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Company Participants

Michelle Qi - Senior IR Director

米歇尔齐 - 高级投资者关系总监

James Liang - Executive Chairman

詹姆斯·梁 - 执行主席

Jane Sun - CEO

孙女士 - 首席执行官

Cindy Wang - CFO

Cindy Wang - 财务总监

Conference Call Participants

Joyce Ju - Bank of America Merrill Lynch


Alex Poon - Morgan Stanley

Alex Poon - 摩根士丹利

Alex Yao - JP Morgan

Alex Yao - 摩根大通

Jiong Shao - Barclays


Good day and thank you for standing by. Welcome to the Trip.com Group 2023 Fourth Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded.


I’ll now like to hand the conference over to your first speaker today, Michelle Qi, Senior IR Director. Please go ahead.

我现在想把会议交给今天的第一位发言人,Michelle Qi,高级投资者关系主任。请开始。

Michelle Qi

Michelle Qi

Thank you. Good morning, and welcome to Trip.com group’s fourth quarter and full year of 2023 earnings conference call. Joining me today on the call are Mr. James Liang, Executive Chairman of the Board; Ms. Jane Sun, Chief Executive Officer; and Ms. Cindy Wang, Chief Financial Officer.


During this call, we will discuss our future outlook and performance, which are forward-looking statements made under the safe harbor provisions of the U.S. Private Security Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, our results may be materially different from the views expressed today. A number of potential risks and uncertainties are outlined in Trip.com Group’s public filings with the Securities and Exchange Commission. Trip.com Group does not undertake any obligation to update any forward-looking statements, except as required under applicable law.


James, Jane and Cindy will share our strategy and business updates, operating highlights, and financial performance for the fourth quarter of 2023, and the full year for 2023, as well as outlook for the first quarter of 2024. And then we will have a Q&A session, after the prepared remarks.

James, Jane 和 Cindy 将会分享我们2023年第四季度的战略和业务更新、运营亮点以及财务表现,以及2023年全年的情况,还有2024年第一季度的展望。然后在准备好的谈话结束后,我们将有一个问答环节。

With that, I will turn the call over to James. James, please.


James Liang

James Liang

Thank you, Michelle. And thanks everyone for joining us on the call today. China's border reopening in 2003 has ignited a global travel search. Our enhanced leadership in product and service has empowered us to significantly outperform the market. In 2023, our total OTA business reached a record high achieving a GMV of approximately RMB1.1 trillion or USD $160 billion [ph].


This marks the year-over-year increase of 130% and growth about 30% compared to 2019. Currently, our total net revenue also grew by 122% year-over-year, and a 25% compared to 2019. We significantly improved our adjusted EBITDA margin to 31% in 2023, which is the highest level over the past decade. In September 2023 we begin buying back our own stock using the existing quota. Additionally, the Board has approved the 2024 capital return program, further increasing our overall quota to a total of USD $581 million. This decision demonstrates our strong confidence in the long term value potential of the company.

这标志着相比2019年,我们的年度增长率达到130%,增长了大约30%。 目前,我们的总净收入也同比增长122%,较2019年增长了25%。我们将调整后的EBITDA利润率提高到2023年的31%,达到过去十年的最高水平。2023年9月,我们开始使用现有配额回购我们自己的股票。此外,董事会已批准了2024年的资本回报计划,将我们的总配额进一步增加到总额为5.81亿美元。这一决定表明我们对公司的长期价值潜力有着强烈的信心。

The China town market has been growing significantly, with outbound travel playing an increasingly large role due to easier visa access and the gradual resumption of international flights.


Our global business is also thriving, particularly in the APAC region, reflecting a strengthened market presence and improve the product competitiveness. Expanding our international operations with diversified products worldwide remains a key priority for us. As travel demand rises, we also recognized the increasing importance of enhancing our service. Through exceptional customer service, AI technology and the reliable content, we continue to invest in improving user experience. Our commitment to globalization and great quality collectively now as our digital strategy drives us to continuously innovate and improve.


