On August 22, Tongcheng Travel ("Tongcheng") released its financial results for the three months ended June 30, 2023.。

With the recovery of China's domestic tourism, the same journey's Q2 earnings report ushered in a big explosion。Performance data show that in the second quarter, revenue from the same journey was 28.6.6 billion yuan (RMB, the same below), a year-on-year increase of 117.4%。Adjusted net profit surged 429% year-on-year to 5.900 million yuan。Adjusted net profit margin of 20.7 per cent, compared with only 8 per cent in the same period last year..5%。Adjusted EBITDA was $800 million, a significant increase of 175.8%。Adjusted EBITDA margin from 22.2% to 28.1%。

Tongcheng pointed out that in the second quarter, China's tourism market demand increased significantly again, and showed a trend of accelerating growth quarter by quarter.。During the holiday season, the national tourism boom is further released, adding vitality to the tourism industry。The recovery of tourism led to a significant increase in the business of the same journey.。

Accommodation, transportation business double blossom

The revenue of the same journey consists of three major segments, namely, accommodation booking business, transportation ticketing business and other.。

Specifically, in the second quarter, revenue from the same journey's accommodation booking service was 10.5.5 billion yuan, an increase of 94.2%, up 90% from the same period in 2019.7%.Among them, the calculation unit of hotel room occupancy rate in a certain period of time) increased by more than 130% compared with the same period in 2019。

The direct driver of growth in this business segment is the continued strong recovery in accommodation demand.。At the same time, explore a variety of hotel scenarios along the way, and stay around the increasingly popular music festivals and concerts this year.。In addition, the company continues to implement cross-selling strategies and conduct more sophisticated operations and marketing campaigns by digging deeper into user preferences and needs.。Under the combined effect of multiple factors, the revenue and business volume of the accommodation reservation business segment recorded new highs.。

Revenue from the same journey's transport ticketing services is mainly derived from commissions charged to providers of transport tickets, travel insurance and other ancillary value-added travel products and services.。In the second quarter, revenue from the business rose 141 year-over-year, driven by a surge in total ticketing..2% to 14.$9.5 billion, up 59% from the same period in 2019.5%。Driven by significant growth, the transportation ticketing business accounted for 52% of total revenue..1%, further from 47% in the same period last year。

Among them, in the ticket business, thanks to Tongcheng's continuous efforts to build a more diversified user base and further penetrate the market, domestic ticket volume increased by 40% compared to the same period in 2019.。In terms of international business, Tongcheng is also working to bring more supply and enhance user interaction, with further improvements compared to the previous quarter.。In terms of train ticket business, Tongcheng continued to improve the liquidity and operational efficiency of its auto ticketing business in the second quarter.。

Other income for the second quarter was 3.1.6 billion yuan, an increase of 103.3%。Revenue from the segment, including revenue from advertising services, revenue from hotel management services, revenue from business travel services, revenue from membership services and revenue from attraction ticket services。

In terms of operating indicators, thanks to the significant growth in business volume, the same journey travel transactions in the second quarter reached 59.7 billion yuan, an increase of 145.7%。The scale of users also reached a new high.。Average monthly active users are 2.7.9 billion, an increase of 41.1%, up 53% from the same period in 2019.5%。Average monthly paying subscribers were 42.2 million, up 61.7%, up 52% from the same period in 2019.3%。Annual paid users increased by 8.6%, up to 2.200 million, a record high。In addition, the monthly payment ratio rose to 15.1%, a three-year high。

Explore the "new tricks" of tourism

In China's increasingly competitive online travel market, in order to enrich the source of traffic and improve the retention rate of users, the same process began to explore a variety of tourism "new tricks."。

The first is to increase cooperation with Internet giant Tencent。About 80% of the average monthly active users on the same journey come from WeChat applets.。Therefore, in the second quarter, the same journey continued to optimize the hotel, air tickets, train tickets, bus tickets and other booking services in the WeChat "search and search" operation, in order to enhance the user experience and user participation.。

At the same time, the company also works with WeChat Pay Hong Kong to jointly launch marketing activities in the Hong Kong Special Administrative Region of China to establish interaction with local users.。In addition, in order to improve the brand image, the same way to launch a variety of innovative marketing activities。For example, in cooperation with Tencent Music, it sponsored two major music festivals in Macau, which made the brand highly exposed among young users.。It also maintained cooperation with Tencent Games and co-hosted the "Tongcheng Cup" brand e-sports event with its King of Glory.。

Tongcheng also cooperates with relevant departments of several tourist destinations to launch several activities to attract users。

