Travelzoo Posts $0.20 Per-Share Loss Despite 3% Revenue Growth in Third Quarter
Key Facts
Travelzoo reported a net loss attributable to the company of $2.009 million, or $0.20 per share, in the third quarter ended September 30, 2026, compared with a profit of $150,000 and earnings per share of $0.01 a year earlier. Revenue was $22.910 million, up from $22.198 million in the year-earlier period, an increase of about 3% year over year. But earnings per share were worse than MarketBeat’s estimate of a $0.0880 loss, while revenue fell short of its estimate of $22.97 million. The results therefore combined revenue growth with weaker profitability, as the company swung to an operating loss of $2.560 million from operating profit of $488,000 a year earlier. The company announced its results on October 27 and was scheduled to discuss them on a live call that day.
The income statement showed a divergence between sales growth and operating performance: gross profit fell to $17.162 million from $17.679 million in the third quarter of 2025. Meanwhile, sales and marketing expenses rose to $14.604 million from $12.198 million a year earlier. Travelzoo said it continued to invest heavily in growing Travelzoo Club membership and accelerating its shift toward recurring membership-fee revenue. Club membership increased 65% year over year during the quarter, according to the company. Marketing expenses are recorded immediately, while the company recognizes membership-fee revenue over the 12-month subscription period, as it explained in its earnings release.
By geography, North American revenue rose to $14.664 million from $13.728 million in the year-earlier quarter, while European revenue was nearly flat at $7.031 million versus $7.036 million. Both regions posted operating losses in the third quarter: North America’s loss was $1.376 million and Europe’s was $1.215 million. By contrast, Jack's Flight Club reported operating profit of $34,000. The figures reflect different revenue trajectories in the two regions, while operating results remained negative in both North America and Europe. The increase in North American revenue did not prevent the company’s overall operating result from turning to a loss during the quarter.
The operating deterioration also extended to the first nine months of the year. Revenue rose to $70.391 million from $69.245 million, but the company posted an operating loss of $1.878 million after operating profit of $6.352 million in the year-earlier period. Second-quarter results provide a nearby comparison: Travelzoo then reported revenue of $23.2 million, down 3% year over year, an operating loss of $2.8 million and a per-share loss of $0.21. In the fourth quarter of 2025, revenue was $22.5 million, up 9% year over year, and earnings per share were zero as the company invested in acquiring club members. In the third quarter of 2026, net cash provided by operating activities rose to $1.819 million, compared with cash used of $374,000 in the same period a year earlier. The positive cash flow stood alongside the net and operating losses reported for the quarter.
In premarket trading on October 27, MarketBeat showed the stock at $4.74, down 7.32% at 7:02 a.m. Eastern time. The site had shown a close of $5.11 on October 26, while EL7 data showed the stock closing at $5.12 that day. MarketBeat also showed consensus estimates of a $0.0880 per-share loss and expected revenue of $22.97 million, leaving a larger gap for earnings per share than for revenue. Travelzoo said it expects revenue growth in the fourth quarter of 2026 and subsequent quarters. It added that profitability is expected to increase over time as recurring membership fees are recognized, while net income may fluctuate in the short term.