Trip.com Group (TCOM) Q1 2025: Inbound Travel Surges 100% as Policy Tailwinds and AI Drive Global Momentum
Trip.com Group delivered a robust Q1 2025, with net revenue up 16% YoY and standout 100% growth in inbound travel bookings, fueled by favorable visa policies and international demand. Strategic investment in AI, product localization, and a disciplined capital return program are enhancing Trip.com’s competitive positioning across both mature and emerging travel markets.
Summary
- Inbound Travel Acceleration: Inbound bookings grew approximately 100% YoY, outpacing all other segments and benefiting from expanded visa-free policies.
- International Platform Expansion: Global OTA bookings surged over 60% YoY, with APAC as a primary growth engine and mobile app bookings now at 70% of international orders.
- AI Integration Deepens: AI-driven tools like Trip Genie saw a 50% increase in user session duration, with over 80% of post-sales inquiries handled by AI chatbots.
- Capital Return Commitment: $84 million in share repurchases and $200 million in dividends signal ongoing focus on shareholder value.
Performance Analysis
Q1 2025 net revenue reached RMB 13.8 billion, up 16% YoY and 9% sequentially, as Trip.com Group capitalized on resilient travel demand across domestic, outbound, and inbound segments. Accommodation reservation revenue rose 23% YoY to RMB 5.5 billion, with both outbound and international hotel bookings delivering strong growth. Transportation ticketing revenue grew 8% YoY, supported by expanding outbound air bookings and rapid international air business expansion. Package tour revenue increased 7% YoY, primarily driven by international demand, while corporate travel revenue rose 12% YoY but declined 18% sequentially due to seasonality.
Adjusted EBITDA reached RMB 4.2 billion, up from RMB 4.0 billion a year ago, reflecting improved operational efficiency even as adjusted sales and marketing expenses grew 30% YoY. Mobile continued to drive engagement, accounting for 70% of international bookings, and the group ended the quarter with RMB 92.9 billion (USD 12.8 billion) in cash, providing ample liquidity for ongoing investment and buybacks.
- Inbound Outperformance: Inbound travel bookings grew approximately 100% YoY, fueled by new visa-free policies and elevated international interest in China.
- Mobile-First Execution: 70% of international orders now originate from Trip.com’s native app, reflecting a strategic shift to high-engagement digital channels.
- Operational Leverage: Adjusted EBITDA margin remained strong despite marketing investment, signaling scalable cost structure and ROI-focused execution.
Trip.com’s diversified business model and geographic mix provided natural hedges against FX volatility and regional slowdowns, while strong Q2-to-date trends point to continued demand resilience.
Executive Commentary
"Following China's strategic push to attract international visitors, inbound travel has become our fastest growing segment. A combination of visa-free policies and increased visibility through global social media has made China a more accessible and attractive destination. In Q1, our inbound travel booking surged by approximately 100% year over year."
James Liang, Executive Chairman
"Our mobile platform now contributes 70% of international bookings, reflecting growing user preference for app-based travel planning and increasing brand recognition. These achievements reflect the success of our localized operations and strategic partnerships."
Jen Sun, Chief Executive Officer
"As of the earnings announcement date, the company has repurchased approximately USD 84 million of its shares. This action underscores our commitment to delivering value to our shareholders. We remain dedicated to this strategy and will continue to evaluate opportunities for additional buybacks throughout the remainder of the year."
Cindy Wong, Chief Financial Officer
Strategic Positioning
1. Inbound Growth Leveraging Policy Shifts
Trip.com’s leadership in inbound China travel is being accelerated by government visa-free initiatives and targeted product expansion. With 54 countries now eligible for easier entry, inbound bookings have doubled YoY, and the company’s broad inventory and multilingual support position it as the go-to platform for international visitors.
2. Mobile and App-Centric Ecosystem
The company’s mobile-first approach is a core differentiator, with 70% of international bookings now completed via its native app. This shift not only boosts direct user engagement and loyalty but also enhances cross-selling opportunities and marketing ROI, particularly in Asia’s app-driven markets.
3. AI as a Platform Advantage
AI is deeply embedded across Trip.com’s customer journey, from planning (Trip Genie) to post-sale support. The AI agent’s 50% increase in session duration and 80%+ automation of customer inquiries demonstrate tangible efficiency gains and improved user experience, underpinning the company’s vision of a one-stop, intelligent travel platform.
