New York – October 29, 2026 -- Travelzoo (NASDAQ: TZOO) reported third-quarter revenue of $22.9 million, up 3% from $22.2 million a year earlier, as Club Members rose 65% year-over-year while the company absorbed a consolidated operating loss of $2.6 million.
Revenue in constant currencies was $23.0 million. Net loss attributable to Travelzoo was $2.0 million, or $(0.20) per share, compared with $0.01 per share in the prior-year period. Non-GAAP operating loss was $2.1 million, excluding $338,000 in stock option expenses and $150,000 in severance expense. The company booked an income tax benefit of $436,000.
Travelzoo expenses membership marketing upfront while recognizing fees over 12 months
Management said it invested significantly in growing Club Members during the quarter and accelerated the shift toward membership fees revenue. Marketing costs were expensed immediately, while membership fees are recognized ratably over the 12-month subscription period. Deferred revenue rose as a result.
Travelzoo introduced a membership fee in 2024. Club Offers and new benefits are available only to paying Club Members, while Legacy Members who joined before 2024 keep access to certain travel offers. Many Legacy Members are converting to Club Members, alongside new joiners.
CEO Holger Bartel said the company will use its global reach and supplier relationships to negotiate more Club Offers and add benefits such as complimentary airport lounge access worldwide in case of a delayed flight.
North America turns to a $1.4 million operating loss on 4% revenue growth
North America segment revenue increased 4% to $14.8 million. The segment posted an operating loss of $1.4 million, or 9% of revenue, against an operating profit of $1.1 million, or 8% of revenue, a year earlier.
Europe revenue grew 5% to $6.9 million. Its operating loss widened to $1.2 million, or 18% of revenue, from $0.6 million, or 10% of revenue, in the prior-year period.
Jack's Flight Club revenue falls 15% to $1.2 million but stays profitable
Travelzoo holds a 60% ownership interest in Jack's Flight Club, whose subscription revenue is recognized ratably over quarterly, semi-annual or annual terms. Operating profit was $34,000, up from $20,000.
The New Initiatives segment, which includes Licensing and Travelzoo META, generated revenue of $27,000 and an operating loss of $3,000. Licensing revenue was $11,000 from the Australian licensee and $5,000 from the Japanese licensee. Travelzoo expects licensing revenue to increase.
Travelzoo ends the quarter with $8.8 million in cash and repurchases 256,898 shares
Cash, cash equivalents and restricted cash stood at $8.8 million as of September 30, 2026. Cash flow from operations was $1.8 million. The company repurchased 256,898 shares of its common stock during the quarter.
Travelzoo reaches 30 million travelers, including Jack's Flight Club. It said comparisons to prior-period reach are no longer meaningful given strategic changes to the membership model.
Travelzoo guides to Q4 revenue growth while warning of volatile net income
The company expects year-over-year revenue growth in Q4 2026 and in subsequent quarters, driven by ratable recognition of membership fees, Club Member growth and Legacy Member conversions. Management expects profitability to increase over time as recurring membership fees are recognized, but said fluctuations in reported net income are likely in the short term.