Q1 2022 Trip.com Group Ltd Earnings Call

June 28, 2022

Thank you for standing by and welcome to the tripped outcome group when she 'twenty to Q1 earnings conference call.

If for standing by and welcome to the trip Dot Com group 2022 Q1 earnings conference call or participants are no listen only mode, there will be a presentation followed by a question and answer session. If you wish to ask a question, you will need to press the starkey followed by the number one on your telephone key pad.

All participants are in a listen only mode there'll be a presentation followed by a question and answer session. If you wish to ask a question you will need to press. The stocky followed by the number one on your telephone keypad.

I would now like to hand, the conference over to Michelle Qi. Please go ahead.

Thank you. Thank you everyone for joining us today, good morning, and welcome to Crimp they'll come group's first quarter of 2022 earnings conference call. Joining me today on the call are Mr. Jim Slim Executive Chairman of the Board Ms Jane Sun, Chief Executive Officer.

I would now like to hand the conference over to Michelle Chief. Please go ahead.

Thank you. Thank you, everyone for joining today. Good morning and welcome to triptolcom group's first quarter of 2022 earnings conference call. Joining me today on the call, our Mr Jim Lam, Executive Chairman of the Board, Ms Jim suam, Chief Executive Officer, and M Indy womam, Chief Financial officers.

And Ms Cindy Wang Chief Financial Officer.

During this call we will discuss our future outlook and performance, which are forward looking statements made under the safe Harbor provision of the U S. Private Security Litigation Reform Act of 1919 five.

During this call, we will discuss our future outlook and performance, which are forward-looking statements made anresafe harbor provision of the? U's private security Litigation Reform Act of one thousand nine hundred and ninety-five.

Forward looking statements involve inherent risks and uncertainties.

As such our results may be materially different from the views expressed today.

Forward-looking statements involve inheret risks and uncertainties.

As such, our results may be materially different from the views expressed today.

Number of potential risks and uncertainties are outlined in trip Com group's public filings with the Securities and Exchange Commission.

A number of potential risks and uncertainties are outlined in triptocom group's public filing with the security and Exchange Commission.

Chip they'll come group does not undertake any obligation to update any forward looking statements, except as required under applicable law.

tritoum group does not undertake any obligation to update any forward-looking statements exact as required under applicable law.

James Jane and Cindy will share in all strategy and business updates operating highlights and financial performance for the first quarter of 2022 as well as the outlook for the second quarter of 2022.

James, Jim and Cindy will share our strategy and business updates, operating highlights and financial performance for its first quarter of 2022, as well as the outlook for the second quarter of 2022 and.

After the prepared remarks, we will have in the Q&A session was that I will turn the call over to Jim <unk>.

After the prepared remarks, we will have an QA session.

Jim Please.

With that, I will turn the call over to Jim.

Thank you Michelle.

Thank you everyone for joining us.

jms Please.

Yes.

Thank you, Michelle.

Thanks.

Thank you everyone for joining us on the call today.

The industry still faces.

Now turning to related to China.

two years into the pandemic, the TRI industry steel faces pandnamic related challenges. The first quarter of 2020 two showed the mixed Pictures in which the Chinese D mes markets and the global markets have developed independent. In China, the first two months of the year, or encouraging one March, was relatively uneasy due to the outrage of omiccound in multiple regions, including the first year cities.

Hello.

<unk> showed a mixed picture.

The Chinese domestic market.

They love it.

In China, the first two months.

Jamie.

It was relatively easy.

Okay.

All regions, including China.

Thanks Cindy.

And that mix influence.

Extended into April and May.

And then control measures.

Such pandemic influence extended into April and may, with strict pandemic control measures and travel curves being imposed as largely limited the performance of the travel industry.

<unk>.

And post largely limited performance.

Industry.

[noise] Australian perspective.

See domestic.

Thanks.

Our shortterm perspectives may not.

The tunnel.

Hey, Sean.

Seem ofcheatic. Demand for travel is still strong, which offers a brighter outlook for the long term.

Outlook for the long term.

The reduction measure and improve the safety perception.

He was our confidence grows.

With St the COVID's risk to reduction measures and improve the safety perceptions, user confidence growth and their desire for travel recovers.

Okay.

[noise] global travel continues to recover at a strong pace.

And diesel.

We anticipate to see a similar pattern in China once the restrictions ease.

Global travel continues to recover at a strong P as government continues to open up.

We anticipate to be a similar pattern in China when those restrictions are eased.

In order to capture as much travel demands we continue to develop novel products to match consumers travel aspirations.

In order to capture such travel demands, we continue to develop TRL products to match consumers' travel opirations.

With the efforts.

We had solid value proposition for our customers and partners in the China market and establish the strengths in both long and short haul travels.

With the efforts in previous quarters, we hand our value proposition of our customers and harners in the China market with established the strength in both longhare and shorehaall travelsthrough, both during our product capabities, service qualities and business efficiency.

So bolstering our product capability so as quantities.

Okay.

In January and February .

The hotel bookings continue to deliver better than market performance increased by more than 20% year over year.

In January and a February our domestic hotel bookings continued to deliver better than the market. Performance increased about more than 20% year-over-year. The market was again largely disruptited by outbreak since March, but we have already seen sign the recovery following the easating of static management measures.

The market. It was again largely disrupted outbreak since March we have already seen signs of recovery following the easing.

Static management measures.

On the international front, we are encouraged.

The benefits of a global recovery from the pandemic.

On the international front, we are encouraging that the benefits the global recovery from the pandemics, with strong travel demand in many countries, especially frrosst Europe , and the procedure Pacific.

Strong demand in many countries, especially across Europe and Asia.

Pacific.

Following these countries tissues to largely removed.

Restrictions.

Following these countries issues to largely remove travel restrictions, we ING strengthening trends of business performance across our global platforms.

And strengthen these fans.

Business performance across our global platforms.

With ample game, achieving triple digits year over year growth in hotel bookings significantly improved, especially the transatlantic and.

