The latest: Leading online travel agent Trip.com Group Ltd. (9961.HK; TCOM.US) on Tuesday announced its net profit soared more than 16-fold year-on-year to 4.62 billion yuan ($652 million) in the third quarter.
Looking up: The company’s revenue nearly doubled to 13.75 billion yuan for the quarter, as domestic hotel bookings grew by over 90% year-over-year. It said outbound hotel and air reservations also recovered to around 80% of pre-Covid levels from the same period in 2019.
Take Note: Along with the revenue surge, the company’s cost of revenue and marketing expenses also both rose more than 90%.
Digging Deeper: Like many travel- and tourism-related companies, Trip.com suffered big revenue hits at the height of the pandemic, and recorded losses in 2020 and 2021. But its business is rebounding as nearly all countries have reopened, including China, which lifted its pandemic-related restrictions last December. The company was profitable in the first nine months of this year, and said it will lay the foundation for future growth by continuing its global expansion and pursuing AI-related initiatives.
Market Reaction: After initially opening higher, Trip.com’s Hong Kong shares gave back most of those gains on Tuesday morning and closed up 0.1% at HK$280.20 by the midday break. The stock now trades near the upper end of its 52-week range.
Translation by A. Au
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