Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The information included in this Management's Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with our unaudited condensed consolidated financial statements and the accompanying notes included in this Quarterly Report, and the consolidated financial statements and accompanying notes, as well as Management's Discussion and Analysis of Financial Condition and Results of Operations contained in our 2024 Annual Report.

This Quarterly Report, as well as statements made by our executive officers, contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the views of our management regarding current expectations and projections about future events and are based on currently available information. Actual results could differ materially from those contained in these forward-looking statements for a variety of reasons, including, but not limited to, those discussed in our 2024 Annual Report, Part I, Item 1A, "Risk Factors," as well as those discussed elsewhere in this Quarterly Report. Other unknown or unpredictable factors also could have a material adverse effect on our business, financial condition and results of operations. Accordingly, readers should not place undue reliance on these forward-looking statements. The use of words such as "anticipates," "estimates," "expects," "intends," "may," "plans," "will," "believes," "would," "opportunity," "goal," "objective," similar terms, variations of such terms or the negative of those terms, generally identify forward-looking statements; however, these words are not the exclusive means of identifying such statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. These forward-looking statements are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. We are not under any obligation to, and do not intend to, publicly update or review any of these forward-looking statements, whether as a result of new information, future events or otherwise, even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized. Please carefully review and consider the various disclosures made in this report and in our other reports filed with the SEC that attempt to advise interested parties of the risks and factors that may affect our business, prospects and results of operations.

Overview

The Tripadvisor Group's mission is to connect people to experiences worth sharing with a vision to be the world's most trusted source for travel and experiences. The Company operates across three business segments: Brand Tripadvisor, Viator, and TheFork. We leverage our brands, technology platforms, and capabilities to connect our large, global audience with partners by offering rich content, travel guidance products and services, and two-sided marketplaces for experiences, accommodations, restaurants, and other travel categories.

Brand Tripadvisor empowers everyone to be a better traveler through its online global platform where hundreds of millions of visitors regularly visit and engage to discover, generate, and share authentic user-generated content ("UGC") in the form of reviews and opinions for experiences, accommodations, restaurants, and cruises in over 40 countries across the world. Brand Tripadvisor offers more than 1 billion user-generated reviews and opinions on over 9 million experiences, accommodations, restaurants, airlines, and cruises.

Viator's mission is to bring extraordinary, unexpected, and forever memorable experiences to more people, more often, wherever they are traveling. In doing so, Viator elevates tens of thousands of businesses, large and small. Viator delivers on its purpose by enabling travelers to discover and book iconic, unique and memorable experiences from operators around the globe. Our

online marketplace is comprehensive and easy-to-use, connecting millions of travelers to the world's largest supply of bookable tours, activities and attractions-nearly 400,000 experiences from more than 65,000 operators. Viator is a pure-play experiences online travel agency ("OTA") singularly focused on the needs of both travelers and operators with the largest supply of bookable experiences available to travelers.

TheFork's mission is to deliver happiness through amazing dining experiences as the leading online restaurant booking platform in Europe. At the forefront of championing restaurant culture, TheFork harnesses technology to promote real life connections between diners and restaurateurs. With a network of approximately 55,000 partner restaurants across 11 countries, nearly 40 million app downloads and more than 20 million reviews, TheFork is a go-to platform for all food lovers to enjoy unforgettable restaurant experiences. Through TheFork, users can easily find restaurants according to their preferences, check real-time availability, instantly book online 24/7, benefit from special offers and pay directly to the restaurants. For restaurateurs, TheFork's technology enables them to optimize reservation management and occupancy rates, increase bookings and visibility, limit the impacts of no-shows, manage payments and streamline operations, all while accessing a broad community of loyal diners.

Our Business Strategy

The Tripadvisor Group operates in a unique position in the travel and experiences ecosystem:

In the Brand Tripadvisor segment, we offer a compelling value proposition to both travelers and partners across a number of key offerings that include experiences, accommodations, dining, and media. This value proposition is delivered through a collection of durable assets that we believe are difficult to replicate: a trusted brand, authentic UGC, a large community of contributors, and a large global travel audience. Our strategy in this segment is to leverage these core assets as well as our technology capabilities to provide travelers with a compelling user experience to help make the best decisions in each phase of the travel journey, including pre-trip planning, in-destination, and post-trip sharing. We intend to drive new traveler acquisition and repeat audience engagement on our platform by offering meaningful travel guidance solutions and services that reduce friction in the traveler journey and create a deeper, more persistent relationship with travelers. Our long-term strategy for the Brand Tripadvisor segment builds on our heritage and the reasons hundreds of millions of travelers come to Tripadvisor each year. Fundamental to this strategy will be: (1) innovating and enhancing world-class travel guidance and planning products to help travelers make confident decisions; (2) prioritizing deeper engagement with travelers, increasing membership, and repeat customers by leveraging our rich data and technology assets to provide more relevant, curated, and contextual content to travelers; and (3) driving a step change in the value we can deliver to our partners by accelerating and diversifying the monetization of our valuable audience across hotels, media advertising, experiences, and restaurants. As we continue to focus on offering a more compelling product and experience that better meets travelers' needs, we believe we will be able to drive deeper engagement through direct channel growth, including through our mobile app. As this direct engagement with users improves and scales, we will be able to collect valuable data and create more relevant opportunities to monetize, which we believe will result in higher average revenue per user over time.

In the Viator and TheFork segments, we provide two-sided marketplaces that connect travelers and diners to operators of bookable experiences and restaurants, respectively.

