Investment Rating - The report maintains a "Buy" rating for Trip.com Group-S (09961 HK) [1][3] Core Views - Q1 2024 saw strong profit growth with revenue of RMB 11 91 billion, net profit of RMB 4 31 billion, and Non-GAAP net profit of RMB 4 06 billion, up 29%, 28%, and 96% YoY respectively [1][7] - Adjusted net margin reached 34%, up 12 percentage points YoY and 8 percentage points QoQ, driven by the recovery of high-margin outbound travel and operational leverage [1][7] - Domestic travel benefited from increased online penetration, while outbound travel saw a strong recovery, with international business expanding rapidly and inbound travel growing significantly [1][8] - Non-GAAP operating profit grew 44% YoY, with a margin of 32%, up 3 percentage points YoY, supported by operational leverage and improved marketing efficiency [1][9] Revenue Breakdown - Domestic hotel and air ticket bookings grew over 20% YoY, with vacation business exceeding 2019 levels [1][8] - Outbound hotel and air ticket bookings surged over 100% YoY, recovering to over 90% of 2019 levels [1][8] - International Trip com revenue grew approximately 80% YoY, with inbound bookings increasing over 4 times [1][8] Profitability - Gross margin stood at 81 2%, down 1 percentage point YoY, but high-margin outbound travel contributed positively [1][9] - Adjusted sales expense ratio improved by 0 4 percentage points YoY, remaining well-controlled at 19 1% [1][9] Outlook - Domestic travel growth is expected to slow due to high base effects, but online penetration will continue to support performance [2] - Outbound travel is expected to remain strong, with further recovery during the summer season, driven by improved flight capacity, lower ticket prices, and visa process enhancements [2] - The report slightly raises 2024 revenue growth forecasts and expects Non-GAAP net profit for 2024-2026 to be RMB 15 5/18 7/22 0 billion, with EPS of RMB 23/27/32 and dynamic PE of 18/15/13x [2] Industry Position - Trip com Group is a leading one-stop travel service provider with a strong foothold in both domestic and international markets, benefiting from its high-end traffic accumulation and supply chain advantages [2]

Investment Rating - The report assigns a "BUY" rating for Trip.com Group (TCOM) with a target price of US$65.8, up from the previous target of US$49.0, indicating a potential upside of 17.9% from the current price of US$55.83 [3][12]. Core Insights - Trip.com Group reported a net revenue of RMB11.9 billion for Q1 2024, representing a year-over-year increase of 29.4%, which exceeded both the forecast and consensus estimates [2]. - The company is positioned to capitalize on globalization opportunities beyond the current pent-up demand in the travel industry, leveraging its one-stop shop business model and strong customer service capabilities [2][7]. - Management anticipates that international business will contribute over 20% of total revenue within the next 3-5 years, supported by a significant total addressable market in Asia that is 1.5 times that of China [7][8]. Summary by Sections Financial Performance - In Q1 2024, Trip.com achieved a non-GAAP operating income of RMB3.8 billion, surpassing forecasts due to better gross profit margins and controlled marketing expenses [2][10]. - The company expects revenue for Q2 2024 to reach RMB12.9 billion, reflecting a 15% year-over-year growth [2]. Market Position and Growth Strategy - Trip.com’s domestic travel bookings grew at a double-digit rate year-over-year in Q2 2024, outpacing the overall market [9]. - The international flight capacity rebounded to 70% of pre-pandemic levels, with Trip.com outperforming the industry by 20-30% in outbound travel bookings [8][9]. - The inbound travel revenue, which accounted for approximately 20% of Trip.com’s revenue in Q1 2024, is expected to further support revenue growth [7]. Operational Efficiency - The non-GAAP operating profit margin for Q1 2024 was 31.6%, significantly better than forecasted, driven by disciplined sales and marketing spending [2][10]. - The company aims to maintain efficient marketing expenditures focused on return on investment, which is expected to stabilize the operating profit margin despite a high base [2][10]. Future Projections - Revenue projections for 2024, 2025, and 2026 are RMB52.8 billion, RMB59.5 billion, and RMB65.8 billion respectively, with corresponding growth rates of 18.5%, 12.6%, and 10.6% [10][11]. - The gross profit margin is expected to remain strong at around 81.3% for 2024, with operating margins projected to improve to 26.2% [10][11].

