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Core Viewpoint - Tripadvisor's stock experienced a 10% increase following Starboard Value's disclosure of a stake exceeding 9% in the company, valued at approximately $160 million as of the previous day's close [1] Company Summary - Starboard Value holds a stake of more than 9% in Tripadvisor, which is valued at around $160 million [1] - Tripadvisor's stock performance has been stagnant since the beginning of the year, having dropped over 30% in 2024 [1] - The company established a special committee last year to explore potential strategic options [1]

Core Insights - The article compares TripAdvisor (TRIP) and Chewy (CHWY) to determine which stock is a better option for value investors [1] Valuation Metrics - TripAdvisor has a Zacks Rank of 2 (Buy), indicating a positive earnings outlook, while Chewy has a Zacks Rank of 3 (Hold) [3] - TRIP's forward P/E ratio is 23.29, significantly lower than CHWY's forward P/E of 91.45, suggesting TRIP is more undervalued [5] - The PEG ratio for TRIP is 2.33, compared to CHWY's PEG ratio of 9.67, indicating TRIP's expected earnings growth is more favorable [5] - TRIP's P/B ratio is 2.93, while CHWY's P/B ratio is 45.89, further highlighting TRIP's relative undervaluation [6] Value Grades - Based on various valuation metrics, TRIP holds a Value grade of B, whereas CHWY has a Value grade of D, suggesting TRIP is the superior option for value investors [6][7]

Financial Data and Key Metrics Changes - The company reported a good quarter with durable travel consumer intent observed until early May [4][5] - There is a focus on long-term growth in travel despite macroeconomic volatility [4][5] - The company is monitoring cancellations and pricing closely, with no significant changes noted up to the reporting date [8][10] Business Line Data and Key Metrics Changes - The experiences category remains a mainstay of travel budgets, with a bifurcation observed between upper and lower-end consumers [6][7] - The meta business has shown strong pricing performance, indicating resilience even in choppy market conditions [12][14] - The company is combining meta with booking in its app, which is expected to enhance user engagement and monetization [14][15] Market Data and Key Metrics Changes - The company is well-positioned to serve both domestic and international travelers, adapting to changing consumer preferences [22][23] - There is a diversification in inventory, particularly in the experiences space, which is crucial for catering to various traveler mindsets [22][24] Company Strategy and Development Direction - The company aims to be the most trusted source for travel and experiences, focusing on authenticity and trust in an AI-driven world [26][27] - Each business segment has its own distinct strategy, with a focus on engagement and monetization [27][30] - The company is investing in marketing and product development to stabilize the hotel category and accelerate experiences [20][21][30] Management's Comments on Operating Environment and Future Outlook - Management acknowledges the uncertainties in the macro environment but remains optimistic about the travel sector's growth [4][10] - The company is focused on leveraging AI to enhance user experience and engagement, which is expected to drive higher conversion rates [55][56] - There is confidence in the potential for TripAdvisor to stabilize and return to modest growth by 2026 [101][102] Other Important Information - The company is exploring partnerships and collaborations to enhance its offerings and market presence [41][43] - The Fork, a subsidiary, is experiencing double-digit growth and is positioned strongly in the European dining market [84][86] Q&A Session Summary Question: How does the company view the impact of macroeconomic factors on travel? - The company closely tracks macroeconomic uncertainty and focuses on long-term growth, noting that travel intent remains strong despite volatility [4][5] Question: What is the strategy regarding direct booking within the app? - The company finds direct booking and meta products to be complementary, aiming to enhance user experience across categories [16][17] Question: How does the company plan to leverage AI in its offerings? - The company is developing an AI-led travel planner that utilizes user-generated content and first-party data to enhance recommendations and user engagement [54][56] Question: What is the outlook for the experiences category amid increasing competition? - The company views the interest from competitors as validation of the category's potential and believes there is room for multiple players [74][75] Question: What is the strategy for The Fork in the European market? - The Fork is focused on growing its presence in Europe, leveraging technology to enhance both B2C and B2B offerings [80][84]

Core Insights - Tripadvisor's Summer Travel Index 2025 indicates a strong interest in travel among US travelers, with 63% expressing excitement for the upcoming season [1] - The report highlights a significant trend among Gen Z and Millennials, who are 38% more likely to travel both domestically and internationally compared to older generations [3][7] Travel Trends - Popular destinations for US travelers include Las Vegas and Cancun, with new trending locations such as Fort Walton Beach, Florida, and Punta Sam, Mexico [3][4] - The Caribbean is a key focus for international travel, with 51% of travelers citing relaxation as their primary reason for travel [5] Activity Preferences - Activities and experiences are prioritized by travelers, with 83% considering them an important part of their travel budget, and 89% planning up to five activities [7] - Gen Z is more inclined to book six or more activities compared to older generations, with 14% of Gen Z planning this versus an average of 9% for older groups [7] Planning and Booking Behavior - 57% of travelers plan to book activities ahead of their vacations, with Gen Z and Millennials being 78% more likely to do so compared to older generations [11] - Younger travelers prefer vacation rentals (30% average) over hotels (21% average for older generations) [12] Experience Categories - The top trending experience categories for 2025 include cultural and themed tours, outdoor activities, and cruises [11]

