TripAdvisor focuses on good news as overall revenue continues to fall

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TripAdvisor saw overall revenue decline for the second quarter in a row as its Hotels, Media & Platform division fell short again.

Despite the drag on one part of the company's key metrics, total adjusted EBITDA was up 17% to $128 million during the second quarter.

The Hotels, Media & Platform division is contributing in a major way to the uplift in profit, with a 27% increase year over year.

Overall revenue increased from $376 million to $422 million over the course of the first and second quarters, but year-over-year the business is down 3% in the comparable three-month periods.

The Experiences & Dining wing of the business saw revenues jump by over a quarter to $125 million -- the second reporting period in a row that the division has seen a 20%-plus increase.

President and CEO Steve Kaufer says investments during 2019 in the division are "setting a foundation to increasingly monetize our influence across more travel categories."

He added: "Phocuswright estimates that global travel activities is a $159 billion market that is currently 80% offline. PwC estimates the global restaurant market reached $1.6 trillion in 2018 and expects its growth to accelerate through 2022.

"We want to reinforce our market-leading position now and remain far from profit-taking mode. We could choose to operate this segment closer to enterprise-level profit margins today; however, we believe investing in platform expansion to capture market share and long-term growth is the best way to maximize future profits and shareholder value."

Back in the Hotels, Media & Platform division, revenues fell from $272 million to $254 million between the second quarter of 2018 and the same period this year.

Kaufer said Hotels revenue decreased primarily due to performance marketing optimizations throughout last year and, to a lesser extent, adverse changes in foreign currency and lower SEO (search engine optimization) revenue.

"We attribute our SEO trends to Google increasingly pushing its own hotel products in search results, a practice we anticipate will receive increased focus from regulators moving forward," Kaufer said.

The division is concentrating on a number of strategic initiatives on the back of its improved profitability, Kaufer said. These include attempts to improve loyalty and membership, delivering a new TripAdvisor brand marketing plan and expanding its B2B products for hoteliers.
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Source: PhocusWire

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