With their booking achieving triple-digits year-over-year growth and whoalthcare booking significantly improuved, especially the translantic and Asia markets.

Yes.

Two years seems to the onset of the pandemic.

Fortunately the green shoots of travel.

It has been two years since to the outsets of pendemic. Fortunately, the threeing sues of travel have already herered along. Opportunities to encourage continued the growth with. Our local fooers will continue to be nimble and adaptive to cater to the fast of changing markeket, environment and the matchshe products and our service offerings to current demand.

Yes.

All of those things.

The user graph.

Our local filter, we will continue to be nimble and adaptive.

As to the fast changing market environment and to match all product and service offerings to current demand.

On the international front.

<unk> global vision to be keen to build on a positive signal as we are.

On the international front will remain global vision to be keen to build on positive signals, as we are seeing so far, and a further 45 of global footprint.

We're seeing so far and as further fortify our global footprint.

I will turn the call over to James.

Additional highlights.

Hey, good.

With that, I will turn the call over to Jane for operational highlights.

Good morning, everyone I would like to start with a clinical nothing.

Thankyou is. Good morning everyone. I would like to start with a preick overview of our performance in the past quarter and updates our strategic focuscesfirst of all, overall performance overview. In the first quarter of 2022, our total net revenue remained largely stable year over year, which was a net result of a relatively well performed first two month and a weaker March impacted by the latest round of omicro outbreaks in China.

In the past to Cortez and update our strategic focus.

Therefore overall performance over here.

Courthouse.

Our total net revenue.

Largely stable year over year, which was a natural result of relative to your well before its first of two men and a weaker March impacted I didn't make it to wrong, Oh mccraw of outbreaks in China.

In January and February our domestic business.

Right after that industrial performance.

In January and February our domestic business sustained after the industry performance, with domestic hotel bookings increased above 20% year over year and were close to a fourll, recovered to twentthousand and 19 levelhowever, same March the whole market have been under severe impact of the pandemic related to restrictionsalthough speaking in Q1, our hotel bookings were close to twentthousand and 20: one level with same city's vacation hotels reservation grew more than 20%.

Domestic hotel bookings increased about 20% year over year and were close to 40 of any coverage to 2019 level how is that since March the home.

Market has been under severe impact of the pandemic related restrictions.

<unk> speaking.

<unk>, a hotel booking or close to peak and your wisdom.

We saved 50 vacation hotel reservation grew morning.

Year over year.

Our air Visitation was also recovered faster than the market.

Although the China domestic market with largely affected by the pandemic and choice and the travel restriction.

We went at night to see that the fundamental demand for travel with you.

Got it.

The recovery was much faster in areas that are affected by Covid.

Fifth hotel bookings in southern China, and Western China has already surpassed 2019 level in the recent months in the past two weeks.

While the total hotel bookings have also surpassed 15 19 level following the easing of Covid situation.

2019 level in the recent months, in the past to two weeks, our total hotel bookings have also surpassed 2019 level. Following the evening of COVID-19 situation, a global market, on the other hand, continued to make major story towards the recovery to pre pandemic level at more and more countries have substantially dved their pandemic related troubal restrictions. Traffic on our global platforms have already surpassed the 2019 level.

Global markets on the other hand continue to make major strides towards recovery to pre pandemic levels at one or more countries have substantially dropped their pandemic related travel restrictions traffic on a global task force have already surpassed the 20.

T level.

World is ready for a great two reopened.

Overall air ticket, Okay, Oh global platform has increased over 270% year over year, English Oh, Greg Tripp dotcom.

The world is ready for a greater reopening over air ticket ings, our global platform, have increase over 270% year over year, in which our global rent TRI com, have managed to increased by approximately 400% year over yearin overtheseas market omestic air ticts bookings on TRI com have surpassed the 20: 19 level with a growth more than 150% and have outpaced the industry average across all of our key market.

<unk> managed to increase by approximately 400% year over year.

In the overseas market domestic air ticket.

Okay.

<unk> com had surpassed the twin peanuts P level, we have grown more than 150% and have outpaced the industry average.

So all of our key markets.

Oh, okay.

Okay.

All of our global platforms have also increased by more than 25% above 17 on teen level in the first quarter.

Domestic hotel bookings.

Now China markets Ultra dot com increased over 200% when compared to the same period in 2019, especially in markets, such as Hong Kong, South Korea, Singapore, Malaysia.

Let's see your key U a E et cetera.

That's a lot of trends continued to gain momentum.

In the second quarter.

The upward trends continued to gain momentum in the second quarter. We have also seen gradual recovery of international traveble as more and more countries decided to lift restrictions and reopen their orders to accept international travelers.

We have also seen gradual recovery of international travel as more and more countries decided to lift restrictions and we opened their borders to access to international travelers.

Second operational highlights and our strategic focus is why the China market and the global market showed a different path.

Second operational highlights and the strategic focuses.

The development it is important for us to stick with our local focus and global vision strategy and be flexible and adaptive to make the best out of situations and are focused on the following areas first of all accommodation.

While the China market and a global market show the different paths of the development, it is important for us to stick with our local focus and global vision strategy and be flexible and adaptive to make the best out of the situation and focus on the following areas. First of all, accommodation in the China domestic market. We continue to strengthen our value propositions to hotel partners and users through product innovation, such as hotel packages.

The China domestic market, we continue to strengthen our value proposition to our hotel partners and the users through product innovation, such as hotel packages and our trip plus program to view the stronger user case, and there was thought it to their customers and starvation.

And our trip-plus program to build stronger user case and are respond to the customers as pation for better services and a valuablefor money. We worked hard to further enhance the quality of our value-added hotel package products, which covers over one thousand hotels.

For better services and value for money, we worked hard to further he has the quantity of our value added hotel package products, which covers or 10000 hotels.

High end hotel packages contributed over 40% off reservation to these participating parlors and umbrella incremental upside to our hotel business partners. We also continue to strengthen our value proposition.

