Tuniu Corp ((TOUR)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Tuniu Corp’s recent earnings call conveyed a positive sentiment, underscored by strong revenue growth and successful expansion of product offerings and sales channels. The company expressed optimism about future revenue increases, although challenges in Southeast Asia and rising operating expenses were noted as areas of concern.
Robust Revenue Growth
Tuniu Corp reported a significant 15% year-over-year increase in net revenues, with packaged tours showing an impressive 26% growth. This robust revenue growth highlights the company’s effective strategies in capturing market demand and expanding its customer base.
Product and Sales Channel Expansion
The company has successfully expanded its product offerings and sales channels, including innovative approaches like live streaming and offline stores. These efforts have led to increased transaction volumes, showcasing Tuniu’s adaptability and forward-thinking strategies in reaching more customers.
Strong Performance in New Destinations
Tuniu’s focus on new destinations has paid off, with transaction volumes for Caucasus products growing by over 150% year-over-year. Additionally, emerging destinations such as South America, Sri Lanka, and the Caucasus have shown significant growth, contributing to the company’s overall success.
Positive Financial Results
The company achieved moderate profitability on both a GAAP and non-GAAP basis, with net income attributable to ordinary shareholders reaching CNY 14.5 million. This financial performance underscores Tuniu’s ability to maintain profitability while pursuing growth.
Projected Revenue Growth
Looking forward, Tuniu anticipates net revenues of CNY 199 million to CNY 208.3 million for the third quarter of 2025, representing a 7% to 12% year-over-year increase. This projection reflects the company’s confidence in its growth trajectory and strategic initiatives.
Decline in Other Revenues
Despite overall positive results, Tuniu experienced a 21% decline in other revenues, attributed to a decrease in fees for advertising services provided to tourism boards and bureaus. This decline highlights a potential area for improvement in the company’s revenue streams.
Operating Expenses Increase
Operating expenses surged by 58% year-over-year, driven by significant rises in research and product development expenses as well as sales and marketing expenses. This increase in expenses presents a challenge that the company needs to address to sustain profitability.
Challenges in Southeast Asia
Tuniu faced challenges in Southeast Asia, with demand declining by roughly 30% during the quarter. Headwinds in countries like Thailand and Cambodia contributed to this decline, posing a challenge for the company’s regional operations.
In summary, Tuniu Corp’s earnings call reflected a positive outlook with strong revenue growth and successful expansion strategies. However, the company faces challenges in managing rising operating expenses and addressing declining demand in Southeast Asia. Looking ahead, Tuniu remains optimistic about its growth prospects, projecting continued revenue increases in the coming quarters.