Travelzoo Shares Drop After 2Q Loss, Lower Revenue

Dow Jones07-28

Travelzoo's shares slumped after the U.S. travel club's revenue was squeezed in the latest quarter as international conflicts created uncertainty among advertisers and travelers.

In early trading Tuesday, the shares were down 27% to $7.41, narrowing the year-to-date advance to 4.1%.

The company swung to a second-quarter loss of $2.1 million, or 21 cents a share, from a year-earlier profit of $1.4 million, or 12 cents a share.

Revenue for the three months slipped 2.9% to $23.2 million, missing the $25 million mean estimate of analysts polled by FactSet.

Revenue from the company's North America business segment declined about 3% year-over-year to $15.7 million, while European segment revenue fell 2% to $6.2 million.

The company forecast revenue growth for the third quarter.

Travelzoo's revenue consists of membership fees and advertising revenue and commissions from purchases made by Travelzoo members. The company said it expects renewals of memberships to further increase because of a growing base of members, after the number of renewals jumped to the highest ever during the second quarter.

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