Despegar.com(US:DESP)2024-08-15 20:05Financial Performance - Gross Bookings increased 4% YoY to $1.3 billion, with a 37% YoY increase on an FX neutral basis[4] - Adjusted EBITDA rose 22% YoY to $36.7 million, with an Adjusted EBITDA margin increase of 173 bps YoY to 19.8%[5] - Revenues increased 12% YoY to $185 million, driven by a Take Rate of 13.8%, which is up 96 bps YoY[11] - Adjusted Net Income surged 397% YoY to $30.2 million, compared to $6.1 million in 2Q23[20] - The company expects Adjusted EBITDA for FY24 to be at least $160 million, representing at least 39% YoY growth[12] - Revenue guidance for FY24 has been updated to at least $760 million, reflecting at least 8% YoY growth[25] - Total adjusted EBITDA increased to $36,687 million in Q2 2024, up 22% from $29,957 million in Q2 2023[36] - Total adjusted net income increased by 397% to $30,223 million from $6,079 million year-over-year[38] - Revenue for Q2 2024 was $185,047 million, representing a 12% increase from $165,524 million in Q2 2023[59] - Gross profit rose by 26% to $133,095 million in Q2 2024, up from $105,524 million in the same quarter last year[59] - Operating income for Q2 2024 was $26,142 million, a 40% increase compared to $18,700 million in Q2 2023[59] Transaction and Booking Metrics - B2B Gross Bookings increased 43% YoY, contributing to 18% of total Gross Bookings[6] - App transactions accounted for a record 49.1% of total transactions, up 1,258 bps from 36.5% in 2Q23[22] - Total transactions increased by 10% year-over-year to 2,431,000 in Q2 2024, with Brazil showing a 26% increase and Mexico a 6% increase[67] - Gross bookings rose by 37% year-over-year to $1.758 billion, with significant growth in the Rest of Latin America at 67%[67] - Total payment volume (TPV) for financial services was $18 million in Q2 2024, an 8% increase from $17 million in Q2 2023[41] - The number of transactions increased by 10% to 2,431,000 in Q2 2024 from 2,204,000 in Q2 2023[41] Cost and Expense Management - Selling and marketing expenses increased by 22% to $62,933 million in Q2 2024, up from $51,695 million in Q2 2023[59] - General and administrative expenses doubled to $16,802 million from $8,396 million year-over-year, reflecting a 100% increase[59] - Operating expenses for Q2 2024 were $106.873 million, reflecting a strategic focus on cost management despite increased revenue[69] - The company experienced a significant increase in share-based compensation expense, which rose to $1,457 million in Q2 2024, a 60% increase from $910 million in Q2 2023[36] Asset and Liability Overview - Total assets decreased to $862,981 million as of June 30, 2024, from $886,062 million as of March 31, 2024, representing a decline of approximately 2%[32] - Total current liabilities decreased to $635,100 million as of June 30, 2024, from $657,754 million as of March 31, 2024, a reduction of approximately 3.4%[32] - Total non-current liabilities decreased to $167,865 million as of June 30, 2024, from $174,275 million as of March 31, 2024, a decline of about 3.7%[32] - Cash and cash equivalents and restricted cash decreased to $204,484 million at the end of the period from $243,934 million at the end of the previous period[34] - Net cash flows provided by operating activities were $12,746 million for the three months ended June 30, 2024, down from $28,873 million in the same period last year[34] - The company reported a net decrease in cash flows used in investing activities of $11,498 million for the three months ended June 30, 2024, compared to $16,660 million in the same period last year[34] Strategic Initiatives and Future Outlook - A strategic alliance was formed with World2Meet, resulting in the sale of Despegar's Destination Management Company, BDexperience[8] - The company plans to continue expanding its market presence in Latin America, leveraging the growth in gross bookings and transactions[67] - Future outlook remains positive with expectations of continued revenue growth driven by new product launches and market expansion strategies[67] - The company updated its 2024 annual guidance, indicating a positive outlook for future performance[54] Revenue Generation and Business Model - Despegar's Gross Bookings is a key operating measure representing the total purchase price of travel products booked through its platform, net of withholding taxes on international trips in Argentina since 2020[75] - The Company generates most of its revenue from commissions and service fees, making Gross Bookings an important revenue indicator[75] - Despegar's revenue is primarily derived from commissions and service fees, with additional income from advertising and financial services[90] - The Financial Services segment includes loan origination and processing services, contributing to the overall business model[92] - The Company emphasizes the importance of the number of transactions as a metric for customer engagement and business scale, independent of average transaction prices[78] Financial Metrics and Definitions - Total Adjusted EBITDA is calculated by excluding financial results, income tax, depreciation, amortization, and other specific charges, providing a clearer view of operational performance[76] - The Total Revenue Margin, or Take Rate, is defined as revenue divided by the sum of Gross Bookings and Total Payment Volume, indicating the efficiency of revenue generation[77] - The Company utilizes FX neutral measures to provide a clearer understanding of financial performance by excluding foreign currency exchange impacts[98] - Despegar has become one of the largest travel companies in Latin America, consolidating various brands under its umbrella to enhance its market position[94]