NEW YORK — Tripadvisor Inc. announced a $369.5 million writedown on its legacy hotels and advertising business in the third quarter, citing persistent challenges from changes in search engine optimization (SEO).
The travel platform expects SEO to continue hindering growth until at least 2027, prompting a strategic shift toward increased investment in paid marketing channels and exploration of artificial intelligence integrations.
Chief Financial Officer Mike Noonan stated that SEO would remain a headwind to growth in 2027, though he anticipated some easing based on current trends. The company’s exposure to SEO, particularly for its legacy Tripadvisor brand, has decreased from a year ago but remains in the mid to high teens.
Marketing costs for Tripadvisor rose to 48.8 percent of revenue in the third quarter, an increase from 43.3 percent in the same period a year prior. This rise was attributed to the company’s pivot from relying on free search traffic to investing more heavily in paid advertising.
Despite the overall SEO challenges, CEO Matt Goldberg noted that traffic generated through artificial intelligence converted at nearly five times the average rate on its Viator platform and approximately twice the average on Tripadvisor’s main site. This AI-driven traffic currently represents less than one percent of total traffic.
Experiences bookings grew by 2 percent in the third quarter, with the Viator segment seeing a 4 percent increase. However, bookings on Tripadvisor’s own site experienced a decline in the low-teens percentage.
The company also announced leadership changes, with CEO Matt Goldberg scheduled to depart in mid-February and CFO Mike Noonan leaving at year-end. Kristen Dalton will assume the role of interim CFO.
Source: Search Engine Journal