At Viator, we are reinforcing our leadership position in experiences by investing in the product, marketing, and bookable supply. Our investment in these areas is expected to drive growth on both sides of the marketplace. On the traveler side of the marketplace, we are investing in products to provide travelers with high-quality experiences that incentivize them to return to book with us increasingly through more economic channels. As travelers return to book on our platform more directly, especially through our mobile app, we expect unit economics to improve and profitability to increase over time. A key component of driving the traveler flywheel is offering breadth and depth of quality experiences and surfacing the most relevant experiences to travelers based on their needs and preferences. On the supply side of the marketplace, we are investing to increase the amount of high-quality, highly demanded, and unique bookable experiences on our platform. With operators, we continue to focus on improving our product and technology capabilities to improve our value proposition of providing high quality demand and tools to manage their business on our platform.

At TheFork, we are driving profitable revenue growth by delivering value to both diners and restaurants as the leader in the European dining market. On the diner side of the marketplace, our investment in marketing is driving growth in new and repeat diner bookings. On the restaurant side, our prior investment in technology has resulted in growth in adoption of our premium online reservation booking software.

Across both Viator and TheFork, our investments are intended to deliver a differentiated value proposition that we believe will drive sustainable market leadership as our partners, operators, and travelers find themselves in an increasingly competitive marketplace environment. We are focused on continuing to grow both our supplier base and our user base by offering innovative products on our branded platforms, and through continued awareness of our brand through marketing efforts.

We are focused on executing initiatives across Tripadvisor Group through organic investment in data, products, marketing and technology to further enhance the value we deliver to travelers and partners across our brands, platforms, and segments. In addition, we may accelerate growth inorganically by opportunistically pursuing strategic acquisitions.

Trends

The online travel industry in which we operate is large, highly dynamic and competitive. We describe below current trends affecting our overall business and segments, including uncertainties that may impact our ability to execute on our objectives and strategies.

Heightened geopolitical tensions and conflicts, including the evolving events in the Middle East and between Ukraine and Russia; acts of terrorism; political instability or changes in legislative or regulatory policies, including U.S. tax laws such as the OBBBA; announced or implemented changes in tariffs; fluctuations in interest rates, tax rates and foreign exchange rates and changes in global economic conditions; and public-health related events are examples of events that could have a negative impact on the travel industry and, as a result, our financial results.

We generate a significant amount of direct traffic from search engines, including Google, through search engine optimization ("SEO") performance across all segments. We believe our SEO traffic acquisition performance has been negatively impacted, and may be impacted in the future, by search engines (primarily Google) changing their search result placement and underlying algorithms to increase the prominence of their own products in search results across our business.

The global experiences market is large, growing, highly fragmented, and underpenetrated, with the vast majority of bookings still occurring through traditional offline sources. We expect to benefit from ongoing market tailwinds as consumers increasingly book experiences online and consumer behavior continues to allocate discretionary spending more to travel and experiences and away from physical goods. Likewise, the global restaurants category is also benefiting from increased online adoption by both consumers and restaurant partners, particularly in Europe. These trends present attractive growth opportunities for our business, as well as to many competitors. Given the competitive positioning of our businesses relative to the attractive growth prospects in the experiences and restaurant categories, we expect to continue to invest in these categories across Tripadvisor Group to continue growing revenue, operating scale, and market share for the long-term.

The Company's revenue and Adjusted EBITDA, as shown in our segment financial information, continue to shift more towards its marketplace businesses with less exposure to its media-based, or click-based offerings, as a result of our strategic focus to grow and invest in these businesses. Our Viator and TheFork segments, which are two-sided marketplace businesses, have exhibited consistent revenue growth and improving profitability post-pandemic. Importantly, as of the nine months ended September 30, 2025, these two segments represented approximately 60% of the Company's consolidated revenue and 30% of our total segment Adjusted EBITDA. As the Company continues to execute on its growth strategies, we expect these trends to continue in the future. Refer to "Note 13: Subsequent Events" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for additional information regarding the Company's recent decision to integrate its experiences operating model across its Viator and Brand Tripadvisor segments to support the Company's prioritization of an experiences-led growth strategy and AI-enabled company.

Recent Developments

Restructuring and Related Reorganization Actions

Fourth quarter of 2025

On November 5, 2025, the Company initiated a series of cost savings actions following a decision to realign its operating model across its Viator and Brand Tripadvisor segments to support the Company's positioning as an experiences-led and AI-enabled company. These cost savings actions primarily include a global workforce reduction, as well as other targeted operating expense reductions. The Company expects at least $85 million in annualized gross cost savings, the majority of which are expected to be realized in 2026 and fully realized by 2027. Refer to "Note 13: Subsequent Events" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for additional information regarding these decisions and estimated restructuring costs that will be incurred by the Company.

Additionally, the Company expects to reorganize its operating segments during the fourth quarter of 2025. Following the Company's decision to integrate its Viator and Brand Tripadvisor experiences operating model, we anticipate our operating segments will be reorganized into the following: (1) Experiences, (2) Hotels & Other; and (3) TheFork. We do not expect TheFork segment to be impacted by this re-segmentation.

Fourth quarter of 2024

During the fourth quarter of 2024, the Company approved and subsequently initiated a set of actions in order to reduce its cost structure, improve operational efficiencies, and realign its workforce with its strategic initiatives. As a result of these actions taken, the Company incurred estimated pre-tax restructuring and other related reorganization costs of approximately $10 million during the three months ended March 31, 2025, which consisted of employee severance and related benefits, primarily in our Brand Tripadvisor segment. Refer to "Note 5: Accrued Expenses and Other Current Liabilities" and "Note 12: Segment Information" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information.