High end hotel packages contributed over 40% of reservations to these participating partners and a broad incremental upside to our hotel business partners. We also continued to strengthen our value proposition in our trip plus program with about two hundred 40 thousand hotels jointed to reward to customers' loyalty with acttra benefits for incremental volume. In a meantime we have also upgraded our backend system and stream.

And our trip plus program with about 240000 hotels joint to reward customer loyalty with extra benefits for incremental volume.

In the meantime, we have also upgraded our backend system and streamlined service procedures as a result, our order confirmation time was shortened by 45% when compared to the first quarter of last year.

Second content platform.

We continue to make solid progress and strengthening our content platform to battery fire and its uses to make a well informed travel decisions.

I'm proud of achievements in 'twenty, two what the amount of daily average user generated content for approval by the 140% sequentially in the first quarter. The number of Kols also increased by 10%.

Of daily average use. The generated content full grew by 100 to 40% sequentially in the first quarter. The number of kolls also increased by 10%.

While the amount of the content and our fleet of content creators continues for a while we also focus on enhancing the efficiency of our content channels as well as improving the quality of our contests.

While the amount of the content and our fleet of content creators continued to roll. We also focus on enhancing the efficiency of our content channels, as were as improving the quality of our contents. We are delighted to see higher user engagement in the first quarter, with the number of average dayaily engaging users our content channel increased by around 40% year-over-yearaverage number of content view per users also increased by around 40%.

We are delighted to see higher user engagement in the first quarter with the number of average daily engaging users Oh content channel increased by around 40% year over year.

Average number of contests view per user also increased by around 40%.

Average of your duration has also seen a double digit improvement in AR continues to grow in the following months.

Average view duration has also seen a double digit to improvement and a continued to grow in the following months.

Third global business.

On the international front, we continue to integrate and upgrade our supply chain and technology capabilities of our national brands, and our Florida strengthened the reliability and efficiency of our customer services.

thir global businesseson the international front, we continue to integrate and upgrade supply chain and technological capabilities of our international brands and further strengthen the reliability and efficiency of our customer services. In mind of global travel recovery, we also worked expanding our content strategy to cover our global businessesleveraging our successful experience in the China market. We managed to improve the daily average traffic of trickdowncom.

In light of global travel recovery. We also worked on expanding our content strategy to color our global businesses.

Leveraging our successfully Sirius and the China market.

Managed to improve the daily average traffic of cooked I'll call content channel.

80% year over year, the content engagement rate increased by 150% year over year. This also helped to nearly double our users retention rate.

Our activity offerings in overseas markets are also seeing continuous improvements since previous quarter in 'twenty touch what reservations of global in destination activities, Oh platform have already surpassed the pre Covid 2019.

No.

On top of that we continue to achieve triple digit growth in the first quarter.

levelon. Top of that, we continue to achieve triple-digit growth in the first quarter. We are encouraged and are well prepared to further collaborate with grow as Nations and attractions to strengthen our market position and gain market share.

I encouraged and are well prepared to further collaborate with global destinations and attractions to strengthen our market position and gain market share.

Fourth cooperative responsibility following up with our rural revitalization initiatives. We currently have nine trips I'll call group of countries retreat in operation with the latest on freshly opened recently, we contribute to <unk>.

Fourth, cooperate responsibility followall up with our rural revitalization initiatives. We currently have nine tripsoutcont groupbal country retreats in operations, with the latest stolen freshly opened recently. We continued to collaborate with local authorities to provide professional trainings, to nurture local alternative accommodations and tourism practitioners in order to support the development of rural tourism.

Olaf rate with local authorities to provide professional training.

Who nurture local alternative accommodations and tourism practitioners in order to support the development of our rural Teresa.

During the recent pandemic outbreak. We also contributed to support their guarantee of supply of daily necessities in Shanghai, and leveraging our resources and experience to help for related to company's personnel withhold Cowboys operations in <unk>.

During the recent pandemic outbreak. We also contributed to support the guarantee of supply of daily necessities in shhai by leveraging our resources and experience to help for related company's personnel with hotel ressolations. In total, our corporate travel team contributed to 16 thousand ru nights and helped approximately 6800 daily necessities supply personnel.

Total our corporate travel team contributed to 160000 room nights and helped approximately 6800, David necessity supply personnel.

We used a relaxation of travel restrictions in many parts of the world. We are finally, starting to see the light at the end of the tunnel for the domestic market. We may still see a relatively weak second quarter due to pandemic impact. However, we will come.

With the rellaxution of our restrictions in many parts of the world, we are finally starting to see the light at the end of the tunnelfor the domestic market. We may still see a relatively weak set in a quarter due to panamic impacthowever, we will continue to show resilience in this fast changing market environment and be flexible with our strategies to swiftly seeiz growth opportunities.

<unk> to show resilience in this fast changing market environment and be flexible with our strategies to swiftly seize growth opportunities with that I will now turn the call over to see peaks.

Thanks, Jay Good morning, everyone for the first quarter of 'twenty to 'twenty. Two took dotcom group reported net revenue of RMB 4.1 billion, which was flattish compared.

With that, I will now turn the call over to Sing beek.

Thanks Jay only every one for the first quarter of 2022, to thought conong group reported net revenue of randb four point one billion, which was blackattish compared to a compared with the same peri as last year and decreased by 12% quarter over-quarter, primarily due to continued disruption to the travel industry from the recent wave of pandemic outbreak.

To compare it with the same period last year and decreased by 12% quarter over quarter, primarily due to continued disruption to the travel industry around the recent wave of pandemic outbreak.

Accommodation reservation revenue for the first quarter of 2022 with R&D at 1.5 billion, representing a 8% decrease year over year, and 24% decrease quarter over quarter recovering 248% off the 2019 level.

Accommodation reservation revenue for the first quarter of 2022 was ironthe one point five billion, representing a 8% decrease year-over-year and 24% decrease quarter over quarter, recovering to 48% of 20 and 19 level.

This is a match without of steady recovery in the first two months is offset by the disruption of an accrual outbreak since March.

This is a natural result of steady recovery in the first two months offset by the disruption of omac outbreak since March.