Core Insights - TripAdvisor (TRIP) reported first-quarter 2025 non-GAAP earnings of 14 cents per share, a 17% increase year over year, exceeding the Zacks Consensus Estimate by 180% [1] - Revenues for the quarter reached $398 million, a 1% year-over-year increase, also beating the Zacks Consensus Estimate by 2.31% [1] Revenue Breakdown - Brand Tripadvisor generated revenues of $219 million, accounting for 55% of total revenues, but saw an 8% decline year over year, surpassing the consensus estimate of $214 million [2] - Media and advertising revenues decreased by 6% year over year to $31 million [2] - Revenues from experiences and dining were $30 million, down 15% year over year [2] - Revenues from branded hotels decreased by 7% year over year to $148 million, with other revenues in this segment totaling $10 million, reflecting a 19% decline [3] - Viator's revenues totaled $156 million, representing 39.1% of total revenues, marking a 10% year-over-year increase and beating the Zacks Consensus Estimate of $155 million [3] - TheFork generated revenues of $46.4 million, accounting for 11.7% of total revenues, with a 12% year-over-year increase, exceeding the consensus mark of $46.04 million [4] Operating Results - TripAdvisor's cost of sales increased by 9% year over year to $27 million, expanding as a percentage of revenues by 50 basis points [5] - Marketing costs rose by 6% year over year to $172 million, with a 200 basis point increase as a percentage of revenues [5] - General and administrative costs decreased by 41% year over year to $17 million, contracting by 300 basis points as a percentage of revenues [5] - Technology costs totaled $22 million, a 4% year-over-year increase, with a 20 basis point expansion as a percentage of revenues [6] - The company reported an operating loss of $15 million, consistent with the loss from the previous year [6] - The total adjusted EBITDA margin was 11%, contracting by 80 basis points year over year [6] Balance Sheet & Cash Flow - As of March 31, 2025, cash and cash equivalents were $1.2 billion, up from $1.1 billion as of December 31, 2024 [7] - Long-term debt increased to $1.16 billion from $831 million in the previous quarter [7] - The company reported $102 million in cash from operations, a recovery from negative cash from operations of $2 million in the prior quarter [8] - Free cash flow for the first quarter was $83 million [8] Q2 2025 Guidance - TripAdvisor expects revenue growth for Q2 2025 to be between 5% and 8% [9] - For Viator, the company anticipates mid-teens growth in the number of experiences booked and revenue growth of approximately 9% to 11% [9] - Brand Tripadvisor expects a sequential improvement in revenues, projecting a flat to a 2% decline year over year [9] - For TheFork, revenues are expected to grow sequentially in the range of 26% to 28%, including approximately six percentage points of currency benefit at current rates [10] - The adjusted EBITDA margin for Q2 2025 is expected to be in the range of 16-18% [10]

Core Insights - Tripadvisor's stock rose over 12% following strong quarterly results, significantly outperforming the S&P 500 which increased by only 0.4% [1] Financial Performance - Tripadvisor reported a 1% year-over-year revenue increase to $398 million, with non-GAAP adjusted net income rising 26% to $21 million, or $0.14 per share [2] - Both revenue and adjusted net income exceeded analyst expectations, with consensus estimates at just under $389 million for revenue and $0.04 per share for adjusted net income [4] Brand Performance - The flagship Tripadvisor brand experienced an 8% revenue decline, generating $219 million, attributed to weaker hotel bookings and drops in media, advertising, experiences, and dining revenue [5] - Conversely, the Viator and TheFork brands showed strong growth, with Viator's sales increasing by 10% to $156 million and TheFork's improving by 12% to $46 million [5] Industry Outlook - Despite recent weakening in the overall travel and tourism industry, demand remains relatively strong, and Tripadvisor's positive quarterly performance is encouraging ahead of the peak travel season [6]

Financial Performance - Tripadvisor Group's LTM Q1 2025 revenue was $929 million, with 10% year-over-year growth[13] - Viator's LTM Q1 2025 revenue was $855 million, showing a 12% year-over-year growth[13] - TheFork's LTM Q1 2025 revenue reached $186 million, reflecting a 16% year-over-year growth[13] - Consolidated Adjusted EBITDA for Q1 2025 was $44 million[69] - The company's liquidity position as of March 31, 2025, was $1,651 million[28] Segment Highlights - Brand Tripadvisor has approximately 300 million monthly unique users and over 100 million active members[43] - Viator's FY2024 Gross Booking Value (GBV) exceeded $4 billion[55] - Viator offers approximately 400,000 bookable experiences[55] - TheFork operates in 11 countries and features over 55,000 bookable restaurants[66] Strategic Focus - The company is progressing with an engagement-led strategy through product delivery, balancing scale, growth, profitability, and market share[11]

