Travelzoo Reports Third Quarter 2025 Results

NEW YORK, Oct. 28, 2025 /PRNewswire/ -- Travelzoo® (NASDAQ: TZOO):

Travelzoo, the club for travel enthusiasts, today announced financial results for the third quarter ended September 30, 2025. Consolidated revenue was $22.2 million, up 10% from $20.1 million year-over-year. In constant currencies, revenue was $21.9 million, up 9% year-over-year. Travelzoo's reported revenue consists of advertising revenues and commissions, derived from and generated in connection with purchases made by Travelzoo members, and membership fees.

In Q3, Travelzoo continued to invest significantly in acquiring more Club Members when we saw that we can achieve a payback and positive return on investment (ROI) within a quarter. Marketing costs were expensed immediately. Membership fees revenue is recognized ratably over the subscription period of 12 months. The effect is a sizable reduction in EPS. We refer to our investor presentation.

Net income attributable to Travelzoo was $0.2 million for Q3 2025, or $0.01 per share, compared with $0.26 per share in the prior-year period.

Non-GAAP operating profit was $1.1 million. Non-GAAP operating profit excludes amortization of intangibles ($2,000), stock option expenses ($399,000), and severance-related expenses ($167,000). Please refer to "Non-GAAP Financial Measures" and the tabular reconciliation below.

"We will continue to leverage Travelzoo's global reach, trusted brand, and strong relationships with top travel suppliers to negotiate more Club Offers for Club Members and add new benefits, such as our popular complementary airport lounge access worldwide in case of a delayed flight," said Holger Bartel, Travelzoo's Global CEO. "Travelzoo members are affluent, active, and open to new experiences. We inspire travel enthusiasts to travel to places they never imagined they could. Travelzoo is the must-have membership for those who love to travel as much as we do."

Travelzoo North America

North America business segment revenue increased 11% year-over-year to $14.2 million. Operating profit for Q3 2025 was $1.1 million, or 8% of revenue, compared to operating profit of $3.2 million or 25% of revenue in the prior-year period.

Travelzoo Europe

Europe business segment revenue increased 9% year-over-year to $6.6 million. Operating loss for Q3 2025 was $640,000, or 10% of revenue, compared to operating profit of $1.0 million, or 17% of revenue in the prior-year period. The reported operating loss occurred because we acquired more Club Members.

Jack's Flight Club

Jack's Flight Club is a membership subscription service in which Travelzoo has a 60% ownership interest. Revenue increased 12% year-over-year to $1.4 million. The number of premium subscribers increased 8% year-over-year. Jack's Flight Club's revenue from subscriptions is recognized ratably over the subscription period (quarterly, semi-annually, annually). Operating profit for Q3 2025 was $20,000, compared to operating profit of $27,000 in the prior-year period.

New Initiatives

New Initiatives business segment revenue, which includes Licensing and Travelzoo META, was $27,000. Operating loss for Q3 2025 was $20,000.

In 2020, Travelzoo entered into royalty-bearing licensing agreements with local licensees for the exclusive use of Travelzoo's brand, business model, and members in Australia, Japan, New Zealand, and Singapore. Under these arrangements, Travelzoo's existing members in Australia, Japan, New Zealand, and Singapore will continue to be owned by Travelzoo as the licensor. Licensing revenue from the licensee in Australia was $9,000 for Q3 2025. Licensing revenue from the licensee in Japan was $7,000 for in Q3 2025. Licensing revenue is expected to increase going forward.

Reach

Travelzoo reaches 30 million travelers. This includes Jack's Flight Club. Comparisons to prior periods are no longer meaningful due to strategic developments of the Travelzoo membership.

Income Taxes

The reported income tax provision and reserves for Q3 2025 are $244,000. Travelzoo intends to utilize available net operating losses (NOLs) to largely offset its tax liability for Q3 2025.

Balance Sheet

As of September 30, 2025, cash, cash equivalents and restricted cash were $9.2 million. Cash flow from operations was ($0.4) million.

Deferred revenue increased because membership fees revenue is recognized ratably over the subscription period.

Share Repurchase Program

During Q3 2025, the Company repurchased 148,602 shares of its outstanding common stock.

L ooking Ahead

For Q4 2025, we expect year-over-year revenue growth to continue. We expect revenue growth to accelerate as a trend in subsequent quarters, as membership fees revenue is recognized ratably over the subscription period of 12 months, as we acquire new members, and as more Legacy Members become Club Members. Over time, we expect profitability to substantially increase as recurring membership fees revenue will be recognized. In the short-term, fluctuations in reported net income are possible. We might see attractive opportunities to increase marketing. We expense marketing costs immediately.

In 2024, we introduced a membership fee for Travelzoo. Legacy Members, who joined prior to 2024, continue to receive certain travel offers. However, Club Offers and new benefits are only available to Club Members, who pay the membership fee. Therefore, we are seeing many Legacy Members become Club Members over time—in addition to new members who join.

