Tripadvisor Reports Second Quarter 2022 Financial Results

NEEDHAM, MA, August 4, 2022 - Tripadvisor, Inc. (Nasdaq: TRIP) today announced financial results for the second quarter ended June 30, 2022.

"I am pleased with our Q2 2022 performance across all segments, which continued to see robust improvement due to the strong demand in leisure travel, our position as a trusted resource for travelers, diners, and experience seekers, and the excellent execution across our teams," said Chief Executive Officer Matt Goldberg. "I join the Company at an exciting time in travel, and look forward to delivering on our plan for the remainder of the year, while charting our course for the future. I am enthusiastic about building from such a strong foundation as we look to provide additional value to travelers and our partners."

Chief Financial Officer Ernst Teunissen continued, "Momentum continued in Q2, and we outperformed our expectations. Our strong performance was driven by high growth rates in Viator and TheFork, and the continued recovery in our hotels business. Our results give us confidence that our investment plan, which balances growth and margin expansion, is working to capture share in key strategic growth areas, and demonstrates the value we are driving for customers across categories. We believe our new segment reporting will provide investors additional insight into the underlying value of our growth assets."

The following summarizes the second quarter of 2022 results under our new segment reporting structure. For additional information on our reportable segments, please see the narrative below captioned "Changes in Segment Information."

Second Quarter 2022 Summary

Three months ended June 30,

(In millions, except percentages and per share amounts)

2022

2021

% Change

Total Revenue

$

417

$

235

77%

Tripadvisor Core (1)

$

274

$

184

49%

Viator

$

136

$

40

240%

TheFork

$

32

$

18

78%

Intersegment eliminations (1)

$

(25)

$

(7)

257%

GAAP Net Income (Loss)

$

31

$

(40)

n.m.

Total Adjusted EBITDA (2)

$

109

$

25

336%

Tripadvisor Core

$

116

$

49

137%

Viator

$

-

$

(13)

n.m.

TheFork

$

(7)

$

(11)

(36)%

Non-GAAP Net Income (Loss) (2)

$

54

$

(10)

n.m.

Diluted Earnings (Loss) per Share:

GAAP

$

0.21

$

(0.29)

n.m.

Non-GAAP(2)

$

0.37

$

(0.07)

n.m.

Cash flow from operating activities

$

295

$

126

134%

Free cash flow (2)

$

282

$

112

152%

n.m. = not meaningful

  1. Tripadvisor Core segment revenue figures shown in this table are gross of intersegment (intercompany) revenue, which is eliminated on a consolidated basis.
  2. "Total Adjusted EBITDA", "Non-GAAP Net Income (Loss)", "Non-GAAP Diluted Earnings (Loss) per Share", and "Free cash flow" are non- GAAP measures as defined by the U.S. Securities and Exchange Commission (the "SEC"). Please refer to "Non-GAAP Financial Measures" below for definitions and explanations of these non-GAAP financial measures, as well as tabular reconciliations to the most directly comparable GAAP financial measures.

1

Monthly unique users - During the second quarter of 2022, average monthly unique users on Tripadvisor-branded websites, a leading indicator of consumer travel demand, increased 19% year-over-year and was approximately 83% of the comparable period in 2019 (pre-COVID-19 timeframe), as compared to approximately 70% of the comparable period in 2019 in Q2 2021.

Revenue - Q2 2022 total revenue of $417 million increased 77% year-over-year and nearly reached parity with the comparable period in 2019 (pre-COVID-19 timeframe), as compared to 56% of the comparable period in 2019 in Q2 2021. Improvement during the second quarter of 2022 was primarily driven by increased consumer demand for travel industry related services, as well as continued easing of government travel restrictions.

Cost performance - Total operating expenses were $354 million for the second quarter, an increase of 31% year-over-year, primarily driven by the following:

  • Cost of revenue was $31 million for the second quarter, an increase of 63% year-over-year, primarily due to increased direct costs from credit card payments and other revenue-related transaction costs in our Viator segment in correlation with the increase in revenue.
  • Selling and marketing costs were $217 million for the second quarter, an increase of 76% year-over-year, primarily due to an increase in our SEM and other online traffic acquisition spend, the substantial majority of which was within our Tripadvisor Core and Viator segments, in response to increasing consumer demand for travel industry related services, amidst the ongoing recovery of the travel industry.
  • Technology and content costs were $53 million for the second quarter, a decrease of 2% year-over-year.
  • General and administrative costs were $28 million for the second quarter, a decrease of 39% year-over-year, primarily due to a non-income tax related government COVID-19 relief subsidy received during the second quarter of 2022 of approximately $11 million in TheFork segment, as well as, and to a lesser extent, a decrease in stock-based compensation expense.