Tripadvisor and Liberty TripAdvisor Merger and Loan Agreement

As previously disclosed in our 2024 Annual Report, on December 18, 2024, the Company and LTRIP entered into the Merger Agreement, whereby Tripadvisor would acquire LTRIP. On April 29, 2025, the Merger closed. The aggregate transaction price of the Merger was $437 million, consisting of: (i) $431 million in cash and common stock consideration paid in connection with the repurchase, plus (ii) approximately $19 million in direct expenses and fees associated with the repurchase; partially offset by (iii) $13 million in LTRIP net operating loss carryforwards ("NOLs"), tax effected, retained by the Company.

Prior to the Merger, assets held by LTRIP substantially consisted of shares of the Company's common stock. As of the close of the Merger, LTRIP beneficially owned approximately 26.8 million shares of the Company's common stock, consisting of 14.0 million shares of common stock and 12.8 million shares of Class B common stock. As a result, the Company accounted for the Merger as a repurchase of the Company's common stock previously held by LTRIP.

Refer to "Note 1: Basis of Presentation" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report in the section entitled "LTRIP and Tripadvisor Merger Agreement and Loan Agreement" for further information.

Retirement of Treasury Shares

On April 29, 2025, the Company's Board of Directors approved the retirement of all common stock and Class B common stock held as treasury stock by the Company, thereby canceling approximately 53.1 million shares of our common stock, with a carrying value of approximately $1.3 billion. The retirement of these shares resulted in a reduction in both the carrying value of treasury stock and additional paid-in capital of approximately $1.3 billion on our unaudited condensed consolidated balance sheet. There was no net effect to the Company's total stockholders' equity balance on its unaudited condensed consolidated balance sheet due to the retirement of these shares. Refer to "Note 10: Stockholders' Equity" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information.

Term Loan B Facility

On March 20, 2025, under the Amended Credit Agreement, the Company increased its existing Term Loan B Facility in the amount of $350 million, maturing July 8, 2031, with an interest rate based on SOFR plus 2.75% (the "Tack-On Incremental Term Loan B Facility"). The Tack-On Incremental Term Loan B Facility was offered at 98.56% of par. The proceeds from the Tack-On Incremental Term Loan B Facility will be used to fund the repurchase, repayment or redemption of the Company's outstanding 2026 Senior Notes and for general corporate purposes. Refer to "Note 6: Debt" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information.

Employees

As of September 30, 2025, the Company had approximately 2,909 employees. Approximately 64%, 31%, and 5% of the Company's current employees are based in Europe, the U.S., and the rest of world, respectively. Additionally, we use independent contractors to supplement our workforce. We believe we have good relationships with our employees and contractors, including relationships with employees represented by international works councils or other similar organizations.

Seasonality

Consumer travel expenditures have historically followed a seasonal pattern. Correspondingly, travel partner advertising investments, and therefore our revenue and operating profits, have also historically followed a seasonal pattern. Our financial performance tends to be highest in the second and third quarters of a given year, which includes the seasonal peak in consumer demand, including traveler accommodation stays, and travel experiences taken, compared to the first and fourth quarters, which represent seasonal low points. In addition, during the first half of the year, experience bookings typically exceed the amount of completed experiences, resulting in higher cash flow related to working capital; while during the second half of the year, particularly in the third quarter, this pattern reverses and cash flows from these transactions are typically negative. Other factors may also impact typical seasonal fluctuations, such as significant shifts in our business mix, adverse economic conditions or economic uncertainty, public health-related events, as well as other factors.

Critical Accounting Policies and Estimates

Critical accounting policies and estimates are those that we believe are important in the preparation of our consolidated financial statements because they require that management use judgment and estimates in applying those policies. We prepare our consolidated financial statements and accompanying notes in accordance with GAAP. Preparation of the consolidated financial statements and accompanying notes requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements as well as revenue and expenses during the periods reported. Management bases its estimates on historical experience, when applicable and other assumptions that it believes are reasonable under the circumstances. Actual results may differ from estimates under different assumptions or conditions.

There are certain critical estimates that we believe require significant judgment in the preparation of our consolidated financial statements. We consider an accounting estimate to be critical if:

There have been no material changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates described in our 2024 Annual Report.

Significant Accounting Policies and New Accounting Pronouncements

There have been no material changes to our significant accounting policies or new accounting pronouncements that we are required to adopt that may have an impact on our unaudited condensed consolidated financial statements since December 31, 2024, as compared to those described under "Note 2: Significant Accounting Policies," in the notes to consolidated financial statements in Item

8 of our 2024 Annual Report, except as described under "Note 2: Significant Accounting Policies," in the notes to our unaudited condensed consolidated financial statements in Item 1 of this Quarterly Report on Form 10-Q.

Revised Operating Expense Presentation

As previously disclosed in our 2024 Annual Report, during the fourth quarter of 2024, the Company revised its operating expense captions on its consolidated statement of operations to better align the Company's financial presentation with how management assesses performance and makes strategic decisions in its business operations, and to provide additional clarity and understanding of our operating expenses for investors. Prior year amounts have been reclassified to conform to the current period presentation. The revised presentation did not result in any changes to previously reported revenues, total costs and expenses, operating income (loss), income (loss) before income taxes, or net income (loss). For further information, refer to "Note 1: Basis of Presentation" in the notes to our unaudited condensed consolidated financial statements in Item 1 of this Quarterly Report on Form 10-Q.

