Trivago Turns a Profit and Excites Some Investors Despite Its Risky Math
Photo Credit: If these employees seem happy now, wait til they see the fancy new Düsseldorf offices that are being built. Trivago
Skift Take
The German hotel search site predicts that its revenue will grow by 50 percent this year. It will also spend about 85 percent of that revenue on marketing. That's a path to either dominance — or disaster.
Trivago, the German hotel search site majority-owned by Expedia, has placed a risky bet on rapid growth through advertising.
The bet is risky because of intense competition.
Trivago is sparring with well-funded rivals for paid traffic, such as Priceline Group's Kayak and Ctrip's Skyscanner. The more these companies fight for customers, the more money that has to be spent by all of them to try to become the world's most-used hotel search engine.
But Trivago says its bet has already begun to pay off according to its first quarter 2017 financial results.
On Monday the German-headquartered company reported a profit of $8
