Q3 2025 trivago NV Earnings Call
Thanks muting know.
Good day, ladies and gentlemen. Thank you for standing by and welcome to Trivago Q3 earnings call 2025
I must advise you the call is being recorded today. Wednesday, the 5th of November 2025
We are pleased to be joined on the call today by Johannes Thomas, CEO and Managing Director, and Wolf Schmuhl, Trivago CFO and Managing Director.
The following discussion including responses to your questions, reflect Management's view, as of Tuesday, November 4th, 2025 only unless expressly stated otherwise in which case it reflects Management's view as of today, Wednesday. November 5th, 2025 only triago does not undertake any obligation to update or revise this information. As always some of the statements made on today's call are forward-looking typically preceded by words such as we expect we believe we anticipate or similar statements. Please refer to the Q3 2025 operating and financial review and trios or the violence with the SEC for information about factors, which could cause survivors actual results to differ materially from those forward-looking statements.
You will find reconciliations of non-GAAP measures to the most comparable GAAP measures discussed today in Togo's operating and financial review, which is posted on TVO's investor relations website at igo.com.
You are encouraged to periodically visit Trio's investor relations website for important content. Finally, unless all the comparisons stated on this call will be against results for the comparable period of 2024. With that, let me turn the call over to Yohannes.
Good morning, and thank you for joining our Q3 2025 earnings call. We delivered 13% year-over-year, Revenue growth, making it our third consecutive quarter of double digit growth.
Q3 exceeded expectations on both the top and bottom lines. And we are encouraged by the strength and durability of our momentum.
We achieved this acceleration despite major foreign exchange headwinds while improving adjusted evda by 18% year-over-year.
Growth gives us confidence, it's led by our strong, double digit, double double digit, branded traffic Revenue growth, which continues to outperform and benefits from compounding effects.
Our AI powered campaign. Featuring brand ambassador June Club as well as our local Productions made a significant impact this summer.
Our product has materially improved the quarter of after quarter, delivering a better user experience and stronger marketing efficiency.
We observed a promising start and EQ floor and expect to close the quarter end the year at nitin's level.
we see our strategy unfolding and expect this to continue to fuel our double-digit growth trajectory in the years to come
While we continue to elevate our brand investment next year, we will operate with discipline and expect compounding effects to increase our profitability gradually.
In the following, I will provide an update on our strategic priorities.
Our first strategic priority is branded growth. Our brand engine is accelerating and continues to compound.
Our summer creators Were Striking. We are steadily improving marketing, efficiency, and have Diversified our new into new brand marketing channels.
we remain disciplined investing where we see strong response,
The club Campaign together with strong, local Productions, lifted branded traffic and revenue across all segments, with standout performance in the America.
We aim to broaden our reach and strengthen creative testing to drive higher travel engagement with our brand.
We body swapped Jurgen klopp with another actor in the same TV ad to isolate the impact of the Creative Concepts.
Versus the use of a high-profile brand ambassador.
For our winter campaign, launching in December. We are producing new TV spots that we expect to build on the strong results.
For the rest of this year and throughout 2026. We will focus on the markets. We prioritize over the past 2 years and emphasizing optimization over expansion.
Our second strategic priority is to enhance our core hotels. Search experience. So Travelers can book with confidence saving time and money. We maintain the high product testing velocity delivering notable enhancements and conversion rate gains that we expect will further improve marketing, efficiency and user satisfaction.
Our AI smart search feature was expanded across key languages on desktop and mobile web.
It's now faster and even more relevant for complex queries.
We have deployed, AI review summaries at scale, providing clear insights distilled from thousands of reviews. We introduced new guest sentiments ratings, that summarize review sentiment allowing travelers to compare hotels and understand their relative strengths and weaknesses in the region.
Over the past year, we significantly elevated the hotel content across our product.
Tangibly improving the user experience and closing a long-standing gap. In our offering, we achieved this with AI powering the kind of work that once required 100. Plus people team while making the content more relevant and updating and more frequently.
Personalization and smart filter recommendation, have further improved, and the map experience is now more intuitive across devices.
Our member proposition keeps enhancing through attractive exclusive deals, provided by our partners and features such as a list, sharing functionality to Foster collaborative trip planning.
Revenue from logged in members, continue to rise which we expect to enhance, retention and conversion.
