Trivago Tests New Marketing Strategy and Products After ‘Rough’ Fourth Quarter
Growing competition from players such as Google, Airbnb, and Trip.com Group, as well as reductions in marketing spend by large online travel agency advertisers and the potential materially adverse impact of a regulatory decision in Australia all led to a Trivago decline in net income for the fourth quarter.
In the fourth quarter, Trivago's net income fell 7.8 percent to $3.38 million (euro 3.1 million), but grew 38.7 percent to $18.76 million (euro 17.2 million) for the full year. An adjustment to Trivago's legal reserves because of the Australia legal decision, with a court date pending to set penalties, adversely impacted fourth quarter net income as well as adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for 2019. Lower advertising spend in the fourth quarter also took a toll on profitability in the quarter.