Travelzoo · NASDAQ:TZOO
Travelzoo — Q2 2024 Earnings Presentation
19 slides from Travelzoo's earnings presentation, Jul 25, 2024
Slide 1: Second Quarter 2024 Performance
Second Quarter 2024 Performance July 25, 2024
Slide 2: Important Notice to Investors
Important Notice to Investors Please read this management presentation together with the Company’s press release issued earlier today announcing the Company’s second quarter 2024 financial results and in conjunction with the Company’s recent Annual Report and Quarterly Reports as filed with the Secu
Slide 3: Part 1: Second Quarter 2024 Performance
Part 1: Second Quarter 2024 Performance Part 2: Management Focus Part 3: Travelzoo META 3 | Second Quarter 2024 Performance
Slide 4: Revenue was consistent year-over-year, but operating profit was up by 23%
Revenue was consistent year-over-year, but operating profit was up by 23%. Revenue Operating Profit Members $ millions $ millions Millions 30.8 31.0 30.8 21.1 21.1 4.0 3.3 Q2 2023 Q2 2024 Q2 2023 Q2 2024 Q2 2023 Q1 2024 Q2 2024 4 | Second Quarter 2024 Performance
Slide 5: The growth in profits was driven by our Europe segment
The growth in profits was driven by our Europe segment. North America Business Segment Europe Business Segment Revenue $ millions Q2 2023 14.1 5.9 Q2 2024 14.1 6.0 Operating Profit $ millions Q2 2023 3.8 -0.2 Q2 2024 3.7 0.5 5 | Second Quarter 2024 Performance
Slide 6: Membership fee revenue is still small
Membership fee revenue is still small. We expect it to substantially drive revenue and profit growth in 2025, when the free membership for legacy members* phases out. Global Revenues $ millions Advertising Membership Fees Other Q2 2023 20.0 1.1 0.0 Q1 2024 20.9 1.1 0.0 Q2 2024 20.0 1.2 0.0 Includes
Slide 7: Revenue recognition of membership fees over the subscription period
We recognize revenue from membership fees ratably over the subscription period. Member acquisition costs, on the other hand, are fully recorded immediately. Revenue Recognition $ Example: New member joined on March 1, 2024, paying a membership fee of $40 per annum Q1 2024 Q2 2024 Q3 2024 Q4 2024 Q1
Slide 8: Our GAAP operating margin was 19%, compared to 15% in Q2 2023
Our GAAP operating margin was 19%, compared to 15% in Q2 2023. Operating Margin 2017 2018 2019 2020 2021 2022 2023 Q1 2024 Q2 2024 25% 18% 19% 11% 9% 7% 4% (2%) (26%) 8 | Second Quarter 2024 Performance
Slide 9: In North America, the GAAP operating margin remained high
In North America, the GAAP operating margin remained high. North America Business Segment Revenue Operating Margin $ millions Q1 2023 14.8 31% Q2 2023 14.1 27% Q3 2023 13.4 22% Q4 2023 13.8 29% Q1 2024 14.2 31% Q2 2024 14.1 26% 9 | Second Quarter 2024 Performance
Slide 10: Total non-GAAP operating profit was $4.8 million and 23% of revenue
Total non-GAAP operating profit was $4.8 million and 23% of revenue. Non-GAAP Operating Profit* GAAP Operating Profit $ millions Adjustments Non-GAAP Operating Profit* 0.8 4.8 4.1 4.0 3.3 0.9 Q2 2023 Q2 2024 * GAAP operating profit + amortization of intangibles + stock option expenses + severance-re
Slide 11: Items excluded in the calculation of non-GAAP operating profit
Items excluded in the calculation of non-GAAP operating profit: $ millions Q2 2023 Q2 2024 Adjustments 0.9 0.8 Impairment of intangibles and goodwill — — Amortization of intangibles 0.4 0.1 Stock option expense 0.4 0.7 Severance-related expenses 0.1 — 11 | Second Quarter 2024 Performance
Slide 12: Operating cash flow of $3.1 million and solid cash position
With operating cash flow of $3.1 million, we maintained a solid cash position—even after repurchasing 800,000 shares during the quarter. Cash Balance at End of Quarter* $ millions 16.4 16.9 13.2 Q4 2023 Q1 2024 Q2 2024 * Includes cash, cash equivalents and restricted cash 12 | Second Quarter 2024 Pe
Slide 13: We believe we can keep our fixed costs relatively low
We believe we can keep our fixed costs relatively low in the foreseeable future. Higher revenues would thus increase margins. Non-GAAP adjustments OPEX and cost of revenues Revenue Operating Expenses and Cost of Revenues $ millions $ millions 22.0 17.8 21.1 21.1 16.4 17.1 0.9 0.8 0.4 16.9 16.0 16.3
Slide 14: Travelzoo's global reach and high-quality users
With more than 30 million members, 8 million mobile app users, and 4 million social media followers, Travelzoo is loved by travel enthusiasts who are affluent, active, and open to new experiences. Travelzoo's Global Reach High-Quality Users, Followers and Subscribers Members* Travelzoo U.S. Member S
Slide 15: Part 2: Management Focus
Part 1: Second Quarter 2023 Performance Part 2: Management Focus Part 3: Travelzoo META 15 | Second Quarter 2024 Performance
Slide 16: Management focus
Management focus • Convert a large number of legacy members*, which represent more than 95% of members, into (paying) members as of January 1, 2025 • Add new benefits to the paid membership • Retain, and grow, our profitable advertising business from the popular Top 20® product • Utilize higher oper
Slide 17: Part 3: Travelzoo META
Part 1: Second Quarter 2024 Performance Part 2: Management Focus Part 3: Travelzoo META 17 | Second Quarter 2024 Performance
Slide 18: 18 | Second Quarter 2024 Performance
18 | Second Quarter 2024 Performance
Slide 19: Have a good day!
NASDAQ: TZOO HAVE A GOOD DAY! For questions, please contact Travelzoo Investor Relations: ir@travelzoo.com