携程集团-S（9961.HK）2024Q1业绩点评 Q1 经调整利润超预期，国际业务保持高增 2024年05月22日 事件：2024年5月21日，携程集团（9961.HK/TCOM）发布2024年Q1未 推荐 维持评级 经审计业绩，24Q1净收入119亿元，yoy+29%（超彭博一致预期116亿元）； 当前价格： 440.00港元 归母净利润 43 亿元，净利率 36.2%；上年同期为 34 亿元（利润率 36.7%）； Non-GAAP 净利润41 亿元（超彭博一致预期为 28 亿元），利润率 34.1%；上 年同期为21亿元（Non-GAAP利润率22.5%）。 [Table_Author] ➢ 住宿、交通稳健增长，度假业务显著恢复。分业务来看，24Q1住宿收入45 亿元，yoy+29%，qoq+15%；交通收入50亿元，yoy+20%，qoq+22%；度 假收入8.83亿元，yoy+129%，qoq+25%；商旅收入5.11亿元，yoy+15%， qoq-19%主要系春节假期企业客户出行相对温和；其他收入 10.31 亿元， yoy+39%，qoq+4%。 ➢ Q1销售费用投放较少，利润表现超预期。24 ...

Financial Data and Key Metrics Changes - Trip.com Group reported a net revenue of RMB 11.9 billion for Q1 2024, representing a 29% increase year-over-year and a 15% increase quarter-over-quarter [23] - Adjusted EBITDA was RMB 4 billion for Q1 2024, compared to RMB 2.8 billion in the same period last year, with an adjusted EBITDA margin of 33% [25] - Diluted earnings per ordinary share were RMB 6.38 or USD 0.88 for Q1 2024, with non-GAAP diluted earnings per ordinary share at RMB 6 or USD 0.83 [25] Business Line Data and Key Metrics Changes - Accommodation reservation revenue for Q1 was RMB 4.5 billion, a 29% increase year-over-year and a 15% increase quarter-over-quarter [23] - Transportation ticketing revenue reached RMB 5 billion, representing a 20% increase year-over-year and a 22% increase quarter-over-quarter [23] - Packaged-tour revenue surged to RMB 883 million, a 129% increase year-over-year and a 25% increase quarter-over-quarter [23] Market Data and Key Metrics Changes - The outbound travel market saw bookings fully recover to pre-pandemic levels during major holiday periods, with outbound hotel and air ticket bookings increasing by over 100% year-over-year [13][23] - Inbound travel bookings increased by 400% year-over-year, driven by visa-free policies and strong demand from key markets [16] - The domestic market showed robust growth, with hotel and air ticket bookings increasing by 20% to 30% year-over-year [12] Company Strategy and Development Direction - The company is focusing on expanding its user base in second- and third-tier cities in China and enhancing user acquisition and cross-selling ratios [29] - Trip.com aims to capture the growing inbound travel market in China, which is projected to be a multitrillion RMB opportunity [29] - The introduction of tailor-made products for the silver generation is expected to tap into a significant market opportunity valued at RMB 1 trillion [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the sustainability of strong performance for the rest of 2024, citing a transition from pent-up demand to a more normalized demand environment [11] - The company anticipates continued strong demand across travel segments, despite potential challenges from declining hotel and air prices [26] - Management remains optimistic about the travel market's recovery, particularly in outbound travel, which is expected to reach 80% of pre-pandemic levels by year-end [41] Other Important Information - The company has introduced the Old Friends Club initiative to cater to the travel preferences of the silver generation, aiming to bridge the gap between peak and off-peak travel seasons [8] - Trip.com is committed to social responsibility, creating job opportunities and supporting local communities through strategic investments [21] Q&A Session Summary Question: What growth drivers should investors pay attention to? - Management highlighted the focus on expanding user base in lower-tier cities and the growth of outbound travel as key drivers [29] Question: Have you observed a decrease in hotel ADR and RevPAR? - Management confirmed a decline in domestic ADR influenced by increased outbound travel and improved hotel availability in lower-tier cities [33] Question: What was the business performance during the Labor Day holiday? - Management reported record high domestic and outbound travel bookings during the holiday, with outbound bookings surpassing 120% of 2019 levels [38] Question: What factors will impact the recovery of outbound travel? - Management noted visa applications and flight capacity as major factors influencing the recovery of outbound travel [42] Question: How does Trip.com plan to capture the inbound travel market? - Management emphasized the rich offerings of China and the introduction of free-visa policies to attract international travelers [47] Question: What is the contribution of inbound travel to Trip.com? - Inbound travel now contributes over 20% to overall revenues, reflecting significant growth [49]