Non-GAAP Financial Measures

Management calculates non-GAAP operating income when evaluating the financial performance of the business. Calculation of non-GAAP operating income, also called "non-GAAP operating profit" in this press release and today's earnings conference call, excludes the following items: amortization of intangibles, stock option expenses, and severance-related expenses. This press release includes a table which reconciles GAAP operating income to the calculation of non-GAAP operating income. Non-GAAP operating income is not required by, or presented in accordance with, generally accepted accounting principles in the United States of America ("GAAP"). This information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly titled measures reported by other companies.

Conference Call

Travelzoo will host a conference call to discuss third quarter 2025 results today at 11:00 a.m. ET. Please visit http://ir.travelzoo.com/events-presentations to

About Travelzoo

We, Travelzoo®, are the club for travel enthusiasts. We reach 30 million travelers. Club Members receive Club Offers personally reviewed by our deal experts around the globe. We have our finger on the pulse of outstanding travel, entertainment, and lifestyle experiences. We work in partnership with thousands of top travel suppliers—our long-standing relationships give us access to irresistible deals.

Certain statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations, prospects and intentions, markets in which we participate and other statements contained in this press release that are not historical facts. When used in this press release, the words "expect", "predict", "project", "anticipate", "believe", "estimate", "intend", "plan", "seek" and similar expressions are generally intended to identify forward-looking statements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including changes in our plans, objectives, expectations, prospects and intentions and other factors discussed in our filings with the SEC. We cannot guarantee any future levels of activity, performance or achievements. Travelzoo undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.

Travelzoo

Condensed Consolidated Statements of Operations

(Unaudited)

(In thousands, except per share amounts)

Three months ended

Nine months ended

September 30,

2025

2024

2025

2024

Revenues

$ 22,198

$ 20,098

$ 69,245

$ 63,224

Cost of revenues

4,519

2,548

13,132

7,708

Gross profit

17,679

17,550

56,113

55,516

Operating expenses:

Sales and marketing

12,198

8,247

34,378

26,231

Product development

631

594

1,963

1,763

General and administrative

4,362

4,664

13,419

13,875

Total operating expenses

17,191

13,505

49,760

41,869

Operating income

488

4,045

6,353

13,647

Other income (loss), net

(64)

359

727

674

Income from operations before income taxes

424

4,404

7,080

14,321

Income tax expense

244

1,148

2,157

3,920

Net income

180

3,256

4,923

10,401

Net income attributable to non-controlling interest

201

Net income attributable to Travelzoo

$ 151

$ 3,184

$ 4,722

$ 10,347

Net income per share—basic

$ 0.01

$ 0.26

$ 0.41

$ 0.81

Net income per share—diluted

$ 0.01

$ 0.26

$ 0.39

$ 0.79

Shares used in per share calculation—basic

10,987

12,176

11,585

12,851

Shares used in per share calculation—diluted

11,213

12,386

11,974

13,035

Travelzoo

Condensed Consolidated Balance Sheets

(Unaudited)

(In thousands)

September 30,

2025

December 31,

2024

Assets

Current assets:

Cash and cash equivalents

$ 8,491

$ 17,064

Accounts receivable, net

12,460

12,825

Prepaid income taxes

654

736

Income taxes receivable

887

—

Prepaid expenses and other

1,931

1,148

Total current assets

24,423

31,773

Deposits and other

302

374

Deferred tax assets

3,469

3,380

Restricted cash

756

675

Operating lease right-of-use assets

4,540

5,655

Property and equipment, net

278

423

Intangible assets, net

1,452

1,498

Goodwill

10,944

Total assets

$ 46,164

$ 54,722

Liabilities and Equity

Current liabilities:

Accounts payable

$ 8,405

$ 6,162

Merchant payables

11,767

16,294

Accrued expenses and other

4,557

3,404

Deferred revenue

9,060

6,545

Income tax payable

—

1,619

Operating lease liabilities

2,058

2,472

Total current liabilities

35,847

36,496

Long-term tax liability

8,906

7,851

Long-term operating lease liabilities

4,494

5,646

Other long-term liabilities

—

376

Total liabilities

49,247

50,369

Common stock

109

118

Tax indemnification

(9,537)

Retained earnings

6,925

14,284

Accumulated other comprehensive loss

(5,596)

(5,327)

Total Travelzoo stockholders' equity (deficit)

(8,099)

(462)

Non-controlling interest

5,016

4,815

Total stockholder's equity (deficit)

(3,083)

4,353

Total liabilities and stockholder's equity

$ 46,164

$ 54,722

Travelzoo

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(In thousands)

Three months ended

Nine months ended

September 30,

2025

2024

2025

2024

Cash flows from operating activities:

Net income

$ 180

$ 3,256

$ 4,923

$ 10,401

Adjustments to reconcile net income to net cash

provided by operating activities:

Depreciation and amortization

179

239

737

Stock-based compensation

399

457

1,108

1,240

Deferred income tax

(1)

(12)

(39)

Net foreign currency effects

(154)

(224)

(165)

Provision of loss (net recoveries) on accounts

receivable and refund reserve

(93)

