TripAdvisor Books Positive Earnings Results

TripAdvisor Inc (TRIP) announced earnings after the bell today, posting an EPS of $0.15, slightly beating the Zacks Consensus Estimate of $0.14, and Revenues of $212.7 million, surpassing the Zacks Revenue Estimate of $204.96 million.  This is the fifth consecutive quarter with a positive earnings surprise by this company.

Over the past few quarters TripAdvisor has been focusing on improving its mobile products, and has seen the fourth quarter web traffic increase 50% year over year. Moreover, the company just launched their new meta-display platform; which allows customers to compare hotel pricing, and availability information from top advertisers on the TripAdvisors website itself.  This new platform has allowed the company to increase their AD rates, which has helped the top line revenues grow 26% compared to Q4 2012.

On the negative, there has been whispers regarding Google (GOOG), and their potential of entering the Online Travel market.  In a recent interview, Ryanair CEO Michael O’Leary touched on a “new pricing system partnership” with Google.  Currently, Google has both an airline search mechanism, and booking services in the USA, and the UK.  Furthermore, the internet giant has also ran a hotel finder service since 2011.  While the speculation is that Google will eventually enter into the market, they would have to compete with two of the biggest advertisers on Google, Priceline (PCLN), and Expedia (EXPE).  Unfortunately, for TripAdvisor, they derive slightly less than one third of their business from Expedia.  

In afterhours trading, TRIP has been fluctuating from an increase just over 2% to a half percent.  We do note that on February 6th Expedia announced earnings, which saw TripAdvisor shares jump just over 9%.  It appears, in afterhours trading, that TRIP’s positive earning numbers were somewhat already priced into Expedia’s strong earnings announcement.  

Tomorrow Zacks will post a full earnings report on TripAdvisor Inc.

Original post