Core Insights - Trip.com Group Limited (TCOM) reported strong first-quarter 2024 results, with earnings and revenues exceeding expectations and showing year-over-year growth [1][2] - The growth is attributed to increased domestic and outbound travel demand in China, supported by stabilized supply and relaxed visa requirements [1] - The company is optimistic about investments in product and technology innovations to enhance user travel experiences [1] Financial Performance - Adjusted earnings per share (EPS) reached 83 cents, surpassing the Zacks Consensus Estimate of 62 cents by 33.9%, compared to 45 cents in the prior-year quarter [2] - Net revenues totaled $1.65 billion, exceeding the consensus mark of $1.61 billion by 2.3%, and up from $1.34 billion in the prior-year quarter [2] - Revenue growth was driven by accommodation reservations (29% increase), transportation ticketing (20% increase), packaged tours (129% increase), and corporate travel (15% increase) [2] - Adjusted EBITDA was $550 million, reflecting a 42.9% year-over-year increase, with an adjusted EBITDA margin expanding by 200 basis points to 33% [2] Balance Sheet - As of March 31, 2024, the company had total cash and cash equivalents, restricted cash, short-term investments, and held-to-maturity deposits amounting to $11.3 billion, an increase from $10.9 billion as of December 31, 2023 [3]

Investment Rating - The investment rating for the company is "Buy" with a target price of HKD 509.00, indicating a potential upside of 16.6% from the current price of HKD 436.40 [2][8]. Core Insights - The report highlights that while hotel prices in mainland China have decreased, the booking volume has exceeded expectations, leading to an anticipated stable profit margin for the year [1]. - For Q1 2024, the company reported revenues of RMB 11.9 billion, a year-on-year increase of 29%, slightly above market expectations. Adjusted net profit rose by 96% to RMB 4.1 billion, with a net profit margin of 34% [1][4]. - The report anticipates that the company's outbound revenue will nearly fully recover to 2019 levels, with international business expected to grow by over 30% [1]. Summary by Sections Financial Performance - Q1 2024 revenue breakdown: Hotel accommodation revenue increased by 29%, transportation by 20%, vacation packages by 129%, and business travel by 15% [1]. - Adjusted net profit for Q1 2024 was RMB 4.1 billion, exceeding expectations by 32% and 45% compared to market forecasts [1][4]. - The company maintained a stable marketing expense ratio at 19%, better than the expected 22-23% [1]. Market Outlook - The report projects a 10% decline in hotel prices in Q2 2024, with a potential marginal improvement in Q4 2024. Despite price declines, the company is expected to maintain double-digit growth in booking volumes due to strong brand recognition and supply chain advantages [1]. - The company is expected to achieve a 30.1% adjusted net profit margin in 2024, with adjusted net profit and earnings per share forecasts raised by 12% and 27% respectively [1][4]. Valuation - The target price has been adjusted from HKD 440 to HKD 509 based on a 20x P/E ratio for 2024, reflecting confidence in sustained travel demand and the company's competitive advantages in both domestic and international markets [2][4].