4. Diversified Geographic and Product Mix
Trip.com’s balanced portfolio across APAC, Europe, and emerging markets reduces reliance on any single region, providing natural hedges against FX swings and local disruptions. Expansion in the Middle East and strong performance in long-haul outbound travel highlight the company’s ability to capture growth wherever demand emerges.
5. Capital Return and Shareholder Alignment
Ongoing share buybacks (USD 84 million in Q1) and a $600 million board-approved program, alongside $200 million in dividends paid YTD, reinforce management’s commitment to returning capital and supporting valuation, especially as cash reserves remain strong.
Key Considerations
Trip.com’s Q1 performance reflects a business firing on multiple strategic cylinders, but investors should weigh the sustainability of current growth rates and the evolving competitive landscape as policy and market dynamics shift.
Key Considerations:
- Inbound Momentum: Visa-free and transit policy changes are driving a structural step-up in inbound travel, but future growth will depend on continued policy support and competitive differentiation.
- Mobile Channel Dominance: The rapid migration to app-based bookings is raising switching costs and deepening user engagement, but also requires ongoing investment in digital product innovation.
- AI-Driven Efficiency: Automation and personalization are reducing service costs and improving customer satisfaction, but sustained AI leadership will require continuous R&D outlays.
- Competitive Loyalty Programs: The domestic market remains rational, with Trip.com’s membership program generating 80% of revenue from existing customers, yet aggressive competitor offers could pressure future loyalty economics.
- Capital Allocation Discipline: Active buybacks and dividends are supporting shareholder returns, but must be balanced against the need for global expansion and tech investment.
Risks
Geopolitical tensions, FX volatility, and shifting macroeconomic conditions could impact cross-border travel flows and consumer sentiment, particularly in outbound and emerging market segments. Competitive intensity in domestic and APAC markets, as well as the need to sustain AI and marketing investments, present ongoing margin and execution risks. Management’s commentary and Q&A responses reflect awareness, but forward visibility remains partly dependent on external policy and demand factors.
Forward Outlook
For Q2 2025, Trip.com expects:
- Continued double-digit YoY growth in both domestic and international bookings, supported by strong Labor Day holiday demand.
- Inbound travel to remain the fastest-growing segment, with ongoing policy tailwinds and expanded service offerings.
- Outbound travel growth to accelerate as cross-border flight capacity approaches 90% of pre-pandemic levels by year-end.
For full-year 2025, management reiterated confidence in resilient travel demand, ongoing operational efficiency gains, and sustained capital return activity. Key drivers will be policy continuity, consumer confidence, and the ability to maintain competitive differentiation in both product and technology.
Takeaways
Trip.com Group’s Q1 results validate its strategic bets on inbound travel, mobile-first engagement, and AI-powered service, while disciplined capital returns provide downside support for investors. The company’s diversified platform and ability to execute across multiple growth levers leave it well positioned, but market and policy shifts remain key variables to monitor.
- Inbound and International Outperformance: Policy tailwinds and product localization are driving outsized inbound growth, with international bookings and app engagement at all-time highs.
- AI and Digital Investment as Differentiators: Tangible efficiency and experience gains from AI integration bolster Trip.com’s one-stop platform ambitions and customer stickiness.
- Capital Returns Remain Robust: Buybacks and dividends are a clear management priority, but ongoing investment will be needed to sustain growth and defend share in a competitive landscape.
Conclusion
Trip.com Group enters the remainder of 2025 with strong momentum across inbound, outbound, and domestic travel, underpinned by digital innovation and policy support. Investors should remain focused on the sustainability of these trends as competitive and macro risks evolve.
Read-Through
The travel sector is seeing a structural shift toward mobile-first, AI-enabled platforms, with policy changes and digital engagement driving demand recovery and new growth vectors. Visa liberalization and cross-border travel normalization are likely to benefit other global OTAs, airlines, and hospitality players, especially those that can localize product and leverage technology for efficiency. Competitive intensity in loyalty programs and app ecosystems will remain a key battleground, with implications for margin structure and customer acquisition across the industry.