It has been announced today that Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) ("Trip.com Group" or the "Company"), a leading one-stop travel service provider, which offers accommodations, transportation tickets, packaged tours, and corporate travel management, has released unaudited results for the third quarter of 2023.
The key highlights for the third quarter of 2023 can be summarized as follows:
As a result of robust summer travel demand, both domestic and international travel experienced a remarkable rebound throughout the third quarter of 2023. In his words, James Liang, Executive Chairman of the company, said, "This demonstrates just how eager travelers are to explore the world." As we move forward, we will continue to grow our company by growing our global presence and cultivating AI-related initiatives, laying the groundwork for continued growth in the future.
"We are pleased to build on our momentum and deliver solid results in the third quarter," stated Jane Sun, Chief Executive Officer. As a result of the strong demand for travel and our investment in technology and product, we are committing to enhancing our supply chain capabilities and strengthening brand awareness in order to strengthen our position in the market."
Financial Results and Business Updates for the Third Quarter of 2023
This was in part due to the arrival of summer peak season and the strong pent-up demand for travel, which lead to a significant recovery in the Company's business, which in turn led to an increase in travel bookings.
A net revenue of RMB13.7 billion (US$1.9 billion) was reported by Trip.com Group in the third quarter of 2023, an increase of 99% over the same period in 2022, primarily as a result of a substantial recovery in the travel market. During the third quarter of 2023, net revenue increased by 22% from the previous quarter, primarily as a result of seasonality.
A total of RMB5.6 billion (US$766 million) of accommodation reservation revenue was generated in the third quarter of 2023, which represents a 92% increase over the same period in 2022, mainly as a result of a substantial recovery of the travel market. In the third quarter of 2023, the number of accommodation reservations increased by 30% compared to the previous quarter. This increase was primarily due to seasonality.
For the third quarter of 2023, the revenue from the transportation ticketing industry was RMB5.4 billion (US$736 million), an increase of 105% over the same period in 2022 primarily as a result of the substantial recovery of the travel market. Due primarily to seasonality, transportation ticketing revenue in the third quarter of 2023 increased by 11% from the previous quarter.
Packaged-tour revenue for the third quarter of 2023 was RMB1.3 billion (US$182 million), a 243% increase from the same quarter in 2022, primarily as a result of the substantial recovery of the travel market in the third quarter of 2023. In the third quarter of 2023, packaged-tour revenue grew by 84% from the previous quarter, mainly as a result of seasonality.
In the third quarter of 2023, corporate travel revenue came to RMB591 million (US$81 million), representing a 60% increase from the same period in 2022 and a 1% increase from the previous quarter, primarily as a result of the significant recovery of the travel market in the country.
During the third quarter of 2023, the cost of revenue increased by 94% to RMB2.5 billion (US$338 million) from the same period in 2022 as well as by 23% from the previous quarter, which was in line with the increase in net revenue. In the third quarter of 2023, the cost of revenue, as a percentage of net revenue, was 18%.
For the third quarter of 2023, product development expenditures have increased by 44% to RMB3.6 billion (US$490 million) from the same period of 2022, and by 21% from the previous quarter as a result of an increase in personnel expenses related to product development. The third quarter of 2023 saw a 26% increase in product development expenses as a percentage of net revenue.
There was a 93% increase in sales and marketing expenses for the third quarter of 2023, reaching RMB2.8 billion (US$378 million) from the same period in 2022, as well as a 17% increase from the previous quarter, due primarily to an increase in expenses relating to marketing and sales promotion. In the third quarter of 2023, the sales and marketing expenses as a percentage of net revenue were 20%.
There was an increase of 22% in general and administrative expenses in the third quarter of 2023 compared to the same quarter in 2022. This increase was primarily due to an increase in general and administrative personnel expenses, which increased by 8% from the previous quarter. The third quarter of 2023 was characterized by an increase of 7% in general and administrative expenses as a percentage of net revenue.
For the third quarter of 2023, the income tax expense was RMB448 million (US$61 million), as compared with RMB277 million for the same period in 2022 and RMB562 million for the previous quarter.. There has been a change in Trip.There was a significant impact of changes in the profitability of the subsidiaries of com Group with different tax rates on the effective tax rate of com Group, as well as certain nontaxable income or loss caused by changes in fair value of equity securities investments and exchangeable senior notes, as well as changes in valuation allowance provided for deferred tax assets.
There was a significant impact of changes in the profitability of the subsidiaries of com Group with different tax rates on the effective tax rate of com Group, as well as certain nontaxable income or loss caused by changes in fair value of equity securities investments and exchangeable senior notes, as well as changes in valuation allowance provided for deferred tax assets.
