Travelzoo’s Q2 2016 Results Show Strong Bottom Line Recovery

by Trefis Team
-37.17%
Downside
7.15
Market
4.49
Trefis
TZOO
Travelzoo
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Travelzoo’s Q2 2016 results followed the previous few quarters’ trend of year-on-year decline in the top line. However, Travelzoo’s bottom line seems to be recovering well with a 140% y-o-y increase in net income to $2 million. Travelzoo underwent a transition in its business model by the introduction of its hotel booking platform in 2014. Since then the company has been focusing more on selling demand based travel services rather than discounted and push-based travel deals. Though the hotel booking platform lacked traction initially, it is steadily growing currently and hence, Travelzoo reacquired its Asia Pacific business last year to expand the hotel platform’s reach. 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. We expect Travelzoo’s travel related business revenue to rise by about 15% over the next 5 years.

q216 tzoo

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for Travelzoo

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