Our first strategic priority is to create more value for our partners and the healthier Marketplace.
Our transaction-based model continues to gain. Share simplifying participation for small and mid-size partners, and helping reduce auction volatility.
Book and go accelerated by our holistic integration is gaining traction. Pilot partners are seeing meaningful conversion, uplifts and market share gains in our platform.
Evidence that is streamlined. Trivago branded booking. Funnel creates value for our users, and partners.
In summary we delivered another quarter of double digit growth and healthy returns despite foreign exchange headwinds.
A stronger brand and a better Hotel. Search experience are resonating with Travelers and partners alike.
Thank you to our teams for your focus, creativity and discipline your work Powers, our progress every day.
I'm a special proud of how broadly our team is adopting Ai and novel ways.
Strengthening our position and delivering more value to our users faster.
With that, I'll hand over to our CFO wolf for more details financial review.
And good morning everyone. We are thrilled to report that the third quarter of 2025 was yet another successful quarter with strong performance.
This quarter, we achieved a 13% year-over-year increase in total revenue which was driven by our successful brand strategy.
We maintained a stable return on advertising spend even as we leveled up our brand investments where elasticities are attractive, but the returns come over time.
This not only reaffirms the effectiveness of our marketing strategy. It also builds the foundation to further scale branded traffic. In the future,
Despite economic uncertainties and foreign exchange related headwinds. We remain confident about our Outlook.
We continue to expect mid-teens percentage revenue growth for the full year of 2025.
And a positive adjusted ebit are of at least 10 million euro.
now, let's review our third, quarter results, and our 2026 Outlook
Unless otherwise the indicated all comparisons for 2025 are on a year-over-year basis.
In the third quarter, our total revenue reached 165.6 million euro representing a 13% increase compared to the same period of 2024.
We are pleased to note. This marks, our fourth consecutive quarter of growth.
By yet, another strong quarter of year-over-year, double digit referral Revenue, growth of 14% in Americas 12% in rest of world and 9% in developed Europe.
Our developed Europe segment faced headwinds from strong prior coms, especially early in the quarter as we called out in our last earnings call.
The trend normalized over the course of the third quarter in 2025.
Our growth was primarily driven by increased branded Channel traffic. In response to our ongoing brand marketing Investments as well as product improvements enhancing our booking conversion.
Unfavorable foreign exchange. Headwinds negatively affected our Revenue developments by approximately 4% globally.
Due to our strong fundamentals and diversified Global footprint. We have still been able to demonstrate strong growth,
During the third quarter, we reported a net profit of €11 million and achieved better than expected results. Adjusted earnings were €16 million.
Operational expenses decreased by, 12.3 million euro, totaling 153.4 million euro for the third quarter.
This was mainly due to the non-recurrence of a 30 million euro impairment charge recorded in the prior year.
Including this impairment charge.
Operational expenses, increased.
By 17.7 million euro, mainly driven by a 14.5 million euro increase in selling and marketing expenses resulting from higher brand marketing Investments made over the course of the quarter.
Advertising spend increased by 7.2 million euro, or 17% in developed Europe, 2.8 million euro or 11% in rest of world.
And 3.6 million euro or 9% in the Americas driven largely by a brand marketing Investments.
Despite the significant scaling of our marketing investments. In this quarter, Global Wars remains stable compared to Prior year at 134.1%.
We observed a solid Ross Improvement year on year during the third quarter in America and increasing from 126.3% and in 2024.
To 135.4% in 2025.
and rest of world increasing from 117.6% in 2024, to 119.2% in 2025,
while we observed a reduction in developed Europe from 151.2% to 141.2%,
As of September 30, 2025, we held €106.3 million in cash and cash equivalents and no long-term debt, continuing to maintain our strong financial position.
Looking forward to 2026. We aim to achieve an increased adjusted Abit r.
of around 20 million euro while continuing our growth trajectory and maintaining double digit percentage Revenue growth
We continue to see substantial opportunities to scale our brand marketing activities, enabling us to reach a larger audience and positively impact over our revenues and profitability long term.
Additionally, we Consolidated Trivago deals Limited.
Formerly holistically limited, for the first time and are moving forward with our first merger integration.
Review is limited as an integral part of Trivago, and it will be included in our financial guidance. Going forward.
