Conference Transcript - TRIP 2026-05-28

Richard Clarke, Analyst — Bernstein

Great. Well, thanks. For anyone that doesn't know me, I'm Richard Clark. I'm the Global Hotels Leisure Online Travel Analyst here at Bernstein, and I'm absolutely delighted to have Matt Goldberg, President and CEO of TripAdvisor, joining us again for the Strategic Decisions Conference. So welcome, Matt. You're always very welcome to join us.

Matt Goldberg, CEO

Thank you. I always enjoy doing this with you, Richard.

Richard Clarke, Analyst — Bernstein

So, you know, we are in a period, let's start with a little bit of macro, and then we'll get into the strategic stuff we're meant to be talking about. But, you know, we, every day we're seeing, you know, headlines out there, bombs seem to be dropping again this morning, oil prices going up. And I think we get a lot of questions of, you know, can travel demand really hold up in this kind of geopolitical macro environment or is eventually this going to bite? So what are you seeing? Are you seeing resilience of travel? Does your business model make you more or less insulated from any disruptions that are out there?

Matt Goldberg, CEO

Yeah. Well, of course, we all see the same macro and read the same news and hear about the same reports. I think you've got to watch what the traveler is doing. And travelers have indicated they want to travel. If Memorial Day travel in the United States was any indication, travelers are going to get out there. You know, it's certainly hard with uncertainty in the background to make bold predictions about what's going to happen in the future. But you can look at travel intent, which has been relatively stable. I think, you know, we're seeing upwards of 70% intent to travel through the summer. That's stable with last year. And, of course, you know, we also see that 9 in 10 travelers are saying they're going to travel the same or more in the summer months. So we'll see what they do. but I think you also have to look at the behaviors and travel in the short term can get disrupted but in the long term travelers get out there they may make other choices so for example they may choose to shift from long haul international to short haul regional or domestic and what I think really sets up us us up well is our focus on experiences because experiences has proven to be the category that is most exciting most durable in these times of disruption and of course at the heart of the travel budget and now we've seen that seven in ten travelers want to put experiences at the heart of their budget the majority want to book ahead of time that's even more when you look at younger travelers so it is a trend that we feel very very excited about so I think in the long haul travel will be resilient it will be durable and we will focus on controlling what we can control and that's what we're focused on and the

Richard Clarke, Analyst — Bernstein

comments you just made about Memorial Day demand is that a comment about what you've seen it at TripAdvisor or just I'm just watching the news just like everybody

Matt Goldberg, CEO

else you know and of course you know even with higher energy prices you know people were out traveling on the roads during Memorial Day as well as getting on the plane and going out and I will say that if we see a shift to domestic we feel really well positioned because that's a place where we've added inventory for our experiences so second and third tier destinations makes us a really good option for those traveling domestically. Okay great

Richard Clarke, Analyst — Bernstein

And on this sort of the TripAdvisor brand product, I guess it's a price comparison site. I mean, would you suggest that has any kind of natural hedge in a period of natural uncertainty? People want to compare prices more aggressively?

Matt Goldberg, CEO

Yeah, well, listen, TripAdvisor is more than just a price comparison site, right? It's a multi-category site that really focuses on every region of the world, all the things you can see, do, eat. And so it tends to be a great demand generation platform. Of course, sort of the meta-search product still remains relevant. In times when people are thinking about their budgets, they really want to compare prices and choose the best options so we can provide that. But they also are less likely to cancel the experiences that they do. They're more likely to cancel something like shopping, which they'll cancel probably two to three times more frequently than they'll cancel an experience. So if they're going to go travel, they really want to go have an experience. They want to make it worth their while. And so that means that across all categories, whether it's lodging or dining, and the fork is performing incredibly well because it's not dependent on going very far away. It can be a trip and dining or it can be local and dining. So that business is performing incredibly well. Or experiences, we feel that across all categories in all destinations, and frankly, all source markets, we have a product that will serve travelers.

Richard Clarke, Analyst — Bernstein

Great, great. So let's hone in on experiences. You've made a comment you want to reorientate the business around building the world's largest experiences marketplace. Maybe just go into a bit of detail what that means to you. Does that mean is Viator now the core brand of TripAdvisor Group or is every brand, is TripAdvisor itself also going to be reorientated around being focused on experiences? So we have been very clear.

