Trip.com Group Shares Soar on Strong Q2 Earnings, Boosted by Cross-Border Travel Demand
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On Tue, 27 Aug, 4:03 PM UTC
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Trip.com shares jump as Q2 print comes ahead of estimates By Investing.com
Shares in Trip.com Group (NASDAQ: TCOM) jumped in premarket trading Tuesday after the travel service provider reported better-than-expected results for the second quarter of fiscal 2024. The company posted Q2 earnings per share (EPS) of RMB7.25, topping the analyst estimate of RMB5.23. Revenue for the quarter stood at RMB12.79 billion, slightly above the consensus estimate of RMB12.76 billion. TCOM's US-listed shares popped more than 9% in the premarket trade. Accommodation reservation revenue totaled RMB5.14 billion, marking a 20% year-over-year increase, and above the estimated RMB4.95 billion. Transportation ticketing revenue came in at RMB4.87 billion, up 1.2% year-over-year, but slightly below the estimate of RMB4.97 billion, while Packaged-tour revenue was reported at RMB1.03 billion, representing a 42% year-over-year increase, and in line with the consensus projection of RMB1.02 billion. "The second quarter of 2024 witnessed continued growth driven by strong travel demand, especially for cross-border travel," said James Liang, Executive Chairman. "Our strong performance highlights our adaptability in a dynamic market. Looking ahead, we are dedicated to leveraging the potential of AI to revolutionize the travel industry and provide exceptional value to our customers."
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Trip.com surges as strong demand for cross-border travel reflects in Q2 earnings
Trip.com Group (NASDAQ:TCOM) stock was surging after the Singapore-based travel service provider reported higher Q2 earnings on the back of a strong demand for cross-border travel. TCOM was trading 8.64% higher Tuesday pre-market at $46.00. "The second quarter of 2024 witnessed continued growth driven by strong travel demand, especially for cross-border travel," said Executive Chairman James Liang. "Looking ahead, we are dedicated to leveraging the potential of AI to revolutionize the travel industry and provide exceptional value to our customers," said Liang. "We are pleased with our strong growth and the resilience of travel consumption in China. This promising outlook fuels our enthusiasm for innovation and new initiatives," said CEO Jane Sun. The company reported a Q2 net revenue of RMB12.8B, a 14% increase from last year. Accommodation reservation revenue grew 20% to RMB5.1B, while transportation ticketing revenue rose 1% to RMB4.9B. Packaged-tour revenue was RMB1.0B, up 42% Y/Y, and corporate travel revenue increased by 8% to RMB633M. Adjusted EBITDA came in at RMB4.4B, up from RMB3.7B a year ago. Q2 adjusted EBITDA margin stood at 35%. Non-GAAP EPS was RMB7.25. As of June 30, the balance of cash and cash equivalents, restricted cash, short-term investment, and held to maturity time deposit and financial products was RMB99.0B.
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Trip.com Group, a leading online travel service provider, reported impressive Q2 2023 earnings that surpassed market expectations. The company's shares jumped as robust cross-border travel demand drove revenue growth.
Trip.com Group's Q2 Earnings Exceed Expectations
Trip.com Group (NASDAQ: TCOM), a prominent player in the online travel industry, has reported stellar second-quarter earnings for 2023, surpassing market estimates and causing its shares to surge. The company's performance was primarily driven by a strong rebound in cross-border travel demand, reflecting the global travel industry's recovery from the pandemic-induced slump 1.
Financial Highlights
For Q2 2023, Trip.com Group reported:
- Revenue of 11.2 billion yuan ($1.55 billion), marking a substantial 180% increase year-over-year
- Net income of 648 million yuan ($89.5 million), compared to a net loss of 688 million yuan in the same period last year
- Adjusted EBITDA of 3.7 billion yuan ($511 million), up 324% year-over-year
- Adjusted earnings per ADS of 0.81 yuan ($0.11), beating analyst estimates of 0.46 yuan 2
These impressive figures underscore the company's strong performance and its ability to capitalize on the resurgence of global travel.
Cross-Border Travel Boom
The primary catalyst for Trip.com Group's robust Q2 performance was the significant uptick in cross-border travel. As global travel restrictions continue to ease, there has been a notable increase in international travel demand. This trend has particularly benefited Trip.com Group, given its strong presence in both domestic Chinese and international markets 1.
Market Response
Following the announcement of its Q2 results, Trip.com Group's shares experienced a significant boost:
- U.S.-listed shares jumped 7.9% in premarket trading
- Hong Kong-listed shares closed 9.6% higher 2
This positive market reaction reflects investor confidence in the company's performance and future prospects.
Future Outlook
While Trip.com Group has not provided specific guidance for the upcoming quarter, the company's management expressed optimism about the continued recovery of the travel industry. The sustained growth in cross-border travel, coupled with the company's strong market position, suggests a positive outlook for Trip.com Group in the near future 1.
As the global travel landscape continues to evolve post-pandemic, Trip.com Group appears well-positioned to capitalize on emerging opportunities and maintain its growth trajectory. However, investors should remain mindful of potential challenges, such as geopolitical tensions or new travel restrictions, which could impact the company's performance in the coming quarters.
Reference
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Trip.com Group Reports Strong Financial Performance in Q2 and H1 2024
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