Segment Information

3 Months Ended

Mar. 31, 2024

Segment Reporting [Abstract]

Segment Information

NOTE 13: SEGMENT INFORMATION

We have three reportable segments: (1) Brand Tripadvisor; (2) Viator; and (3) TheFork. Our Brand Tripadvisor segment includes the following revenue sources: (1) Tripadvisor-branded hotels – consisting of hotel meta revenue, primarily click-based advertising revenue, and also hotel B2B revenue, which includes primarily subscription-based advertising and hotel sponsored placements revenue; (2) Media and advertising revenue – consisting primarily of display-based advertising revenue (also referred to as “media advertising”); (3) Tripadvisor experiences and dining revenue – consisting of intercompany (intersegment) revenue related to affiliate marketing commissions earned primarily from experience bookings, and to a lesser extent, restaurant reservation bookings on Tripadvisor-branded websites and mobile apps, fulfilled by Viator and TheFork, respectively, which are eliminated on a consolidated basis, in addition to external revenue generated from Tripadvisor restaurant offerings; and (4) Other revenue – consisting of cruises, alternative accommodation rentals, flights, and rental cars revenue. The nature of the services provided and related revenue recognition policies are summarized by reportable segment in “Note 3: Revenue Recognition.”

Our operating segments are determined based on how our chief executive officer, who also serves as our chief operating decision maker (“CODM") manages our business, regularly accesses information, and evaluates performance for operating decision-making purposes, including allocation of resources. Adjusted EBITDA is our segment profit measure and a key measure used by our CODM and Board of Directors to understand and evaluate the operating performance of our business and on which internal budgets and forecasts are based and approved. We define adjusted EBITDA as net income (loss) plus: (1) (provision) benefit for income taxes; (2) other income (expense), net; (3) depreciation and amortization; (4) stock-based compensation and other stock-settled obligations; (5) goodwill, long-lived asset, and intangible assets impairments; (6) legal reserves and settlements; (7) restructuring and other related reorganization costs; and (8) non-recurring expenses and income.

Direct costs are included in the applicable operating segments, including certain corporate general and administrative personnel costs, which have been allocated to each segment. We base these allocations on time-spent analyses, headcount, and other allocation methods we believe are reasonable. We do not allocate certain shared expenses to our reportable segments, such as certain information system costs, technical infrastructure costs, and other costs supporting the Tripadvisor platform and operations, that we do not believe are a material driver of individual segment performance, which is consistent with the financial information used by our CODM. We include these expenses in our Brand Tripadvisor segment. Our allocation methodology is periodically evaluated and may change.

The following tables present our reportable segment information for the three months ended March 31, 2024 and 2023 and include a reconciliation of adjusted EBITDA to Net income (loss). We record depreciation and amortization, stock-based compensation and other stock-settled obligations, goodwill, long-lived asset and intangible asset impairments, legal reserves and settlements, and non-recurring expenses and income, net, which are excluded from segment operating performance, in "Corporate & Eliminations". In addition, we do not report total assets, capital expenditures and related depreciation expense by segment as our CODM does not use this information to evaluate operating segment performance. Accordingly, we do not regularly provide such information by segment to our CODM.

Our segment disclosure includes intersegment revenues, which consist of affiliate marketing fees for services provided by our Brand Tripadvisor segment to both our Viator and TheFork segments. These intersegment transactions are recorded by each segment at amounts that we believe approximate fair value as if the transactions were between third parties and, therefore, impact segment performance. However, the revenue and corresponding expense are eliminated in consolidation. The elimination of such intersegment transactions is included within the “Corporate & Eliminations” column in the tables below.

	Three months ended March 31, 2024
	Brand Tripadvisor (1)		Viator (2)			TheFork (3)			Corporate & Eliminations			Total
	(in millions)
External revenue	$	213	$	141		$	41		$	—		$	395
Intersegment revenue		27		—			—			(27	)		—
Total Revenue	$	240	$	141		$	41		$	(27	)	$	395
Adjusted EBITDA		78		(27	)		(4	)		—			47
Depreciation and amortization										(22	)		(22	)
Stock-based compensation										(28	)		(28	)
Legal reserves and settlements (4)										(10	)		(10	)
Restructuring and other related reorganization costs							(1	)					(1	)
Non-recurring income (expense) (5)										(1	)		(1	)
Operating income (loss)													(15	)
Other income (expense), net													(1	)
Income (loss) before income taxes													(16	)
(Provision) benefit for income taxes													(43	)
Net income (loss)													(59	)

	Three months ended March 31, 2023
	Brand Tripadvisor (1)		Viator (2)			TheFork (3)			Corporate & Eliminations			Total
	(in millions)
External revenue	$	221	$	115		$	35		$	—		$	371
Intersegment revenue		23		—			—			(23	)		—
Total Revenue	$	244	$	115		$	35		$	(23	)	$	371
Adjusted EBITDA		72		(30	)		(9	)		—			33
Depreciation and amortization										(21	)		(21	)
Stock-based compensation										(23	)		(23	)
Non-recurring income (expense) (6)										(3	)		(3	)
Operating income (loss)													(14	)
Other income (expense), net													(1	)
Income (loss) before income taxes													(15	)
(Provision) benefit for income taxes													(58	)
Net income (loss)													(73	)

(1)Corporate general and administrative personnel costs of $2 million for both the three months ended March 31, 2024 and 2023, were allocated to the Viator and TheFork segments.

(2)Includes allocated corporate general and administrative personnel costs from the Brand Tripadvisor segment of $1 million in each of the three months ended March 31, 2024 and 2023.

(3)Includes allocated corporate general and administrative personnel costs from the Brand Tripadvisor segment of $1 million in each of the three months ended March 31, 2024 and 2023.

(4)Represents an estimated accrual for the potential settlement of a regulatory related matter of $10 million, expensed during the first quarter of 2024 to general and administrative expenses on our unaudited condensed consolidated statement of operations. Refer to “Note 9: Commitments and Contingencies” for further information.

(5)The Company expensed certain transaction costs of $1 million during the first quarter of 2024 to general and administrative expenses on our unaudited condensed consolidated statement of operations. The Company considers such costs to be non-recurring in nature.

(6)The Company expensed $3 million of previously capitalized transaction costs during the first quarter of 2023 to general and administrative expenses on our unaudited condensed consolidated statement of operations. The Company considers such costs to be non-recurring in nature.

Customer Concentrations

Refer to “Note 4: Financial Instruments and Fair Value Measurements” under the section entitled “Risks and Concentrations” for information regarding our major customer concentrations.

Product Information

Revenue sources within our Brand Tripadvisor segment, consisting of Tripadvisor-branded hotels revenue, Media and advertising revenue, Tripadvisor experiences and dining revenue, and other revenue, along with our Viator and TheFork segment revenue sources, comprise our products. Refer to “Note 3: Revenue Recognition” for our revenue by product.