Domestic hotel booking were close to last year's Cold Q1 level with local hotel grew by more than 20% year over year.

Domestic hotel bookings were close to last year's qone level with local hotel grew by more than 20% year-over-year.

Transportation ticketing revenue for the first quarter of 2022 with RMB, one 7 billion, representing a 10% increase year over year, and 10% increase quarter over quarter recovering to 50% of the 20 <unk>.

Transportation ticketing revenue for the first quarter of 2022 was ironthe one point seven billion representing and 10% increase year-over-year and 10% increase quarter over quarter, recoverying to 50% of the 2019 level, among which China. Domestic recovery momentum was largely disrupted by resurgerance of COVID-19 since March, while air reservations on our international platforms saw significant increase, mainly contributed by the recovery in Europe .

Level, among which China domestic recovery.

Mental what's largely disrupted by resurgence of Covid since March what are reservations on our international platforms.

Significant increase mainly contributed by the recovery in Europe , and Asia as a result of relaxation of travel restrictions.

Packaged tour revenue for the first quarter of 2022 was RMB 124 million, representing a 27% decrease year over year, and 30% decrease quarter over quarter recovering to 12% of the 20th 19 level.

And Asia as a result of relaxation of travel restrictions packis. The tour revenue for the first quarter of 20 and 20 two was R and B. one hundred and 20, four million, representing a 20 seven percent decrease year-over-year and 30% decreased quarter over quarter, recovering to 12% of the 20 and 19 level. This is mainly due to pandemic related travel restrictions in domestic China market, a largely milded album travel tourism.

This is mainly due to pandemic related travel restrictions in domestic China market and largely muted outbound travel tourism.

Corporate travel revenue for the first quarter of 2022 was RMB 222 million, representing a 12% decrease year over year, and 40% decrease quarter over quarter.

copate travel revenue for the first quarter of twent Y and 22 was on the two hundred and 22 million, representing a 12% decrease year-over-year and 40% decrease quarter-over-quarter.

Recovering to a 93% of the 2019 level, primarily due to the impact of pandemic related traffic management in March.

Recovering to 93% of the 2019 level, primarily due to the impact of pandemic-related esstatic management in March.

Excluding share based compensation charges, our total adjusted operating expenses decreased by 11% year over year and two what's the saving of 38% compared to the same period in 2019, reflecting our effective cost control.

Excluding share-based compensation charges, our total adjusted operating expenses decreased by 11% year-over-year and was a saving of 38% compared to the same period in 2000 and nineteenreflecting our effecttiive post control and efficient operating management across business lines.

Our efficient operating management across business lines.

Adjusted product development expenses for the first quarter decreased by 6% from the previous quarter. It was a saving of 19% compared to the same period in 2019, as we continued to run lean and maintain a stable headcount in it.

Adjusted product development expenses for the first quarter decreased by 6% from the previous quarterit was a saving of 19% compared to the same period in two thousand and 19, as we continued to run lean and maintain a stable headcount in a team.

Team.

Adjusted selling and marketing expenses for the first quarter decreased by 33% from the previous quarter. It was a saving of 62% compared to the same period in 2019, as we continue to stick with our prudent marketing protocol.

Adjusted sales and marketing expenses for the first quarter decreased by 33% from the previous quarter. It was a saving of 62% compared to the same period in 2019, as we continued to stick with our prudent marketing protocol.

Our adjusted G&A expenses for the first quarter decreased by 9% from the previous quarter. It was a savings of 23% when compared to the same period in 2019.

Adjusted gna expenses for the first quarter decreased by 9% from previous quarter. It was a saving of 23% when compared to the same period in two thousand and nineteen and.

Adjusted EBITDA was RMB 91 million for the first quarter compared to a negative 216 million in the same period last year and RMB 54 million in the previous quarter adjust.

Adjusted EBITDA was indb 91 million for the first quarter, compared to negative 216 million in the same period last year and indb 54 million in the previous quarter. Adjusted EBITDA margin was 2% for the first quarter, compared to negative 5% in the same period last year, a 1% in the last quarter.

Adjusted EBITDA margin was 2% for the first quarter compared to a negative 5% in the same period last year at 1% in the last quarter.

Diluted loss per ordinary share and per avs, where I M. B 1.5 to all U S. Dollar 24 cents for the fourth quarter of 2022.

Diluted loss per ordinary Sha and per ADS were I the one point five two all U's dollar 24 cents for the firstth quarter of 20 20, two.

Excluding share based compensation charges and fair value change of equity securities investments.

Excluding share based of compensation charges and fair value change of equity securities investments. A exchangeable senior notes now GAAP diluted loss per ordinary RE and per ADS were IRB six -cent or U's dollar one cent for the first quarter.

Changeable senior notes no GAAP diluted loss per ordinary share and per a D. S Y M D six cents or U S. Dollar one since for the first quarter.

As of March 31st 2022.

The balance of cash and cash equivalents.

As of March thirty-first 2022, the balance of cash and cash equivalents.

Restricted cash and short term investment.

Oh, two maturity time deposits and financial products was RMB 63.3 billion are U S dollar 10 billion.

Restricted cash short-term investment held to maturity time, deposit and financial products was irnb 63.3 billion on U's dollar M billion.

Turning to the second quarter of 2022 we would like to share some color of our recent businesses.

Turning to the second quarter of 2022, we would like to share some color of our recent businesses.

Multiple rounds of omicron outbreak across China, including first tier cities, such as center, so high in Beijing, largely impacted the entire China domestic travel industry.

Multiple rounds of omaco outbreak across China, including first tier cities such as shchangang, Shanghai and Beijing, largely impacted the entire China domestic travel industry.

In the quarter to date, the industry level air passenger volume was down by 70% to 90%.

In a quarter to date the industry level air passenger volume was down by 70% to 90% and.

And the industry level hotel Revpar was down by 40 to 60 per cent compared to the same period in 2019.

And the industry level. Hotel rappar was done by 40% - 60% compared to the same period in 2019, among which a significant portion was attributable to quarantine requirements.

All of which a significant portion was attributable to quarantine requirements.