Statements of Operations

Selected Financial Data

(in millions, except percentages)

n.m. = not meaningful

Revenue and Segment Information

Brand Tripadvisor Segment

Brand Tripadvisor revenue decreased by approximately $21 million and $49 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. The decrease in Brand Tripadvisor revenue during the three and nine months ended September 30, 2025, when compared to the same periods in 2024, occurred across all revenue streams within the segment, as discussed below.

Adjusted EBITDA in Brand Tripadvisor decreased by approximately $27 million and $58 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, while adjusted EBITDA margin decreased 8.6 percentage points and 6.0 percentage points during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. The decrease in adjusted EBITDA was due to a decrease in revenue, as noted above, as well as, an increase in paid online marketing costs (i.e., traffic acquisition costs) in our hotel and experiences offerings, partially offset by a decrease in personnel costs due to a reduction in headcount primarily related to cost reduction measures taken during the first quarter of 2025. The decrease in adjusted EBITDA margin during the three and nine months ended September 30, 2025, when compared to the same periods in 2024, was primarily due to an increase in marketing costs as a percent of revenue, as the mix of paid marketing channels and related online marketing costs increased for our hotel and experiences offerings.

The following is a detailed discussion of the revenue sources within our Brand Tripadvisor segment:

*Percentages may not total to 100% due to rounding.

Tripadvisor-branded Hotels Revenue

Tripadvisor-branded hotels revenue decreased by approximately $8 million and $17 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to a decrease in hotel B2B revenue and, to a lesser extent, a decrease in hotel meta revenue. These decreases were driven primarily by continued headwinds impacting both free and paid marketing channels, resulting in lower click volumes, which more than offset growth in pricing as measured in cost-per-click rates ("CPCs"). Growth in CPCs was due in part to certain product changes made that improved qualified referrals to our partners and, as a result, increased CPCs, across all geographies.

Media and Advertising Revenue

Media and advertising revenue primarily consists of revenue from display-based advertising (or "media advertising") across our Tripadvisor Group platform and decreased approximately $5 million and $11 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. These decreases were primarily due to declines in traditional display and programmatic advertising (together sometimes referred to as "on platform" advertising) that correlates closely with overall traffic volume which declined during the second and third quarters of 2025, due to the aforementioned traffic headwinds.

Tripadvisor Experiences and Dining Revenue

Tripadvisor experiences and dining revenue, which includes intercompany (intersegment) revenue consisting of affiliate marketing commissions earned primarily from experience bookings and, to a lesser extent, restaurant reservation bookings on Tripadvisor-branded websites and mobile apps, fulfilled by Viator and TheFork, respectively, are eliminated on a consolidated basis, in addition to revenue earned from Tripadvisor's restaurants service offerings. Tripadvisor experiences and dining revenue decreased approximately $4 million and $13 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to, previously mentioned headwinds impacting direct and SEO channel volumes, in experiences, as well as ongoing dynamics in restaurants related to our go-to-market shift from a sales-led model to a self-service model.

Other Revenue

Other revenue includes click-based advertising and display-based advertising revenue from our cruise, vacation rentals, flights, and rental cars offerings on Tripadvisor websites and mobile apps. Other revenue decreased approximately $4 million and $8 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to a decline in vacation rentals revenue as this offering continues to be strategically de-emphasized.

Viator Segment

Key Operating Metrics

We use the operating metrics described below to assist us in measuring our operations performance, identifying trends, formulating projections and making strategic decisions for the Viator segment. We are not aware of any uniform standards for calculating these metrics, which may hinder comparability with other companies that may calculate similarly titled metrics in a different way. Management believes it is useful to monitor these metrics together and not individually as it does not make business decisions based upon any single metric. We regularly review our processes and may adjust how we calculate these metrics to improve their accuracy. We make these key metrics available to investors because we believe they are useful to investors both because they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making, and because they may be used by investors to help analyze the health of our business. None of these metrics should be considered as an alternative to any measure of financial performance calculated in accordance with GAAP.

Number of Experience Bookings

We define an experience booking as a single tour, activity, or attraction that can be purchased through Viator's platform for one or several travelers, prior to adjustments such as date changes, refunds, or cancellations. This metric is reported at the time the booking is made. As an example, a single experience booked in January for three travelers would be reported as one experience booking in the first quarter. We believe that the number of experience bookings, an operational measure, is a useful indicator of the scale of our marketplace. The number of experiences booked were approximately 6.6 million and 17.9 million during the three and nine months ended September 30, 2025, respectively, an increase of approximately 18% and 16%, respectively, when compared to the same periods in 2024, primarily driven by growth on Viator's branded site and app as well as third-party points of sale.

Gross Booking Value ("GBV")

GBV represents the total dollar value of experience bookings powered by the Viator platform in a given period prior to any adjustments such as date changes, refunds or cancellations. GBV is an operational measure that provides an indication of total engagement and economic activity driven by our platform in a given period by all marketplace constituents (travelers, experiences operators, and partners). Management uses GBV for operational decision-making purposes to monitor the growth, scale, and reach of its online marketplace as well as assess the health of its global ecosystem. Accordingly, management does not consider GBV to be an indicator of revenue or any other financial statement measure.

GBV reached $1.3 billion and $3.7 billion during the three and nine months ended September 30, 2025, respectively, an increase of approximately 15% and 12%, respectively, when compared to the same periods in 2024, primarily due to growth in the number of experience bookings as discussed above, partially offset by a decline in pricing. The decline in pricing was primarily due to growth in third-party points of sale which generally sell lower priced products compared to the Viator and Tripadvisor points of sale.

