Tripadvisor, Inc. · NASDAQ:TRIP
Tripadvisor — Investor Presentation (November 2011)
34 slides from Tripadvisor's investor presentation, Nov 21, 2011
Slide 1: Investor Presentation Q4 2011
Investor Presentation (NASDAQ: TRIP) Q4 2011 Exhibit 99.1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Forward-Looking Statements. Non-GAAP Measures. Industry / Market Data . Additional Information about the TripAdvisor Spin-Off. result of new information, future events or otherwise. Investors are cautioned not to place undue reliance on forward-looking statements. prepared for
Slide 3: TripAdvisor Overview
TRIPADVISOR OVERVIEW STEPHEN KAUFER, CO-FOUNDER, PRESIDENT AND CEO TripAdvisor and the TripAdvisor logo are trademarks or registered trademarks of TripAdvisor LLC in the U.S. and/or other countries. All other trademarks are the property of their respective owners. (c) 2011 TripAdvisor LLC. All right
Slide 4: It all started when…
It all started when… Iberostar Tucan Hotel, Playa del Carmen
Slide 5: Investment Highlights
Leading online travel media platform • 44M monthly uniques (1) Huge and growing market opportunity • $39B+ (2) spent on travel advertising each year Definitive resource for travelers and critical partner for merchants • Over 50M reviews and opinions; over 500,000 hotels featured Powerful network eff
Slide 6: TripAdvisor by the Numbers
Scaled, growing, profitable – leading online travel media platform TripAdvisor by the Numbers Market opportunity 160,000+ Attractions 57,000,000+ Facebook connections 50,000,000+ Reviews and opinions 520,000+ Hotels 715,000+ Restaurants 8,000,000+ Candid photos Destinations 93,000+ 10,000,000+ Mobil
Slide 7: Travel: Huge Market, Underpenetrated Online
All other e-commerce 56% Offline: 62% Offline: 84% Travel nearly half of global e-commerce (1) Online hotel bookings growing faster, more profitable (2) Online travel – US / Europe maturing while APAC / LATM growing fast (2) Travel ad spend is large and underpenetrated online 76% 62% Travel: Huge Ma
Slide 8: Most Important Information Influencing $800B+ of Travel Spend
Word of mouth content is most important in influencing purchasing decisions (2) Customer Reviews Friend recommendations 98% of participants found TripAdvisor’s hotel reviews to accurately represent the experience (3) Most Important Information Influencing $800B+ of Travel Spend (1) 76% 49% 40% 37% 3
Slide 9: Significant Network Effects and Economies of Scale
Scale drives content generation Critical source of customers for suppliers Audience High monetization enables efficient customer acquisition Over 50M users and opinions Significant Network Effects and Economies of Scale Reviewers want access to broadest audience A source for a very high % of client
Slide 10: Strong and Differentiated Competitive Position
Search providers OTAs Other travel media Other review services Strong and Differentiated Competitive Position High traffic Rich content TripAdvisor position Depth of reviews drive user experience TripAdvisor is a mission critical supplier TripAdvisor has significantly greater reach/scale Depth and b
Slide 11: TripAdvisor's Business Model
Business listing Lead generation Display ad / sponsorship Display ad / Cost per click ad Business Value TripAdvisor’s Business Model Candid photos Search filtering Room tips Tips from friends Review summary Friend experiences Detailed reviews Consumer Value
Slide 12: Wisdom of Friends – Ability to Connect Improves Experience
Wisdom of Friends – Ability to Connect Improves Experience Deep social integration heightens the experience Since launch, 57M people have been instantly personalized Facebook users are more engaged on the site Facebook users are 2x more likely to contribute full reviews Higher conversion and monetiz
Slide 13: Leading Scale and Global Reach
Monthly unique visitors (‘000s) – branded websites Global reach Highly efficient sources of traffic 31,419 27,941 15,347 14,224 12,188 11,109 10,576 10,378 9,232 8,411 8,355 44,461 TripAdvisor Sites Booking.com Expedia Sites Yahoo! Travel Orbitz Worldwide Travelocity Qunar.com Ctrip.com Hotels.com K
Slide 14: Content Syndication
Content Syndication A powerful extension of TripAdvisor 30,000 partner sites use Trip- Advisor content Provides access to 150M monthly uniques Syndication makes TripAdvisor the de-facto standard for travel review information
Slide 15: TripAdvisor Media Group
TripAdvisor branded sites 44M monthly uniques (1) TripAdvisor Media Group 61M monthly uniques (1) TripAdvisor Media Group (1) comScore Media Metrix, September 2011
Slide 16: Key Areas of Investment and Growth
New Platforms New Geographies New Products Key Areas of Investment and Growth China Vacation rentals Mobile • World’s 2 nd largest economy after the US • 1B hours spent online per day, twice the amount of time in the U.S. (3) • Expect more than 650M internet users by – but still less than 50% penetr
Slide 17: Strategy: Mobile Adoption