We are encouraged however, we are encouraged.

By the recent business recovery as the outbreak are more under control.

We are encouraged. However, we are encouraged by the recent business recovery, as the outbreaks are more under control, starting from June .

Starting from June .

In the past several weeks our hotel reservations have surpassed the 2019 level, mainly contributed by local vacation demands while long haul travel is still under pressure.

In the past several weeks, our hotel reservations have survedpassed a 2019 level, mainly contributed by local stacation demands, while long-hare travel is stillue under pressure.

Oh hold travel remain Rob.

It made muted under current conditions.

albon travel remain. Rub would remain muted under current conditions.

And outside of China.

The recovery momentum in Europe U S and Asia remain robust.

And outside of China the.

Recovery momentum in Europe U's and Asia remain robust.

Our international brands showed further improvement in April and May benefitting from the relaxation of travel restrictions and reopening of country borders.

Our international brand showed further improvements in April and may, benefiting from the relaxation of travel restrictions and reopening of country borders.

As the Covid threat continues to linger in the China domestic market, we will continue to adopt strict cost control protocols.

As the coate stack continuees to lener in the China domestic market, we will continue to adopt strict cost control protocols.

While we maintain to seize the growth opportunity in the global market.

While we RE main keen to seize the growth opportunity in the global markets.

With that operator, please open the line for questions.

Thank you.

With that operator. Please open the line for questions.

If you wish to ask a question. Please press star one on your telephone and wait for your name to be announced.

Thank you. If you wish to ask a question, please press stcar one on your telephone and wait for your names be announced.

If you wish to cancel your request please press star two.

If you're on a speakerphone, please pick up the handset to ask a question.

If you wish to cancel your request, please press stout to. If you honor speak your phone, Please pick up the handset to ask your question. Your first question comes from Alex poon with Morgan Stanley . Please go ahead.

Your first question comes from Alex Poon with Morgan Stanley . Please go ahead.

Thank you management for taking my questions I'm glad to see the global travel recovery.

Thank you management, for taking my questions. It's glad to see the global travel recoverycan management share with us more about your global expansion strategy, your pure international business? Given, the chance for albound travel recovery in a near term is still probably remote. Thank you very much.

Can management share with us more about your global expansion strategy your pure international business, given the chance for outbound travel recovery near term.

It's still probably remote thank you very much.

Yeah.

Yeah. Thank you I talked with you separately.

Yes.

Yes Thank you. Don let' me look for the post.

We will continue to integrate our supply chain.

Technology, our international brands.

we'will continue to integrate and upgrade in the supply chain and technology of our international brand and further strengthen the reliability and efficiency of our customer service.

Jonathan reliability and efficiency.

Okay.

We have been working more closely with local suppliers.

The growing need for these patients.

In Indian markets. We have been working more calcly with local suppliers to address the growing needs for station.

Which held true.

Hum.

I'll just share with increasing Brian .

Which helped chitop foundain market share with increasing brand awareness and app usage in the past two years.

And optimistic in the past two years and lay a strong foundation.

For further growth.

One is the cross border how long.

And lay strong foundation.

Samsung removed.

For further growth once the firstross quarter our which restrictions are removed.

In Europe , all about Brian a banner called collaborate throughout the previous quarter.

In Europe . All of our brands have been both collaboration throughout the previous quarters, giving a strong boo to our product comfort petitiveness in the region.

Given our strong Q2.

Concrete.

In the region.

A small country glass demand.

And travel restrictions.

As more and more counes have dropped their pandemic-related traveler restrictions, we are glad that these strong recovery and synergies across our international brands.

The strong recovery in our synergies across all international brands.

We shared in our pre.

The remarks.

In Q1.

It's taken a booking.

As we shared in the prepared remarks.

Ballpark, one have increased over 270% year over year.

In Q1 of our ticket booking, our global platform, have increased over 270% year-over-year.

Ingrid shop global brands.

<unk> managed to increase our approximately 400% year over year.

In which our global brand, ch com, have managed to increase prximately 400% over-year.

Our hotel reservations on Google platforms achieved 25% growth.

Over hotel reservations. Our global platforms achieved 25% growth versus 2019, with significant contribution fromont ammenal reservations in our theseas markets.

2019.

Significant contribution.

Reservations and once these markets.

Yeah or trend enhances gained momentum in the second quarter.

The upward trends continued to gain momentumed in the second quarter.

Thank you Alex.

Okay.

Thank you, attex.

Thank you.

Your next question comes from Ronald Keung with Goldman Sachs. Please go ahead.

Thank you. Your next question comes from Ronald Kun with Goldman Sachs. Please go ahead.

Okay.

I just want to ask Uh huh.

Thank you. Thank yougoodbye.

Current economic situation.

The you want to ask: how will the current kind of economic situation change your expectations on the recovery? For the recovery trend first, what had domestic and then be outbound bravel market, how does the current pandemic situation might have hped your expectations for border reopening and compound evenven of our recovery? And lastly, what is your expectationsation for the recovery momentum once the border reopen?

Okay.

So the recovery trend.

Domestic and outbound.

Ooh market.

How does the kind of pandemic situation.

Okay.

Well, they're reopening.

Oh yeah.

What is your expectation.

Momentum.

Once the border real things. Thank you.

I think you're around that I think we believe.

We believe the demand for China domestic travel and the global travel is still very solid AR in the areas with comparatively fewer travel restrictions such as southern China and wept in China. We are very encouraged to see the hotel reservations have already surpassed.

Thank you, ronest. Thank we believe the mat.

We believe that demand for China domestic travel and the global travel is still very solid in the areas with comparatively fewer travel restrictions, such as Southern China and westestern China. We have very encouraged to see the hotel reservations have already surpassed the 2019 level in the recent months and our total hotel reservations also quickly rebounded to the precovvid level in the past two weeks at the outbreaks got better controlled and our global brands also see very strong recovery momentum.

The 2019 level are in the recent months and our total hotel reservations also quickly rebounded to the pre COVID-19 level in the past two weeks as the outbreak Scott that's a controlled.

