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Turbulence ahead at TripAdvisor?

July 26, 2012 | Online Marketing

This article suggests that TripAdvisor had its time in the sun, but the prospects of decelerating growth and the rise of the next generation of user-review sites point to more weakness in the future.

TripAdvisor closed out its second quarter with disappointing results. Revenue climbed 16% to $197.1 million, well short of the $202.8 million that analysts were targeting.

That's disappointing, of course, but it could be worse. Earnings, adjusted earnings, cash flow, free cash flow, and adjusted EBITDA all grew even slower than TripAdvisor's 16% year-over-year advance on the top line. In other words, margins aren't exactly cooperating even though it was TripAdvisor's revenue miss that led to the share sell-off after the report.

A closer look reveals a problematic trend closer to home. International growth actually helped pad TripAdvisor's success during the period. Domestic revenue actually climbed roughly 7% higher during the quarter, and investors may want to see what's at the root of its decelerating stateside growth.

Could it be that info-seeking travelers in this country have turned to new resources? TripAdvisor may brag about the 56 million unique visitors that it attracted during the month of May, but Facebook generates 10 times as many unique visitors in a single day as TripAdvisor attracts in an entire month.

Get the full story at AOL Daily Finance

Read also "TripAdvisor strategy causes investor flight" at MarketWatch.com

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