Trivago today announced financial results for the third quarter of 2020 ended September 30.
Highlights
Total revenue decreased by €189.9 million, or by 76%, during the third quarter of 2020 compared to the same period in 2019. During the nine months ended September 30, 2020, total revenue decreased by €466.6 million, or by 68%, compared to the same period in 2019.
Net income decreased by €2.6 million to a loss of €2.3 million in the third quarter of 2020, compared to the same period in 2019.
Adjusted EBITDA decreased by €5.2 million to €6.1 million in the third quarter of 2020 compared to the same period in 2019.
In the third quarter of 2020, Referral Revenue declined to €15.2 million, €32.5 million and €10.6 million in Americas, Developed Europe and RoW, respectively, compared to the same period in 2019. But compared with the second quarter, Referral Revenue increased by 320%.
In the third quarter of 2020, total Qualified Referrals decreased by 49% as Qualified Referrals decreased by 65%, 38% and 49% in Americas, Developed Europe and RoW, respectively, compared to the same period in 2019. But compared with the second quarter, total Qualified Referrals increased by 250%.
In the third quarter of 2020, consolidated ROAS was 190.3%, compared to 122.8% in the same period in 2019.
Operational Highlights
In the third quarter of 2020, cost of revenue remained stable at €2.6 million. In the nine months ended September 30, 2020, cost of revenue increased by €1.6 million to €8.1 million, or 25%, period-overperiod, mainly due to an increase in costs for third-party cloud-related and data center-related service providers, and higher personnel costs due to higher headcount included in cost of revenue.
Selling and marketing expense was 60% of total revenue in the third quarter of 2020, compared to 85% in the same period in 2019.
In the third quarter of 2020, selling and marketing expense decreased by €176.3 million, or by 83%, period-over-period to €36.6 million, of which €30.6 million, or 84%, was Advertising Spend.
Trivago in H2 2020 and 2021
After the easing of lockdown restrictions imposed in Trivago’s main markets, it saw a seasonal increase in summer travel that was stronger than expected and was predominantly driven by trips to nearby nature destinations. However, with the return of the colder weather in October in the Northern Hemisphere, a second wave of infections has materialized. As a result, most European countries have implemented partial or full lockdown measures again, and consequently, travel activity levels are again declining.
Trivago’s main focus for the third quarter of 2020 was to continue to prepare for 2021 while preserving its cash-position, generate learnings, and develop features and products that it believes will enable it to compete better. Trivago believes that its focus on local travel will be a key advantage going forward.
Trivago says it remains difficult for it to forecast its financial outlook for the fourth quarter of 2020 and the first half of 2021.
“While we will continue to see volatility in the months to come, we remain optimistic and excited about our opportunity in the travel market. Our key focus is managing the uncertainty in the short-term and preparing ourselves for a sustainable recovery that we anticipate will occur in the second half of 2021.”
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