Travelzoo’s Recovery Is Expected To Continue In Q3 2016 Primarily Boosted By Its Hotel Booking Platform
Travelzoo’s hotel booking platform, introduced in 2014, has been showing signs of steady growth (after its initial sluggish demand) over the last few quarters. The platform marked the company’s shifting of focus from discounted and push-based travel deals to pull or demand-based services. The growth in the platform looked so promising for the company that it reacquired its Asia Pacific business in order to expand the global reach of the hotel platform. Travelzoo’s travel business accounts for ~70% of its revenues and we expect the contribution to increase to 80% over the next five years. The hotel booking platform is the main revenue generator for this segment.
Though Travelzoo’s results in the last quarter still showed persistent year-on-year decline in the top line, the bottom line witnessed significant recovery with the net income increasing 140% y-o-y to $2 million. In fact, post its Q2 2016 earnings results, on account of its significant recovery and promising future, we had upgraded Travelzoo’s stock price by ~30%.
On the management front, Travelzoo announced a few crucial changes including its Chairman Holger Bartel assuming the position of its global CEO since January 1, 2016. We expect Travelzoo to continue its recovery in the third quarter as well, and its hotel booking platform to continue attracting more users on its platform. The company’s focus of increasing pull or demand based offerings while replacing the erstwhile push-based products is expected to continue. Also, the prominence of its Local Deals and Search segments might continue declining while the hotel booking platform gains in importance over time.
Have more questions about Travelzoo? See the links below.
- What Is Travelzoo’s Fundamental Value On The Basis Of Its Forecasted 2015 Results?
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- Travelzoo: Year 2015 In Review
- How Has Travelzoo’s Stock Performed In The Last Five Years?
- What Drove Travelzoo’s Revenue Growth And Led To Its EBITDA Decline Over The Last Five Years?
- How Have Travelzoo’s Different Segments Performed Over The Last 5 Years?
- Travelzoo Q1 2016 Earnings Results
- Travelzoo’s Expected Revenue And EBITDA For 2016: Trefis Estimate
- How Is Travelzoo’s Travel Related Business Expected To Grow In The Next 5 Years?
- How Do We See Travelzoo’s Top Line Trending?
- Travelzoo’s Q2 2016 Results Show Strong Bottom Line Recovery
Notes:
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