Tripadvisor's Q2 Earnings and Revenues Miss Amid Macro Pressures

Tripadvisor TRIP shares have appreciated 3.5% since the company reported its second quarter 2026 results on Aug. 6. The move comes even as both revenues and earnings missed the Zacks Consensus Estimate, likely reflecting adjusted EBITDA that came in above the company's own expectations and continued progress on its experiences-led portfolio simplification, including the pending sale of TheFork.

TripAdvisor reported second-quarter 2026 non-GAAP earnings of 35 cents per share, which missed the Zacks Consensus Estimate of 42 cents by 16.67%. The company had reported earnings of 46 cents per share in the year-ago quarter.

Revenues decreased 16.5% year over year to $441.9 million and missed the consensus mark by 13.12%.

TripAdvisor shares have appreciated 38.3% year to date, outperforming the Zacks Retail-Wholesale sector's 9.3% decline.

TripAdvisor, Inc. Price, Consensus and EPS Surprise

TripAdvisor, Inc. price-consensus-eps-surprise-chart | TripAdvisor, Inc. Quote

Q2 Details of TRIP

Experiences: Revenues for the segment came in at $278.6 million, reflecting year-over-year growth of 3%. Excluding currency, growth was approximately 2%.

The number of experience bookings was approximately 6.5 million in the quarter, up approximately 5% year over year. Viator, TripAdvisor's largest owned and operated point of sale, delivered 10% bookings growth, while sustained SEO headwinds on the TripAdvisor point of sale pressured overall segment growth by approximately 5 percentage points.

Gross booking value reached approximately $1.4 billion, reflecting year-over-year growth of approximately 3%. Testing around discounting and a higher mix of lower-priced items pressured average booking value.

Adjusted EBITDA for the segment was $30.8 million, or 11.1% of segment revenue, compared with $37.8 million, or 14% of segment revenue, in the year-ago quarter. Deleverage was primarily driven by a free-to-paid channel mix shift across Viator and the TripAdvisor point of sale.

Hotels & Other: Revenues totaled $163.3 million, down 21% year over year.

Hotels revenues were $117.9 million, down 23% year over year, as strong pricing growth was more than offset by hotel shopper volume headwinds. Media and advertising revenues declined 12% to $31.2 million on softer on-site traffic. Other revenues fell 20% to $14.2 million.

Adjusted EBITDA for the segment was $45.6 million, or 27.9% of segment revenues, compared with $59.4 million, or 28.9% of segment revenues, a year ago. Margin deleverage was driven by an ongoing shift in prepaid channel mix and higher technology costs, partly offset by lower personnel costs.

TheFork: Following the June 2026 agreement to sell TheFork to American Express for $700 million, the business is now classified as discontinued operations and is no longer a reportable segment. Revenues for TheFork were $61 million, up 13% year over year (10% in constant currency), with adjusted EBITDA of $11 million, or approximately 19% of revenues. The transaction, expected to close by the end of 2026, is anticipated to generate net proceeds of approximately $680 million.

TRIP's Operating Results

Total costs and expenses from continuing operations were $404.1 million, down 3% year over year.

Cost of sales fell 15% year over year to $31 million, or 7% of revenue, aided by a benefit of approximately $2 million tied to an indirect tax refund.

Marketing costs rose 4% year over year to $215.4 million, or 48.7% of revenue, driven by continued free-to-paid channel mix pressure, including SEO headwinds in Experiences and Hotels & Other.

Personnel costs declined 21% year over year to $99.2 million, or 22.4% of revenue, reflecting lower Hotels & Other costs and reduced stock-based compensation tied to the 2025 cost savings program.

Technology costs were largely flat year over year at $21.6 million, or 4.9% of revenues. General and administrative costs rose 53% year over year to $14.5 million, or 3.3% of revenues, against an easier prior-year comparison stemming from a one-time true-up.

Operating income was $37.8 million compared with $57.9 million in the year-ago quarter.
Total adjusted EBITDA from continuing operations was $76.4 million, 17.3% of revenues, down 21% from $97.2 million and 20.4% of revenues, a year ago.

TRIP's Balance Sheet and Cash Flow

As of Jun 30, 2026, cash and cash equivalents from continuing operations were $843.2 million, down from $1.12 billion as of March 31, 2026, primarily reflecting the repayment of $345.4 million in 2026 Senior Notes on April 1. Long-term debt stood at $815.9 million, compared with $817.5 million at the end of the first quarter.

Operating cash flow from continuing operations was $141.2 million compared with $203.7 million in the year-ago quarter. Free cash flow was $129.8 million compared with $183.4 million a year ago.

The company did not repurchase any shares in the quarter given its ongoing portfolio review, including the TheFork sale process. Approximately $110 million remains available under the existing share repurchase authorization.

Q3 2026 Guidance

For the third quarter, TripAdvisor expects Experiences bookings growth of approximately 5% to 7% and revenues in a range of a 2% decline to 1% growth, including approximately 1 percentage point of currency headwind. Experiences adjusted EBITDA margin is expected in the 14% to 17% range.

Hotels & Other revenues are expected to decline approximately 20-23%, with adjusted EBITDA margin of approximately 22-25%.

On a consolidated continuing operations basis, TripAdvisor expects third-quarter revenues to decline 7-10%, with adjusted EBITDA margin of 17-20%. Management noted a more prudent outlook for the second half of 2026, citing continued macro uncertainty, weather-related cancellations and softer U.S. to Europe demand, while characterizing these pressures as transitory rather than structural.

Zacks Rank & Other Stocks to Consider

TRIP currently carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader sector are The TJX Companies TJX, Abercrombie & Fitch ANF and Five Below FIVE. Each stock carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The TJX Companies is set to report second-quarter fiscal 2027 results on Aug. 19. The Zacks Consensus Estimate for The TJX Companies’ second-quarter EPS is pegged at $1.18, up by a penny over the past 30 days and indicating an improvement of 5.1% year over year.

Abercrombie & Fitch is slated to report second-quarter fiscal 2027 results on Aug. 26. The Zacks Consensus Estimate for Abercrombie & Fitch’s second-quarter earnings is pegged at $1.9 per share, unchanged over the past 30 days and indicating a decline of 18.1% year over year.

Five Below is slated to report second-quarter fiscal 2027 results on Aug. 26. The Zacks Consensus Estimate for Five Below’s second-quarter earnings is pegged at $1.28 per share, up by 4cents over the past 30 days and indicating an improvement of 58.02% year over year.

Zacks' Research Chief Names "Stock Most Likely to Double"

Our team of experts has just released the 5 stocks with the greatest probability of gaining +100% or more in the coming months. Of those 5, Director of Research Sheraz Mian highlights the one stock set to climb highest.

This top pick is a little-known satellite-based communications firm. Space is projected to become a trillion dollar industry, and this company's customer base is growing fast. Analysts have forecasted a major revenue breakout in 2025. Of course, all our elite picks aren't winners but this one could far surpass earlier Zacks' Stocks Set to Double like Hims & Hers Health, which shot up +209%.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research