Core Insights - TripAdvisor reported revenue of $398 million for the quarter ended March 2025, reflecting a year-over-year increase of 0.8% and an EPS of $0.14, up from $0.12 in the same quarter last year, with a revenue surprise of +2.31% over estimates [1] Revenue Breakdown - Revenue from the brand Tripadvisor was $219.40 million, slightly above the average estimate of $213.61 million, but down 8.6% year-over-year [4] - Viator generated $155.80 million, exceeding the estimated $155.43 million, marking a 10.5% increase compared to the previous year [4] - Intersegment eliminations reported at -$23.40 million, better than the estimated -$26.79 million, showing a 13.3% improvement year-over-year [4] - TheFork's revenue was $46.40 million, slightly above the estimate of $46.04 million, with a year-over-year increase of 13.2% [4] - Tripadvisor-branded hotels generated $148 million, surpassing the estimate of $135.20 million, but down 6.9% from the previous year [4] - Media and advertising revenue was $30.80 million, below the estimate of $33.66 million, reflecting a 6.7% decline year-over-year [4] - Experiences and dining revenue was $30.50 million, missing the estimate of $33.92 million, down 15.3% from the year-ago quarter [4] - Other revenue was $10.10 million, below the estimate of $10.73 million, representing a 15.8% decline year-over-year [4] Adjusted EBITDA Performance - Adjusted EBITDA for the brand Tripadvisor was $64.90 million, significantly higher than the estimated $49.62 million [4] - TheFork reported an adjusted EBITDA of -$3.50 million, better than the estimate of -$4.46 million [4] - Viator's adjusted EBITDA was -$17.60 million, also better than the estimated -$21.90 million [4] Stock Performance - TripAdvisor shares have returned +19.6% over the past month, outperforming the Zacks S&P 500 composite's +10.6% change, with a current Zacks Rank of 3 (Hold) indicating potential performance in line with the broader market [3]

Financial Data and Key Metrics Changes - Consolidated revenue for Q1 2025 was $398 million, representing 1% growth or approximately 3% growth in constant currency, driven by marketplace businesses [8][23] - Consolidated adjusted EBITDA was $44 million, or 11% of revenue, exceeding expectations due to revenue outperformance and lower fixed costs [9][23] - Gross booking value (GBV) grew 10% or 12% in constant currency to approximately $1.1 billion [25] Business Line Data and Key Metrics Changes - Viator's revenue grew 10% to $156 million, with bookings growth of 15% and an adjusted EBITDA loss of $18 million, reflecting an 800 basis point margin improvement [10][25] - Brand TripAdvisor's revenue was $219 million, a decline of 8%, with adjusted EBITDA at $65 million or 30% of revenue, driven by favorable pricing in Hotel Meta [12][26] - The Fork's revenue grew 12% or 16% in constant currency to $46 million, with an adjusted EBITDA loss of $3 million, reflecting normal seasonality [16][30] Market Data and Key Metrics Changes - North America remained the largest source market for Viator, with healthy growth in bookings and stable booking windows year over year [24] - The US share of international travel from certain source markets, particularly Canada, has decreased, while domestic travel share has increased [19] Company Strategy and Development Direction - The company aims to be the most trusted source for travel and experiences, focusing on diversifying its portfolio and optimizing legacy offerings [6][7] - The strategy includes scaling marketplaces, particularly in experiences, and leveraging AI for personalized recommendations [8][17] - The completion of the merger with Liberty TripAdvisor Holdings has simplified the capital structure and is expected to enhance shareholder engagement and governance [6][43] Management's Comments on Operating Environment and Future Outlook - Management acknowledges macroeconomic uncertainty but remains confident in the long-term growth potential of travel and experiences [18][22] - Travel sentiment remains positive, with consumers planning leisure travel and prioritizing experiences in their budgets [21][72] - The company expects consolidated revenue growth of 5% to 7% for the full year, maintaining its guidance despite the uncertain environment [37] Other Important Information - The company raised $350 million in an add-on to its existing Term Loan B and plans to restart its share repurchase program [32][34] - The company is leveraging AI across various functions, including customer service, content moderation, and marketing [17][90] Q&A Session Summary Question: Guidance and macro uncertainty - Management is comfortable with the current guidance framework but acknowledges macro uncertainty as a reason for not adjusting guidance upward [39][42] Question: Impact of Liberty buyout - The merger simplifies the capital structure and allows for a clearer focus on value drivers and shareholder engagement [43][46] Question: Viator margins and marketing - Management believes Viator can achieve OTA-like margins through product-led growth and improved marketing efficiency [49][50] Question: Cross-border exposure and marketing adjustments - Viator is predominantly a North American booker base, making it less susceptible to international trade pressures [54][55] Question: Google auction changes - Management is actively involved in optimizing ad placements and formats in response to Google's changes [59][60] Question: Average booking value decline - The decline in average booking value is primarily due to a higher mix of lower-priced third-party bookings [61][62] Question: Travel spending in a slower consumer environment - Management notes that consumers are defending travel spending, particularly on experiences, even in a slowing economy [70][72] Question: Pricing trends in Hotel Meta - Improvements in user experience have led to pricing uplifts in Hotel Meta, contributing to better monetization [73][76] Question: Viator marketing strategy - The marketing strategy focuses on utilizing paid channels effectively and enhancing user experience to drive repeat business [95][96] Question: Share count post-merger - Post-transaction, the expected diluted share count is approximately 118 million shares [98]