Matt Goldberg, CEO

We are reorienting the entire company to be experiences-centric. to lead with the most exciting part of travel, the fastest growing part of travel, and frankly one of the most difficult categories to organize. And obviously we have 30 years of experience with Viator, which is the leading OTA in experiences on multiple measures. But we also are fortunate enough to have more than one brand. So Viator can go incredibly deep when you know you want an experience. And TripAdvisor can go incredibly wide, wherever you are in the world, wherever you're going, whatever experience you want to have, whether it's paid or free, TripAdvisor can serve you. And having two brands has a number of benefits. It has the benefits of creating a very large pool of travelers for demand. Obviously, there are hundreds of millions of travelers that turn to TripAdvisor every month. We have over 100 million in our membership base. We have almost 10 million things to do, see, and eat there. And that can create tremendous demand. And we will oriented to serving the traveler who wants to find the best experience we're really excited because our vertical focus on experiences allows us to focus on going and finding the highest intent traveler whether they're on our platforms or others leveraging our data and ai to target them effectively to get them onto our product to turn our product into something that is going to convert far more effectively get people to come back and be more loyal and then to add the inventory uh and the experiences which we have the largest and are increasingly focused on being the highest quality across the globe and that means that we can get a flywheel going and when you have multiple brands to do that with and we will serve third parties because we still think that third parties are incremental and profitable we think that that flywheel uh and you add to it the software that we bring to the operators we can serve operators incredibly effectively and we can connect them directly to that demand so orienting the company around the growth profile with the increasing profitability is the transformation we're going through and we feel that that's going well you can see it showing up in our

Richard Clarke, Analyst — Bernstein

financial profile which is shifting so you said within that you're increasingly focused on improving the quality maybe you can just sort of dial in on that a little bit so is this is this a shift in focus you want to go from more of a curate curated set are you removing poor quality uh experiences like how are you raising absolutely

Matt Goldberg, CEO

we're doing a lot there so um it's always been something that we've thought about but of course as you're building out these marketplaces you're looking to add and we've always been an open marketplace for experiences yeah i think we are far more focused on serving the best possible experience that gets consumers to repeat and that means having the highest quality and that does mean Thinking about how you measure quality, thinking about who you go out and target in the first place, the way that you onboard them, and we are onboarding, leveraging AI to speed that up, to make sure that we're scoring appropriately, to understand the experience that people are having, to drive that first booking as quickly as possible. That's also an important part of bringing new inventory onto the platform and getting the quality to do the work to drive loyalty. And that's something we think size is great, but more important is quality. And we will focus on quality equally with the size, if not more important, frankly.

Richard Clarke, Analyst — Bernstein

And just your latest view on how big a prize is the experiences market. I mean, we see a lot of numbers being put around there. But, you know, most seem to have experiences marked as, you know, multiple hundred billions of, you know, potential GBV value, you know, commission rates around that sort of 20% level. So, you know, is this really a sort of $40 to $50 billion revenue market opportunity? Or is there, you know, is actually that includes subsets that you can never go after? Or is this a huge potential prize?

Matt Goldberg, CEO

I would say yes, absolutely a huge potential prize. And we're only playing in a subset of it, right? We are highly concentrated in the U.S. We have an opportunity to expand internationally and grow our TAM meaningfully. We are highly concentrated in tours and activities, which are both smaller than attractions. And so we have an opportunity to add attractions. We have the opportunity to reimagine our serviceable, addressable market and think about niche areas. And there's a number of niche areas, which includes local and the reasons people travel, whether that's health and wellness or, you know, for sport or a live event. So we have the opportunity to grow in a number of ways that include tailwinds that aren't going away, the shift from offline to online and the way that we can play a role in that shift, adding new categories, adding new territories, and, of course, thinking about, you know, how we drive loyalty and work with third parties. I think you put all of that together. It is a very big opportunity, probably larger than the narrow slice. And it depends how we define it, and we will invest over time to create the biggest serviceable, addressable market that we believe we can deliver on, and we're just getting started. It's early.

Richard Clarke, Analyst — Bernstein

And so talk about going into some of those kind of new sub-verticals, if you like, attractions. How do you get into that? Is that selling the tickets? And then you were talking about maybe doing live events as well. Is that an opportunity potentially?

Matt Goldberg, CEO

I think there are many to sort through, and we can look at doing that through partnership. We can look at doing that through our teams that are set up around the globe to add new inventory. And, of course, we always want to follow the consumer. So if we're thinking about serving a consumer in a new territory, we will think about what is the experience that that local person, maybe in France or Spain or Italy, might be thinking about their travel. How would that be different than how we've typically served? That might mean language difference. That may mean product, you know, that is localized all on a global platform. And we think that there's a tremendous opportunity for growth ahead. And it is a long-term path for growth. So we get really excited about the growth rates into the future. We think they're double-digit growth rates into the future. And we think that they migrate profitably as we continue to see our cohorts shift with more loyal and increasingly, you know, less costly to serve. And so we've seen that shift, and that's why our profitability has increased as we've continued to deliver good, strong growth rates.

