TripAdvisor(TRIP) - 2022 Q1 - Quarterly Report

Part I—Financial Information Unaudited Condensed Financial Statements Unaudited Q1 2022 financial statements reveal $262 million revenue, a $34 million net loss, and $86 million positive operating cash flow Condensed Consolidated Statements of Operations (Q1 2022 vs Q1 2021) | Metric | Three months ended March 31, 2022 ($ million) | Three months ended March 31, 2021 ($ million) | | :--- | :--- | :--- | | Revenue | 262 | 123 | | Operating Loss | (20) | (84) | | Net Loss | (34) | (80) | | Diluted Loss Per Share | (0.24) | (0.59) | Condensed Consolidated Balance Sheets (As of March 31, 2022) | Account | March 31, 2022 ($ million) | December 31, 2021 ($ million) | | :--- | :--- | :--- | | Cash and cash equivalents | 781 | 723 | | Total Current Assets | 1,043 | 940 | | Total Assets | 2,372 | 2,289 | | Long-term debt | 834 | 833 | | Total Liabilities | 1,605 | 1,500 | | Total Stockholders' Equity | 767 | 789 | Condensed Consolidated Statements of Cash Flows (Q1 2022 vs Q1 2021) | Cash Flow Activity | Three months ended March 31, 2022 ($ million) | Three months ended March 31, 2021 ($ million) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | 86 | (19) | | Net cash used in investing activities | (14) | (10) | | Net cash provided by (used in) financing activities | (10) | 287 | Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses Q1 2022 financial results, emphasizing strong revenue growth, COVID-19 recovery, strategic marketing, and robust liquidity - The company's long-term growth strategy focuses on enhancing user experience, driving loyalty, expanding bookable offerings, and deepening travel partner engagement[143] - Consolidated revenue for Q1 2022 increased 113% YoY to $262 million, reaching approximately 70% of 2019 levels, indicating strong recovery[148] Revenue and Adjusted EBITDA by Segment (Q1 2022 vs Q1 2021) | Segment | Q1 2022 Revenue ($ million) | Q1 2021 Revenue ($ million) | YoY Change | Q1 2022 Adj. EBITDA ($ million) | Q1 2021 Adj. EBITDA ($ million) | | :--- | :--- | :--- | :--- | :--- | :--- | | Hotels, Media & Platform | 160 | 88 | +82% | 46 | (3) | | Experiences & Dining | 92 | 28 | +229% | (22) | (24) | | Other | 10 | 7 | +43% | 3 | 1 | - The company believes its cash and cash equivalents of $781 million, along with available credit, are sufficient to fund operations and commitments for at least the next twelve months[216] Business Trends and COVID-19 Impact The company notes substantial improvement in Q1 2022 traffic and revenue, with unique users reaching 71% of 2019 levels, driven by recovering travel demand - Average monthly unique users reached approximately 71% of 2019 levels in Q1 2022, up from approximately 55% in Q1 2021[147] - Consolidated revenue for Q1 2022 reached approximately 70% of 2019 levels, a significant improvement from 33% in Q1 2021[148] Segment Performance Analysis Segment analysis shows Hotels, Media & Platform revenue grew 82% YoY to $160 million, and Experiences & Dining surged 229% YoY to $92 million - Hotels, Media & Platform revenue increased 82% YoY, reaching approximately 63% of 2019 levels, with U.S. hotel auction CPC rates nearing or exceeding 2019 levels[153] - Experiences & Dining segment revenue increased 229% YoY, reaching approximately 115% of 2019 levels, with Experiences revenue growing over 350% compared to Q1 2021[159][160] - Dining revenue increased approximately 125% YoY, nearly reaching parity with 2019 levels, as European restaurants reopened[160] Consolidated Expense Analysis Consolidated expenses show a 93% increase in Selling and Marketing costs to $141 million, driven by direct SEM spend, while Technology and Content costs decreased 2% Selling and Marketing Expenses (Q1 2022 vs Q1 2021) | Expense Category | Q1 2022 ($ million) | Q1 2021 ($ million) | YoY Change | | :--- | :--- | :--- | :--- | | Direct costs | 94 | 29 | +224% | | Personnel and overhead | 47 | 44 | +7% | | Total | 141 | 73 | +93% | - Technology and content costs decreased by $1 million (2%) YoY to $54 million, primarily due to lower stock-based compensation expense[187] Liquidity and Capital Resources The company maintains a strong liquidity position with $781 million in cash and $497 million available credit, achieving $86 million positive operating cash flow - As of March 31, 2022, the company had $781 million in cash and cash equivalents and $497 million available borrowing capacity under its Credit Facility[204] Cash Flow Summary (Q1 2022 vs Q1 2021) | Cash Flow Activity | Q1 2022 ($ million) | Q1 2021 ($ million) | | :--- | :--- | :--- | | Operating Activities | 86 | (19) | | Investing Activities | (14) | (10) | | Financing Activities | (10) | 287 | - The company received a $48 million U.S. federal tax refund in April 2022 related to the carryback of net operating losses under the CARES Act[215] Quantitative and Qualitative Disclosures About Market Risk No material changes to the company's market risk profile occurred in Q1 2022, though exposure to foreign currency fluctuations and geopolitical tensions persists - The company reports no material change in its market risk profile during Q1 2022[231] - Key market risks include adverse changes in stock prices, interest rates, and foreign currency exchange rates, heightened by international operations, the COVID-19 pandemic, Brexit, and geopolitical tensions[232][233] Controls and Procedures Management concluded that disclosure controls and procedures were effective as of March 31, 2022, with no material changes to internal control over financial reporting - Management concluded that as of March 31, 2022, the company's disclosure controls and procedures were effective[234] - There were no material changes to the company's internal control over financial reporting during Q1 2022[235] Part II—Other Information Legal Proceedings The company is involved in various ordinary course legal matters, with management not expecting a material adverse effect on the business - The company is involved in various typical legal matters, including intellectual property, tax, and regulatory compliance[236] - Management does not believe the final disposition of these matters will have a material adverse effect on the business[236] Risk Factors No material changes to the company's risk factors have occurred since the December 31, 2021 Annual Report on Form 10-K - There have been no material changes in the company's risk factors from those disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2021[237] Unregistered Sales of Equity Securities and Use of Proceeds No unregistered equity securities were sold, and no shares were repurchased in Q1 2022, with $75 million remaining available under the repurchase program - No unregistered equity securities were issued or sold during the quarter ended March 31, 2022[238] - No shares of common stock were repurchased in Q1 2022; $75 million remains available under the program, but repurchases are restricted by covenants[239] Other Information and Exhibits This section confirms no defaults on senior securities or mine safety disclosures, concluding with a list of filed exhibits including management certifications - The company reports no defaults upon senior securities[240] - The report includes standard exhibits such as CEO/CFO certifications, Inline XBRL documents, and certain management compensation agreements[243]