Revenue and Adjusted EBITDA

Viator segment revenue increased by approximately $25 million and $66 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily driven by growth in booking volume, partially offset by a decline in pricing. The decline in pricing was primarily due to growth in third-party points of sale which generally sell lower priced products compared to the Viator and Tripadvisor points of sale. In addition, we estimate Viator's revenue growth rate was positively impacted by foreign currency fluctuations of approximately 3% and 1% during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024.

Adjusted EBITDA in our Viator segment improved by approximately $19 million and $52 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, and adjusted EBITDA margin improved by 5.5 percentage points and 7.0 percentage points during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. The improvement in adjusted EBITDA was primarily due to an increase in revenue as noted above and, to a lesser extent, a decrease in marketing costs, partially offset by an increase in variable costs related to revenue growth, such as credit card payment processing fees, and an increase in personnel costs to support business growth. The improvement in adjusted EBITDA margin during the three and nine months ended September 30, 2025 when compared to the same periods in 2024 was primarily due to a decrease in marketing costs as a percent of revenue.

TheFork Segment

TheFork segment revenue increased by approximately $14 million and $31 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. This improvement was primarily driven by booking volume growth largely in TheFork's branded channel and, to a lesser extent, increased adoption of our premium online reservation booking software offering and third-party partnership revenue. In addition, we estimate TheFork's revenue growth rate was positively impacted by foreign currency fluctuations of approximately 8% and 4% during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024.

Adjusted EBITDA in TheFork segment improved by approximately $8 million and $14 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, while adjusted EBITDA margin improved by 10.7 percentage points and 7.9 percentage points during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024. The improvement in adjusted EBITDA was primarily due to an increase in revenue as noted above, partially offset by increased marketing costs, in addition to an increase in cost of sales to support certain third-party partner relationships during the first half of 2025. The improvements in adjusted EBITDA margin was primarily due to lower personnel costs as a percentage of revenue.

Consolidated Expenses

Cost of Sales

Cost of sales consists of expenses that are directly related or closely correlated to revenue generation, including direct costs, such as credit card and other booking transaction payment fees, media production costs, ad serving fees, and other revenue generating costs. In addition, cost of sales includes operating costs such as bad debt expense and non-income taxes, including sales, use, digital services, and other non-income related taxes.

Cost of sales increased approximately $1 million the three months ended September 30, 2025, when compared to the same period in 2024, primarily due to an increase in variable costs supporting revenue growth including credit card payment processing fees in Viator, partially offset by a decrease in digital service tax costs in Viator and a decrease in bad debt expense in Brand Tripadvisor, reflecting strong collections during the quarter. Cost of sales increased approximately $6 million during the nine months ended September 30, 2025, when compared to the same period in 2024, primarily due to an increase in variable costs supporting revenue growth including credit card payment processing fees and other transaction related costs in Viator and TheFork, partially offset by lower digital service taxes ("DST"), primarily due to $4 million in incremental DST during the second quarter of 2024 related to enacted tax legislation in Canada requiring retrospective application, which did not reoccur in 2025, as well as, a decrease in bad debt expense in Brand Tripadvisor, as noted above.

Marketing

Marketing expenses consist of direct costs, including traffic generation costs from paid online traffic acquisition costs (including SEM and other online traffic acquisition costs), syndication costs and affiliate marketing commissions, social media costs, brand advertising (including connected television, traditional television and other offline advertising), promotions and public relations.

Marketing costs increased approximately $16 million and $40 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily driven by an increase in marketing costs in Brand Tripadvisor. Paid online marketing costs in Brand Tripadvisor increased as part of our overall marketing mix in our hotel and experiences offerings, and to a lesser extent TheFork, which combined increased $16 million and $38 million during the three and nine months ended September 30, 2025, respectively, partially offset by a decrease in Viator of $3 million and $7 million during the three and nine months ended September 30, 2025 when compared to the same periods in 2024, inclusive of intersegment (intercompany) marketing expenses.

Personnel

Personnel expenses consist primarily of salaries, payroll taxes, bonuses, employee health and other benefits, and stock-based compensation. In addition, personnel expenses include costs associated with contingent staff, bonuses and commissions for sales, sales support, customer support and marketing employees.

Personnel costs did not materially change during the three months ended September 30, 2025 when compared to the same period in 2024, as a decrease in personnel costs in Brand Tripadvisor were offset by an increase in personnel costs to support business growth in Viator and TheFork. Personnel costs decreased approximately $9 million during the nine months ended September 30, 2025 when compared to the same period in 2024, primarily driven by a reduction in headcount related to cost-reduction measures initiated in Brand Tripadvisor during the first quarter of 2025, partially offset by an increase in personnel costs to support business growth in Viator during the year.

Technology

Technology expenses consist primarily of licensing, data center costs including cloud-based solutions, maintenance, computer supplies, telecom, and content translation and localization costs.

Technology and content costs increased approximately $2 million and $6 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to increased data center costs in Brand Tripadvisor and licensing costs in Viator.

General and Administrative

General and administrative expenses consist primarily of professional service fees and other fees including audit, legal, tax and accounting, and other operating costs including real estate and office expenses, and non-compensation related personnel expenses such as travel, relocation, recruiting, and training expenses.

