$TRIP.COM-S(09961.HK) The main driver of performance growth is strong inbound tourism and pure overseas business. However, while pure overseas business is growing rapidly, it also requires high costs and investments, and profit release will not be fast. This has led to nearly stagnant profit growth for Trip.com this quarter, with revenue growth but no incremental profit. Additionally, the company's previous guidance for profit growth for the entire year of 2025 was also quite conservative, resulting in insufficient market confidence.

This quarter, the volume of outbound travel hotel and flight bookings has exceeded 120% of the same period in 2019 (the previous quarter's figure was nearly 120%), and bookings for pure overseas business have increased by 70% year-on-year, better than the previous quarter's 60%. Inbound travel bookings have increased by over 100% year-on-year.

From the financial perspective, the two main pillar businesses are:

1) Revenue from hotel booking business has increased by nearly 32.7% year-on-year, reaching the upper limit of the company's previous guidance. The growth rate has jumped by a full 11 percentage points compared to the previous quarter. According to the company's previous guidance, domestic hotel and travel booking revenue has approximately increased by 20% year-on-year, with outbound and pure overseas business both showing strong growth of over 50%, driving overall growth.

2) The revenue growth rate of the ticketing business has also recovered to 16.4%, better than the expected growth of about 14%. On one hand, the company has actively reduced the impact of bundled sales items such as insurance tied to flight tickets, which is nearing completion. On the other hand, higher-priced international flights for entry and exit will also bring higher revenue elasticity.