There was a net income of RMB4.6 billion (US$637 million) for the third quarter of 2023, a significant increase over RMB245 million for the same period in 2022 and RMB648 million for the previous quarter in 2023. In the third quarter of 2023, adjusted EBITDA amounted to RMB4.6 billion (US$634 million), which was considerably higher than the RMB1.4 billion of the previous quarter and the RMB3.7 billion of the same period in 2022. In the third quarter of 2023, adjusted EBITDA margin was 34%, compared to 21% for the same period in 2022 and 33% in the previous quarter.
Trip's net income attributable to its operations.As of the end of the third quarter of 2023, RMB4 billion has been allocated to the shareholders of com Group.There was a decline of RMB6 billion (US$634 million) in the first quarter of 2023 compared to RMB266 millions for the same period in 2022 and RMB631 millions for the previous quarter. The non-GAAP net income attributable to Trip is calculated after excluding share-based compensation charges, fair value changes of equity securities investments, exchangeable senior notes recorded in other income/(expenses), and their tax effects..It is estimated that RMB4 billion has been invested in com Group by shareholders for the third quarter of 2023.It represents an increase of RMB9 billion (US$673 million), compared to RMB1 billion.A total of RMB3 billion was spent during the same period in 2022 and RMB4 billion in 2023.In the previous quarter, the company had a revenue of $4 billion
In the previous quarter, the company had a revenue of $4 billion
In the third quarter of 2023, diluted earnings per ordinary share and per ADS were RMB6.84 (US$0.94). In the third quarter of 2023, non-GAAP diluted earnings per ordinary share and per ADS were RMB7.26 (US$1.00) per ordinary share and per ADS after excluding share-based compensation charges, fair value changes of equity securities investments, and exchangeable senior notes, and their tax effects. There are currently one ordinary share of the Company represented by each ADS.
It is estimated that at the end of September 30, 2023, there will be a balance of RMB79.0 billion (US$10.8 billion) in cash and cash equivalents, restricted cash, short-term investments, and held to maturity time deposits and financial products.
A recent development in the field
During the period September 2023 to the date of this press release, the Company purchased 3.6 million ADSs for a total gross consideration of US$120 million in accordance with its existing share repurchase plan.
It has been decided by the board of directors that the Company will implement a regular policy of capital return to benefit its shareholders and ADS holders, starting from the year 2024. This policy includes discretionary annual share repurchases, discretionary annual cash dividend declarations, or a combination thereof.. A board of directors is given the authority to determine the form, timing, and amount of capital return measures in any specific year at the discretion of the board of directors, based on a variety of factors such as the Company's financial condition, results of operations, cash flow, capital requirements, and other relevant factors.
A board of directors is given the authority to determine the form, timing, and amount of capital return measures in any specific year at the discretion of the board of directors, based on a variety of factors such as the Company's financial condition, results of operations, cash flow, capital requirements, and other relevant factors.
Call for a conference call 
Following the announcement of this acquisition, the management team of Trip.com Group will host a conference call at 7:00 PM EST on November 20, 2023 (or 8:00 AM CST on November 21, 2023) to discuss the acquisition.
There will be a live webcast of the conference call and a replay of the call available through our website: https://investors.trip.com . The record will be available on our website for twelve months following the conference call.
To join this conference call, participants must pre-register by clicking the Participant Registration link below: https://register.vevent.com/register/BI570196cd01794d8298b96e3dd8d9fd65 
The participant will receive a registration packet when they register for the conference call, including the dial-in numbers and the unique PIN number they will use to join the conference call. To join the conference, please dial the number provided, enter your PIN number, and you will be automatically connected to the conference call.
