trivago N.V. · NASDAQ:TRVG
trivago — Q2 2018 Earnings Presentation
32 slides from trivago's earnings presentation, Jul 25, 2018
Slide 1: Earnings Call Q2 2018
Earnings Call Q2 2018 25 July 2018
Slide 2: Disclaimer
Disclaimer All of the information herein has been prepared by the Company solely for use in this presentation. The information contained in this presentation has not been independently verified. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be
Slide 3: Agenda
Agenda Company update Financial performance Guidance 2018 Appendix: Financial statements 3
Slide 4: Agenda
Agenda Company update Financial performance Guidance 2018 Appendix: Financial statements 4
Slide 5: Q2 2018 – Financial Performance
Q2 2018 – Financial Performance 2017 2018 YoY Total Revenue (€mm) Qualified Referrals (mm) RPQR1 (€) Referral Revenue by segment 565.9 494.4 20% 24% Rest of Word 373.6 366.6 39% 36% Americas 298.3 235.0 196.4 177.1 1.50 1.50 1.30 1.33 41% 40% Developed Europe Q2 H1 Q2 H1 Q2 H1 Q2 2017 Q2 2018 (21)%
Slide 6: We have operated with minimal external funding since inception…
We have operated with minimal external funding since inception… Revenue (€mm) Adj. EBITDA (€mm) 1035 754 493 309 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 €1.4mm external funding 2006 - 2008 Self-funded First financing Second First TV First steps Expedia acquires a 63% Listed on $
Slide 7: …but have incurred wider losses in recent quarters…
…but have incurred wider losses in recent quarters… 2017 2018 Adj. EBITDA (€mm) 19.3 3.2 (7.1) (8.7) (17.7) (21.9) Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Source: Unaudited US GAAP financials 7
Slide 8: …which we started to address in Q2
…which we started to address in Q2 RPQR ROAS QR Decline in Continuing commercialization trends Increased focus on conversion Starting Reduction in Q2 advertising Spend Source: Internal data 8
Slide 9: This has resulted in a significant decline in revenue but stabilized ROAS
This has resulted in a significant decline in revenue but stabilized ROAS RPQR ROAS QRs Sequential QoQ growth rates Sequential QoQ growth rates Sequential QoQ growth rates 100% 30% 30% 50% 10% 10% 0% (10)% (10)% (30)% (30)% (50)% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Source: Growth rates prior to Q2 2
Slide 10: Our reductions in advertising spend show early signs of profitability improvement
Our reductions in advertising spend show early signs of profitability improvement Advertising Spend QRs ROAS YoY growth rates (%) YoY growth rates (%) YoY growth rates (%) Apr'18 May'18 Jun'18 Apr'18 May'18 Jun'18 Apr'18 May'18 Jun'18 Source: Internal data 10
Slide 11: Our advertiser revenue share mix remains stable
Our advertiser revenue share mix remains stable Advertiser revenue share development 18% 28% 24% 24% All Others 47% 38% 38% Booking Holdings 33% 35% 39% 38% 38% Expedia Group First nine Q4 2017 Q1 2018 Q2 2018 months 2017 Source: Internal data 11
Slide 12: Agenda
Agenda Company update Financial performance Guidance 2018 Appendix: Financial statements 12
Slide 13: Q2 2018 – Financial Update
Q2 2018 – Financial Update 2017 2018 YoY Total Revenue Adj. EBITDA1 Net Income / (Loss) Return on Advertising Spend (€mm) (€mm) (€mm) (%) 22.5 565.9 3.2 4.3 494.4 (3.4) (17.7) 117% (20.7) 113% (39.6) 110% 109% (42.5) 298.3 235.0 (% of Total Revenue) (% of Total Revenue) 4.0% 1.1% 0.8% Q2 H1 (1.1)% Q
Slide 14: KPI – Global
KPI – Global 2017 2018 YoY Qualified Referrals (mm) RPQR1 (€) ROAS (%) 373.6 366.6 117% 109% 113% 110% 196.4 177.1 1.50 1.30 1.50 1.33 Q2 H1 Q2 H1 Q2 H1 (10)% (2)% (13)% (11)% (3) ppts (8) ppts Attribution model and Commercialization Commercialization platform optimizations Attribution model and Inc
Slide 15: KPI – Developed Europe
KPI – Developed Europe 2017 2018 YoY Qualified Referrals (mm) RPQR1 (€) ROAS (%) 124% 127% 131% 128% 1.47 1.46 1.50 1.48 155.7 133.5 82.1 63.5 Q2 H1 Q2 H1 Q2 H1 (23)% (14)% (1)% (1)% 3 ppts (3) ppts • Qualified Referrals decreased against a • RPQR slightly decreased as lower • ROAS improved in Q2 dr
Slide 16: KPI – Americas
KPI – Americas 2017 2018 YoY Qualified Referrals (mm) RPQR1 (€) ROAS (%) 2.23 2.03 1.79 1.70 Q2 H1 117% 112% 117% 108% (20)% (16)% 107.5 106.8 52.0 46.9 Q2 H1 RPQR1 (US$2) Q2 H1 (10)% (1)% (5) ppts (9) ppts 2.46 2.13 2.20 2.06 Q2 H1 (13)% (6)% • Qualified Referrals decreased against a • RPQR decreas
Slide 17: KPI – Rest of World
KPI – Rest of World 2017 2018 YoY Qualified Referrals (mm) RPQR1 (€) ROAS (%) 0.94 0.81 0.97 0.86 Q2 H1 92% 87% 94% 87% (14)% (11)% 66.7 110.6 126.2 62.4 Q2 H1 RPQR1 (US$2) Q2 H1 7% 14% (5) ppts (7) ppts 1.04 0.97 1.05 1.04 Q2 H1 (7)% (1)% • Qualified Referrals increased against a • RPQR decreased d
Slide 18: Opex and headcount development
Opex and headcount development Cost and expenses Q2 2017 Q2 2018 % YoY (€mm) Cost of revenue 1 1.4 1.3 (7.1)% Headcount 1,2 Other selling & marketing 14.3 16.7 16.8% 1,620 1,566 1 Technology & content 12.0 15.7 30.8% 1,386 1,282 1 General & administrative 9.1 12.2 34.1% 1,2 Costs and expenses 36.8 4
Slide 19: Agenda
Agenda Company update Financial performance Guidance 2018 Appendix: Financial statements 19
Slide 20: Guidance for 2018
Guidance for 2018 Adjusted EBITDA guidance1 €(15)mm to €(30)mm 1. Adjusted EBITDA is a non-GAAP measure and only adjusted for share-based compensation 20
Slide 21: Appendix
Appendix 21
Slide 22: Consolidated Financials H1 2018, trivago N.V.