Richard Clarke, Analyst — Bernstein

And maybe just talk to us about that growth rate. You know, Q1, you talked about January and February. I think Viator, brand Viator was growing 20%.

Matt Goldberg, CEO

Greater than 20%.

Richard Clarke, Analyst — Bernstein

Greater than 20%. Yep, in both volume and GBB. And then experiences overall growing in the sort of high teens, and then you had a little bit of disruption in March from Mexico, Hawaii, et cetera. But is that level of growth rate you saw in January and February, is that a sustainable growth rate? Was there some idiosyncratic tailwinds there, or is that what you're aspiring to achieve in growth?

Matt Goldberg, CEO

Growth rates are always interesting to pick apart. But I think that the broader point is that we said that we're going to accelerate our growth rate, and that's, in fact, what we were doing in January and February. We had the dislocation in March. That meant volumes came down, cancellations went up. we've seen cancellations come back to a more appropriate level and a more normalized level and and we've seen the build back that we said we expected to happen through q2 that is actually happening even with you know some of the external things happening we are seeing build back as we as we as we started to talk about at our last earnings and you know I think the the point is we feel really confident about our ability to exit the year with an accelerated growth rate and to continue that long into the future so that that holds and appreciate maybe don't

Richard Clarke, Analyst — Bernstein

name specific names but just talk to us a bit about the competitive position in experiences we've seen you know other platform businesses want to get involved in selling experiences what is the sort of viator and trip advisor moat that means you're the best place to go and book

Matt Goldberg, CEO

experiences so you know the competitive interest in this category in our mind validates it you know The fact that there are horizontal players that are interested, the fact that it's a category that all travel aggregators think is important, just suggests that this is a really big opportunity. It has relatively low awareness. We think we have a tremendous advantage in being a vertical focused on this category, and that's because it's really hard to organize. And so having a focus on those operators, having a focus on the unique demand profile of travelers who want experiences, which is different than other categories. And then having the sort of marketplace infrastructure, right, which means the ability to go find the demand connected to that supply and everything in between, the transactional workflows, payments, logistics, all the tricky bits about putting this together. So we feel that's something that's important. But that's not totally unique. There are others who are vertically focused. What we have that nobody else has is this multi-brand opportunity with TripAdvisor, which stands for trust multi-category huge source of demand we know that about a third of them come to us for experiences and growing quickly we know that that's true across the world and we're in every region there TripAdvisor is known it lowers the barrier for us to enter new markets and you combine that with Viator nobody else has it it also brings a data asset that we can leverage to drive our conversion rate and of course it's also a testbed of a very large volume of people that we can drive our testing, which will drive conversion rate and experimentation velocity, which is critical to really drive your outcomes on a marketplace. So we think that that is quite unique, and we just got started on bringing that together, so we put our marketing teams together, and we believe that focusing holistically on experiences as a company is going to be a very valuable proposition for a long time to come.

Richard Clarke, Analyst — Bernstein

And you talked earlier about the fact that you'll go and meet the customers where they are. So you've done some partnerships. You support some of your – some other platforms with the Viator inventory. What gives you the confidence that that is incremental, that you should support other platforms rather than trying to drive everything through your own platform and keeping the kind of customer relationship? Well, we're very attentive to that.

Matt Goldberg, CEO

And, you know, obviously we go after whomever has a high intent audience. and that includes you know many many thousands of travel agents it includes any you know site that has an audience that might want to book an experience that can be e-commerce it can be large tech platforms and of course can also be OTAs like booking an Expedia and you know we have a lot of confidence that the way that we are working with them that is a traveler who we would not otherwise get on our own it's something we watch over time as we enter new markets, we will consider what is our third-party strategy, but we have a lot of confidence that those are incremental, profitable, and allow us to reinvest in that marketplace. And I think that's been a really good part of our flywheel that we intend to continue with. Perfect.

Richard Clarke, Analyst — Bernstein

I'm going to have some more questions on AI later, of course, but just specifically when we talk about experiences. I guess when we talk about online travel in a lot of categories, there's always a lot of questions about what is the actual level of disintermediation risk? Can an LLM get straight to the supply? Does it need that aggregation there? So specifically with experiences, is that a realistic threat that you could be disintermediated, or does the platform have a sort of essential value to the transaction?

