Shares of Trip.com (9961) sank by over 10 percent on Thursday after delivering a slower revenue growth guideline and recording a 42 percent drop in net profit in the first quarter.
The online travel agency expects its revenue to grow at just 3 to 8 percent in the second quarter, due to macro headwinds such as elevated energy pricing and geopolitical volatility, alongside operational adjustments the company implemented to align with evolving industry standards and compliance frameworks.
The company logged a net income of 2.5 billion yuan (HK$2.88 billion) in the three months through March, down from 4.3 billion yuan the year prior.
Revenue for the quarter, however, jumped by 17 percent to 16.2 billion yuan, primarily driven by resilient travel demand.
Accommodation reservation revenue also rose 17 percent to 6.5 billion yuan in the period, while transportation ticketing revenue climbed by 12 percent to 6.1 billion yuan.
Packaged-tour revenue gained 19 percent to 1.1 billion yuan.
Trip.com said it is fully cooperating with the regulator in its ongoing investigation, but is unable to predict the timing, outcome, or consequences of the investigation, or estimate the possible loss that may be associated with it.
China’s State Administration for Market Regulation launched an investigation into whether the company has abused or is abusing a dominant market position to engage in monopolistic conduct in January.
