UOB Kay Hian
Report Date: Friday, 29 August 2025
Trip.com Group Delivers Robust Q2 2025 Results, Eyes Further Upside with Strong International Travel Momentum
Overview: Trip.com Group’s Stellar Performance and Bullish Outlook
Trip.com Group (9961 HK), China’s largest online travel agency, continues to captivate investors with impressive financial results for Q2 2025 and a confident outlook for the remainder of the year. UOB Kay Hian maintains its BUY rating, boosting the target price to HK$725.00, implying a potential upside of 31.3% from the current share price of HK$552.00. The company’s strong international rebound, resilient domestic demand, and prudent cost control underpin its growth trajectory.
Company Snapshot: Key Facts and Shareholder Structure
Sector: Consumer Discretionary
Market Cap: HK$334,971.8 million (US$43,022.9 million)
Shares Outstanding: 653.6 million
52-week Price Range: HK$345.00 – HK$598.00
Major Shareholders:
Baidu Holdings Ltd: 9.4%
Naspers Ltd: 5.0%
Blackrock Inc: 4.9%
FY25 Net Asset Value/Share (RMB): 260.42
FY25 Net Cash/Share (RMB): 154.60
Q2 2025 Financial Results: Strong Top-line and Profitability Beats
Trip.com posted a 16.2% year-on-year (YoY) increase in net revenue for Q2 2025, climbing to RMB 14.86 billion. Non-GAAP net profit rose 1% YoY to RMB 5.01 billion, outpacing consensus by 15%. The net margin, although down 5 percentage points (ppt) YoY at 33.8%, remained ahead of market expectations.
| Metric |
Q2 2025 |
Q1 2025 |
Q2 2024 |
YoY Change |
QoQ Change |
| Revenue (RMBm) |
14,864 |
13,850 |
12,788 |
+16.2% |
+7.3% |
| Accommodation Revenue |
6,225 |
5,541 |
5,136 |
+21.2% |
+12.3% |
| Transportation Revenue |
5,397 |
5,418 |
4,871 |
+10.8% |
-0.4% |
| Packaged Tour Revenue |
1,079 |
947 |
1,025 |
+5.3% |
+13.9% |
| Corporate Travel |
692 |
573 |
633 |
+9.3% |
+20.8% |
| Gross Profit (RMBm) |
12,025 |
11,125 |
10,460 |
+15.0% |
+8.1% |
| Gross Profit Margin |
81.0% |
80.4% |
81.9% |
-0.9 ppt |
+0.6 ppt |
| Non-GAAP Net Profit (RMBm) |
5,011 |
4,188 |
4,985 |
+0.5% |
+19.7% |
| Non-GAAP Net Margin |
33.8% |
30.3% |
39.0% |
-5.3 ppt |
+3.5 ppt |
Business Segment Analysis: Accommodation, Transportation, and More
Accommodation: Revenue climbed 21.2% YoY, driven by robust domestic and outbound hotel bookings. Domestic hotel volume increased by high teens YoY, though average daily rates (ADR) declined by low single digits, outperforming the broader industry.
Transportation: Notched 10.8% YoY growth, buoyed by outbound transportation bookings. Domestic air ticket revenue was flattish due to price declines, but outbound travel outpaced the industry, with hotel and air ticket bookings reaching 120% of 2019 levels.
Packaged Tours & Corporate Travel: Packaged tour revenue grew 5.3% YoY, and corporate travel rose 9.3% YoY. Both categories are steadily rebounding, with international demand a key driver.
Others: This segment saw 31% YoY revenue growth, underscoring Trip.com’s diversified service offering.
International and Outbound Travel: The Growth Engine
International air and hotel booking revenue soared 60% YoY in Q2 2025.
Outbound hotel revenue surged to 130% of 2019 levels; international hotel revenue is projected to jump over 70% YoY in Q3 2025.
Inbound travel bookings doubled YoY, showcasing growing international appeal.
Guidance and Growth Outlook for Q3 2025 and Beyond
Q3 2025 Revenue Guidance: 12-17% YoY growth, targeting RMB 18.1 billion, mainly leveraging international tourism momentum.