Consolidated Financials H1 2018, trivago N.V. in €k H1 2018 H1 2017 Abs Δ vs. H1'17 Δ vs. H1'17 Comments Referral revenue 486,984 559,327 (72,343) (12.9)% Other revenue 7,379 6,652 727 10.9% • Overview of P&L under US GAAP Total revenue 494,363 565,980 (71,617) (12.7)% Cost of revenue 3,026 2,509 51
Slide 23: Consolidated Financial Information H1 2018, trivago N.V.
Consolidated Financial Information H1 2018, trivago N.V. in €k H1 2018 H1 2017 Abs Δ vs. H1'17 Δ vs. H1'17 Referral revenue 486,984 559,327 (72,343) (12.9)% 1 Other revenue 7,379 6,652 727 10.9% 2 Comments Total revenue 494,363 565,980 (71,617) (12.7)% Cost of revenue excl.SBC 2,945 2,457 488 19.9%
Slide 24: Reconciliation of non-GAAP Financial Measures H1 2018, trivago N.V.
Reconciliation of non-GAAP Financial Measures H1 2018, trivago N.V. in €mm H1 2018 H1 2017 Abs Δ vs. H1'17 Δ vs. H1'17 Net income/(loss) (42.5) 4.3 (46.8) n.m. Income/(loss) from equity method investment — — — —% Income/(loss) before equity method investment (42.5) 4.3 (46.8) n.m. Expense/(benefit)
Slide 25: Consolidated Financials Q2 2018, trivago N.V.
Consolidated Financials Q2 2018, trivago N.V. in €k Q2 2018 Q2 2017 Abs Δ vs. Q2'17 Δ vs. Q2'17 Comments Referral revenue 231,094 295,035 (63,941) (21.7)% Other revenue 3,905 3,300 605 18.3% • Overview of P&L under US GAAP Total revenue 234,999 298,336 (63,337) (21.2)% Cost of revenue 1,447 1,411 36
Slide 26: Consolidated Financial Information Q2 2018, trivago N.V.
Consolidated Financial Information Q2 2018, trivago N.V. in €k Q2 2018 Q2 2017 Abs Δ vs. Q2'17 Δ vs. Q2'17 Referral revenue 231,094 295,035 (63,941) (21.7)% 1 Other revenue 3,905 3,300 605 18.3% 2 Comments Total revenue 234,999 298,336 (63,337) (21.2)% Cost of revenue excl.SBC 1,395 1,372 23 1.7% 1.
Slide 27: Reconciliation of non-GAAP Financial Measures Q2 2018, trivago N.V.
Reconciliation of non-GAAP Financial Measures Q2 2018, trivago N.V. in €mm Q2 2018 Q2 2017 Abs Δ vs. Q2'17 Δ vs. Q2'17 Net income/(loss) (20.7) (3.4) (17.3) n.m. Income/(loss) from equity method investment — — — —% Income/(loss) before equity method investment (20.7) (3.4) (17.3) n.m. Expense/(benef
Slide 28: Consolidated Statement of Cash Flows H1 2018, trivago N.V.
Consolidated Statement of Cash Flows H1 2018, trivago N.V. in €k H1 2018 H1 2017 Net income/(loss) (42,531) 4,273 1 Adjustments to reconcile net income/(loss) to net cash used: Comments Depreciation 5,529 3,130 Amortization of intangible assets 842 2,386 1. 1 Negative cash flow from operating activi
Slide 29: Consolidated Statement of Cash Flows Q2 2018, trivago N.V.
Consolidated Statement of Cash Flows Q2 2018, trivago N.V. in €k Q2 2018 Q2 2017 Net income/(loss) (20,733) (3,385) 1 Adjustments to reconcile net income/(loss) to net cash used: Comments Depreciation 3,106 1,655 Amortization of intangible assets 421 388 1. 1 Negative cash flow from operating activi
Slide 30: Consolidated Balance Sheet H1 2018, trivago N.V.
Consolidated Balance Sheet H1 2018, trivago N.V. As of As of in €k June 30, 2018 December 31, 2017 Cash & cash equivalents 98,581 190,201 1 Comments Restricted cash 103 103 Accounts receivable, less allowance 83,427 43,062 2 1. 1 Decrease in cash and cash equivalent was driven by Accounts receivable
Slide 31: Reconciliation of non-GAAP Financial Measures from Q1 2017- Q1 2018
Reconciliation of non-GAAP Financial Measures from Q1 2017- Q1 2018 in €mm Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Net income/(loss) 7.7 (3.4) (7.7) (9.6) (21.8) Income/(loss) from equity method investment — — — — — Income/(loss) before equity method investment 7.7 (3.4) (7.7) (9.6) (21.8) Expense/(
Slide 32: trivago