Financial Performance - Trip.com reported quarterly earnings of $0.83 per share, exceeding the Zacks Consensus Estimate of $0.62 per share, and up from $0.45 per share a year ago, representing an earnings surprise of 33.87% [1] - The company posted revenues of $1.65 billion for the quarter ended March 2024, surpassing the Zacks Consensus Estimate by 2.25%, and an increase from $1.34 billion year-over-year [1] - Over the last four quarters, Trip.com has consistently surpassed consensus EPS and revenue estimates [1] Stock Performance - Trip.com shares have increased approximately 57.8% since the beginning of the year, significantly outperforming the S&P 500's gain of 11.2% [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.76 on revenues of $1.84 billion, and for the current fiscal year, it is $2.96 on revenues of $7.36 billion [4] - The estimate revisions trend for Trip.com is currently unfavorable, resulting in a Zacks Rank 4 (Sell), indicating expected underperformance in the near future [4] Industry Context - The Leisure and Recreation Services industry, to which Trip.com belongs, is currently ranked in the bottom 43% of over 250 Zacks industries, suggesting potential challenges ahead [5] - Vail Resorts, another company in the same industry, is expected to report quarterly earnings of $9.99 per share, reflecting a year-over-year increase of 22.1%, with revenues anticipated to be $1.31 billion, up 5.9% from the previous year [6]

Financial Performance - In Q1 2024, Trip.com Group's net revenue reached RMB 11.9 billion (USD 1.6 billion), representing a year-over-year increase of 29% and a quarter-over-quarter increase of 15%[3]. - Q1 2024 net profit was RMB 4.3 billion (USD 599 million), compared to RMB 3.4 billion in the same period of 2023[5]. - Total revenue for the three months ended March 31, 2024, reached RMB 11,921 million, a 15.4% increase from RMB 10,338 million in the same period of 2023[13]. - Net profit attributable to Ctrip Group for the three months ended March 31, 2024, was RMB 4,312 million, compared to RMB 1,297 million in the same period of 2023, representing a significant increase of 232.5%[14]. - The gross profit for the three months ended March 31, 2024, was RMB 9,667 million, up from RMB 8,315 million in the same period of 2023, reflecting a growth of 16.3%[13]. - Operating profit for the three months ended March 31, 2024, was RMB 3,315 million, an increase of 50.9% from RMB 2,197 million in the same period of 2023[13]. - The EBITDA margin for the three months ended March 31, 2024, was 33%, compared to 28% in the same period of 2023, indicating improved operational efficiency[15]. - Ctrip Group's diluted earnings per share for the three months ended March 31, 2024, was RMB 6.38, compared to RMB 1.94 in the same period of 2023, reflecting a substantial increase[14]. Revenue Breakdown - Revenue from accommodation bookings in Q1 2024 was RMB 4.5 billion (USD 623 million), a 29% year-over-year increase[3]. - Transportation ticketing revenue for Q1 2024 was RMB 5 billion (USD 692 million), reflecting a 20% year-over-year increase[4]. - The company reported a significant increase in accommodation booking revenue, which reached RMB 4,496 million for the three months ended March 31, 2024, compared to RMB 3,480 million in the same period of 2023, marking a growth of 29.2%[13]. Investment and Development - The company invested RMB 3.1 billion (USD 431 million) in product development in Q1 2024, which accounted for 26% of net revenue[4]. - Research and development expenses for the three months ended March 31, 2024, amounted to RMB 214 million, slightly down from RMB 215 million in the previous quarter[14]. - Trip.com Group is committed to product and technology innovation to enhance user experience and drive sustainable growth[2]. - The company emphasized its commitment to enhancing its travel platform and expanding its market presence, particularly focusing on user engagement and innovative travel solutions[10]. - The company anticipates continued growth in user data and market expansion, driven by new product developments and strategic initiatives[15]. Financial Position - As of March 31, 2024, the company had cash and cash equivalents totaling RMB 81.9 billion (USD 11.3 billion)[5]. - As of March 31, 2024, the total assets of the company amounted to RMB 228.5 billion, an increase from RMB 219.1 billion as of December 31, 2023, representing a growth of approximately 4.2%[11]. - The total liabilities increased to RMB 99.9 billion as of March 31, 2024, compared to RMB 96.1 billion as of December 31, 2023, reflecting a rise of about 3.0%[12]. - The company's total equity rose to RMB 128.6 billion as of March 31, 2024, up from RMB 123.0 billion as of December 31, 2023, indicating an increase of approximately 4.6%[12]. - The cash and cash equivalents, along with restricted cash and short-term investments, totaled RMB 44.8 billion as of March 31, 2024, compared to RMB 44.0 billion as of December 31, 2023, showing a slight increase of about 1.8%[11]. - The net accounts receivable increased to RMB 12.3 billion as of March 31, 2024, from RMB 11.4 billion as of December 31, 2023, marking a growth of approximately 7.4%[11]. - The company reported a total current liabilities of RMB 86.8 billion as of March 31, 2024, up from RMB 72.4 billion as of December 31, 2023, which is an increase of about 19.9%[12]. - The goodwill remained stable at RMB 59.4 billion as of both December 31, 2023, and March 31, 2024, indicating no significant changes in this area[11]. Market Trends and Challenges - Domestic hotel and flight bookings grew by over 20% year-over-year, while outbound hotel and flight bookings increased by over 100%[2]. - The company's international OTA platform, Trip.com, saw total revenue growth of approximately 80% year-over-year[2]. - The company continues to face risks related to economic fluctuations and competition, which may impact future performance and strategic initiatives[7].

