Ad Spending Cuts Help Trivago Return to Profitability

Sean O'Neill

October 24th, 2018 at 12:00 PM EDT

Photo Credit: A look at the reception area in the new headquarters of online travel company Trivago. The Düsseldorf, Germany, offices occupy six floors spread across two buildings. Trivago

Skift Take

Shares in the hotel search company rose the most in two years on news that a cut in ad spending had pushed the Expedia-controlled company into the black. But the company, which once enjoyed meteoric growth, seems unlikely to return to turbo-charged revenue gains anytime soon.

The management of Trivago predicted earlier this year that the hotel and alternative accommodations listings company would reverse past poor performance by the second half of the year. The forecast came true Wednesday as it reported a return to profitability in its third-quarter earnings. Germany-based Trivago achieved profitability by scaling back on marketing spending, which devours nearly all of its revenue, and with some staff layoffs. Trivago did not detail how much of its advertising spend was slashed in the quarter. Net income was $11.5 million, or €10.1 million, in the third quarter. That compared to a net loss of $8.7 million, or €7.7 million

Ad Spending Cuts Help Trivago Return to Profitability

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