We already see our initiative gaining traction in terms of conversion improvements and an increased market share on our platform.
Showcasing the value for our users and partners of a facilitated booking funnel.
With that. Let's open the line for questions. Operator, we are now ready to take the first question.
We will now begin the question and answer session. If you would like to ask a question, please raise your hand. Now, if you have dialed into today's call, please press star, 9, to raise your hands, and star 6 to mute please stand by while we compare the Q&A roster.
Your next question comes from the line of Tom white with da Davidson and Cole. Please don't go ahead.
Hey, this is Wyatt Swanson on for Tom. Thanks for taking the questions.
Uh, first 1, it's it's great to hear that revenue from logged in users, continues to increase serious, to hear your goals of, you know, what percentage of users could be logged in over the next.
well, the 18 months and maybe some of the initiatives being put in place to retain these more loyal slash logged in users,
Yeah, thank you for the question. I think a very important 1 and um, the the number has increased and it's important on the target. Yeah. So it's not that. We had dogmatically having a Target. Let's say, we want to bring this to 50% or so, it would rather be an outcome of diligent testing and experimenting in. What moment in time do we asked users to log in in a way that this improves conversion doesn't cost us short-term Revenue at unreasonable levels. So we now have increased it. We last
I'm sad is north of 20%. I would say if we are reaching something like 30%, it is a number where we can say, we have a core identified, a core user segments that when they log in, they will have a different triago experience.
Yeah, so, and maybe it is 40. Uh, we don't know exactly and we will find out. We know the current user, Uh, current users that we have behind the login, more than 20%. They convert 25%, better than the others. So, it's really a meaningful, uh, difference, uh, to all others. Um, they have more engagement on our side and we will continue to, um, offer special deals to them. Uh, we have done the, um, uh, enhanced sharing functionality, collaboration functionality. Um, we expect to have price alerts expanded the functionality, and you can think about it. When a user comes to the side, and we have a closer relationship. We know there is this
Um, 2 to 4 weeks, period where they are likely to book. And in this period, we need to maximize the contacts over time so they are not just coming through with Trivago 1 time. And that's really the goal here to increase engagement during this hot period, where they're likely to book. And then also, if they had a better experience, certainly to increase retention, which is much harder to measure and estimate, and which is not kind of part of our direct, uh, planning. But in
Increase in conversion rate with those users and their engagement. It's already attractive from what we are seeing today and that we will continue to uh to embrace whether it will be 30 or 40, it will be an outcome. It's not um, a fixed Target.
Got it. That's that's very helpful. Thank you. And then 1 more uh B2B has been pretty notable area of growth for the large OTAs recently. If you're just whether taga potentially play a role in that space in the coming years and how would you see that looking? Exactly.
Yeah, we have been discussing B2B here and then, um, also with, um, holistic. So now having a, a white label platform, you could uh, access B2B rates and build a special proposition for, um, B2B, um, for the B2B World, um, and offer white labels for those who, um, for those who are seeking that, uh, we work with, um, Affiliates and, um, and there is some attractive business, but we really are focused around Leisure at this point in time. That's where our proposition proposition is is strong. And uh the the space is huge. Um, and we, you know, Simplicity as Beauty. We are not doing flights, we are not doing package and so on because there's so much meat in this space, and that's where we see a lot of opportunity to grow long term. There's certainly, um, uh, options that we can look into
But um, the timing is not right for that.
Sounds good. Thank you.
Your next question comes from the line of navitan with B Riley Securities. Your line is now open, please go ahead.
Um, on the outlook for 2026. If I need to say the expect Revenue to grow double digits, if it's a 20 million, uh, how should we think about growth in the core business? The lead gen business versus Hollister or should we expect both to be growing double digits or different pace? Just talk about that.
I love it. Uh, thanks for your question.
So regarding uh, regarding holist, um, for the future, we will uh, only guide on a Consolidated level.
but uh, to give some clarity there, we expect those segments
To grow double digit, and maybe it's helpful to to add some color on on 2026.
Um, and on the budget.
