TripAdvisor (NASDAQ:TRIP) stumbled in today’s trading after the online travel company reported second-quarter profit and revenue that trailed market expectations due to higher expenses.
Shares fell 13.3 percent to $80.97 at 2:43 p.m. in Toronto, paring this year’s gain to 8.2 percent.
Net income fell to $58 million, or $0.40 per share, in the April-to-June quarter, from from $68 million, or 47 cents a share, a year earlier, the Newton, Massachusetts-based company said in a statement today.
Excluding one-time items like amortization costs, earnings were $0.54 per share.
Revenue climbed 11.6 percent to $405 million year-over-year. Revenue was driven by strength in click-based advertising and display-based advertising business.
Analysts had forecast a profit of $0.56 cents per share and $413.2 million in revenue, according to Capital IQ.
In the latest quarter, costs surged 46 percent to $326 million, led by a 51 percent jump in selling and marketing expenses.
Revenues from the Hotel segment were $343.0 million, up 13 percent from the year-ago quarter and accounted for 85 percent of the total revenue.
Revenues from the Other segment were $62.0 million, soaring 210 percent year over year and contributing the remaining 15 percent.
Geographically, on a year-over-year basis, North American revenues increased 31 percent to $211.0 million, representing 52 percent of total revenue, while Latin America revenues jumped 46 percent to $19.0 million, accounting for 5 percent.
By product, Click-based advertising revenue rose 13 percent to $266 million, while display advertising increased 8 percent to $40 million.
Like its peers, TripAdvisor has stepped up advertising spending and discounts and loyalty programs in response to increased competition ranging from sites such as Kayak that search multiple sites to startups such as Airbnb.
The company said its monthly unique visitors reached 375 million in the quarter, up 30 percent compared to the prior year.