Matt Goldberg, CEO

We have a lot of confidence that the experiences category is going to be more durable to that level of disintermediation because of the long-term nature of the supply, because of the challenge in that marketplace and how hard it is to structure, Because of everything you need to bring to that customer, logistics and customer service and all of the pieces that some of the horizontal players will not choose to do. We've already seen some of the AI players, the broad LLM horizontals, back off of wanting to be the booking platform of record. and of course we're working with many of them and have a seat at the table which I think is really important because we believe that we can collapse that moment where you're looking for something and help you book. You know, there is this trust gap with AI which is travelers by and large want to experiment with it for discovery to build an itinerary maybe and maybe that's half or more of travelers who are playing with AI in that way but less than 10% of them were actually booking And we believe that's because of trust, it's because of relevance, it's because Viator and TripAdvisor in what we built with our marketplace platform is actually the best place to book and you can rely on it. So we believe that we bring all of that in addition to our content and our data. And so we've had very rich conversations with a number of players. We recently announced that we launched with Anthropic and Claude. We'd already had an app with OpenAI. We're doing work across the board with Microsoft and Amazon and Meta. We are out there having really good conversations and partnering. And, of course, at Google I.O., they announced that Viator is going to be with them as we experiment. So we are playing, and we think that seat at the table allows us to play a role to influence it and to position ourselves very well. But we do not think, we believe there is a more durable moat for experiences than some other areas.

Richard Clarke, Analyst — Bernstein

Some other areas. And customer service, you mentioned there, I guess when it comes to experiences, customer service is incredibly important, right? You know, I need to actually go and find at that moment where I'm meant to be doing this experience. I need a kind of customer, someone to contact. So that's quite a big part of the Viator experiences proposition.

Matt Goldberg, CEO

We think it's an incredible advantage, our customer service, and we believe that we are market leading in the industry. We focus on it a lot. And, of course, we're doing customer experience not only for Viator and experiences, but also TripAdvisor across the board, and The Fork. And when you look at it, we're wiring it with AI, and I know that some have been out there talking about, you know, if you look across all of our brands, across all of them, between 30 and 60% of all our customer service is being handled by AI without a human in the loop, satisfactorily. And that will only grow over time, and that will be a productivity advantage for us as we continue to drive our customer service strategic asset. It is a strategic asset.

Richard Clarke, Analyst — Bernstein

So experience is obviously the primary future of the TripAdvisor group. Talk to us about how you see the future of, say, the other parts of the business, particularly maybe starting with the price comparison, the meta search. Does that have a future, or is that going to be replaced by other business models over time?

Matt Goldberg, CEO

Absolutely. You know, price comparison is still an important product. It's good for consumers, and it's very good for those who bid on that traffic. And you've seen, although obviously we have declared it's hard to compete with Google in that space, and we don't think it's the growth avenue of the future, but it's still profitable. And we intend to deliver on that. And what you've seen is really strong pricing, which is an indicator that our clients and our partners really like that product. And you continue to see, you know, some subset of the total traffic, we call them the hotel shopper, that's been more durable than the overall traffic, which obviously has the known SEO headwinds. And so that is a really good indicator that there will be long life there. I think the thing that everybody wants to know is, you know, how does that stabilize over time? We've declared that we're going to invest for, sorry, that we're not going to invest for growth, that we're going to run it for profit. and we think running it for profit is the right thing to do and we think that it can have long life and we think that it does not become a product that goes away. But we also recognize that we have better opportunities for our capital because we're not a pure play there. In fact, I always ponder at the fact that so many people think about TripAdvisor Group as TripAdvisor as price comparison. You even said it to me today. You're a price comparison. But that is now not even close to a majority of our revenue. It's still important for a profit perspective, and we intend to simplify that business so that we can serve it well, orient ourselves around experiences, and continue to mine that profitability into the future.

Richard Clarke, Analyst — Bernstein

And if I think about some of the other opportunities that we've talked about down the years, B2B has been talked about as an opportunity, and display advertising, that kind of business model. Are these still potential avenues of revenue growth for TripAdvisor or is it really experiences is the main pathway?

Matt Goldberg, CEO

Well, we continue to have B2B relationships. As I mentioned, we have almost 10 million operators that are listed on TripAdvisor and they want to have a relationship with our audience. And that audience is high intent and performance for them. And so our media business has actually held up reasonably well, all things considered. And they're doing a lot not only on our platform but off platform. And I think that's an asset we can think differently about in the future. But we want to be clear that experiences is the biggest opportunity. And so we will allocate capital there because it will grow and it will become more and more profitable. And so we will make decisions based on what serves the experience seeker first as opposed to trying to serve some other master. And I do think both B2B and media will be a part of our future. I think B2B is really interesting in experiences where we're serving the operators in really effective ways and there are other ways that we can serve them. And clearly it's been a huge growth opportunity at The Fork where B2B has come on really strong and has been a tremendous growth driver. So we're, as a company, I think skilled in B2B and there are opportunities for us to continue to think about how that serves our vision and our strategy.