As we have now entered around 27 Corr, travel markets. And for the next we year we we plan to optimize these existing markets
We are quite optimistic that these markets offer enough room for growth, for for growth. Um, and uh, as well, we will will all all Aloe gradually optimize profitability and this is reflected in our uh, 2026 guidance.
um, with an adjusted a of around, uh, 22, 20 million euro,
So what are the major reasons uh for giving us this this confidence? So first of all, the market we are we are um, tackling is is large and our share is still is still below 1%. And this gives us a substantial Runaway.
Uh, we are 1 of the strongest brand in the category. And, uh, we offer a very differentiated product. And this also creates a clear room room to grow
Um, our our brand Investments.
Are still below. 2019 level levels.
And also, there we see a strong opportunity to invest at attractive returns.
Recent and current Brands uh Investments are uh compounding and we expect them to support our profitability in in 2026.
Maybe let me build on this point. Yeah, I think that's a very important to, to explain, um, more exactly what we mean with expansion versus optimization, um, in the past years. And also, when we build Trivago, We have basically, uh, been growth oriented and we took profits from, uh, markets that have delivered substantial profitability and invested it into a markets that we, um, activated or reactivated.
And uh, and for some markets, um, it goes fast for some Market. It takes time optimiza to optimize those markets and compounding effects to, to make them profitable. But now when we stopped expanding markets, um, we basically take some of the compounding effects to our bottom line, and it's a matter of optimizing country, mix marketing mix and, um, improving our creatives. And that's work. Gradually, we see more profitability than Landing in our bottom line.
Well.
Super helpful, um, on that. So maybe just, uh, just talk about the compounding. Um, what kind of improvement are you seeing in the marketing efficiency? Um, just give us a sense of that. It seems to be playing a role in this, uh, increased profitability.
That's something. I mean what we look at how much of our um volume how much of our growth is coming from branded uh growth versus uh versus other channels. And by by far, the majority of our growth is coming from branded growth. And this is only possible if you see compounding effects C over year or somewhere into off season periods. And and that's what we see. Um, we see clearly and every year we are investing the the year after will benefit from that. Uh, that's something we have seen in the past we are seeing that today in some markets more in some markets less and that's part of our optimization, what? Elasticity and
How much compounding effects we're seeing, uh, over time?
Got it. And and then last point last question, is around this logged in contribution to revenue. Um, what are the, what are the incentives or benefits that you are? That you're giving to the, to the logged in?
And um and these logged in users, we see a higher engagement and um, and and that's a strong signal that, you know, conversion is a strong signal for retention, uh, for satisfaction. And those users we expect to come back with a higher probability.
And this share is increasing. Uh, we are increasing the amount of deals. We are showing to our users. We are optimizing, um, with our partners, what's the right level of deals, uh, um, that we are providing to our users. So the higher, the deals, the higher, the conversion rate, the higher the satisfaction. Um, and you know, we we aim to find a good balance between having, um, a margin out of that. Um, and um, and still having a a steep conversion rate Improvement, uh, while we're doing that,
Um, congrats on the progress. Thank you.
Your next question comes from the line of Doug anmer with JP Morgan. Your line is now open. Please go ahead.
Great. This is daily on for dog, thanks for taking the questions. Um, so first 1 on
Um just AI overall. So you know, we've seen consumers search, search Behavior, increasingly shift across platforms and notably AI driven tools such as like, Google's AI mode chat GPT.
Um, so how positioned to defend, or grow your share of top of funnel traffic in this type of environment? And do you see a strategic need for travala to be present on these new experiences? If not like what differentiates Travis proposition and capturing um, those consumers intent versus the broader search and AI ecosystems
Yeah, thank you for the question. I think, um, an important 1 that we, um, we are observing very closely, I think, um, very important. Um, and that's true for us. And other players we are talking to the shift, um, to the AI platforms is really small when it comes closer to the planning and booking process. So it's a tiny process uh Chinese share of of uh traffic. We are seeing today. Um, is if you use it you probably see there's a benefit of inspirational and so on, but as soon as it goes a bit down, the planning a bit more concrete and considering it's more clunky to use a chat experience, um, to to Really nail down your selection. I'm not saying nobody's doing it, but we don't see a like a flood of people doing this. Uh, so the traffic, we
We get from this AI engines today is is is very small. It is growing, it's converting better than than other uh, traffic. Um, so um, um, we are looking at how fast is this growing? If we look at, um, the impact we have seen from AI. Um, from the AI mode, for instance, in the US when it got rolled out or in, in Europe recently, we have certain not seen a huge impact on any, um, um, major, um, Google metric. Um, our SEO for instance, um, is a small part of our business. We're not concerned of losing much SEO business in general, because it's so small. But last quarter, it has not been a headwind for us. Um, it was rather flattish and, um, and overall, you know, we have not seen what happened so far, uh, which was not small. It had which had quite some scope, the AI summaries and the, the the AI mode didn't really have a, um, a substantial impact on on what we are.