And our global brands also see very strong recovery momentum in.

In beer domestic and international travel following the east of our travel assistance across countries.

Their domestic international travel following the ease of travel restrictions across countries.

So being very optimistic about the pent up demand for the outbound travel outbound travel, especially where we noticed that the recent a quick recovery of the domestic.

Now being very optimistic about the p-up demand for the albound travel, albound travel especially where we notice that the recent quick recovery of the domestic travel during the summer time. We do not expect to see drastic changes in the inbound and albound travel policies in the near future, but we strongly believe that the pent-up demand is there. It's just the matter of time. When country decided to open the borderthank you.

Domestic travel during the summertime, we do not expect to see drastic changes, India inbound and outbound travel policies are in the near future, but we strongly believe that the pent up demand is dear it's just a matter.

Of time, when the country decided to open the border.

Thank you.

Thank you Jay.

Thank you.

Your next question comes from Brian <unk> with Citigroup. Please go ahead.

Thank you. Your next question comes from Brian Gong, with cityit oup. Please go ahead.

Good morning, James Jane Cindy and Michelle Thanks for taking my question.

Good morning james- James in the enemyicshele since for taking my questionso. How is the early bookings situation for the summer session, for domestic and the international marketting respectively, and can you share more color about your overall? All look for the second half and next year. Thank you.

So.

So early bookings Felicia for the summer session or domestic and the international market respectively.

Can you share more color, what's your or Austin or the second half and next year.

Okay.

Thank you so.

So far we have comparatively limited visibility given the very short booking windows patents recently.

Thank you. So far we have comparatively limited visibility given the very short booking windows patacktern recently and we are cautious about the short and perspectives of the China domestic travel given the current COVID-19 policies in multiple regions in China, including Shanghai Beijing, the big cities. Nevertheless, we remain optimistic about the long-term prosperity because first, with the current health care measures and reportly lower mortality rate.

We are cautious about the short term perspective itself the China domestic travel given the current COVID-19 policies in multiple regions in China, including Shanghai, Beijing, but big cities. Nevertheless, we remain optimistic about the long term prosperity.

Because first with the current health care measures and reported a lower mortality rate. We are finally seeing the the COVID-19 become yeah, hopefully more manageable threat.

We are finally seeing the COVID-19 become a hopefully more manageable threp.

And Meanwhile, we have recently C D authority, making efforts to reduce the potential disruption from amico cases, such as relaxing unnecessary quarantine lockdown measures and increasing the granularity of the scope of cross province travel ban from province level to the country.

And meanwhile we have recently see the authority making efforts to reduce the potential disruption from omicro cases, such as relaxing unnecessary currency and lock down measures and increasing the brand nity of the scope of cross Pros travel ban from probs level to the country level.

Free level.

Yes. So we we we think it's hard to predict the the the trend the growth trend for the second half.

Yes So we think it's hard to predict the trend. The growth trend for the second half but so far what we noticed is that when the policse is.

But so far what we noticed is that the when the policy east.

And in China, We did see the pent up demand our growth.

Growth for the China domestic market, but of course for the Internet on the international front.

In China. We did see the Pan up demand growth for the China domestic market but, of course, for the Internet. On the international front, the growth is there and we see huge growth potentials for Dom, for the whole international business, including the international, including the domestic market, as well as the cross border business travel, as well as the leisure travel. Demand is coming back. Thank you.

The growth is there and we see huge growth potentials.

For the last four before the whole international business, including the Internet.

International, including the domestic market as well as the cross border.

Business travel as well as the leisure travel demand is coming back. Thank you.

Thank you.

Thank you. Your next question comes from Alex Yao with Jpmorgan. Please go ahead.

Thank you, Thank you. Your next question comes from Alex ya with JP Morgan. Please go ahead.

Well thank you for.

For taking my question.

New waves of armor all.

Thank you meagement, for taking my question. The new waves of arnicon obreak pushed down the industry even to the level of 2020 in the thalf fif to weeks.

All right.

M D C.

Even to the loved one of them 2020 in the past few weeks.

Can you shoot.

Strategies.

Two parts.

Well controlled situation continues for another week.

Can you share those few strategies if the tight travel control situation continues, or another wave of coovid research in the rest of the year? Thank you.

Kobe research in the rest of the year. Thank you.

Yeah.

Hum.

Yeah. So thanks, Alex are the new ways of the Oh, Oh Oh.

Looks like it's Oh quite Oh, that's definitely it's infectious but that's the.

Yes So think, Alex. The new Ed of the on the carro looks like is quite less badly. Its infectious, but the impact is minor myot. So with the.

The impact is minor mild.

So with the.

More vaccine is being taken and more data showed that the mortality rate is quite small we look.

More vaccine is being taken and more data showed that the moority rate is quite low. We look at the control procedures by the government. It's also relaxed more. So wherever we see a relaxation in the unnecessary lockdown, we see a boom in the industry. So for the western part of China and the certaind part of China, business are goinging very well. So even with shanghaia in Beijing still being recovered, in the past two weeks our hotel booking has already surpassed.

Look at the control procedures by the government. It's also a relaxed oh I'm more so wherever we see a relaxation.

The unnecessary are locked down are we see a boom in.

The industry so for the western part of China in the southern part of China business are going very well, so even with Shanghai Beijing still being recovered in the past two weeks Oh, a hotel booking has already surpassed the pre COVID-19 level of 2019.

And so we all hope for that Wisdom boys active vaccine.

precoed level of 2019. So we are hope for that with the more effecttiive vaccine being taken by that more population and more experience being accumulated. We will be able to.

You can take them by you got more population and more experience are being accumulated.

We'll be able to Uh huh.

Handle the upcoming challenges and hopefully you know the with what we have seen from Q1 Q2 and east of the unnecessary lock down.

Handle the upcoming challenges and hopefully not the with what we have seen from two on Q2 and ease of the unnecessary lockdown. It's on the uptrendt for the business.

It's on the upswing for their business.

Thank you.

Yeah.