Core Insights - Trip.com Group Limited reported strong financial results for the first quarter of 2024, with net revenue increasing by 29% year over year to RMB11.9 billion (US$1.6 billion) [3] - The company experienced significant growth in both domestic and international travel bookings, with outbound hotel and air bookings increasing by over 100% year over year [2][3] - Adjusted EBITDA for the first quarter was RMB4.0 billion (US$550 million), reflecting an adjusted EBITDA margin of 33%, up from 31% in the same period of 2023 [3][14] Financial Performance - Net income for the first quarter of 2024 was RMB4.3 billion (US$599 million), compared to RMB3.4 billion for the same period in 2023 [3][14] - Accommodation reservation revenue increased by 29% year over year to RMB4.5 billion (US$623 million) [3] - Transportation ticketing revenue rose by 20% year over year to RMB5.0 billion (US$692 million) [3] - Packaged-tour revenue surged by 129% year over year to RMB883 million (US$122 million) [3] - Corporate travel revenue increased by 15% year over year to RMB511 million (US$71 million) [3] Cost Structure - Cost of revenue increased by 37% year over year to RMB2.2 billion (US$310 million), representing 19% of net revenue [3] - Product development expenses rose by 16% year over year to RMB3.1 billion (US$431 million), accounting for 26% of net revenue [3] - Sales and marketing expenses increased by 32% year over year to RMB2.3 billion (US$320 million), making up 19% of net revenue [3] Market Outlook - The company noted a significant increase in travel demand in China, supported by a more stabilized supply and relaxed visa requirements [2] - Management emphasized the commitment to investing in product and technology innovations to enhance user experience [2]

Group 1 - Trip.com Group Limited will announce its financial results for the three months ended March 31, 2024, on May 20, 2024, after market close [1] - A conference call will be hosted by the management team at 8:00 PM U.S. Eastern Time on May 20, 2024, with a live webcast available [1] - Participants must pre-register to join the conference call and will receive details including dial-in numbers and a unique access PIN upon registration [2] Group 2 - Trip.com Group Limited is a leading global one-stop travel platform, offering a comprehensive suite of travel products and services [3] - The company operates under various brands, including Ctrip, Qunar, Trip.com, and Skyscanner, and aims to provide cost-effective travel bookings and support [3] - Founded in 1999, Trip.com Group was listed on Nasdaq in 2003 and on HKEX in 2021, with a mission to pursue the perfect trip for a better world [3]