Doing 1 part, is that? We have built Our Brands so we have lots of business coming direct and then the dependency is lower. And I think if you asked about the positioning, um, in the, uh, in for us in the future, I think brand is a very important answer to that. So people come to us, um, to play with AI features to leverage Ai, and I think we have demonstrated in the last 2 years, how much AI is in the center of our strategy? I, I honestly believe we wouldn't be where we are.
Or I have very different priorities than optimizing down a vertical. If I would call out 1 player that I believe is leading in the, in travel. Um, in, in the AI space, it is Google Google has built out their travel, um, vertical, uh, since more than a decade, um, combining these features with their AI functionalities. Um, is something that we probably will see, but Google has a strong position as well, so they will probably shift inside their, um, Channel size so move traffic from General search into AI into vertical. Um, I I don't necessarily see that they are gaining market share through that.
And we are present there, we are part of Google Hotel ads. We're part of all kinds of AD formats in Google and we are where we see attractive volumes, um, and returns. So I think where it matters at this point in time, we are very present and we know how the game works. Um, if I think about the long term, it's very hard to predict, what role will play a a, you know, pure AI players chat Bots agents. Um, will they become mainstream and really complex? Um, uh uh search.
Um, search processes decision making processes where, um, where it's not obvious for me that, um, that 1 of the general 1 will make it such a smooth process anytime soon. Yeah. And therefore, I believe, if we are strong in brand, um, if we are strong in leveraging AI, uh, this can make our business, very attractive, our proposition stronger and and that's where we are playing. And I'm not hugely concerned about, um, a flood of people suddenly switching the way and be their behavior in in how they search travel. It's chaotic people have chaos. When they, when they, when they book their their trip, they look for dozens of sites. Um, and whether they now use AI on top, we will be there when it's, uh, when it's relevant.
Got it, and that's a follow-up. Um, thinking 2024 and this year, you guys...
Try to operate with a A Break Even mentality in terms of just a little bit better um prioritizing growth. Um so when you look at your 2026 guidance that 20 million you know just study with uh that you know embed a similar mentality um or should we expect some like a beginning of margin expansion story given?
Here are comments about optimization and brand marketing versus expansionary.
Yeah, maybe let me build on what I said. I think this will mostly come out of the effect that we stop taking profits out of profitable markets and push it into new markets.
Uh, so you basically, uh, just move the profits to bottom line, and not move it into new markets. This doesn't mean we are not expanding our marketing investment in brand in General on a relative scale. Um, we likely will invested less than in previous year on a relative scale to revenue, but we expect growth to be higher than our uh, spend increase.
And um, uh, we are, uh, you know, our, um, the, the what we explained at the beginning of the year, our, our general way of becoming more profitable is keeping our cost base flat. Um, and and growing, uh, with our revenue on top margin expansion is not necessarily. Uh, it's not part of our current, uh, projections is really about taking the compounding effects into our bottom line, improving efficiency in our markets and not increasing Opex at unreasonable levels.
Got it. Thank you.
Your next question comes from the line of Jack. He won with mizuho, your line is now open. Please go ahead.
Hello. This is Jack on for Lloyd, wonsley of mizuho. I just have 2 quick questions.
Uh, first are you seeing any update on bidding from Airbnb as they pivot to more focus on hotel and second 1, how are you seeing customer acquisition costs. Trending in paid search especially when we think about 1 of the right balance for kayak, that happened. Uh, last week. Thank you.
Efforts that they want to lean more into into hotels. Um, we work on the relevant inventory, where, um, there is a likeliness. They get visibility on our platform. We are by far, uh, making most of our, um, returns with hotels. Um, still, if you have periods where, um, where there is, let's say, um, a fair in a city, um, or when you have a small cities where there are few hotels, you know, the the alternative accommodations are a great complimentary for our properties. Um, we see, I mean, we as an attractive partner to to enable that.
