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TripAdvisor ‘ahead of expectations’ as it reveals strong start to year

Posted by Lee Hayhurst on
TripAdvisor ‘ahead of expectations’ as it reveals strong start to year

TripAdvisor saw a decline in hotel revenues offset by an upturn in non-hotel revenues in its first-quarter update this week.

The world’s biggest travel review site revealed revenue for the three month period were 2% ahead of the same period last year at $378 million.

While hotel income was down 5%, non-hotel income jumped 36% although the latter amounts to just $79 million versus $299 million.

Growth in non-hotel revenue was mainly driven by experiences and restaurants.

Net income fell to $5 million in the period to the end of March, down from $13 million year on year.

The figures were impacted by a $5 million tax adjustment charge following the implementation of the US tax overhaul and a higher GAAP tax rate.

However, the firm’s share price jumped by 19% on the back of the trading update after performance exceeded analysts’ expectations.

Steve Kaufer, chief executive of TripAdvisor, said: “We had a strong start to 2018; our hotel results were ahead of our expectations, and we delivered accelerated non-hotel revenue growth.

“We are expanding our global platform for the benefit of users and partners and we are executing along our key product, supply and marketing initiatives that position our business for long-term profitable growth.”

TripAdvisor forecast earnings before interest, taxes, depreciation and amortisation (Ebitda) growth in 2018, an improvement on its previous flat forecast.

The company said it was “also incrementally positive about our revenue prospects, while maintaining our expectation that 2018 hotel segment revenue will decline compared to 2017, due primarily to tough year-over-year comparisons for click-based revenue.”

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