Travelzoo (TZOO) investor relations material

Executive summary

• Q1 2026 revenue increased 5% year-over-year to $24.3 million, with strong growth in North America and Europe and stable operating profit despite higher marketing investments.

• Club Membership strategy drove a 112% year-over-year increase in members, with growth from both legacy conversions and new members.

• Membership fees now exceed 20% of total revenue, providing a stable and predictable income stream.

• New features and perks, such as lounge access, a travel hotline, and upcoming culinary journeys, were added to enhance membership value.

• Net income attributable to shareholders was $2.5 million, or $0.23 per share, compared to $0.26 per share in the prior-year period.

Financial highlights

• Q1 consolidated revenue: $24.3 million; constant currency revenue: $23.6 million, up 2% year-over-year.

• Operating profit: $3.4 million (14% margin), with non-GAAP operating profit at $3.5 million; gross profit was $19.0 million.

• Cash flow from operations was $3.9 million; cash, cash equivalents, and restricted cash stood at $11.3 million at quarter-end.

• Repurchased 500,000 shares during the quarter, using $3.3 million.

• Operating expenses totaled $15.6 million, up from $15.2 million in Q1 2025.

Outlook and guidance

• Year-over-year revenue growth is expected to continue in Q2 and subsequent quarters, driven by recurring membership fees and new member acquisitions.

• Profitability and EPS are expected to increase over time as recurring revenue from renewals grows.

• Short-term net income may fluctuate due to immediate expensing of marketing costs and timing of renewals.

• Management aims to accelerate revenue growth and expand both Club Membership and Jack's Flight Club subscriptions.