Statement of Safe Harbor
There are forward-looking statements in this announcement. Accordingly, these statements are made in accordance with the "safe harbor" provisions of the U.S.. In 1995, the Private Securities Litigation Reform Act was passed into law.. It should be noted that forward-looking statements can be identified by terminology such as "may," "will," "expect," "anticipate," "future," "intend," "plan," "believe," "estimate," "is/are likely to," "confident," or other similar expressions.. There are a number of quotes from management in this press release, as well as quotes from Trip.The strategic and operational plans of the Com Group contain forward-looking statements. There are inherent risks and uncertainties associated with forward-looking statements. The actual results could differ materially from those contained in any forward-looking statement as a result of a number of important factors. The risks and uncertainties that may relate to the project include, but are not limited to, severe or prolonged downturns in the global or Chinese economies, general declines or disruptions in the travel industry, volatility in the trading price of Trip, and so on..com Group's ADSs or shares, as well as Trip.Due to Trip's reliance on relationships and contractual arrangements with travel suppliers and strategic alliances, it is unable to compete against new and existing competitors, failing to manage current and potential future growth successfully, and experiencing risks associated with any strategic investments or acquisitions, as well as seasonality within the travel industry in the relevant jurisdictions where Trip.As a result of the failure to develop Trip.com Group successfully,.There is a risk of damage to or failure of Trip.com Group's existing or future business lines.Infrastructure and technology of the com Group, as well as the loss of Trip's services.Key executives of the Trip.com Group discuss the impact of COVID-19 on their business.com Group's business operations, adverse changes in the economic and political policies of the PRC government, inflation in China, the risks and uncertainties associated with PRC laws and regulations with regard to the ownership structure of the variable interest entities, as well as the contractual arrangements among Trip,.The TripCom Group, the variable interest entities and their shareholders, as well as other risks outlined in the TripCom Group.Com Group's filings with the U.S. Securities and Exchange Commission. The Securities and Exchange Commission (SEC) or the Stock Exchange of Hong Kong Limited is the regulator for securities. There is no guarantee that the information contained in this press release and in the attachments is accurate or complete, and Trip.As a matter of policy, the com Group is not under any obligation to update any forward-looking statement, except as required by applicable law
As a matter of policy, the com Group is not under any obligation to update any forward-looking statement, except as required by applicable law
Non-GAAP Financial Measures - What You Need to Know
As a supplement to the trip.This report presents the consolidated financial statements of Trip.com Group, which are prepared and presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"),.The Trip.com Group uses non-GAAP financial information in relation to adjusted net income attributable to the Trip.com Group.com Group Limited, adjusted EBITDA, adjusted EBITDA margin, and adjusted diluted earnings per ordinary share and per ADS, all of which are adjusted from the most comparable GAAP result, are adjusted to exclude the share-based compensation charges that are not tax deductible, changes in the fair value of equity securities investments as well as exchangeable senior notes, net of tax, as well as any other items that may be relevant.. Taking a trip.The management of the com Group believes that non-GAAP financial measures allow it to better understand the operating results from quarter to quarter and provide it with a better ability to plan and forecast operations in the future
The management of the com Group believes that non-GAAP financial measures allow it to better understand the operating results from quarter to quarter and provide it with a better ability to plan and forecast operations in the future
As the name implies, non-GAAP information is not prepared in accordance with GAAP, has no standardized meaning under GAAP, and may differ from non-GAAP methods of accounting and reporting used by other companies.. Please note that the presentation of this additional information should not be construed as a substitute for results presented in accordance with GAAP. A limitation of using non-GAAP financial measures is that non-GAAP measures do not include share-based compensation charges, fair value changes of equity securities investments and exchangeable senior notes, and their tax effects, all of which have been and continue to be significant recurring expenses in Trip..It is expected that the com Group's business will continue to grow in the near future
It is expected that the com Group's business will continue to grow in the near future
Listed at the end of this press release are reconciliations of Trip.com Group's non-GAAP financial data to the most comparable GAAP data included in its consolidated statement of operations that are based on GAAP.
Trip.com Group Limited is a company owned by Trip.com
Taking a trip.The TCOM Group Limited (Nasdaq: TCOM; HKEX: 9961) is a leading global one-stop travel platform that combines a comprehensive range of travel products, services, and differentiated travel content under one platform.. Travelers in China, and increasingly travelers around the world, have turned to Trip.China as their go-to destination to explore travel, get inspired, book travel in an informed and cost-effective manner, enjoy hassle-free on-the-go support, and share their travel experiences with others.. In 1999, the company was founded, and it was listed on Nasdaq in 2003 and on HKEX in 2021. It operates under a portfolio of brands, including Ctrip, Qunar, and Trip.There is a mission to pursue the perfect trip to make the world a better place by combining sites like Booking.com and Skyscanner
There is a mission to pursue the perfect trip to make the world a better place by combining sites like Booking.com and Skyscanner
If you would like more information, please contact:
In order to contact Investor Relations at Trip.com Group Limited, call +86 (21) 3406-4880 X 12229 or email [email protected]
The Trip.com Group Limited is the source of this information
The Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) is a leading one-stop travel service provider providing services such as accommodation reservations, transportation tickets, and cruise bookings...
As one of the leading one-stop travel service providers of accommodation and travel arrangements, the Trip.com Group Limited (Nasdaq: TCOM; Hong Kong Stock Exchange: 9961) ("Trip.com Group" or the "Company"), has...
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