General and administrative costs decreased approximately $3 million during the three months ended September 30, 2025 when compared to the same period in 2024, primarily due to a decrease in real estate expense, as a result of a reduction in our real estate portfolio and, to a lesser extent, a decrease in professional service fees, both in Brand Tripadvisor. General and administrative costs decreased approximately $23 million during the nine months ended September 30, 2025 when compared to the same period in 2024, primarily due to an estimated accrual for the potential settlement of a regulatory related matter of $10 million during the first quarter of 2024, which was reduced by $4 million, during the second quarter of 2025, as discussed above and, to a lesser extent, transaction related costs incurred during 2024 of $4 million, which did not reoccur in 2025, all of which are included in Brand Tripadvisor. In addition, the decrease in real estate expenses, as discussed above and, to a lesser extent, a decrease in professional service fees, both in Brand Tripadvisor, contributed to the decrease in general and administrative costs during the nine months ended September 30, 2025 when compared to the same period in 2024.

Depreciation and Amortization

Depreciation expense consists of depreciation on computer equipment, leasehold improvements, furniture, office equipment and other assets, and amortization of capitalized website development costs and right-of-use ("ROU") assets related to our finance lease. Amortization consists of the amortization of definite-lived intangibles purchased in business acquisitions.

Depreciation and amortization increased approximately $2 million and $4 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to increased depreciation related to previous capital expenditure investments in internal website development, partially offset by the completion of amortization related to intangible assets purchased in business acquisitions in previous years.

Restructuring and other related reorganization costs

Restructuring and other related reorganization costs consist primarily of employee severance and related benefits and other related reorganization costs.

The Company incurred increased pre-tax restructuring and other related reorganization costs of approximately $10 million during the nine months ended September 30, 2025, as discussed above. This amount was not material for both the three months ended September 30, 2025 and 2024. Refer to "Note 5: Accrued Expenses and Other Current Liabilities" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for more information regarding restructuring and other related reorganization costs.

Interest Expense

Interest expense primarily consists of interest incurred, commitment fees, and debt issuance cost amortization related to the Credit Facility, the Term Loan B Facility, the 2025 Senior Notes, the 2026 Senior Notes, as well as imputed interest on finance leases.

Interest expense increased approximately $5 million and $12 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to an increase in our aggregate outstanding principal amount, which incrementally increased our ongoing financing costs. The majority of interest expense reported during the both three months ended September 30, 2025 and 2024, and the nine months ended September 30, 2025, was primarily related to the Term Loan B Facility, while during the nine months ended September 30, 2024, interest expense incurred was primarily related to the 2025 Senior Notes, which were redeemed in July 2024 and, to a lesser extent, the Term Loan B Facility. Refer to "Note 6: Debt" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information.

Interest Income

Interest income primarily consists of interest earned from available on demand bank deposits, time deposits, money market funds, and marketable securities, including amortization of discounts and premiums on our marketable securities.

Interest income decreased approximately $2 million and $7 million during the three and nine months ended September 30, 2025, respectively, when compared to the same periods in 2024, primarily due to a decrease in interest rates received on demand bank deposits, time deposits, and money market funds.

Other Income (Expense), Net

Other income (expense), net generally consists of net foreign exchange gains and losses, forward contract gains and losses, earnings/(losses) from equity method investments, gain/(loss) and impairments on non-marketable investments, gain/(loss) on sale/disposal of businesses, and other assets, gain/(loss) on extinguishment of debt, and other non-operating income (expenses).

Other expense, net decreased approximately $4 million during the three months ended September 30, 2025, when compared to the same period in 2024, primarily due to net foreign exchange gains incurred as a result of foreign currency rate movements during the period and a loss on extinguishment of debt of $2 million during the third quarter of 2024, which primarily consisted of a non-cash write-off of unamortized debt issuance costs, which did not reoccur in 2025. Other expense, net increased approximately $1 million during the nine months ended September 30, 2025, when compared to the same period in 2024, primarily due to net foreign exchange losses incurred as a result of foreign currency rate movements during the period, partially offset by a loss on disposal of certain assets of approximately $3 million during the first quarter of 2024 and a loss on extinguishment of debt of $2 million, as noted above, both of which did not reoccur in 2025.

(Provision) Benefit for Income Taxes

Our effective tax rate for the three months ended September 30, 2025 differs from the U.S. federal statutory rate of 21%, primarily due to benefits related to the 2017 Tax Act. Our effective tax rate for the nine months ended September 30, 2025 differs from the U.S. federal statutory rate of 21%, primarily due to a discrete tax benefit of $11 million recorded during the first quarter of 2025 to release income tax reserves as a result of the U.S. federal statute of limitation of assessment closing on tax years 2014, 2015, and 2016.

The change in our income tax provision during the three months ended September 30, 2025, when compared to the same period in 2024, was primarily due to changes in discrete items including stock-based compensation shortfalls. The change in our income tax provision during the nine months ended September 30, 2025, when compared to the same period in 2024, was primarily the result of an Internal Revenue Service ("IRS") audit settlement for the 2014, 2015, and 2016 tax years of $41 million, recorded during the nine months ended September 30, 2024, which did not reoccur in 2025, as well as, a discrete tax benefit of $11 million in the first quarter of 2025, as described above. Refer to "Note 7: Income Taxes" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information.

Net income (loss)

Net income increased by approximately $15 million during the three months ended September 30, 2025 when compared to the same period in 2024. Improvements in net income were largely driven by an increase in revenue, as described in more detail above under "Revenue and Segment Information" and a decrease in income tax expense of $17 million, as described in more detail above under "(Provision) Benefit for Income Taxes". These improvements were partially offset by increased marketing costs in our Brand Tripadvisor and TheFork segments, as described in more detail above under "Consolidated Expenses."