Early success: 10M+ downloads Global: Available in 20 languages Depth: Multiple reviews on hundreds of activities in each city Frictionless: GPS and direct bookings maximize functionality Breadth: Information on thousands of activities, hotels, transport Mobile channel is additive and complementary
Slide 18: What TripAdvisor is Doing in China
What TripAdvisor is Doing in China Purchased Kuxun: #2 metasearch player in China Built Daodao from scratch: launched in 2008
Slide 19: Vacation Rentals
Vacation Rentals A new growth opportunity Over 200,000 vacation rental listings Uniquely leverages platform to target travellers searching for hotels Acquired FlipKey and Holiday Lettings Partnered with Interhome, Stayz, Toprural and AKENA
Slide 20: We Have a Winning Culture
… We Have a Winning Culture . . . Speed wins • Rapid iteration and product development cycle Recruit the best and brightest . . . globally • Top engineering talent and robust training programs Say thank you • Recognized by Boston Globe’s “Top Places to Work” (2010, 2011) And give back • 2% of operat
Slide 21: Led by an Experienced Management Team
Experienced management with proven ability to execute Led by an Experienced Management Team Steve Kaufer Chief Executive Officer and Co-Founder (11 years) Barbara Messing Chief Marketing Officer (Joined in 2011, formerly at Hotwire) Andy Gelfond Vice President, Engineering (7 years) Julie Bradley Ch
Slide 22: Financial Overview
FINANCIAL OVERVIEW JULIE BRADLEY, CFO
Slide 23: TripAdvisor Financial Highlights
Compelling business model Highly profitable and cash flow generative Rapid growth Highly scalable; capital efficient TripAdvisor Financial Highlights • Diversified revenue streams globally • Differentiated content provides natural search advantage • Low fixed costs • Low cost to acquire customers •
Slide 24: Track Record of Growth and Profitability
Revenue ( ¹ ) ($M) Adjusted EBITDA (1) ($M) Track Record of Growth and Profitability y/y growth 47% 18% 38% NA 34% Adj. EBITDA Margin 49% 56% 54% 54% 54% (1) Reflects TripAdvisor Holdings, LLC Combined Results of Operations as disclosed in Annex E of Amendment No. 4 to Expedia, Inc. Form S-4 filed N
Slide 25: Robust Historical Growth and Pattern of Seasonality
TripAdvisor Media Group Segment Revenue by Quarter ($M)1 Robust Historical Growth and Pattern of Seasonality Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 q/q growth rate 10% 8% (27%) 39% 5% 8% (18%) 43% 10% 11% (23%) 38% 14% 7% y/y growth: +14% +14% +29% +33% +39% +43% +34% +30% +35% +30% +19% Refle
Slide 26: Increasing Revenue Diversification
$298M $352M $485M Increasing Revenue Diversification Display 13% CPC 87% Display 14% CPC 86% Subscription / Other 6% Display 15% CPC 79% Note: Reflects segment data as disclosed in Expedia 10-K and 10-Q filings. Includes Expedia intersegment revenue and does not adjust for separation. Revenue by geo
Slide 27: Illustrative Post-Spin Operating Model
Illustrative post-spin business profile (annual basis) Key impacts and initiatives Illustrative Post-Spin Operating Model • Changes to the Expedia customer relationship • Standalone public company costs • User experience enhancement initiatives (e.g., site redesign / de-monetization) • Growth invest
Slide 28: Strong Balance Sheet
TripAdvisor Holdings LLC ($M, except per share amounts) Historical (as of 6/30/2011) Pro forma adjustments Pro forma (as of 6/30/2011) Strong Balance Sheet Cash and cash equivalents $112 $32 $144 Short-term investments - Receivable from Expedia, net (75) - Other current assets - Total current assets
Slide 29: Operational Drivers
Engagement Reach Scalability Operational Drivers • Number of reviews • Natural search rankings • Engagement / time spent on site • Seasonality • Advertising (CPC, CPM) • Syndication / licensing • Members • Traffic • Listings Monetization • Sales and marketing • Traffic acquisition • Engineering • In
Slide 30: Spin Transaction
Spin Transaction • Spin rationale • Value creation opportunity for both TripAdvisor and Expedia • Benefits of an enhanced equity currency and greater transparency • Businesses historically managed as independent entities • Create businesses that have a single business focus • Enhance the effectivene
Slide 31: Concluding Remarks
CONCLUDING REMARKS STEPHEN KAUFER, CO-FOUNDER, PRESIDENT AND CEO
Slide 32: Investment Highlights
Leading online travel media platform • 45M monthly uniques (1) Huge and growing market opportunity • $33B (2) spent on travel advertising each year Definitive resource for travelers and critical partner for merchants • Over 50M reviews and opinions; over 500,000 hotels featured Powerful network effe
Slide 33: TripAdvisor
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Slide 34: Adjusted EBITDA Reconciliation
($ in thousands) Adjusted EBITDA reconciliation Six months ended Year ended December 31, June 30, Adjusted EBITDA $146,626 $197,219 $260,963 $140,675 $174,494 Depreciation of property and equipment (1) 5,022 9,330 12,871 5,678 8,616 OIBA $141,604 $187,889 $248,092 $134,997 $165,878 Amortization of i