TripAdvisor Falls as Profit Misses Again on Business TransitionBy
Efforts to move beyond ad-driven review site have been elusive
Turnaround is ‘around the corner’ chief financial officer says
TripAdvisor Inc., the online travel review site working to become a hotel-booking hub, fell as much as 11 percent after posting earnings and revenue that missed analysts’ estimates.
Fourth-quarter profit, excluding some items, was 16 cents a share, well short of analysts’ average forecast for 31 cents. Revenue was $316 million, the company said in a statement Wednesday, missing projections for $327 million. The shares were down 5.1 percent to $50 at 4:47 p.m in New York.
TripAdvisor, based in Needham, Massachusetts, has been trying to switch its business model from an advertising-driven reviews site to the place where tourists book hotels as well. So far success has been elusive. Its shares fell 46 percent in 2016 as the company missed analysts’ earnings estimates each quarter. In December, things began to look up with the signing of a deal with Expedia Inc. to let its customers book some hotels from the travel giant’s site directly on TripAdvisor.
That deal hasn’t had the chance to effect the company’s revenue growth yet, but Chief Financial Officer Ernst Teunissen said it’s now on the way.
“As expected, our significant investments in these growth initiatives dampened full year 2016 financial results,” he said in the statement. “However, we believe we turned a corner in the fourth quarter.”