Richard Clarke, Analyst — Bernstein

So you talked in the last earnings report about TripAdvisor being able to plug that trust gap. You mentioned it earlier, between sort of AI search and booking. Maybe you can just give us your sort of vision of what does that model look like? How do your brands plug that? How is travel going to flow through the TripAdvisor?

Matt Goldberg, CEO

Well, stated simply, we have unique assets. And those unique assets include the brand and the trust that it engenders in travelers and has done for more than 25 years. that includes our content which is continuing to grow you know in the last fiscal year we reported we added 80 million new ratings reviews and opinions on a base of over a billion the actual contributors to that asset and the contributions are relatively stable in fact we grew contributors last fiscal year that we reported over the previous fiscal year and the contributions was relatively stable. So even though you have traffic that has been declining because of the SEO headwinds in Google SERP, which the business had been built on over the years, that is a very stable base, which suggests that travelers continue to want to contribute and we have traffic coming to benefit from it. We also have this incredible data asset and all of the inventory that we can bring, the pricing and availability. And so So the ability to collapse the moment where you're looking for something to do or see or eat or experience and making that booking happen, certainly in the experiences category is an opportunity that we can do on platform. And we're totally focused on that. But we can also bring that raw material to partners. And that's why we've been talking to the LLM providers, because they recognize that having that layer of judgment, the human layer. And listen to what these players are saying. It is that human element that brings trust that will allow that gap to be closed. And so we believe we can bring that raw material. It can be with partners in the form of multiple ways to monetize. And I've said we are already doing it with more than a half a dozen partners, which we put in place relatively quickly. It's meaningful. It's going to continue to grow. We're having conversations about deepening those with a number of those players. But as importantly, we can do it on our own platforms. And so we will continue to leverage AI and all of those materials to drive loyalty and conversion on our sites, and of course, to target and onboard our operating partners, and to go out and find the right high-intent customers to come. So AI really plays a role both on-platform and off-platform, and we think we're well-positioned We actually really see a world where it will be a tailwind. Now, you have to work through that SEO challenge, which everybody talks about. But, you know, we were the best in the world at SEO for a long time. And as that has declined, all of that capability applies to what is being called AEO or GEO, which is the AI-first search. And we are applying it, and we are seeing ourselves surface. And that has been a high-intent customer that we're getting there, and it's growing very quickly off of a small base. And so as you do this kind of transformation, it takes a bit of time. And I know I'm impatient for things to happen very, very fast. But we see ourselves working through that. And as we work through that, our financial profile will reflect it.

Richard Clarke, Analyst — Bernstein

And maybe just what you expect to be the sort of revenue model of those AI platforms and the sort of ability of TripAdvisor, would you go and buy traffic from them or would you hope to be able to sort of show up organically because of the quality of the assets you're bringing to them?

Matt Goldberg, CEO

Well, we will have capability and advantage in doing both. We'll be competitive, and we've tested with what might it look like to go and advertise there. And that testing has been very informative, and where we see opportunities, we'll lean in. And we're always looking for a diverse set of high-intent travelers to come to our platforms. But we can also get large amounts of traffic organically. And, in fact, that is a big part of the value exchange, and we are seeing organic traffic come. We can also get licensing dollars. And we can build experiences where we benefit from the revenue that those experiences would generate. One thing we will not do is we're not going to share the revenue that we generate when it comes to our platforms. We don't need to.

Richard Clarke, Analyst — Bernstein

So you mentioned the unique data you've got, the review data, other data you've got. I guess we sometimes get the pushback, well, other companies have reviews. Google has reviews. Booking.com has reviews. Maybe you can just help us understand how much deeper and better and higher quality is that data and review data that TripAdvisor holds.

Matt Goldberg, CEO

Well, I talked about the stability of the data asset, which is really good. And we are going to continue to lean into that asset because we know that it serves us and our strategy. It's great for people who are looking for experiences as well as other categories. We think we lead in the quality front. You know, we have an industry-leading trust and safety team that does an incredible job of sort of rooting out anything that is violating our guidelines. We're using AI to remove AI-written reviews. We might think about experimenting with using AI to sort of stimulate a real review from a real human, but we are totally focused on making sure that reviews are coming from real people who actually went and did it because that is the highest quality. We also tend to have a better set of data, whereas some of the other players might, you know, your review might be one star hated it, five stars great. That's not happening on our platform. Our platform is actually saying, you know, five stars, this was an incredible dining experience in a corner of Paris that I really loved. I had a great time with my wife, and I recommend it if you're looking for a romantic getaway in Paris. we really get that kind of level and we have it in a structured format and we're able to use that in a very effective way so we think it's a it's a tremendous advantage but again like I said before as I was talking about inventory it's not always about quantity it's about quality and we intend to continue to be

Richard Clarke, Analyst — Bernstein

the leader in quality so you'd mentioned on the last earnings call potentially being open to allowing an LM to be trained on your data maybe go into how's that different to what you're currently doing at the moment? How big an opportunity is that? Is that a sizable financial opportunity for TripAdvisor?

