Travelzoo Q2 revenue beats but EPS misses on marketing costs

Overview

• Travelzoo Q2 2025 revenue grows 13% yr/yr, beating analyst expectations

• EPS of $0.12 misses analyst estimates, impacted by marketing costs

• Operating income misses estimates; company repurchased 172,088 shares

Outlook

• Travelzoo expects Q3 2025 revenue growth to continue year-over-year

• Company anticipates accelerated revenue growth in subsequent quarters

• Travelzoo expects increased profitability from recurring membership fees

• Short-term fluctuations in net income are possible

Result Drivers

• MEMBER ACQUISITION - Significant investment in acquiring new Club Members, with a focus on achieving quick ROI, impacted EPS

• NORTH AMERICA GROWTH - North America segment revenue increased 14% yr/yr, contributing significantly to overall revenue growth

• EUROPEAN LOSSES - European segment reported an operating loss due to increased spending on acquiring more Club Members

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the leisure & recreation peer group is "buy"

• Wall Street's median 12-month price target for Travelzoo is $26.50, about 48.3% above its July 22 closing price of $13.70

• The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 10 three months ago

Press Release: ID:nPn6CnxrLa