The year 2023 mark the China's reopening to the world, and 2024 will be a year of consolidating and expanding global tourism. I'm holding our digital strategy we aim to become a leading player in Asia market and a global market in a three to five years.


With that I'll turn the call over to Jane, for operational highlights.

请让我把电话转给Jane, 她将进行运营重点报告。

Jane Sun

Jane Sun

Thank you, James. Good morning, everyone. As a quick overview, our net revenue in Q4 grew by 104% year-over-year and increased by 24% compared to 2019. During this period, the travel industry witnessed a strong momentum. As rising travel sentiment drove growth and supply side constraints continued to ease. Both, our hotel and air reservations grew by approximately 130% year-over-year. For the full year of 2023, our total net revenue achieved year-over-year growth of 122% and 25% compared to 2019. This outstanding result was due to the robust release of travel demand and the exceptional performance across all of our business segments.


Additionally, our adjusted EBITDA margin in 2023 significantly improved to 31%, reflecting the successful optimization of our cost structure and overall productivity enhancement.


Now let me walk you through different market performance. First, China Domestic. In Q4, the China domestic market continued to exhibit robust growth. Our domestic hotel bookings witnessed a year-over-year growth of over 130% or more than 60% compared to 2019.


Demand for travel showed no signs of slowing down during the winter season. Popular destinations such as Harbin in the northern part of the country, experienced a surge in visitors. Notably, individuals have been prioritizing travel expenditures over other daily expenses, indicating a shift towards experiential spending. This change in consumer behavior has significantly favored travel industry as more people allocate their resources towards exploring new places and creating memorable experiences.


We have continued to expand our user base among the elderly demographics through the deep integration of product integration, content generation and marketing efforts. In Q4, the number of the users over 50 years old, increased by more than 90% compared to 2019. And this is just a beginning to capitalize on the market opportunity for retired community, which has been in power and ample time.


Second, outbound market. Despite the winter seasonality in Q4, outbound travel from China, maintain the same level of the recovery as the peak season in Q3. The gradual easing of supply side constraints, such as increased international flight capacity, and certain clearance of the Visa block, played a significant role in facilitating this positive trend. Chinese travelers continue to exhibit high demand for travel to overseas destinations. Moreover, many countries implemented visa free policies, specifically targeting at Chinese travelers, further enhancing the appeal of these destinations and securing their popularities.

第二,出境市场。 尽管Q4季节性处在冬季,但自中国出境旅行的恢复水平仍保持与Q3旺季相同水平。 逐渐放松供给方面的约束,例如增加国际航班容量,以及某些签证限制的清除,在促进这一积极趋势方面发挥了重要作用。 中国旅行者对海外目的地的需求仍然持续高涨。 此外,许多国家实施了针对中国旅行者的免签政策,进一步增加了这些目的地的吸引力并确保了它们的受欢迎程度。

In Q4, Trip.com Group’s outbound air ticket and hotel bookings recovered to more than 80% of pre-pandemic level, surpassing the market overall recovery rate of 60%. Thailand, Singapore, Japan, Korea, Malaysia remain as the top outbound travel destination on our platform.


Third, global markets. On the international front, we actively enhance our global market presence. Through the strong synergy of improved products, enhance the services and targeted marketing efforts, we have witnessed a steady growth in APAC region. In Q4, total GMV of our overseas OTA brand grew by more than 70% year-over-year, and increased by more than one 100% compared to 2019.


Now, let me walk you through a few strategic highlights. First, globalization. As 2023 was about a return to travel, then 2024 will be the year when people go further than ever before. The travelers become more comfortable and confident then touring around the world. They are taking to the skies, rails, roads and the seas to experience unforgettable adventures. From music festivals to exotic adventures, travelers are increasingly seeking more than just a typical gateway. They are craving for immersive cultural experiences thrilling adventures, and the music, euphoria. All value a meaningful connections and quality time with their families and friends.



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