Matt Goldberg, CEO

So we haven't done it in the past because all of our deals were intended to be very, very thoughtful about a learning agenda. What we didn't, we would have been blocking anybody that didn't have the right to come and take our content and data. Although, of course, you know, in the past, there'd been all kinds of, you know, of the search model benefited from taking data and so but I think anything over the last several years we chose to either block or go do a deal when we did those deals we basically said okay what do we want to learn and what rights do we want to give and so we would give rights to a certain amount of data a certain amount of content for certain uses and we did not permit training of the models I think that that's something we could consider doing we would want the value exchange to be meaningful we haven't greenlit anything yet but are in a number of conversations. And if we find something that we think is good for us, good for the partner, and where we will have a value exchange that really works, and you can read that as meaningful, we'll do it. But if not, we don't have to do that.

Richard Clarke, Analyst — Bernstein

And maybe just talk about your own internal AI initiative. So you mentioned customer service earlier. The AI trip planning tools, is this gaining traction? And maybe any other areas that you're focused on using AI internally?

Matt Goldberg, CEO

Richard, you know this because you've been following it. We've been driving AI product development since the emergence of generative AI and long before through machine learning and leveraging our data to drive predictive analytics. So we have a lot of experience with it and over the last few years as we've been experimenting of course we experimented with itinerary builder on trip advisor we experimented with review summaries and of course conversational AI or a planning assistant which we call Ali on trip advisor and we've done a lot on Viator and the fourth two but if you if you look at that that was all on top of a platform that was our platform of the past what we've been doing lately. is experimenting in AI-native products. And that means thinking about the product from an AI-first experience. We've been doing that around planning and discovery, which could lead to an itinerary, or it could lead to a set of content or booking opportunities, with the idea that you can collapse the moment of search with the moment of booking. And we've been experimenting with that. We're also experimenting with in-destination AI. So if I'm in destination and the weather suddenly changes or something unexpected happens what's around me now what are the things i might want to do today how do i find access to promotions and opportunities that i might not otherwise and so we can do a lot there and we're learning a lot we've said that as we've done ai native development we actually have seen higher levels of engagement and conversion from our earlier experiments with ai so that's very promising but as with all these things we're going to be very prudent in how we scale it and we're going to invest appropriately because i think sometimes we all get ahead of ourselves around what consumers really want we will wait for the consumer signal and i think you're seeing that across travel and the reason i like our position is that we are doing it on our own platforms we are doing it hand in hand with very good relationships with all of the horizontal llms and having really interesting conversations around how where it might go and how we might influence it. And I think we have multiple ways to serve that consumer. So I think we are well

Richard Clarke, Analyst — Bernstein

set up. Okay, perfect. Maybe let's shift on to your portfolio review. Maybe talk to the decision that the fork could and probably will be separated from the group going forward. Why was that considered an asset that could be separated? And any updates on, I think you said at the Q1 results you had to stop buybacks because it was imminent. Is that still the case?

Matt Goldberg, CEO

I don't think we said we had to stop buybacks because it was imminent. I think we said we were having conversations in the market that caused us not to be able to. So I just want to be thoughtful about that. The fork is a great asset, and it's only gotten stronger over the last few years. You know, it is the clear leader in dining in Europe. It's in 11 markets and competing incredibly effectively in that region. It has a really good balance. It was originally almost primarily B2C or serving the consumer. But as we've added inventory, we've really focused on the restaurant and serving them with software that can help them manage their businesses. And we have seen increasing penetration rates of our premium software with restaurants, and we're at a price point where we think there is tremendous headroom. And that growth has been fabulous. So getting that B2B, B2C. They've been experimenting with innovation across AI and ask the fork, across social, where they're seeing really good indicators and and being able to use social to drive bookings and restaurant demand. And they're experimenting across the board with their data as well. So we love the business. As we've reoriented ourselves and declared that we're gonna be an experience-centric business, we recognize we don't have to own the fork. We can benefit from it through commercial relationship if we pick a partner that we're excited about. we also recognize we're not getting the value we believe we deserve for that business necessarily in our portfolio and we've said that we're gonna go look for catalytic opportunities to not only highlight the value of experiences but also to look at every option to create shareholder value and we have a board that is enthusiastic about considering the portfolio review and no options are off the table and we talked about the fork because we thought that it had been run separately before. It has a fantastic management team. It is a natural one to consider. And as I said at earnings, we feel good about the process, and it won't be long before we'll

Richard Clarke, Analyst — Bernstein

update. Okay, perfect. And maybe you can give us any sense of what you might use the funds for if you were to dispose of the business. Is that, are there opportunities to go and accelerate? Are there acquisitions or investments you can make in experiences, or would this be allocated back to shareholders?

