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Ctrip Group released its 2023Q3 financial report: net operating income of 13.7 billion yuan, a year-on-year increase of 99%
On November 21, 2023, Beijing time, Ctrip Group (NASDAQ: TCOM and Hong Kong Stock Exchange: 9961) announced its unaudited financial results for the third quarter as of September 30, 2023. The financial report shows that in the third quarter of 2023, Ctrip Group’s net operating income was 13.7 billion yuan, a year-on-year increase of 99%. At the same time, Ctrip Group is also contributing to the high-quality recovery of the tourism industry in terms of globalization strategy, AI empowerment, and ESG sustainable development.
Liang Jianzhang, co-founder and chairman of the board of directors of Ctrip Group, said, "Thanks to the strong summer travel demand, both domestic and international travel showed strong growth momentum in the third quarter, reflecting travelers' desire to explore the world. Globalization is our An important business pillar, AI innovation will also be the core of the long-term strategy. Looking forward to the future, we will continue to expand the global market and develop artificial intelligence innovation to lay the foundation for the company's sustainable development."
Strong growth in domestic and overseas performance, recovery in inbound and outbound business, significant increase in globalization strategy
The arrival of the summer travel season has led to an increase in travel bookings. Ctrip Group achieved accommodation booking revenue of 5.6 billion yuan in the third quarter, a year-on-year increase of 92%; transportation ticketing revenue was 5.4 billion yuan, a year-on-year increase of 105%.
Among them, domestic hotel bookings increased by more than 90% year-on-year and more than 70% compared with the same period in 2019. Among domestic hotels, long-distance hotel bookings grew the fastest, with a year-on-year growth rate of 133%. Although cross-border air passenger volume in the third quarter only recovered to about 50% of the same period in 2019, Ctrip's outbound hotel and air ticket bookings have recovered to about 80% of the same period in 2019, continuing to lead the industry's recovery level.
Based on Ctrip Group's global layout over the years, Ctrip's international business continues to maintain strong momentum. In the third quarter, total bookings on Ctrip's international OTA platform increased by more than 100% compared with the same period last year and the same period in 2019. With significantly improved profitability, Ctrip's international OTA platform's contribution to the group accounts for nearly half of Ctrip's overall overseas business. In the third quarter, 60% of global bookings came from APP channels; in the core Asia-Pacific market, mobile APP bookings accounted for more than 70%.
In September, the General Office of the State Council issued "Several Measures to Release the Potential of Tourism Consumption and Promote High-Quality Development of the Tourism Industry", which specifically mentioned the need to strengthen inbound tourism. Driven by the establishment of the national goal of promoting inbound tourism and supporting policies, three The booking volume of inbound travel on Ctrip’s international platform increased by three digits year-on-year in the quarter. With the gradual resumption of international flights and various proactive measures, Ctrip strives to increase the number of inbound tourists served in 2024 by more than 150% compared with 2019.
In addition, Ctrip will also support the development of inbound tourism in multiple dimensions. It has currently built an inbound tourism service platform on the international version of Trip to create a one-stop portal for foreigners to visit China. The platform will provide vivid and detailed explanations on how to travel to China, where to go, how to play and other issues in the form of pictures, texts and videos, and will provide visa application tips, hotels and attractions, mobile payment and communications, transportation and catering, etc. , booking and other services. The "China Travel Guide" launched in September this year has served nearly 100,000 overseas tourists.
In the process of marching towards a globalization strategy, Ctrip Business Travel has expanded its "global territory" by increasing its overseas business. In the third quarter of this year, business travel management business revenue increased by 60% year-on-year. Relying on the digital solutions accumulated in the domestic market, Ctrip Business Travel launched the "Global Influence Plan" to continue to strengthen the supply of overseas hotels, airlines, and car resources, and further improve the global business travel supply chain resources. At the same time, we create multiple values for customers, supply chain partners, ecological partners and industry partners in technology, services, resources, payment and other aspects.
Actively deploying "AI+travel" applications, artificial intelligence empowerment effects are beginning to appear
"The unique thing about travel is that it is essentially a human-centered experience, a high-level need that is not easily saturated. The epidemic has accelerated the digitalization process of the tourism industry, and the development of AI technology has also changed consumer expectations ." Liang Jianzhang said.
As artificial intelligence has a profound impact on the tourism industry, Ctrip has launched a series of AI tools to redefine the travel booking experience. In July this year, Ctrip launched its first large-scale tourism vertical model "Ctrip Ask", which combined Ctrip's existing accurate structural real-time data and robots and search algorithms trained by Ctrip's history to build a "reliable answer database" for travelers to obtain accurate answers. travel data and opinions. This AI-based content marketing tool can also help partners showcase their products to target audiences more efficiently.
In addition, the AI travel assistant "TripGenie" launched at the beginning of this year has improved user participation and service efficiency since this year. The order conversion rate has doubled compared with ordinary users, and the user retention rate has also increased. In terms of using AI to improve quality and efficiency, AI chatbots can solve a large number of inquiries with high accuracy through text and voice, driving up the self-service rate. The self-service solution rate for air tickets has reached 78%, and the self-service solution rate for hotels has reached 68%.
ESG empowers businesses to achieve results, promoting sustainable development of the tourism industry
With the bright prospects for tourism recovery, Ctrip has made ESG sustainable development an integral part of its long-term strategy, comprehensively promoting environmentally friendly, community-friendly, family-friendly, and stakeholder-friendly strategies, and committed to achieving carbon neutrality by 2050.
In terms of environmental friendliness, Ctrip has launched low-carbon hotels, low-carbon flights, low-carbon cars, and low-carbon business travel products. Currently, more than 16 million users have booked sustainable travel products. At the same time, Ctrip has launched the "Low Carbon Hotel Standard", which has significant characteristics such as quantification, testability, and improvement, and is committed to driving the hotel industry to achieve the temperature control goals of the Paris Agreement. After being selected into the low-carbon hotel standard, merchants received certification. The clear "low-carbon hotel" label attracted more clicks from users, and the order volume also increased steadily. The first batch of hotels selected for the standard have received dividends. Take "Beijing Pan Pacific Hotel" as an example. After being selected as a low-carbon hotel by Ctrip, its exposure increased, driving the order volume to increase by 43% month-on-month.
At the same time, in terms of community friendliness, Xiedu Fake Farm has opened 26 Xiedu Fake Farms in 13 provinces and autonomous regions including Anhui, Henan, Shaanxi, Shanxi, Jiangxi, Fujian, Inner Mongolia, Xinjiang, Hunan, Sichuan, and Guizhou, including 4 direct ones. We operate public welfare farms and 22 jointly operated farms. It not only helps local villagers get rich and increase their income, but also provides young people with the opportunity to "return" to the countryside.
The brand effect of high-end B&Bs has begun to appear after the climbing period. As of now, in 2023, the total revenue of the holiday farm has achieved a growth of 269% year-on-year, and the growth of online order GMV has even reached 369%. In addition, with the help of diversified business models such as catering and event experience, the non-guest room revenue of Xixing Holiday Farm has also increased by 88% overall compared with 2022.
"We are encouraged by the strong travel demand across all business lines in the third quarter, and short-term outbound travel will continue to be the main driver of growth. Looking forward, our international business will also become a key driver of growth, thanks to increased product supply and improved profitability. A key pillar of long-term growth; coupled with the efficiency improvements that AI technology may bring, we remain optimistic about the market prospects and confident in the group's future opportunities." said Sun Jie, CEO of Ctrip Group.
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