Trip.com’s Q1 2025 financial report reveals several interesting trends amid a turbulent external environment.
Accommodation as the Growth Engine
In Q1 2025, despite challenges in China’s domestic demand and uncertainties in the US tariff and export environment, Trip.com delivered stable growth.
Net Revenue: Reached 13.8 billion yuan, up 16% year-over-year.
Accommodation Booking Revenue: Hit 5.5 billion yuan, up 23% year-over-year, emerging as the primary growth driver.
Other Core Businesses: Transportation ticketing, vacation tours, and business travel saw revenue growth rates of 8%, 9%, and 12%, respectively. Although these rates are lower than that of accommodation, transportation ticketing revenue still exceeded 5 billion yuan.
Notably, compared to Booking Group’s profit-focused strategy, Trip.com places greater emphasis on scale and growth. For an OTA with nearly 100 million room nights per quarter, a revenue growth rate of over 20% can be considered growth-oriented. Trip.com’s accommodation bookings grew by 23%, and international hotel orders exceeded 120% of the same period in 2019. This indicates that Trip.com’s market share expansion in Asia poses a competitive threat to regional peers.
Inbound Tourism
Inbound tourism was a key highlight in the Q1 earnings call, with bookings surging 100% year-over-year. Orders from visa-free countries such as South Korea, Thailand, Malaysia, and Indonesia saw an increase of over 240%.
Trip.com CEO James Liang often highlights the potential of China’s inbound tourism market, which could reach a trillion yuan in GDP. Even with a more neutral assessment, the current base is low, indicating significant growth potential. Investors are considering whether this will be a long-term, massive opportunity.
From a policy perspective, China’s introduction of a 240-hour visa-free transit policy in December 2024, covering 54 countries and 60 entry-exit ports, is highly significant. Generally, visa-free policies are rare, and even when offered, they usually last less than 24 hours. Only a few countries provide slightly longer visa-free periods for specific nationalities or airports. Even fewer countries, which position themselves as regional transit hubs, offer up to 144 hours of visa-free transit, allowing actual entry and sightseeing, such as the UAE and Qatar.
The 240-hour policy is not just for transit but signifies China’s high level of openness to foreigners entering through these 60 ports to “experience” China. Coupled with the new immediate refund shopping tax system, this enhances China’s attractiveness as an inbound destination.
Silver-Haired Market
The silver-haired market, another growth axis, is still in the exploratory phase in terms of scale and potential.
Trip.com entered this market with the “Trip.com Old Friends Club” brand, seeing a 100% year-over-year increase in GMV and user numbers in Q1 2025. Although the base is not disclosed, it is clear that the company is taking this market seriously. With over 7,000 products, 2,000 partner hotels, 4,000 silver-haired exclusive packages, and one-on-one customer support, the company is leveraging localized content marketing strategies (such as short videos).
Unlike traditional group tour packages for the elderly, Trip.com’s approach focuses on accommodation and online packages, which aligns with its supply chain integration strengths. Whether this market will form a long-term competitive moat for Trip.com remains to be seen. However, the stable demand for middle-aged and elderly travel in regions like the Yangtze River Delta indicates that developing incremental value within the existing traffic system is a relatively achievable strategy for platform-type OTAs.
Local Expansion and Overseas Layout
While Trip.com’s momentum in the Chinese market remains strong, especially in accommodation, its overseas development faces diverse challenges, including geopolitical uncertainties and regional competition.We believe that Trip.com’s future success in Asia will largely depend on its ability to collaborate fully with joint ventures or subsidiaries in key markets and gradually build a regional synergy system.
The company mentioned its joint venture with Japan’s JTB in the earnings call. We believe this should also include the companies acquired in South Korea and Taiwan. The focus should not only be on product coverage in these destinations but also on deeper integration with other Trip.com products to amplify the group’s strengths.
From this perspective, Trip.com, which has long been a one-stop platform, has a stronger foundation for brand extension in Asia compared to Booking’s recently advocated Connected Trip strategy.
