NEWTON, MA, February 13, 2013 -- TripAdvisor, Inc. (NASDAQ: TRIP) today announced financial results for the fourth quarter and full year ended December 31, 2012.
• Fourth quarter 2012 revenue was $169.4 million, up 23% year-over-year; full year 2012 revenue increased to $763.0 million, up 20% year-over-year.
• Fourth quarter 2012 net income was $33.6 million, or $0.23 per diluted share, up 52% year-overyear; full year 2012 net income increased to $194.1 million, or $1.37 per diluted share, up 9% yearover-year.
• Fourth quarter 2012 non-GAAP net income was $41.3 million, or $0.29 per diluted share, up 26% year-over-year; full year 2012 non-GAAP net income increased to $218.7 million, or $1.54 per diluted share, up 10% year-over-year.
• Fourth quarter 2012 Adjusted EBITDA was $64.3 million, or 38% of revenue, up 17% year-overyear; full year 2012 Adjusted EBITDA increased to $352.5 million, or 46% of revenue, up 9% yearover-year.
• Cash flow from operations for the fourth quarter was $71.1 million, or 42% of revenue, up 172% year-over-year; full year 2012 cash flow from operations increased to $239.1 million, or 31% of revenue, up 10% year-over-year.
• Free cash flow for the fourth quarter increased 199% year-over-year to $62.4 million, or 37% of revenue; full year 2012 free cash flow was $209.8 million, or 27% of revenue, up 7% year-overyear.
• Effective February 12, 2013 Mr. Gregory B. Maffei, President, CEO and Director of Liberty Interactive Corporation, was elected Chairman of the Board and designated to serve on the Executive Committee and Compensation Committee.
• Board of Directors authorizes up to $250 million of share repurchases.
“The fourth quarter capped an exciting year during which we reinforced our importance in the travel planning funnel. We deepened our social and personalization initiatives, grew our member and content base rapidly and innovated our product offerings, including introducing a new meta experience on smartphones,” said Steve Kaufer, CEO of TripAdvisor. “In 2013, we want to build on that momentum and amplify our global brand, providing the best experience for every user, on every device, in every geography.”
Discussion of Fourth Quarter and Full Year 2012 Results
Revenue for the fourth quarter of 2012 was $169.4 million, an increase of $31.6 million, or 23%, compared to the fourth quarter of 2011. Revenue for the year ended December 31, 2012 was $763.0 million, an increase of $125.9 million, or 20%, compared to the year ended December 31, 2011.
• Click-based advertising – Revenue from click-based advertising totaled $123.8 million for the fourth quarter of 2012, an increase of 24% compared to the fourth quarter of 2011. Click-based advertising revenue represented 73% of total revenue in the fourth quarter of 2012, compared to 72% in the fourth quarter of 2011. Revenue from click-based advertising totaled $587.8 million for the year ended December 31, 2012, an increase of 18% compared to the year ended December 31, 2011. Click-based advertising revenue represented 77% of total revenue for the year ended December 31, 2012, compared to 79% of revenue for the year ended December 31, 2011.
• Display-based advertising – Revenue from display-based advertising totaled $22.3 million for the fourth quarter of 2012, a decrease of 3% compared to the fourth quarter of 2011, which contained a large advertising purchase. Display-based advertising revenue represented 13% of total revenue in the fourth quarter of 2012, compared to 17% in the fourth quarter of 2011. Revenue from display-based advertising totaled $94.1 million for the year ended December 31, 2012, an increase of 10% compared to the year ended December 31, 2011. Display-based advertising revenue represented 12% of total revenue for the year ended December 31, 2012, compared to 13% in the year ended December 31, 2011.
• Subscription, transaction and other – Revenue from subscription, transaction and other totaled $23.3 million for the fourth quarter of 2012, an increase of 56%, compared to the fourth quarter of 2011. Subscription, transaction and other revenue represented 14% of total revenue in the fourth quarter of 2012, compared to 11% in the fourth quarter of 2011. Revenue from subscription, transaction and other totaled $81.1 million for the year ended December 31, 2012, an increase of 58% compared to the year ended December 31, 2011. Subscription, transaction and other revenue represented 11% of total revenue for the year ended December 31, 2012, compared to 8% for the year ended December 31, 2011.
For the fourth quarter of 2012, revenue from the U.S. totaled $83.8 million, and represented 50% of total revenue. Revenue from the U.K. totaled $22.2 million, and represented 13% of total revenue for the fourth quarter of 2012. Revenue from the rest of the world totaled $63.4 million, and represented 37% of total revenue for the fourth quarter of 2012. For the year ended December 31, 2012, revenue from the U.S. totaled $386.2 million, and represented 51% of total revenue. Revenue from the U.K. totaled $110.2 million, and represented 14% of total revenue for the year ended December 31, 2012. Revenue from the rest of the world totaled $266.5 million, and represented 35% of total revenue for the year ended December 31, 2012. Click-based advertising revenue by geography is based on the geographic location of our websites.
