Trivago Earnings: A Path to Profitability Emerges

Probably no industry was hit as hard by COVID-19 as the travel sector. Air traffic ground to a virtual halt during the pandemic's first wave -- and even today, international travel is still restricted in much of the world. Meanwhile, large swathes of the public are still reluctant to get on planes due to the risks of contracting the virus, and would-be business travelers have shifted to having most meetings via videoconferencing.

For online travel agencies like Trivago (NASDAQ: TRVG), this environment presents a host of challenges, and the company's third-quarter earnings report showed that the business is still in recovery mode. Revenue in the quarter jumped 129.6% year over year to 138.6 million euros, but that was still down by nearly 50% from Q3 2019 levels.

As a hotel-and-accommodations meta-search platform, Trivago relies on bidding partners like Expedia and Booking Holdings for its revenue. If demand for hotel rooms is down, bids from its booking partners and the prices they're willing to pay will be down too, naturally. Management had not given guidance for the third quarter, but the results topped the analysts' consensus, and the company said it made significant progress on the path to recovery, especially in the Americas and Europe.

Source Fool.com