Latest news with #GBTG
Yahoo
19-05-2025
- Business
- Yahoo
GBTG Q1 Earnings Call: Revenue Misses Expectations as Management Cuts Full-Year Guidance
B2B travel services company Global Business Travel (NYSE:GBTG) fell short of the market's revenue expectations in Q1 CY2025 as sales only rose 1.8% year on year to $621 million. On the other hand, the company expects next quarter's revenue to be around $625 million, close to analysts' estimates. Its non-GAAP profit of $0.16 per share was 6.6% below analysts' consensus estimates. Is now the time to buy GBTG? Find out in our full research report (it's free). Revenue: $621 million vs analyst estimates of $633.3 million (1.8% year-on-year growth, 1.9% miss) Adjusted EPS: $0.16 vs analyst expectations of $0.17 (6.6% miss) Adjusted Operating Income: $55 million vs analyst estimates of $99.25 million (8.9% margin, 44.6% miss) The company dropped its revenue guidance for the full year to $2.43 billion at the midpoint from $2.53 billion, a 3.8% decrease EBITDA guidance for the full year is $510 million at the midpoint, below analyst estimates of $551.9 million Operating Margin: 8.9%, up from 2.6% in the same quarter last year Free Cash Flow Margin: 4.2%, down from 5.6% in the previous quarter Transaction Value: 8.35 billion, up 244 million year on year Market Capitalization: $2.92 billion Global Business Travel's Q1 results reflected the impact of a softer macroeconomic environment, as management pointed to slower-than-anticipated organic transaction growth and flat demand across several customer segments. CEO Paul Abbott highlighted that growth was stronger among global multinational clients and in premium travel services, while small and medium enterprise (SME) customers continued to tighten spending. Abbott stated, 'Transaction growth was relatively stronger with global multinational customers, up 6% in the quarter… SME growth remained slower at 2%.' Looking ahead, the company lowered its full-year outlook, citing persistent economic uncertainty and stabilized but subdued transaction growth trends. CFO Karen Williams noted that despite incremental cost savings and productivity gains—including increased automation and AI investments—the revised guidance assumes current demand conditions persist. Williams explained, 'Our approach to guidance is based on a weaker economy and built on the assumption that the flat transaction growth we have seen over March and April continues.' Management attributed the quarter's underperformance to weaker organic transaction growth, particularly among SME customers, and a moderated demand environment. Despite these challenges, the company reported margin expansion and highlighted operational efficiencies as key positives. Premium travel demand: Growth in premium and international travel outpaced domestic volumes, with higher average ticket prices and premium hotel occupancy supporting revenue per transaction. SME segment softening: SME customers remained cautious, with tightened budgets leading to lower organic transaction growth, although new customer wins provided some offset. Digital adoption and efficiency: 81% of transactions occurred via digital channels, with a growing mix of higher-margin bookings through proprietary platforms such as Neo and Egencia. Management emphasized that this digital shift has driven both productivity and cost savings. Cost control measures: Adjusted operating expenses declined despite ongoing investments in technology and sales, as management increased its annual cost savings target to $110 million for 2025, up from $95 million previously. CWT merger update: The company amended its merger agreement with CWT, reducing the number of shares to be issued and extending the transaction timeline. Management reiterated confidence in closing the deal by the end of 2025, pending litigation outcomes. Management's outlook for the rest of the year centers on cautious assumptions: stable but muted demand, further cost containment, and continued investment in digital transformation to drive margin expansion and maintain competitiveness. Macro-driven demand risk: Ongoing economic uncertainty is expected to keep transaction growth flat, with management watching for any material changes in corporate travel policies or broader economic indicators. Margin expansion focus: Increased automation and AI investments are projected to support further operating leverage and offset headwinds from softer top-line growth. The company expects to maintain high-single-digit operating margins. Share gains from new wins: Management anticipates continued share gains from new contract wins, especially in the SME segment, to partially offset weaker organic growth. Peter Christiansen (Citigroup): Asked about signs of clients trading down to less expensive travel options. CEO Paul Abbott replied that premium travel demand remained stable, with no significant shift to cheaper alternatives observed. Lee Horowitz (Deutsche Bank): Inquired about the trajectory of macro trends and whether conditions had stabilized. Abbott noted most clients are in a "wait-and-see mode," with only moderate changes in travel budgets or policies. Stephen Ju (UBS): Questioned how GBTG can strengthen its value proposition amid elongated sales cycles. Abbott emphasized the company's ability to deliver cost savings and complete spend visibility, which becomes more attractive during economic slowdowns. Duane Pfennigwerth (Evercore ISI): Sought details on regional performance differences, particularly between the U.S. and other markets. Abbott said international and premium travel segments outperformed domestic, with overall trends stable across regions. Yehuda Silverman (Morgan Stanley): Asked about potential changes in customer budget restrictions and investment levels. Abbott explained that unless macro conditions worsen, further tightening is unlikely; Williams clarified that investment reductions reflect productivity gains, not decreased commitment. Looking ahead, the StockStory team will monitor (1) the pace of new contract wins, particularly among SME customers, (2) the success of digital channel adoption and associated margin improvements, and (3) the resolution of the CWT merger process, including regulatory and legal developments. Additionally, we will track any shifts in corporate travel budgets or demand patterns that could alter the company's revenue trajectory. Global Business Travel currently trades at a forward price-to-sales ratio of 1.2×. In the wake of earnings, is it a buy or sell? Find out in our free research report. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today. Sign in to access your portfolio
Yahoo
06-05-2025
- Business
- Yahoo
Global Business Travel (NYSE:GBTG) Reports Sales Below Analyst Estimates In Q1 Earnings