Profitability - Q2 2022 consolidated net income of $31 million improved from a net loss of $40 million in Q2 2021, primarily driven by an increase in consolidated revenue. Q2 2022 Adjusted EBITDA of $109 million improved from Adjusted EBITDA of $25 million in Q2 2021.

Cash & Liquidity - As of June 30, 2022, the Company had $1.05 billion of cash and cash equivalents, an increase of $322 million from December 31, 2021, driven by operating cashflows.

Changes in Segment Information

During the second quarter of 2022, as part of our continuous review of the business and in consultation with our new Chief Executive Officer ("CEO"), we evaluated our operations and realigned the reportable segment information which our chief operating decision maker ("CODM") regularly assesses to evaluate performance for operating decision-making purposes, including allocation of resources. The CODM for the Company is our CEO.

As a result of this segment realignment, effective for the quarter ended June 30, 2022, the Company has the following reportable segments:

  • The Tripadvisor Core segment includes the following revenue sources from Tripadvisor's core offerings on its platforms: (1) Tripadvisor-branded hotels - consisting of hotel auction revenue, primarily click-based advertising revenue, and hotel B2B revenue, which includes primarily subscription-based advertising and hotel sponsored placements revenue; (2) Tripadvisor-branded display and platform - consisting primarily of display-based advertising revenue; (3) Tripadvisor experiences and dining revenue - including intercompany (intersegment) revenue consisting of affiliate marketing commissions earned primarily from experience bookings and, to a lesser extent, restaurant reservation bookings on Tripadvisor-branded websites and mobile apps, fulfilled by Viator and TheFork, which are eliminated on a consolidated basis, in addition to revenue from Tripadvisor restaurant service offerings; and (4) Other revenue - consisting of cruises, rentals, flights, and cars revenue.
  • The Viator segment consists of revenue from our wholly-owned Viator business, which is a leading online experiences marketplace facilitating travelers' discovery and booking of experiences from third party operators across the globe. Viator's online marketplace is comprehensive, connecting millions of travelers to the world's largest supply of bookable tours, activities and attractions-over 300,000 experiences from approximately 50,000 operators. Viator primarily serves as the merchant of record and generates commissions for each booking transaction facilitated through its online platform.

2

  • TheFork segment consists of revenue from our wholly-owned business, TheFork, which is primarily European based, with operations in all major European markets. TheFork provides information and services for consumers to discover and book restaurant reservations with approximately 60,000 restaurants through our dedicated online restaurant reservations platform. TheFork primarily generates transaction fees (or per seated diner fees) that are paid by our restaurant customers for diners that are seated as a result of reservations made on TheFork's platform. TheFork also generates subscription fees for access to certain online reservation management services, marketing analytic tools, and menu syndication services.

Direct costs are included in the applicable operating segments, including certain corporate general and administrative personnel costs, which have been allocated to each segment. We do not allocate certain shared expenses to our reportable segments, such as certain information system costs, technical infrastructure costs, and other costs supporting the Tripadvisor platform and operations, that we do not believe are a material driver of individual segment performance. We include these expenses in our Tripadvisor Core segment. This is consistent with the financial information viewed by our CODM.

All prior period segment disclosure information in this press release has been reclassified to conform to the current segment reporting structure. These reclassifications had no effect on our unaudited condensed consolidated financial statements in any period. We have included comparative figures by recasting summary historical results for the quarters within and for the years ended December 31, 2021, 2020, and 2019, and the quarter ended March 31, 2022, on a segment basis as Exhibit 99.3 to our Form 8-K filed August 4, 2022.

