TripAdvisor drops most in 4 years as booking problems persist

TripAdvisor Inc.’s shares fell the most in more than four years after the travel website said its rocky transition to making money from hotel bookings instead of referral fees would continue through 2017. TripAdvisor, based in Needham, Massachusetts, fell as much as 19 per cent to $51.34, the biggest intraday drop since July 2012. The stock hadn’t traded this low since April 2013. Tuesday night, TripAdvisor reported third-quarter revenue of $421 million, missing the average analyst estimate of $436.6 million. The company, which compiles reviews and opinions on travel destinations and hotels, is fighting to transition from a model that makes money by sending users to other companies’ platforms to seal reservations into a booking website of its own, which has the potential to bring in higher revenue. But as it’s gone through that journey, margins have fallen. In the first nine months of 2016, profit margins were 25 per cent compared with 32 per cent in the same period in 2015. They are likely to fall further in 2017, the company said in a statement Tuesday. (Gerrit De Vynck/Bloomberg)