Tongcheng Travel announced its second-quarter results for the period ended June 30, 2022 on August 22 and it saw a double decline in revenue and net profit.
China's largest travel agency Ctrip's rival, Tongcheng travel (Chinese: 同程旅行，0790: HK), recorded revenue of CNY 1.32 billion (USD 192 million) in the second quarter of 2022, plunging 38.3% year on year, according to its financial report filed on August 22.
The firm also reported an adjusted net profit of CNY 112 million, down 73.20% year on year. The adjusted EBITDA decreased by 46.8% year on year to CNY 292 million. Tongcheng Travel said in its earnings report that the double-digitdecline in revenue and net profit in Q2 2022 can be mainly attributed to the epidemic.
In terms of revenue composition, the three main businesses of Tongcheng Travel are the accommodation booking business, transportation ticketing services and other businesses.
Specifically, revenue from its accommodation business declined 26.84% YoY to CNY 544 million, while revenue from transportation ticketing service almost halved to CNY 620 million compared to the same period of 2021. The revenue from other businesses (including advertising services, ancillary value-added user services, membership services, business travel services and attraction ticket services) recorded CNY 156 million, a decline of 2.93% compared to the same period of the previous year.
According to the report, in the sinking market, namely, small-town and rural markets, local travel consumption was relatively less affected, providing room for growth in Tongcheng Travel's users and business.
According to the data, as of June 30, 2022, Tongcheng Travel's registered users in non-first-tier cities accounted for 87.1%, and about 61.7% of new paid users on the WeChat platform came from third-tier and below cities in China. In the future, the agency will further break into the market with its strategic cooperation with urban and rural bus operators.
Its competitors include Ctrip (TCOM:NASDAQ; 9961:HK), Fliggy, Meituan, etc.
As of press time, it closed at HKD 16.66 apiece, with a market cap of HKD 36.97 billion.