In April, Tongcheng cooperated with Guilin Culture and Tourism Bureau and Xiufeng District People's Government to jointly launch the "Feier Meng Dream Market" to explore the tourism model of "Tourism + Market."。

On June 25, Tongcheng announced that it will jointly launch the 2023 Gexian Village Tongcheng Music Festival with Gexian Village in Shangrao, Jiangxi Province, and provide a comprehensive play experience for camping life, combining scenic spots with music festivals to try the "travel + music" model.。Before and after the festival, Tongcheng Travel launched a series of related tourism products around the festival with the help of the platform's full chain resource system such as transportation, accommodation, scenic spots and vehicles, providing users with a one-stop music festival travel consumption experience.。

In addition, in June, Tongcheng also cooperated with the Jiangsu Provincial Department of Culture and Tourism to jointly launch a digital co-branded card that provides free access to all tourist attractions and multiple entertainment facilities in Jiangsu Province, including 143 scenic spots in 13 cities in Jiangsu Province.。

"Online and offline" all together

In order to implement all kinds of tourism "new tricks," Tongcheng continues to build and improve its "online + offline" industrial network.。

On the online side, Tongcheng further promotes the Black Whale Membership Program, offering more exclusive benefits and privileges to members.。At the same time, the company launched a new membership version to cater to different travel scenarios, and further strengthened the application to attract users with higher value and stickiness.。The cumulative number of Black Whale members continued to grow significantly in the last quarter。

Secondly, Tongcheng strengthens cooperation with mobile phone suppliers to integrate products and services into its ecosystem.。Tongcheng is actively participating in Huawei Hongmeng Ecological Co-construction。Tongcheng said that it will continue to build front-end products such as HarmonyOS-based mobile apps and meta-services to provide users with all-round, full-scene travel services.。In addition, Tongcheng maintains cooperation with location-based applications to expand user coverage.。

In terms of transportation routes, as of the end of June, Tongcheng's online platform provided ticket services for more than 400,000 routes, about 430,000 automobile routes, more than 800 ferry routes and more than 10,000 domestic tourist attractions operated by more than 750 airlines and agents.。

On the offline side, the main focus is on the hotel, the second quarter of the same journey with the hotel cooperation, the use of QR code scanning function to obtain users.。At the same time, further develop the hotel management business and enrich the company's hotel brand portfolio from low-star to high-star hotels.。By the end of June, the same journey had provided more than 2.5 million hotels and non-standard accommodation options。

In addition, in terms of transportation, Tongcheng expanded its public transportation project to more cities in the second quarter, given the huge flow of subways and buses in the city.。

In the second quarter, Tongcheng also opened its offline store franchise program。The plan aims to open up the "online + offline" travel and vacation service link to better meet the needs of users.。It is understood that the first batch of offline stores have landed in Shanghai, Jiangsu, Zhejiang and other provinces and cities.。In addition, the same way also through the acquisition of a number of travel agency companies into the holiday product market, broaden its boundaries in the tourism industry。

Thanks to the company's efforts to acquire customers offline, Tongcheng successfully seized the opportunity of sinking market and gained market share.。In the second quarter, the same process further penetrated the sinking market with a lower online rate.。As of June 30, registered users living in non-first-tier cities in China accounted for about 87% of the total number of registered users.。In the three months to the end of June, about 70% of the new paying users of the WeChat platform came from non-first-tier cities in China.。

Catch up with the digitalization of tourism

At present, Tongcheng is committed to transforming from an online travel platform to an intelligent travel manager, and empowering the tourism industry with deep Internet expertise and advanced technology to establish an efficient tourism ecosystem.。

On the one hand, Tongcheng continues to optimize its "Huixing System" to visualize its travel solutions through clearer product displays.。On the other hand, Tongcheng has stepped up efforts to improve the automation of customer service, handing over standardized problems to artificial intelligence-driven robots to further improve customer service efficiency.。

Tongcheng is also actively exploring the use of artificial intelligence-generated content (AIGC) in its business and strengthening relationships with upstream suppliers to accelerate the digitalization of the tourism industry with superior innovation capabilities.。

In the second quarter, Tongcheng cooperated with several airports.。Cooperate with Chengdu Shuangliu International Airport to help the airport develop transit system to attract transit passengers。Strategic cooperation with Yichang's Three Gorges Airport, which mentioned that the two sides will carry out in-depth cooperation in multimodal transport innovation, airport digitization and route network layout optimization.。Tongcheng also works with Henan Airport Group to help it develop intermodal solutions, integrated membership programs and digital platforms.。

In addition, through the comprehensive hotel PMS brand matrix, Tongcheng also provides software as a service (SaaS) solutions to more single and chain hotels and non-standard accommodation to optimize operational efficiency.。