Thank you. Your next question comes from Thomas Chong with Jefferies. Please go ahead.

Thank you.

Thank you. Your next question comes from Thomas Chong with jeffrefriys. Please go ahead.

Hi, Thanks management for taking my questions May I ask a question about that conversation is that men are how should we think about the trend for the a b O S.

fench management for taking my questions. May I ask the question about accommodation assessment? How should we think about the trend for the adl as well as the take away? Thank you.

Great. Thank you.

Thank you Thomas.

The because the the whole travel industry was negatively affected by the outbreaks in multiple provinces. So overall, our ADR what down.

Thank you com much because the whole travel industry was negatively affected about the outbreaks in multiple provinces. So overall our ADR work down.

Especially in Q2 for example, our ADR them.

More than a 20% domestically and.

Especially in Q2 for example our ad down more than 20% domestically and.

And then in Q1, our ADR was done by high teens in the Q in Q1 compared with <unk>. These are all compared with the 2019 level on the international front, maybe because its the early start.

And in Q1 our ADR was done by high teens in the Q. in the Q1 compared was to. These are all compared with the 2019 level on the international frontmaybe because it's early start of the early start of the international travel, So we also see some negative impact on the ads on the international front.

Of the early thoughts are off the international travel. So we also see some negative impacted on the ADR.

On the international front.

Thank you.

Okay.

Thank you. Your next question comes from Wei Zhang with UBS. Please go ahead.

Thank you.

Thank you. Your next question comes from way long with U B's. Please go ahead.

Hi, Good morning management. Thank you for taking my question.

My question is if we look at longer term some of these structural changes that we've seen since the Covid breakout for example, the short haul travel and vacation getting more popular do we see them as incremental opportunities longer term and how are we positioned to grab these opportunities also related to that.

Speaker 1: Good morning management. Thank you for taking my questionmy question is: if we look at longer term, some of these structural changes that we've seen since the colibric out- for example, the short-haul travel and dacation getting more popular- do we see them as incremental opportunities longer term and how are we positioned to grab these opportunities? Also related to that, how do we think about the role that the content driven e-commerce or live streaming platforms could play in travel booking and how could that affect the competitive landscape for OTAs? Thank yousureso for the short courort travel.

How do we think about the role that the content driven e-commerce or live streaming platforms could play in.

In travel booking and how could that affect the competitive landscape for otas. Thank you.

Sure so for the so called travel.

Over the past two years, we've are working very hard to build a very strong use case for the short haul travel through multiple initiatives in product and marketing and the innovations to date short haul travel has become a key contributor to our domestic a recovery, especially in.

Over the past to two years we've working very hard to build a very strong user case for the shop travel through multiple initiatives in product and marketing innovationsto date, shopor travel has become a key contributor to our domestic recovery, especially in the base where lawor travel is restricted. For example, in Q1 our inaprovincial hotel booking grew about 20% compared with the preCOVID two thousand and nineteen level, with the local hotel bookings cially increased by over 60%.

The days were long haul travel is restricted.

For example in Q1, our intra provincial hotel bookings grew about.

20% compared with the pre Covid 2019 level with the local hotel bookings actually increased by over 60% compared with the 2019 level for Ctrip.

Because we are we are actually are famous for book, but bookings are for the long haul travel so compare with the pre COVID-19 level are we did notice that more and more customer notice to all have awareness that if you come to ctrip.

Compare with the 2019 level for because we are actually a famous for book, for booking for the law haul travel. So compare with the preCOVID level. We did notice that more and more customer notice all have awareness that if you come to futuresite or future app you can easily fight value for money product for the local travel bookings. So we believe this is part of it, or significant part of this incremental business for us.

Sites or Ctrip App, you can easily find value for money product for the local travel bookings. So we believe this is a part of it a significant part of this incremental business for us.

With regard to the content strategy Oh, we have achieved the multiple milestones in key metrics such as content generation user engagement and conversion to orders all of these efforts and achievements allow us to better inspire and assist users to make.

With regard to the content strategy, we have achieved the multiple moestones in key metrics such as content generation, usual engagement and conversion to ordersall these efforts and achievements allow us to better inspire and assistt users to make where informed travel decisions and make us a more effecttive, attractive marketing hubs for our advertising partners. In Q1, for example, our domestic travel advertising revenue increased over 20% compared.

Well informed travel decisions and make us a more effective attractive marketing hubs.

For our advertising partners.

In Q1 for example, our domestic travel advertising revenue increased over 20% compared to the pre COVID-19.

Level.

Yeah.

So we so far we are happy to see that.

To the preCOVID level. So we so far. We are happy to see that our content strategy help started to help us firstly to increase the user's engagement and secondly, have positive contribution to our revenue. Thank you.

Our content strategy help.

Got it to help us firstly to increase.

Increase the users engagement and secondly have a positive contribution to our revenue.

<unk>.

Thank you once again, if you wish to ask a question. Please press star one on your telephone and wait for your name to be announced.

Thank you once again. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced.

Your next question comes from James Lee from Mizuho. Please go ahead.

Your next question comes from James Lee from muho. Please go ahead.

Great. Thanks for taking my question given all the disruptions and the travel industry I was hoping chain that you can talk about maybe some of the government policies to support the tourism industry for both consumers and suppliers.

Great Thank we taking my questions. Given all the on-and off disruptions in the travel industry of hoping Jane, that you can talk about maybe some the government policies to support the tourism industry for both consumers and suppliersthank.

Yeah Yeah.

Go ahead.

Yeah we see a go ahead.

Yeah, with the ongoing pandemic and intermittent locked down the travel industry.

Yes with the ongoing pandemic and intermittent lockdowns the travel industry. It's still in need of more support from the authority and Jay and James have make a lot of efforts talking with related government or authorities and we are glad to see that the authority is making efforts to reduce the potential disruptions for armacro cases. Especially recently we see a lot of relaxation.

Do you a need of more support from the Oh authority and.

A J and James have them make a lot of our efforts are popular with related government authorities and we are glad to see that the authority is making efforts.

