Trip.Com Falls 1% on Poor Q1 Revenue and Losses
The stock in Trip.com Group Ltd. (Nasdaq: TCOM) slipped 1% to$ $24.99 per American depositary share in early trading Friday after reporting weak first-quarter revenue and losses in the first quarter.
The Shanghai-based online travel provider said in a statement today that in the three months through March that revenue plunged 42% year-over-year to $669 million. However, the figures were still better than expected, beating Zacks' Consensus Estimate by nearly 15%.
It also suffered a net loss of $754 million, in contrast to a net income of $643 million in the same period in the preceding year.
The quarterly decline was led by its accommodation reservation and transportation ticketing revenue, which fell 62% and 29% year-over-year respectively. While things will likely worsen for the second quarter, Trip.com said it is starting to see some recovery.
"The COVID-19 pandemic has brought significant challenges to the global travel industry. However, it is encouraging that by now, we have seen stabilization or recovery of travel activities in many of the markets where we operate," James Liang, the executive chairman of Trip.com, said in a statement today.
He added, "In China, travel activities hit bottom in February, and have since consistently been on a recovery track. In recent weeks, the recovery in high-end hotel meaningfully outpaced other segments, thanks to our timely product innovation for the COVID-19 new normality. Travel is human nature and we have full confidence that the industry will return and reach new high as the pandemic recedes."
Starting in June, international flights could more than triple to 407 a week, as reported by state media China News on Wednesday, citing Li Jian, China's aviation authority deputy director. This is contingent on Covid-19 risks being manageable; international flights have been regulated to 134 per week since late March.
Operating for more than 20 years, Trip.com has been public since 2003 and was formally known as Ctrip.com. According to the company, it has over 45,100 employees and more than 400 million members and claims to be one of the largest travel agencies in the world.
To add to Trip.com's struggles this year, its shares are now down nearly 40% year-to-date. Going forward, Trip.com expects its net revenues to nosedive in the range of approximately 67% to 77% year-over-year in the second quarter.
The S&P 500 Ride Ahead – Rocky or Not So Rocky?
Happiness Biotech Gets Green Light to Sell Hand Sanitizer in Canada
SMIC Doubles STAR Offering as Stock Gains on China's Growing Chip Market
Facebook, Google, and Twitter Pause Data Requests from Hong Kong Amid New Security Law
Novavax Jumps 31% on Securing $1.6 Billion for its Covid-19 Vaccine
Will Gold March Forward on Fed's Forward Guidance?