128

121

Changes in operating assets and liabilities:

Accounts receivable

(988)

127

756

(258)

Prepaid income taxes

(154)

(134)

(461)

Prepaid expenses, deposits and other

(560)

(69)

(703)

464

Accounts payable

2,314

(284)

2,134

430

Merchant payables

(612)

431

(5,053)

(3,348)

Accrued expenses and other

(981)

463

859

2,162

Deferred revenue

643

—

2,363

—

Income tax payable

(576)

315

(2,584)

593

Other liabilities

(73)

628

273

1,381

Net cash provided by operating activities

(374)

5,331

4,209

13,258

Cash flows from investing activities:

Purchases of property and equipment

(15)

(46)

(49)

(129)

Net cash used in investing activities

(15)

(46)

(49)

(129)

Cash flows from financing activities:

Repurchase of common stock

(1,545)

(6,183)

(12,964)

(16,605)

Exercise of stock options and taxes paid for

net share settlement of equity awards

—

(335)

(104)

(592)

Net cash used in financing activities

(1,545)

(6,518)

(13,068)

(17,197)

Effect of exchange rate on cash, cash equivalents

and restricted cash

(17)

415

(215)

Net increase in cash, cash equivalents and

restricted cash

(1,951)

(1,137)

(8,493)

(4,283)

Cash, cash equivalents and restricted cash at

beginning of period

11,198

13,243

17,740

16,389

Cash, cash equivalents and restricted cash at end

of period

$ 9,247

$ 12,106

$ 9,247

$ 12,106

Travelzoo

Segment Information from Continuing Operations

(Unaudited)

(In thousands)

Three months ended September 30, 2025

Travelzoo

North

America

Travelzoo

Europe

Jack's

Flight Club

New

Initiatives

Consolidated

Revenues from unaffiliated

customers

$ 13,728

$ 7,036

$ 1,407

$ 27

$ 22,198

Intersegment revenues

503

(471)

(32)

—

Total net revenues

14,231

6,565

1,375

22,198

Sales and marketing expenses

6,998

4,549

651

—

12,198

Other expenses

6,104

2,656

704

9,512

Operating profit (loss)

1,128

(640)

(20)

488

Other income (loss), net

(64)

Income from operations before

income taxes

424

Three months ended September 30, 2024

Travelzoo

North

America

Travelzoo

Europe

Jack's

Flight Club

New

Initiatives

Consolidated

Revenues from unaffiliated

customers

$ 12,846

$ 6,021

$ 1,198

$ 33

$ 20,098

Intersegment revenues

(24)

(3)

—

Total net revenues

12,822

6,018

1,225

20,098

Sales and marketing expenses

4,557

3,038

511

145

8,251

Other expenses

5,115

1,952

687

7,802

Operating profit (loss)

3,150

1,028

(160)

4,045

Other income, net

359

Income from operations before

income taxes

4,404

Nine months ended September 30, 2025

Travelzoo

North

America

Travelzoo

Europe

Jack's

Flight Club

New

Initiatives

Consolidated

Revenues from unaffiliated

customers

$ 44,296

$ 20,745

$ 4,140

$ 64

$ 69,245

Intersegment revenues

1,196

(1,084)

(112)

—

Total net revenues

45,492

19,661

4,028

69,245

Sales and marketing expenses

19,400

13,101

1,877

—

34,378

Other expenses

18,550

7,856

1,963

145

28,514

Operating profit (loss)

7,542

(1,296)

188

(81)

6,353

Other income, net

727

Income from operations before

income taxes

7,080

Nine months ended September 30, 2024

Travelzoo

North

America

Travelzoo

Europe

Jack's

Flight Club

New

Initiatives

Consolidated

Revenues from unaffiliated

customers

$ 41,134

$ 18,605

$ 3,397

$ 88

$ 63,224

Intersegment revenues

(76)

—

Total net revenues

41,184

18,631

3,321

63,224

Sales and marketing expenses

15,107

9,429

1,393

280

26,209

Other expenses

14,772

6,280

2,034

282

23,368

Operating profit (loss)

11,305

2,922

(106)

(474)

13,647

Other income, net

674

Income from operations before

income taxes

14,321

Travelzoo

Reconciliation of GAAP to Non-GAAP Information

(Unaudited)

(In thousands, except per share amounts)

Three months ended

Nine months ended

September 30,

2025

2024

2025

2024

GAAP operating expense

$ 17,191

$ 13,505

$ 49,760

$ 41,869

Non-GAAP adjustments:

Amortization of intangibles (A)

500

Stock option expenses (B)

399

456

1,108

1,239

Severance-related expenses (C)

167

330

395

360

Non-GAAP operating expense

16,623

12,624

48,212

39,770

GAAP operating income

488

4,045

6,353

13,647

Non-GAAP adjustments (A through C)

568

881

1,548

2,099

Non-GAAP operating income

1,056

4,926

7,901

15,746

Investor Relations:

ir@travelzoo.com

SOURCE Travelzoo