Matt Goldberg, CEO

Yeah, and we're fortunate. We have a strong balance sheet. We've got good cash flow generation, so healthy. If we were fortunate enough to have additional cash come in, we would be able to make prudent choices about shareholder return, whether they come in the form of share buyback, paring down debt and strengthening the balance sheet, or looking at opportunities to invest in experiences. We see both inorganic opportunities in that category that could be interesting but we also see organic opportunities and we're going to do that all judiciously but certainly we are thinking about shareholders and you know we think that being prudent about how we look at that in the future is something that we'll do perfect and beyond the

Richard Clarke, Analyst — Bernstein

fork are there you know is there other potential portfolio changes that could be could be made i guess if you know experiences is the center of the business you've talked about wanting those two brands so what else is there potentially within the group that could be subject yeah there's a a number of different things that we could do.

Matt Goldberg, CEO

I don't want to necessarily get ahead of myself today. But you could imagine we could think about, because we talked about simplifying TripAdvisor. And what that means is there could be opportunities for other transactions, certainly. There could be opportunities for partnerships, strategic partnerships, where if we identify a business line that we've been in in the past, where we don't think we have the scale or right to go win, or we're not going to invest as heavily as somebody else, there could be partnerships that would be, we think, meaningfully accretive. And we're open to all of that. And there's also areas of the business where, you know, and you've seen us do this, simplification also means saying what you won't do. And we're happy to look at stuff and say we're going to exit it because it helps us focus. Simplification and focus on a high-growth category where we have the right to win, we believe is the best vision, strategy, and way to run our company. and we think it will get rewarded over time. So there are multiple options, and nothing's off the table.

Richard Clarke, Analyst — Bernstein

So talk to us a little bit about having activists within the TripAdvisor shareholder structure. I guess what we see, you know, outwardly is some open letters which can be a little aggressive, but, you know, what's the reality of working with them? They've appointed a couple of or managed to encourage a couple of extra board members to join the group. Is everyone now more aligned? How much of a sort of conflict are you still finding?

Matt Goldberg, CEO

No, there's no conflict. As you know, we had an agreement that we announced in late March. We were very pleased with the agreement. It has been very collaborative. And, you know, we had been on the process of board renewal. And remember, you know, we had simplified our shareholder structure in kind of late April and started the process. And, you know, then we had this partner to have a conversation with about board renewal come not long after so this was the natural result we're very enthusiastic about having four new independent board members went through our screening process we added two immediately that we knew well and we've put into our proxy that we've named two others who will get elected at our AGM and we're excited about that it's been engaging energizing having a fresh perspective with strong background is something, you know, every CEO should want for their business. And at a moment like this one, where we're making really important decisions, couldn't be a better time to have that kind of constructive relationship. So yes, open letters, none of that seemed in any way unusual to me. What was important to me was that we were focused on the business, driving value,

Richard Clarke, Analyst — Bernstein

staying focused, which is exactly what we did. So to what extent do you feel, you know, sort of scoreboard pressure or stock price pressure at the moment? You know, the stock's kind of hovering around that kind of ten dollar mark you know what is the most misunderstood component you know you've laid out today i guess you're happy with the strategy you're moving ahead with experience focused you're optimistic about where that will take the business doesn't seem to be i think fairly reflected in the share price today so what is what is misunderstood and you know how much pressure do you feel to sort of get that share price working i agree with you and you know we

Matt Goldberg, CEO

we recognize that um the sum of the parts there's a dislocation which is why we are doing our portfolio review and have made some of the comments there that we've made and think that we have opportunities there, as I've discussed previously, we've made so much progress. We simplified our shareholder structure and went from a control company to a non-control company. We went through the process of what happens when you do that, and we are through that now. At the same time, we took out more than 20% of our shares. That felt like a very positive thing for us to do. We then announced that we were focused clearly on simplifying the complexity, focusing on the most exciting part of travel, which is experiences. We've begun to organize ourselves around that and deliver against that. We are at the same time simplifying TripAdvisor, which has well understood secular challenges that we are working our way through and feel good about that, and we've shifted our financial profile. Remember, it wasn't long ago that Metasearch and TripAdvisor was the vast majority of the revenue in this company, and more than all of the profit. Last year, it was not the majority. The marketplace business had become the majority and really coming on strong. And the marketplace businesses had delivered 35% of the profit. And now, we're seeing experiences, it's 50% of the revenue and growing, and this year, there'll be more. And we'll continue to drive a much higher level of profit. So we feel that the financial position of the company has shifted, and that will get rewarded over time. We will continue to focus on that, do the things we're doing, stay focused. And, you know, we recognize that transformation is not easy work, but it is very rewarding work when you get through it, and we feel like we've moved through it reasonably well. We want things to move faster. We are looking for catalytic opportunities, and we'll continue to pursue that with great vigor.