Second Quarter 2022 Revenue by Source

Three months ended June 30,

(In millions, except percentages)

2022

2021

% Change

Tripadvisor Core

Tripadvisor-branded hotels

$

188

$

131

44%

Tripadvisor-branded display and platform

37

26

42%

Tripadvisor experiences and dining (1)

35

16

119%

Other

14

11

27%

Total Tripadvisor Core Revenue

274

184

49%

Viator

136

40

240%

TheFork

32

18

78%

Intersegment eliminations (1)

(25)

(7)

257%

Total Revenue

$

417

$

235

77%

  1. Tripadvisor experiences and dining revenue within the Tripadvisor Core segment shown in this table are gross of intersegment (intercompany) revenue, which is eliminated on a consolidated basis.

3

Conference Call

Tripadvisor posted prepared remarks and supplemental financial information on the Investor Relations section of Tripadvisor's website at http://ir.tripadvisor.com. Tripadvisor will host a conference call tomorrow, August 5, 2022, at 8:30 a.m., Eastern Time, to discuss the Company's second quarter 2022 financial results, and which may include forward looking information about Tripadvisor's business. Investors and other interested parties may also go to the Investor Relations section of Tripadvisor's website at http://ir.tripadvisor.com for a live webcast of the conference call. A replay of the conference call will be available on Tripadvisor's website for three months.

About Tripadvisor

Tripadvisor, the world's largest travel guidance platform*, helps hundreds of millions of people each month** become better travelers, from planning to booking to taking a trip. Travelers across the globe use the Tripadvisor site and app to discover where to stay, what to do and where to eat based on guidance from those who have been there before. With more than 1 billion reviews and opinions of nearly 8 million businesses, travelers turn to Tripadvisor to find deals on accommodations, book experiences, reserve tables at delicious restaurants and discover great places nearby. As a travel guidance company available in 43 markets and 22 languages, Tripadvisor makes planning easy no matter the trip type.

The subsidiaries of Tripadvisor, Inc. (Nasdaq:TRIP), own and operate a portfolio of travel media brands and businesses, operating under various websites and apps, including the following websites: www.bokun.io, www.cruisecritic.com, www.flipkey.com, www.thefork.com, www.helloreco.com, www.holidaylettings.co.uk, www.housetrip.com, www.jetsetter.com, www.niumba.com,www.seatguru.com, www.singleplatform.com, www.vacationhomerentals.com, and www.viator.com.

  • Source: SimilarWeb, unique users de-duplicated monthly, June 2022
  • Source: Tripadvisor internal log files

4

Tripadvisor, Inc.

SELECTED FINANCIAL INFORMATION

Unaudited Condensed Consolidated Statements of Operations

(in millions, except per share amounts)

Three Months Ended

Six Months Ended

June 30, 2022

June 30, 2021

June 30, 2022

June 30, 2021

Revenue

$

417

$

235

$

679

$

358

Costs and expenses:

Cost of revenue (1) (exclusive of depreciation and

amortization as shown separately below)

31

19

53

31

Selling and marketing (1)

217

123

357

196

Technology and content (1)

53

54

107

109

General and administrative (1)

28

46

68

84

Depreciation and amortization

25

28

50

57

Total costs and expenses

354

270

635

477

Operating income (loss)

63

(35)

44

(119)

Other income (expense):

Interest expense

(11)

(11)

(23)

(22)

Interest income and other, net

1

-

-

-

Total other income (expense), net

(10)

(11)

(23)

(22)

Income (loss) before income taxes

53

(46)

21

(141)

(Provision) benefit for income taxes

(22)

6

(24)

21

Net income (loss)

$

31

$

(40)

$

(3)

$

(120)

Earnings (loss) per share attributable to common stockholders:

Basic

$

0.22

$

(0.29)

$

(0.02)

$

(0.88)

Diluted

$

0.21

$

(0.29)

$

(0.02)

$

(0.88)

Weighted average common shares outstanding:

Basic

140

137

139

136

Diluted

145

137

139

136

(1) Includes stock-based compensation expense as follows:

Cost of revenue

$

- $

-

$

1

$

1

Selling and marketing

$

3

$

4

$

6

$

8

Technology and content

$

9

$

13

$

18

$

24

General and administrative

$

9

$

15

$

18

$

28

5

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Disclaimer

TripAdvisor Inc. published this content on 04 August 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 August 2022 21:36:05 UTC.