CEO)
  • Mike Noonan (Chief Financial Officer)

Call Summary

Financial Performance

• Consolidated Q3 revenue was $532M, reported as flat versus Q3 2023 and in line with expectations.
• Consolidated adjusted EBITDA was $122M, or 23% of revenue, reported as non-GAAP performance.
• Brand TripAdvisor revenue was $255M, down 12% year over year, and branded hotels revenue was $151M, down 17% year over year driven primarily by Hotel Meta.
• Viator revenue was $270M, up 10% year over year, and Viator GBV grew 9% to approximately $1.1B in the quarter.
• Viator adjusted EBITDA was $30M, or 11% of revenue, reflecting year-over-year margin leverage of over 400 basis points.
• The Fork revenue was $49M, up 17% year over year (15% in constant currency), with adjusted EBITDA of $5M, or 10% of revenue.
• Operating cash flow was negative $44M and free cash flow was negative $64M in the quarter, which the company described as seasonally typical.
• The company ended the quarter with nearly $1.1B of cash and cash equivalents, an increase of $45M from December 31, 2023.
• Cost line items increased as a percent of revenue, including cost of revenue at 9% (+100 bps), technology and content at 14% (+100 bps), and sales & marketing at 51% of revenue (flat as a percent of revenue).
• Q3 year-over-year share-based compensation increased by $7M due to vesting schedule differences, and prior-year one-time items included a $49M refund related to a 2009-2011 IRS transfer pricing settlement.

Guidance

• Full-year 2024 consolidated revenue and adjusted EBITDA are in line with the company’s August outlook on a consolidated basis.
• Company expects high single-digit revenue declines at Brand TripAdvisor for the full year 2024 relative to 2023.
• Consolidated adjusted EBITDA is expected to deleverage roughly 100 basis points year over year for 2024.
• The company expects a sequential acceleration of consolidated revenue growth in Q4 to low- to mid-single digits year over year.
• Q4 revenue growth expectations by segment are mid-teens for Viator and mid-20s for The Fork, while Brand TripAdvisor revenue is expected to be flat sequentially.
• Q4 margin expectations are approximately 20% for Brand TripAdvisor, high single digits for Viator, and roughly flat year over year for The Fork.
• The company explicitly stated that some growth investments were delayed into 2025, and that delaying investments improved Q3 adjusted EBITDA but will reduce expected Q4 revenue and adjusted EBITDA versus the August outlook.