Um, and then on the question of, um, our of Performance Marketing, you know, we, we have never been so dependent on SEO. So for us, the paid game was, uh, was always part of where we are, we have very disciplined and paid. Uh, so, um, we are whenever we have opportunities, we prefer investing into brand. Uh, we we aim to keep, um, um, keep disciplined approach and performance. We have not seen any major inflation in, um, in the economics on, um, on Performance Marketing that are worth mentioning.
Thank you.
Your next question comes from the line of Ron Josie with City. Your line is now open. Please go ahead.
Hi. This is Robert on on Veyron makes a statement question here. You guys did mention that AI is driving product improvements that previously required. 100 plus person teams in the prepared. Remarks can you maybe double click on this and expand on where we'll start to see these productivity gains across the p&l. Next year, either in the form of kind of double digit Revenue growth and re accelerating revenues or petrol costs.
To.
Sew and maybe let me. So, in the past, um, an example that I outlined here was we had a Content team, uh, of 100 plus people where we were, um, basically editing creating condensed information about the hotel. So it was a lot of, uh, people for, you know, with lots of different languages, they were summarizing, what reviews, uh, what reviews said, what are hotels unique about, um, and try to create condensed view of a hotel and I think that's where Trivago differentiates to other platforms. We don't give you a whole lot of content. Um know our goal is to Aggregate and give you a distilled view on.
What's important to know about this hotel so you can take a decision fast. Yeah. We have you save time and money. Um and uh and we had that before the pandemic, we still had a big content team and we never rebuilt it. We have a compact small team that leverages AI to improve our images to improve, uh, our content to distill it and in ways that were not possible before and also refreshing, uh, this on a constant basis. So accuracy of the information you find on Trivago, um, is even better. So that's, um, I think a very good, very tangible example and that's why I pointed it out, um, in in where this has, um, created value. And I would rather see this as an opportunity upside because that improves the engagement on the platform that improves, uh, um, satisfaction that improves conversion, and that's, um, ultimately drives marketing efficiency and, uh, and um, the ability to deliver profits, um,
And then on a generally what we say internally and what I strongly believe, we are a company, that's very small and Compact and we need to be just the speedboat of the, of the industry, the fastest learning fastest, executing team, in the space and more like we were 600. People need to be as impactful as, um, as um, uh, 6,000 people. So every person having the 10x impact um um, in order to compete in a space, uh, that's big and and competitive we don't have this huge Workforce that we need to optimize.
Confuses half why they are searching for hotels? I think there's lots of upside opportunity and that's how I would think about it. Yeah. So we can rather deliver growth or profitability by leveraging Ai and its Lo less about a cost efficiency game.
that's,
Your next question comes from the line of Stephen you with UBS your line is now open. Please go ahead.
Hi, this is
Hi, this is Vanessa.
On for Steven. Uh, so I just have 1 question. And um, now that holistic was officially part of the company, you are in a position to send more of your traffic to your supply partners.
So can you talk about the extent of any potential Channel conflicts that may or may not have risen with the OTAs? And if that's just something we need to think about, thank you.
So what holistic do, um, is doing, um, and we have renamed holistic into Trivago deals, and for us, for listo is now an innovation Center and Israel that we are, um, uh, that we are focusing on non-core meta search products. Um, they have their own otaa brands that have been competing before in the space. So there's not a huge difference there. Um, what they are doing for us, is building a white label. Um, uh, White Label, uh, booking
Mentioned that we actually offer to our partners and every partner is invited to join it, uh, from small to big. Um, we believe more values create for the smaller ones that have less resources to invest into conversion optimization. Um, so we, we see small and medium-sized OTAs joining this product, um, um, potentially hotel. Chains are interested in joining that product that don't have, um, a good converting, a booking funnel. So it's actually creates value for our partners, um, end users and and and that's a win-win situation that we aim that we aim to create.
There are no further questions at this time. I will now send a call back to your hannes Thomas for closing remarks.
Yeah, thank you for joining us. This quarter marks another milestone in our turnarounds, our strategy is working and we will remain laser focused on executing on our key initiatives. Um thank you for joining today and um for continued trust and support. We look forward to keep you updated in the quarters ahead.
This concludes today's call. Thank you for attending. You may now disconnect.