Richard Clarke, Analyst — Bernstein

So I'm just going to go to some of the audience questions. So this one's got an upvote, so I'll go for this one first. But please go deeper into what it means running old core trip for profit versus growth. Can you give some examples of what you are actually doing as part of that strategy? And what is the confidence interval that it can be stabilized over the next three years?

Matt Goldberg, CEO

So it means that we are focusing on really matching our costs with our revenue to maximize how much profit we can deliver from that business. you've seen us do that over time we are declaring clearly that when there are capital allocation choices we're going to put our capital allocation choices towards the high growth the future rather than the things that we believe aren't going to return to growth we are looking at what are the assets there that we want to continue to support because they're going to serve our vision and our strategy and you can see a number of them you know we have as I mentioned over a billion ratings, reviews, and opinions, and adding a good number every year with stability. We have hundreds of millions of travelers who are coming to us in that business every year. We have over 100 million members in that business and 10 million operators. So we will leverage those assets to serve our future while we simplify so that we are not trying to be all things to all people. And so we're not afraid of walking away from the things that people don't rely on us for or where we can't win. And I think that will maximize the question around our confidence and stability. We have a lot of confidence that what drives TripAdvisor for the consumer, what drives TripAdvisor for the operators that want to be there, continues to hold, and that we will see stability. Obviously, you've got to work through. I mean, the thing that we're working through is well understood. It goes back to 2015, 2016. And it relates to, I think, a couple of things, which is you know google's decision uh to you know advantage themselves as a monopolist as as we've heard from uh you know not my word that's the word of of the judicial branch of our of our government um and to prioritize their own platforms and that's very hard to compete with so the serp and the seo that we this business had had really done the best in the world that became a headwind and now you've got to work through that headwind and so we're working through it but we believe that it'll stabilize. And we think you can see it when you look through the segments of users and who's actually, who the shoppers are and what they're doing, who the contributors are and what they're doing. And they are different than the broad traffic trends and already more stable than the broad traffic trends. And we think that will be something which is promising for the future.

Richard Clarke, Analyst — Bernstein

Is the valuation gap between what you believe the fork is worth and what buyers are willing to pay narrowing and how long would you be prepared to run

Matt Goldberg, CEO

this process for yeah I think I've commented on that we think it's worth more than we're getting credit for we have every confidence that's there are a number of players who are focused in this category to which the fork will be valuable so this won't go on for long we we said I think we said at earnings that we would update in the in the not-so-distant future the near term okay

Richard Clarke, Analyst — Bernstein

And the question here, can you compare Viator to other experiences platforms? So how is Viator differentiated versus, I guess, the other pure plays in the space?

Matt Goldberg, CEO

Yeah, you've got really three pure plays which are sort of divvied up by where their source traveler comes from. So you've got us who are the leader in the U.S. We're growing share and really feeling good about our US position. Very hard to come into the US from outside. You've got a player in Europe and you've got a player in Asia. I think the way that we're different is we've really led around our ability to add supply and our supplier relationships. We're differentiated in the connection to TripAdvisor, which is a unique advantage that we are really just getting started on orienting work together in a much more meaningful way because they used to get run separately. We also believe that our ability to compete for, you know, in various channels for high intent traffic is an advantage. And ultimately we believe that our ability to enter both new categories and new geographies as we continue to work on our R&D, which by the way will be transformed in the way that we're using AI. You know, all of our engineers are now using AI, the productivity is going up. That drives experimentation velocity. It allows you to experiment much more to drive conversion rates higher. And as we do that, we are early in that game. And as that accelerates, the three of those together, the way that we acquire customers, the way that we bring them onto our platform to repeat and have a great experience, and the way we bring operators onto our platform and meet that demand, we think we can be as good or better than anyone in the world at this. and the focus that we have. We also, by the way, are unique in that we have a software asset that we bring, which is different than just Viator. It's called Boken, and it works. It connects to long-tail suppliers and helps them manage their business wherever they're selling their product, Viator or elsewhere. And that is a very unique advantage, too, that we intend to think about. How does that constellation of capabilities come together and allow us to go and win the global opportunity? And we have a lot of confidence we can do it. Great. Well, on that note, I think a good place to finish. So, Matt, thanks for your time.