B2B travel services company Global Business Travel (NYSE:GBTG) fell short of the market's revenue expectations in Q1 CY2025 as sales only rose 1.8% year on year to $621 million. Next quarter's revenue guidance of $625 million underwhelmed, coming in 4.2% below analysts' estimates. Its GAAP profit of $0.16 per share was 78.5% above analysts' consensus estimates. Is now the time to buy Global Business Travel? Find out in our full research report. Global Business Travel (GBTG) Q1 CY2025 Highlights: Revenue: $621 million vs analyst estimates of $633.3 million (1.8% year-on-year growth, 1.9% miss) EPS (GAAP): $0.16 vs analyst estimates of $0.09 (78.5% beat) Adjusted EBITDA: $141 million vs analyst estimates of $139.8 million (22.7% margin, 0.9% beat) The company dropped its revenue guidance for the full year to $2.43 billion at the midpoint from $2.53 billion, a 3.8% decrease EBITDA guidance for the full year is $510 million at the midpoint, below analyst estimates of $549.5 million Operating Margin: 8.9%, up from 2.6% in the same quarter last year Free Cash Flow Margin: 4.2%, down from 5.6% in the previous quarter Transaction Value: 8.35 billion, up 244 million year on year Market Capitalization: $3.24 billion Paul Abbott, Amex GBT's Chief Executive Officer, stated: "In the first quarter, we delivered on our commitments, with strong profit growth, margin expansion and cash generation. Investments in our software and services are driving share gains and productivity improvements. Our strong and flexible operating model positions us well to navigate through a more uncertain environment.' Company Overview Holding close ties to American Express, Global Business Travel (NYSE:GBTG) is a comprehensive travel and expense management services provider to corporations worldwide. Sales Growth Examining a company's long-term performance can provide clues about its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Over the last three years, Global Business Travel grew its sales at an excellent 35.1% compounded annual growth rate. Its growth beat the average software company and shows its offerings resonate with customers. Global Business Travel Quarterly Revenue This quarter, Global Business Travel's revenue grew by 1.8% year on year to $621 million, falling short of Wall Street's estimates. Company management is currently guiding for flat sales next quarter. Looking further ahead, sell-side analysts expect revenue to grow 6% over the next 12 months, a deceleration versus the last three years. This projection doesn't excite us and implies its products and services will see some demand headwinds.
Yahoo
10-04-2025
- Business
- Yahoo
3 Reasons to Sell GBTG and 1 Stock to Buy Instead
Global Business Travel trades at $6.75 per share and has stayed right on track with the overall market, losing 9.5% over the last six months while the S&P 500 is down 7.7%. This might have investors contemplating their next move. Is there a buying opportunity in Global Business Travel, or does it present a risk to your portfolio? Get the full stock story straight from our expert analysts, it's free. Even with the cheaper entry price, we're swiping left on Global Business Travel for now. Here are three reasons why there are better opportunities than GBTG and a stock we'd rather own. Holding close ties to American Express, Global Business Travel (NYSE:GBTG) is a comprehensive travel and expense management services provider to corporations worldwide. Forecasted revenues by Wall Street analysts signal a company's potential. Predictions may not always be accurate, but accelerating growth typically boosts valuation multiples and stock prices while slowing growth does the opposite. Over the next 12 months, sell-side analysts expect Global Business Travel's revenue to rise by 4.5%, a deceleration versus its 47% annualized growth for the past three years. This projection is underwhelming and indicates its products and services will face some demand challenges. For software companies like Global Business Travel, gross profit tells us how much money remains after paying for the base cost of products and services (typically servers, licenses, and certain personnel). These costs are usually low as a percentage of revenue, explaining why software is more lucrative than other sectors. Global Business Travel's gross margin is substantially worse than most software businesses, signaling it has relatively high infrastructure costs compared to asset-lite businesses like ServiceNow. As you can see below, it averaged a 60.1% gross margin over the last year. Said differently, Global Business Travel had to pay a chunky $39.91 to its service providers for every $100 in revenue. If you've followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can't use accounting profits to pay the bills. Global Business Travel has shown mediocre cash profitability over the last year, giving the company limited opportunities to return capital to shareholders. Its free cash flow margin averaged 6.8%, subpar for a software business. Global Business Travel's business quality ultimately falls short of our standards. After the recent drawdown, the stock trades at 1.2× forward price-to-sales (or $6.75 per share). While this valuation is fair, the upside isn't great compared to the potential downside. We're fairly confident there are better investments elsewhere. We'd recommend looking at the most dominant software business in the world. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Comfort Systems (+751% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
Yahoo
04-03-2025
- Business
- Yahoo
Global Business Travel Group Full Year 2024 Earnings: EPS Misses Expectations
Revenue: US$2.42b (up 5.8% from FY 2023). Net loss: US$138.0m (loss widened by 119% from FY 2023). US$0.30 loss per share (further deteriorated from US$0.25 loss in FY 2023). All figures shown in the chart above are for the trailing 12 month (TTM) period Revenue was in line with analyst estimates. Earnings per share (EPS) missed analyst estimates by 31%. In the last 12 months, the only revenue segment was Business Travel and Meetings and Events contributing US$2.42b. The largest operating expense was General & Administrative costs, amounting to US$750.0m (47% of total expenses). Explore how GBTG's revenue and expenses shape its earnings. Looking ahead, revenue is forecast to grow 5.2% p.a. on average during the next 3 years, compared to a 9.8% growth forecast for the Hospitality industry in the US. Performance of the American Hospitality industry. The company's share price is broadly unchanged from a week ago. While earnings are important, another area to consider is the balance sheet. We have a graphic representation of Global Business Travel Group's balance sheet and an in-depth analysis of the company's financial position. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned. Sign in to access your portfolio
