Here is why Travelzoo shares gained 20%

Travelzoo (NASDAQ: TZOO) stock jumped 20% after the internet media firm that offers exclusive experiences and offers to members announced Q1 2022 financial results. The company had consolidated revenue of $18.5 million, representing a 29% YoY increase from $14.3 million.

Net income was $2.4 million

Commissions and advertising revenues made up the company’s total revenue and were generated in relation to purchases Travelzoo members made. For the first quarter of 2022, Travelzoo recorded a net income from ongoing operations of $2.4 million. On a consolidated basis plus minority interests, the company had a net income of $2.4 million from ongoing operations. Earnings per share from ongoing operations were $0.19 relative to $0.14 per share a year earlier.

Travelzoo had a non-GAAP operating profit of $2.7 million. However, the non-GAAP profit excluded the amortization of intangibles of $0.2 million and share option expenses of $0.5 million. The company's Global CEO, Holger Bartel, said:

Travelzoo had cash and cash equivalents of $36.7 million

At the end of the quarter, the company had consolidated cash and equivalents plus restricted cash of $36.7 million. The company used $6.8 million in operations, mainly used in relation to a drop in merchant payables by $6 million. Travelzoo also used $1 million in acquiring intangible assets in the first quarter.

The posted revenue during the quarter also included a revenue reserve of $3.8 million connected to commissions generated from the sale of vouchers. The company booked the reserve as contra revenue.

The North American business segment revenue was up 195 YoY to $11.7 million. During the first quarter, operating profit was $1.7 million or 15% of sales relative to operating profit of $39,000 from a year ago. On the other hand, European business unit revenue was up 66% YoY to $5.9 million, while operating profit was 3% of the revenue of $178,000 relative to $696,000 a year ago.