Wobbles at travel deal service Travelzoo, with it posting falls in revenue and net income for the third quarter of 2012 and its share price hitting a two-year low today.
Revenues for the year to date increased from$113 million in 2011 to $114 million in the first nine months of 2012, but quarter-on-quarter the company saw the same metric fall from $38.6 million to $35.4 million, a decline of 8%.
Over the same period, net income slumped by 42% to $3.4 million in the third quarter of 2012.
CEO Chris Loughlin says the results are as a result of a decline in its SuperSearch and Local Deals services that were not offset by the “positive momentum it saw its Getaways product.
Profitability is being hit due to investment in the company’s sales teams in both the Americas and Europe and ongoing efforts with its subscriber marketing.
Travelzoo had 22.4 million members at the end of September 2012, up by 5% from the same point 12 months beforehand.
Loughlin says he is “disappointed” with the third quarter results, but insists “we are confident about Travelzoo’s “long-term opportunity”.
The company will continue to make improvements to its mobile and hotel products, affecting its profitability in the near-term, but Loughlin believes “”these are the right steps to position Travelzoo for sustainable and profitable future growth”.
Travelzoo’s share price is now at its lowest since almost the same period in 2010. It hit a high of 94.22 in April 2011 but has been on a steady downward trajectory ever since, halving in value to around 18.00 since the beginning of this year.
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