Trivago has again reported financial losses for the third quarter of 2024, citing an impairment charge as a contributing factor.
The hospitality metasearch company reported total revenue of €146 million in the three months ending September 30, marking a 7% drop compared to the same period in 2023, and net loss of €15 million.
Adjusted EBITDA was €13.6 million in the quarter, which the company said brings it closer to its full year prediction of breakeven for adjusted EBITDA. Advertising spend in the quarter came in at €108 million, down by almost €8 million compared to the same period last year.
“Despite the decline, we continued to observe positive revenue developments from branded traffic channels as we continue our aim towards returning to year-over-year top line growth,” said Trivago in its Q3 release.
Trivago said the net loss came primarily as the result of a €30 million impairment charge in relation to its "annual indefinite-lived intangible asset impairment analysis" and was due in part to weakness in performance marketing that lead to a drop in revenue. Trivago also cited overall economic uncertainty.
Subscribe to our newsletter below
The company said it remains optimistic that it can return to top line growth year-over-year during the fourth quarter, in part through disciplined marketing investment decisions.
Trivago said it sees room to scale its brand marketing efforts to drive future revenue. It predicts a year-over-year revenue boost in 2025 and “double digit” growth of revenue in the medium-term.
Managing director and CEO of Trivago Johannes Thomas touched on a number of priorities for the company on the call including branded growth bolstered by brand marketing efforts, deals recovery experience and notably the company’s artificial intelligence strides.
Trivago, he said, has expanded its AI-powered hotel highlights, bolstering its coverage from 120,000 hotels to 250,000 hotels located in 27 markets in an effort to improve user experience by sharing relevant information. The company also has new personalization-geared algorithms to improve the relevance of its search results.
AI is part of its brand marketing efforts, too. “So there are marketing cases, there are organizational cases, and then there are product cases,” Thomas said in a post-earnings call interview with PhocusWire. He added that Trivago is evolving its core search, too, and expects to share more on that in the near future.
And he’s not too concerned about the evolution of AI search taking away the need for metasearch platforms like Trivago.
"I think a radically new user experience is not necessarily better, so I think that I wouldn't expect there's suddenly a much better product on the market. And I think in travel in particular, it's very important that you have a big brand,” said Thomas. “You can have the best product, but if nobody knows it, it will not get traction, and you will not get data. You need the data to learn. And I think that's a big advantage we have, that we're one of the most recognized brands. We have a ton of data we can learn with, and I think that is an advantage in the speed of learning we can have around this.”
The same day it announced its Q2 earnings in July, Trivago also shared that it had invested in Holisto, furthering a partnership that kicked off in 2022.
*This story was be updated following Trivago's call with financial analysts Wednesday morning.