Net income increased by approximately $75 million during the nine months ended September 30, 2025 when compared to the same period in 2024. The improvement in net income was largely driven by an increase in revenue, as described in more detail above under "Revenue and Segment Information", a decrease in income tax expense of $73 million, as described in more detail above under "(Provision) Benefit for Income Taxes" and, to a lesser extent, a decrease in general and administrative costs in our Brand Tripadvisor segment, and a decrease in personnel costs, as described in more detail above under "Consolidated Expenses." These improvements were partially offset by increased marketing costs in our Brand Tripadvisor and TheFork segments during the nine months ended September 30, 2025 and, to a lesser extent, pre-tax restructuring and other related reorganization costs of approximately $10 million during the first quarter of 2025, and an increase in borrowing costs and a reduction in interest income, all of which is described in more detail above under "Consolidated Expenses."

Adjusted EBITDA

To provide investors with additional information regarding our financial results, we also disclose consolidated Adjusted EBITDA, which is a non-GAAP financial measure. A "non-GAAP financial measure" refers to a numerical measure of a company's historical or future financial performance, financial position, or cash flows that excludes (or includes) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP in such company's financial statements.

Adjusted EBITDA is also our reported measure of segment profit and a key measure used by our CODM, management and Board of Directors to understand and evaluate the operating performance of our business as a whole and our individual operating segments, and on which internal budgets and forecasts are based and approved. In particular, the exclusion of certain expenses in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons and better enables management and investors to compare financial results between periods as these costs may vary independent of ongoing core business performance.

Accordingly, we believe that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results in the same manner as our CODM, management and Board of Directors. We define Adjusted EBITDA as net income (loss) plus: (1) provision (benefit) for income taxes; (2) other expense (income), net; (3) depreciation and amortization; (4) stock-based compensation; (5) goodwill, long-lived asset, and intangible assets impairments; (6) legal reserves, settlements and other (including indirect tax reserves related to audit settlements and the impact of one-time changes resulting from enacted indirect tax legislation); (7) restructuring and other related reorganization costs; (8) transaction related expenses; and (9) non-recurring expenses and income unusual in nature or infrequently occurring.

Our use of Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results reported in accordance with GAAP. Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including net income (loss) and our other GAAP results.

Some of these limitations are:

The following table presents a reconciliation of Adjusted EBITDA to Net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, for the periods presented:

Stock-Based Compensation

Refer to "Note 9: Stock Based Awards" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information on current year equity award activity, including the issuance of approximately 6.7 million service-based RSUs with a weighted average grant-date fair value of $14.85 and approximately 0.9 million PSUs with a weighted average grant-date fair value of $14.92 during the nine months ended September 30, 2025.

Liquidity and Capital Resources

Our principal source of liquidity is cash flow generated from operations and our existing cash and cash equivalents balance. Our liquidity needs can also be met through drawdowns under the Credit Facility. As of September 30, 2025 and December 31, 2024, we had approximately $1.2 billion and $1.1 billion, respectively, of cash and cash equivalents, and approximately $496 million of available borrowing capacity under the Credit Facility. As of September 30, 2025, approximately $223 million of our cash and cash equivalents were held by our international subsidiaries outside of the U.S., of which approximately 35% was held in the U.K. As of September 30, 2025, the significant majority of our cash was denominated in U.S. dollars.

As of September 30, 2025, we had $597 million of cumulative undistributed earnings in foreign subsidiaries that are no longer considered to be indefinitely reinvested. As of September 30, 2025, we maintained a deferred income tax liability on our unaudited condensed consolidated balance sheet, which was not material, for the U.S. federal and state income tax and foreign withholding tax liabilities on the cumulative undistributed foreign earnings that we no longer consider indefinitely reinvested.

As of September 30, 2025, we are party to the Amended Credit Agreement, which, among other things, provides for a $500 million revolving Credit Facility with a maturity date of June 29, 2028. As of September 30, 2025 and December 31, 2024, we had no outstanding borrowings under the Credit Facility, except $4 million and $3 million, respectively, of undrawn standby letters of credit issued under the Credit Facility. The Company may borrow from the Credit Facility in U.S. dollars, Euros and Sterling. For information regarding interest rates on potential borrowings and commitment fees on the daily unused portion of capacity under the Credit Facility refer to "Note 6: Debt" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report. As of September 30, 2025, our unused revolver capacity was subject to a commitment fee of 0.25%, given the Company's total net leverage ratio. The Credit Facility, among other things, requires us to maintain a maximum total net leverage ratio and contains certain customary affirmative and negative covenants and events of default, including for a change of control. As of September 30, 2025 and December 31, 2024, we were in compliance with the covenant requirements in effect under the Credit Facility. While there can be no assurance that we will be able to meet the total net leverage ratio covenant in the future, based on our current projections, we do not believe there is a material risk that we will not remain in compliance throughout the next twelve months.

As of September 30, 2025, the Company had an aggregate outstanding principal amount of $353 million and approximately $821 million in short-term debt and long-term debt, respectively, on our unaudited condensed consolidated balance sheet pertaining to the 2026 Senior Notes and Term Loan B Facility, both of which are discussed below.

The outstanding principal of $345 million, 2026 Senior Notes provide, among other things, that interest at a rate of 0.25% per annum is payable on April 1 and October 1 of each year, until their maturity on April 1, 2026. The 2026 Senior Notes are senior unsecured obligations of the Company, although unconditionally guaranteed on a joint and several basis, by certain of the Company's domestic subsidiaries.