Margin Guidance: Gross margin expected to shrink 2ppt YoY to 80.5%, with non-GAAP operating margin at 32%. AI integration is expected to support operational efficiencies.
Other Income: Trip.com will recognize RMB 12 billion from the partial divestment of its MakeMyTrip stake as an investment gain in Q3 2025.
Key Financials and Forecasts
| Year (RMBm) |
2023 |
2024 |
2025F |
2026F |
2027F |
| Net Turnover |
44,510 |
53,294 |
61,384 |
70,180 |
79,315 |
| EBITDA |
12,141 |
15,028 |
16,830 |
20,303 |
24,087 |
| Operating Profit |
11,324 |
14,177 |
16,030 |
19,488 |
23,251 |
| Net Profit (Reported) |
9,918 |
17,067 |
29,246 |
18,200 |
20,711 |
| Net Profit (Adjusted) |
13,071 |
18,041 |
18,408 |
20,639 |
23,467 |
| EPS (Fen) |
1,947.7 |
2,620.4 |
2,646.0 |
2,966.6 |
3,373.1 |
| PE (x) |
24.2 |
18.0 |
17.8 |
15.9 |
14.0 |
| Net Margin (%) |
22.3 |
32.0 |
47.6 |
25.9 |
26.1 |
| ROE (%) |
8.5 |
12.9 |
18.6 |
10.1 |
10.3 |
Margin and Cost Management
Gross margin stood at 81.0% in Q2 2025, down 1ppt YoY, due to increased outbound business mix.
Non-GAAP operating margin was 31.4%, 2ppt lower YoY, but sales and marketing costs as a percentage of revenue held steady at 22%, attributed to precise targeting and efficient overseas marketing spend.
Outbound and international businesses are expected to remain resilient, with international hotel revenue forecasted to leap over 70% YoY in Q3 2025.
Share Repurchase and Capital Management
As of August 27, 2025, Trip.com had repurchased 7 million ADSs for US$400 million, equating to a capital yield of 1.5% for the year.
An additional US$5 billion (11.7% of market cap) share repurchase program was authorized in August 2025.
Revised Earnings and Risks
Revenue forecasts for Q3 and full-year 2025 were trimmed by 2% and 1% respectively, but earnings forecasts were raised by 5% and 7% due to continued cost discipline and AI-driven operational improvements.
Key risks include:
Weaker travel consumption power
Normalization of domestic travel demand
Valuation and Investment Recommendation
UOB Kay Hian maintains a BUY rating with an increased target price of HK$725.00 (US$94.00), based on a 22.6x 2026F PE multiple, aligning with global peers. Trip.com is well-positioned for further market share gains, propelled by robust international travel demand and prudent financial management.
SOTP Valuation Summary
| Segment |
FY26F Revenue (HK\$m) |
FY26F NPAT (HK\$m) |
PE (x) |
Value (HK\$m) |
% Tcom Holding |
Value to Tcom (HK\$m) |
Value/Share (HK\$) |
| Core Travel (Accommodation/Transport) |
58,466 |
11,787 |
19 |
223,947 |
100% |
223,947 |
321.9 |
| Package Tour/Corporate/Other |
16,735 |
3,374 |
18 |
60,729 |
100% |
60,729 |
87.3 |
| Key Equity Investees (15% holdco discount) |
– |
– |
– |
28,860 |
– |
28,860 |
41.5 |
| Net Cash |
– |
– |
– |
190,934 |
100% |
190,934 |
274.4 |
| Total |
– |
– |
– |
504,470 |
– |
– |
725.0 |
Conclusion: Powerful Tailwinds and Shareholder Returns
Trip.com Group stands out for its strong earnings execution, international travel surge, and effective capital management. With continued investments in technology and prudent cost control, the company is well-placed to capture further upside in China and globally. Investors can look forward to continued growth, supported by a robust balance sheet, ongoing share repurchases, and a clear strategy to capitalize on the travel industry’s global recovery.
