(Reuters) - TripAdvisor Inc reported lower-than-expected quarterly profit and revenue, but shares rose after the travel review website operator said absolute U.S. revenue per hotel shopper recovered to levels seen before the roll out of its instant booking feature in early 2014.
The Needham, Massachusetts-based company’s shares were up about 6 percent at $49.75 in after-hours trading on Tuesday.
TripAdvisor launched the instant booking feature, which allows booking of hotel rooms directly through the company’s website in an attempt to capture higher-margin booking fee.
However, the feature weighed on the company’s traditional referral revenue stream.
“First quarter year-over-year revenue per hotel shopper growth was 2 percent, up nine percentage points sequentially and up 23-points since the first-quarter trough last year,” the company said in prepared remarks as part of its quarterly earnings.
Company-branded, click-based ad revenue and revenue from instant booking rose 11.6 percent in the first quarter, despite continued revenue dilution from last year’s launch of instant booking in certain non U.S. markets, TripAdvisor said.
The company also reiterated its 2017 forecast of double-digit consolidated revenue growth, as well as double-digit click-based and transaction revenue growth.
TripAdvisor also said it expects to spend about $70 million-$80 million on television ads, starting in the United States.
The company's net income fell to $13 million, or 9 cents per share, in the first quarter ended March 31, from $29 million, or 20 cents per share. (bit.ly/2phutPv)
On an adjusted basis, the company earned 24 cents per share, missing analysts’ average estimate of 26 cents, according to Thomson Reuters I/B/E/S.
The company’s total revenue rose 5.7 percent to $372 million, but missed estimate of $377.1 million.
Reporting by Sruthi Shankar and Arunima Banerjee in Bengaluru; Editing by Maju Samuel and Sriraj Kalluvila
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