2025-08-31 16:21Summary of Trip.com Group Ltd (TCOM.O) Conference Call Company Overview - Company: Trip.com Group Ltd (TCOM) - Industry: Online Travel Agency (OTA) in China - Founded: 1999, listed on NASDAQ in 2003 Key Financial Results - 2Q25 Performance: Revenue increased by 16% year-over-year (YoY) to RMB 14.8 billion, exceeding expectations - Segment Breakdown: - Accommodation revenue: RMB 6.2 billion (+21% YoY) - Transportation ticketing: RMB 5.4 billion (+11% YoY) - Packaged tours: RMB 1.1 billion (+5% YoY) - Corporate travel: RMB 692 million (+9% YoY) - Other revenues: RMB 1.47 billion (+31% YoY) [11][12] Revenue Growth Projections - Domestic Revenue Growth: Projected at 9% YoY in 2H25, driven by hotel room nights growth despite softening transportation ticketing volume [2] - Outbound Growth: Expected to slow to low teens in 2H25 but still outperform the industry [2] Margin Insights - Operating Margin: Adjusted Operating Profit Margin (OPM) expected to improve to 32% in 3Q25, with a drop anticipated in 4Q25 due to seasonal factors [3] - Marketing Efficiency: Improved marketing optimization has positively impacted margins [3] Shareholder Return Strategy - Share Repurchase Program: Announced a USD 5 billion share repurchase program to offset dilution from Employee Stock Ownership Plans (ESOP) and support share price during volatility [4][12] Earnings Estimates - Revised Earnings Estimates: Increased by 2% for 2025, 2% for 2026, and 3% for 2027 [1] - Target Price: Raised to USD 85 from USD 78, reflecting a 30.2% expected share price return [6][10] Financial Metrics - 2023A Net Profit: RMB 13,071 million - 2024A Net Profit: RMB 18,041 million - 2025E Net Profit: RMB 18,698 million - 2026E Net Profit: RMB 21,231 million - 2027E Net Profit: RMB 23,287 million [5] Risks and Challenges - Downside Risks: Include potential softening of the China macro environment, slower-than-expected recovery in travel demand, worsening spending and margins, intensified domestic competition, and new outbreaks of COVID-19 or other epidemics [26] Conclusion - Investment Recommendation: The stock is rated as a Buy due to resilient domestic performance, strong growth prospects, and a focus on shareholder returns [24][25]