Trip.com Group Limited Reports Unaudited Second Quarter and First Half of 2023 Finan

Trip.com Group Limited (Nasdaq: TCOM; HKEX: 9961) ("Trip.com Group" or the "Company"), a leading one-stop travel service provider of accommodation reservation, transportation ticketing, packaged tours, and corporate travel management, today announced its unaudited financial results for the second quarter and first half of 2023.

Key Highlights for the Second Quarter of 2023

• Domestic and international business continued to show robust recovery in the second quarter of 2023

- Domestic hotel bookings grew by 170% year over year and by over 60% compared to the pre-COVID level for the same period in 2019.
- Outbound hotel and air reservations recovered to over 60% of the pre-COVID level for the same period in 2019, surpassing the industry-wide recovery rate of 37% in terms of international air passenger volume for the same period.
- Air ticket bookings on the Company's global OTA platform grew by over 120% year over year and nearly doubled compared to the pre-COVID level for the same period in 2019.

• The Company delivered strong results in the second quarter of 2023

- Total net revenue increased by 180% year over year and exceeded the pre-COVID level for the same period in 2019 by 29%.
- Net income for the second quarter was RMB648 million (US$91 million), which improved from RMB43 million for the same period in 2022.
- Adjusted EBITDA for the second quarter was RMB3.7 billion (US$507 million). Adjusted EBITDA margin was 33%, compared to 9% for the same period in 2022 and 31% for the previous quarter.

"During the second quarter of 2023, the demand for both domestic and international travel remained resilient." said James Liang, Executive Chairman. "Despite limited air capacity recovery, the robust rebound of travel activities reflects travelers' strong desire to explore the world. We remain optimistic about the enduring demand for travel and the long-term market outlook."

"We are encouraged by our solid results in the second quarter," said Jane Sun, Chief Executive Officer. "With the thriving market demand and our outstanding performance, we are poised to take the lead in driving the industry's recovery and actively creating an abundance of job opportunities alongside our esteemed business partners."

Second Quarter of 2023 Financial Results and Business Updates

The Company's business continued to recover significantly since the pent-up demand for travel remains strong, which led to an increasing volume of travel bookings.

For the second quarter of 2023, Trip.com Group reported net revenue of RMB11.2 billion (US$1.6 billion), representing a 180% increase from the same period in 2022 and a 22% increase from the previous quarter, primarily due to the substantial recovery of travel market.

Accommodation reservation revenue for the second quarter of 2023 was RMB4.3 billion (US$591 million), representing a 216% increase from the same period in 2022 and a 23% increase from the previous quarter, primarily due to the substantial recovery of travel market.

Transportation ticketing revenue for the second quarter of 2023 was RMB4.8 billion (US$664 million), representing a 173% increase from the same period in 2022 and a 16% increase from the previous quarter, primarily due to the substantial recovery of travel market.

Packaged-tour revenue for the second quarter of 2023 was RMB722 million (US$100 million), representing a 492% increase from the same period in 2022 and an 87% increase from the previous quarter, primarily due to the substantial recovery of travel market.

Corporate travel revenue for the second quarter of 2023 was RMB584 million (US$81 million), representing a 178% increase from the same period in 2022 and a 31% increase from the previous quarter, primarily due to the substantial recovery of travel market.

Cost of revenue for the second quarter of 2023 increased by 106% to RMB2.0 billion (US$277 million) from the same period in 2022 and increased by 23% from the previous quarter, primarily due to the substantial recovery of travel market. Cost of revenue as a percentage of net revenue was 18% for the second quarter of 2023.

Product development expenses for the second quarter of 2023 increased by 67% to RMB3.0 billion (US$407 million) from the same period in 2022 and increased by 10% from the previous quarter, primarily due to an increase in product development personnel related expenses. Product development expenses as a percentage of net revenue was 26% for the second quarter of 2023.

Sales and marketing expenses for the second quarter of 2023 increased by 185% to RMB2.4 billion (US$325 million) from the same period in 2022 and increased by 34% from the previous quarter, primarily due to an increase in expenses relating to sales and marketing promotion activities. Sales and marketing expenses as a percentage of net revenue was 21% for the second quarter of 2023.

General and administrative expenses for the second quarter of 2023 increased by 58% to RMB955 million (US$132 million) from the same period in 2022 primarily due to an increase in general and administrative personnel related expenses and increased by 7% from the previous quarter. General and administrative expenses as a percentage of net revenue was 8% for the second quarter of 2023.

Income tax expense for the second quarter of 2023 was RMB562 million (US$77 million), compared to RMB173 million for the same period in 2022 and RMB341 million for the previous quarter. The change in Trip.com Group's effective tax rate was primarily due to the combined impacts of changes in respective profitability of its subsidiaries with different tax rates, certain non-taxable income or loss resulting from the fair value changes in equity securities investments and exchangeable senior notes, and changes in valuation allowance provided for deferred tax assets.

Net income for the second quarter of 2023 was RMB648 million (US$91 million), compared to RMB43 million for the same period in 2022 and RMB3.4 billion for the previous quarter. Adjusted EBITDA for the second quarter of 2023 was RMB3.7 billion (US$507 million), compared to RMB355 million for the same period in 2022 and RMB2.8 billion for the previous quarter. Adjusted EBITDA margin was 33% for the second quarter of 2023, compared to 9% for the same period in 2022 and 31% for the previous quarter.

Net income attributable to Trip.com Group's shareholders for the second quarter of 2023 was RMB631 million (US$89 million), compared to RMB69 million for the same period in 2022 and RMB3.4 billion for the previous quarter. Excluding share-based compensation charges, fair value changes of equity securities investments and exchangeable senior notes recorded in other income/(expense) and their tax effects, non-GAAP net income attributable to Trip.com Group's shareholders for the second quarter of 2023 was RMB3.4 billion (US$475 million), compared to non-GAAP net loss attributable to Trip.com Group's shareholders of RMB203 million for the same period in 2022 and non-GAAP net income attributable to Trip.com Group's shareholders of RMB2.1 billion for the previous quarter.

Diluted earnings per ordinary share and per ADS was RMB0.94 (US$0.13) for the second quarter of 2023. Excluding share-based compensation charges, fair value changes of equity securities investments and exchangeable senior notes and their tax effects, non-GAAP diluted earnings per ordinary share and per ADS was RMB5.11 (US$0.70) for the second quarter of 2023. Each ADS currently represents one ordinary share of the Company.

As of June 30, 2023, the balance of cash and cash equivalents, restricted cash, short-term investment, held to maturity time deposit and financial products was RMB75.0 billion (US$10.3 billion).