To reduce the potential disruption from Omnicom cases, especially recently, we see a lot of relaxation.

Unnecessary quarantine lockdown measures are a lot of Ah Ah Ah Ah Ah provinces in China, and increasing the granularity of the scope of the cross province to province travel beds from the province level to the county level so with.

Of unnecessary quarantty and lockdown measures in a lot of provines in China and increasing the granularity of the scope of the cross prov proince travel beded from the province level to the county levelso. With the authority and industry players joining hand to improve our business environment and to stand against the challenges together, we are very confident that the travel industry will come back even stronger. Thank you.

The authority and industry players, joining hand to improve our business environment and to stand against the challenges together are we are very confident that the travel industry will come back even stronger.

<unk>.

Thank you. Your next question comes from Tim Yang with T H capital. Please.

Thank you. Your next question comes from 10 Y with TH capital. Please go ahead.

Please go ahead.

Morning management I have a question related to your cash.

Now morning management as a question related to your cash sustainability issue and S's cot on and off. And you know, China continue its zerial covert policy and just so the company know in the last several quarters is in the position of earurning some cash. So how sustainable if the company's cash position under the current situation, current the environment? Is there any room for the company to achieve further cost saving?

System ability issue.

Those coal, but on and off and you know China continue it sits aerial cool but policy.

And just so the company you know in the last several quarters is in the position of a burning some cash so how sustainable is the company's cash position under the current situation currently but the environment is there any room for the company to achieve further.

Cost saving or you know is this company has any plans to further to raise some capital you know to enrich your balance sheets. So that's the question. Thank you.

Hmm mm.

Oh, Ctrip has been experienced up and down all the the travel industry in the last almost 20 years. So we have a rich experience to weather the storm and we believe the most important to our parts to a two two.

To survive.

Even become a stronger is to have the sufficient liquidity to keep the sufficient liquidity in place. So as of March 31st the company had so these three points 3 billion RMB or close to 10 billion U S dollar on hand in cash and.

Even become a stronger, is to have the sufficient liquidity to keep the sufficient liquidity in place. So, as of the March 30, first the company had 30, three point three billion R MB, or close to one billion U's dollar, our hand in cash.

Including our held to maturity time deposits and financial products.

And most importantly, our net cash was USD, one 9 billion as of March 31st two this year and our net working capital was U S. Dollar 1.7 billion.

Including our he to maturity time decost and financial products.

And most importantly, our net cash was U's or a one point nine billion as of March, So refers to this year, and our net working capital was U's or a one point seven billion.

We will frequently we actually frequently assess our liquidity positions with latest business data and are confident to conclude that the combination of our existing cash reserves cash flow from operations and financing sources are sufficient to meet our anticipated.

We will frequently. We actually frequently- assess our liquidity positations with latest business data and are confident to conclude that the combination of our existing cash reserve, cash flow from operations and financing sources are sufficient to meet our anticipated cash needs, including our working capital, capital expenditure and repayment of financial obligations for the foreseenable futurewith regard to the cost savingsduring the last past two years, we have already streamled.

Cash needs, including our working capital capital expenditure and repayment of financial obligations for the foreseeable future.

With regard to the cost savings.

And during the latter part of two years.

We have already streamlined our operations across business lines. In addition to certain adjustment related to Covid.

Our operations across business lines, in addition to certain adjustment related to COVID-19 and in addition, our improvements on content, cost selling and technology have further lif marketing our marketing efficiencies. For example, in Q1 our total adjusted operating expenses decreased the 11% year-over-year and compare with preco level, it was a saving of close to 40% thanks to our largely flexible cost structures and very effective cost controls.

And in addition, our improvements on content cost Sally and technology have further lifted marketing Ah Ah.

Our marketing efficiencies for example in Q1, our total adjusted operating expenses.

Decreased 11% year over year, and compared with pre COVID-19 level. It was a saving of close to 40%. Thanks to our largely flexible cost structures and very effective.

<unk> cost controls.

And going forward, we expect to achieve further cost savings, especially in the second quarter are largely discretionary sales and marketing expenses would be adjusted according to the extend of our business recovery and <unk>.

Going forward, we expected to achieve further cost savings, especially in the second quarter. Our largely discretion of sales and marketing expenses will be adjusted according to the extent of business recovery and can continue to be our I driven.

Continue to be Oh, why driven.

And also we are able to run lean and stay productive, especially for our domestic operations.

And also we are able to runling and state productive, especially for our domestic operations with the current team structure and will continue to improve our operating efficiencies. And, for example, in the second quarter part of the performance based the bonus may be decreased due to the due to the negatively impacted the top line growth.

With the current team structure, and we'll continue to improve our operating efficiencies.

And.

For example in the second quarter.

It's part of the performance based bonus maybe decreased due.

Due to the and due to the negatively impacted the top line growth.

However, we are in the international or the overseas market. We may increase some investment to capture the pent up demand depending on the growth momentum and business recovers.

However we in the international or in the overseas market, we may increase some investment to capture the pent-up demand, depending on the growth momentum and business recoveries. But impacted to our group level, cost structure will be pretty limited. Thank you.

But the impact to our group level cost structure.

We'll be pretty limited thank you.

Okay.

Right.

Thank you.

That's all the time, we have for our question and answer session. Today, I'll now hand back to Michelle Qi for closing remarks.

Thank youthat's all the time we have for our question-and-answer session today. I'll now hand back to Michelle Chief, for closing remarks.

Oh. Thank you thanks, everyone for joining US today, you can find the transcript and webcast of today's call investors don't trip Dow Com. We look forward to speaking with you on our second quarter of 2022 earnings call. Thank you and have a good day.

Thank you. Thanks everyone for joining us today. You can find the transcript and webcast of today's call on investors: dog trip do com. We look forward to speaking with you on our second quarter of 2022 earnings call. Thank you and have a good day. Thank you.

Thank you.

Okay.

That does conclude our conference for today. Thank you for participating you may now disconnect.

That does conclude our conference for today. Thank you for participating. You may now disconnect.

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