Related-party revenue from Expedia totaled $39.5 million for the fourth quarter of 2012, an increase of $2.1 million, or 6%, compared to the fourth quarter of 2011. Related-party revenue from Expedia totaled $203.8 million for the year ended December 31, 2012, a decrease of $7.3 million, or 3%, compared to the year ended December 31, 2011.
GAAP net income for the fourth quarter of 2012 was $33.6 million, or $0.23 per diluted share, compared to GAAP net income of $22.0 million, or $0.16 per diluted share, for the fourth quarter of 2011. GAAP net income for the year ended December 31, 2012 was up 9% to $194.1 million, or $1.37 per diluted share, compared to GAAP net income of $177.7 million, or $1.32 per diluted share, for the year ended December 31, 2011.
Non-GAAP net income for the fourth quarter of 2012 was $41.3 million, or $0.29 per diluted share, compared to non-GAAP net income of $32.8 million, or $0.24 per diluted share, for the fourth quarter of 2011. Non-GAAP net income for the year ended December 31, 2012 was up 10% to $218.7 million, or $1.54 per diluted share, compared to non-GAAP net income of $198.5 million, or $1.46 per diluted share, for the year ended December 31, 2011.
Adjusted EBITDA for the fourth quarter of 2012 was $64.3 million, and Adjusted EBITDA margin was 38%, compared to Adjusted EBITDA of $55.1 million and Adjusted EBITDA margin of 40% for the fourth quarter of 2011. Adjusted EBITDA and Adjusted EBITDA margin for the year ended December 31, 2012 was $352.5 million and 46%, compared to $322.9 million and 51% of revenue for the year ended December 31, 2011.
Cash flow from operating activities for the fourth quarter 2012 was $71.1 million, an increase of $45.0 million, or 172%, compared to the fourth quarter of 2011. The increase was due primarily to an increase in net income, an increase in working capital movements and partially offset by the classification of related party activity with Expedia pre and post spin-off. Cash flow from operating activities for the year ended December 31, 2012 was $239.1 million, an increase of $21.2 million, or 10%, compared to the year ended December 31, 2011.
As of December 31, 2012, cash and cash equivalents and short and long term marketable securities were $585.7 million, up $402.2 million year-over year. As of December 31, 2012, TripAdvisor had 1,575 employees, up from 1,483 employees at September 30, 2012 and 1,250 at December 31, 2011.
In the Company’s earnings release and the related conference call or webcast, the Company may use or discuss non-GAAP net income, Adjusted EBITDA, Adjusted EBITDA margin and free cash flow, which are non-GAAP financial measures as defined by the Securities and Exchange Commission.
Please refer to the section below entitled “Use of non-GAAP Financial Measures” for definitions of these non-GAAP financial measures and the financial schedules attached to this press release for reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measure.
Other Fourth Quarter and Year End 2012 Business Highlights
• TripAdvisor’s travel community averaged more than 50 million monthly unique visitors for the quarter ended December 31, 2012, according to comScore. At about 10% of the world’s monthly unique visitors in online travel, TripAdvisor remains the largest travel website in the world.
• TripAdvisor user content continued to grow at 60 contributions per minute, covering more than 670,000 hotels and accommodations, 1 million restaurants and nearly 250,000 attractions in more than 120,000 destinations throughout the world. TripAdvisor syndicates its content to more than 575 partners and TripAdvisor widgets can be found on more than 70,000 sites around the globe, reaching over 300 million people per month.
• TripAdvisor averaged more than 40 million monthly Facebook visitors to its website and Facebook app during the fourth quarter, according to AppData, and now has more than 44 million marketable members, up nearly 100% year-over-year, according to company logs. Facebook users have contributed 1 billion Open Graph shared actions, 2 billion travel “pins,” and 35% of new reviews come from Facebook-connected users.
• TripAdvisor reached more than 31 million downloads of its TripAdvisor, City Guides and SeatGuru mobile apps and average unique monthly visitors via mobile devices grew nearly 190% year-over-year to more than 45 million for the quarter ended December 31, 2012, according to company logs. The Company introduced a metasearch display for all smartphone 4 sessions, giving users hotel room pricing and availability in-line and launched 20 new City Guides, bringing its total to 80 cities covered.
• TripAdvisor’s Business Listings customer base grew to more than 50,000 subscribers, up more than 40% year-over-year. TripAdvisor also now has a vacation rental inventory of more than 300,000 listings, up more than 50% year-over-year.
• TripAdvisor announced its biggest-ever Travelers' Choice® campaign, awarding 6,000 properties its 2013 Travelers' Choice honors. In its 11th year, Travelers’ Choice now covers Top Hotels, Luxury, Bargain, Service, Small Hotels, and B&Bs and Inns in 82 countries worldwide.
