TripAdvisor Inc. (NASDAQ: TRIP) saw its stock price plummet by over 7.5% on November 7, 2024, despite reporting better-than-expected earnings for the third quarter. While the travel company's adjusted earnings per share (EPS) of $0.50 surpassed the consensus analyst estimate of $0.44, its revenue for the quarter fell short of Wall Street expectations, raising concerns about its growth prospects amid ongoing competitive pressures.

For the three months ended September 30, TripAdvisor posted revenue of $532 million, slightly lower than the expected $527.9 million and representing a 0.2% year-over-year decline. The revenue miss appeared to overshadow the positive earnings surprise, triggering a sell-off in the company's shares.

While TripAdvisor's Viator experiences and dining segment and TheFork dining reservations platform achieved strong revenue growth, the company's core Brand Tripadvisor segment, which includes its hotel meta-search and media business, reported a 12% year-over-year decline in revenue to $255 million. This decline was primarily driven by a 17% drop in branded hotels revenue, highlighting the ongoing challenges in TripAdvisor's legacy hotel meta-offering.

In a conference call with analysts, TripAdvisor CEO Matthew Goldberg acknowledged the headwinds in the company's legacy hotel meta offering but expressed confidence in the growth potential of the experiences and dining segments. Goldberg stated that the company is leveraging generative AI and other technologies to enhance customer service and product recommendations, with the aim of driving higher conversion rates.

However, analysts cited competitive challenges and concerns over TripAdvisor's ability to drive top-line growth as potential factors behind the stock's decline. Despite the company's efforts to diversify its revenue streams and focus on growth areas like experiences and dining, investors appeared to be concerned about the ongoing pressure on its core business and the potential impact on overall growth and profitability.