Trip.com Group Ltd - ADR

Strong Q1 growth, led by inbound; solid profitability - Gross bookings (core OTA): ~RMB 300bn; Group net revenue: ~RMB 16.2bn (+17% YoY). - Inbound travel momentum: inbound gross bookings +~90% YoY; company already served ~7m inbound travelers in Q1, versus ~20m inbound travelers in 2025. - International OTA growth: international gross bookings +~65% YoY; Europe + U.S. now ~25% of inbound traffic (Asia remains largest source). - Adjusted EBITDA: ~RMB 4.8bn (vs ~RMB 4.2bn in Q1’25). EPS (diluted, GAAP): RMB 3.67 / ADS $0.53; Non-GAAP EPS: RMB 5.73 / ADS $0.83. - What’s good: clear evidence of inbound and international scaling plus margin/earnings improvement (EBITDA up).

Management’s 2026 outlook: growth moderates; Q2 guidance +3% to +8% YoY - Q2 net revenue growth guidance: ~+3% to +8% YoY. - Why moderation vs Q1: Q1 was exceptionally strong; growth trends are easing. - Key headwinds cited for near term: higher energy prices + geopolitical tensions → higher airfares, tighter airline capacity, and disruptions, especially long-haul, changing booking patterns. - Operational/compliance adjustments also weigh short term, though framed as constructive for long-term platform quality.

AI strategy positioned as “fulfillment + infrastructure,” not just recommendations - Company argues AI agents will increasingly shift from “information” to “fulfillment”, which favors OTAs with real-time inventory, verified supply, pricing, and transaction/service infrastructure. - Concrete product direction: - Integrated AI assistant with core search enabling natural language/voice-based, complex multi-variable requests returning instantly bookable results. - Expanding AI efficiency internally (e.g., customer service automation, supplier content quality) and opening platform via Skills / MCP / AI-native integrations. - Modularization of capabilities into AI-ready services so agents can complete end-to-end travel journeys. - Surprising/interesting: management explicitly wants Trip.com to become trusted infrastructure for third-party AI agents—a potential new demand channel rather than only app-based traffic.