On July 8, 2024, under the Amended Credit Agreement, the Company issued a $500 million Term Loan B Facility maturing July 8, 2031, with an interest rate based on secured overnight financing rate ("SOFR") plus 2.75%, payable monthly. On July 15, 2024, the Company used these funds to fully redeem its outstanding $500 million, 2025 Senior Notes. The Term Loan B Facility was offered at 99.75% of par. On March 20, 2025, under the Amended Credit Agreement, the Company increased its existing Term Loan B Facility by $350 million, maturing July 8, 2031, with an interest rate based on SOFR plus 2.75% (the "Tack-On Incremental Term Loan B Facility"). We expect the proceeds from the Tack-On Incremental Term Loan B Facility will be used to fund the repurchase, repayment or redemption of the Company's outstanding 2026 Senior Notes and for general corporate purposes. The Tack-On Incremental Term Loan B Facility was offered at 98.56% of par. We refer to the Term Loan B Facility, combined with the Tack-On Incremental Term Loan B Facility, as the "Term Loan B Facility." The Term Loan B Facility is required to be paid down at 1.00% of the aggregate principal amount per year, repayable in quarterly installments on the last day of each calendar quarter, equal to 0.25% of the principal amount with the balance due on the maturity date. Principal payments of $6 million were made under the Term Loan B Facility during the nine months ended September 30, 2025.

The 2026 Senior Notes are not registered securities and there are currently no plans to register these notes as securities in the future. We may from time to time repurchase the 2026 Senior Notes and Term Loan B Facility through tender offers, open market purchases, privately negotiated transactions or otherwise. Such repurchases, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions and other factors. For further information on the Amended Credit Agreement, the Credit Facility, the Term Loan B Facility, 2025 Senior Notes and 2026 Senior Notes, refer to "Note 6: Debt" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report.

Significant uses of capital and other liquidity matters

On September 7, 2023, our Board of Directors authorized the repurchase of $250 million in shares of our common stock under a share repurchase program. This share repurchase program does not have a fixed expiration date or obligate the Company to acquire any particular number of shares and may be modified, suspended or discontinued at any time. During the three months ended September 30, 2025, the Company did not repurchase any shares of outstanding common stock under this share repurchase program. During the nine months ended September 30, 2025, we repurchased 2,808,080 shares of our outstanding common stock at an average price of $14.22 per share, exclusive of fees and commissions, or $40 million in the aggregate. As of September 30, 2025, we had $160 million remaining available to repurchase shares of our common stock under this share repurchase program. During the nine months ended September 30, 2024, we repurchased 1,366,385 shares of our outstanding common stock at an average price of $18.28 per share, exclusive of fees and commissions, or $25 million in the aggregate.

Our business typically experiences seasonal fluctuations that affect the timing of our annual cash flows during the year related to working capital. As a result of our experience bookings, we generally receive cash from travelers at the time of booking or prior to the occurrence of an experience, and we record these amounts, net of commissions, on our consolidated balance sheet as deferred merchant payables. We pay the operator, or the supplier, after the travelers' use. Therefore, we generally receive cash from the traveler prior to paying the operator and this operating cycle represents a source or use of cash to us. During the first half of the year, experience bookings typically exceed completed experiences, resulting in higher cash flow related to working capital, while during the second half of the year, particularly in the third quarter, this pattern reverses and cash flows from these transactions are typically negative. Other factors may also impact typical seasonal fluctuations, such as significant shifts in our business mix, adverse economic conditions, public health-related events, as well as other factors that could result in future seasonal patterns that are different from historical trends. In addition, new or different payment options offered to our customers could impact the timing of cash flows, such as our "Reserve Now, Pay Later" payment option, which allows travelers the option to reserve certain experiences and defer payment until a date no later than two days before the experience date. Usage of this payment option may continue to increase, though it is still not used in a majority of bookings to date, and affect the timing of our future cash flows and working capital.

As described above, on April 29, 2025, the Merger with LTRIP closed. The aggregate transaction price of the Merger totaled $437 million (of which $411 million consisted of cash payments), consisting of: (i) $431 million in cash and common stock consideration paid in connection with the repurchase, plus (ii) approximately $19 million in direct expenses and fees associated with the repurchase; partially offset by (iii) $13 million in LTRIP NOLs, tax effected, retained by the Company. Refer to "Note 1: Basis of Presentation" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report in the section entitled "LTRIP and Tripadvisor Merger Agreement and Loan Agreement" for further information.

As discussed in "Note 7: Income Taxes" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report, we received a final notice regarding a MAP resolution agreement for the 2014 through 2016 tax years in January 2024, which we subsequently accepted in February 2024. During the three months ended June 30, 2024, we made a payment to the IRS of $141 million, inclusive of estimated interest, and during the three months ended September 30, 2024, we made various state tax payments totaling $18 million, inclusive of estimated interest, to satisfy this audit settlement.

In addition, in January 2021, we received an issue closure notice from HM Revenue & Customs ("HMRC") in the U.K. relating to adjustments for the 2012 through 2016 tax years. These proposed adjustments are related to deductions for intercompany financing and would result in an increase to income tax expense in an estimated range of $25 million to $35 million, exclusive of interest expense, at the close of the audit if HMRC prevails. We are also currently subject to audit by HMRC in tax years 2017 through 2022. If HMRC were to seek adjustments of a similar nature through a closure notice for transactions in these years, we could be subject to significant additional tax liabilities. Although the ultimate timing for resolution of this matter is uncertain, any future payments required would negatively impact our operating cash flows.

We believe that our available cash and cash equivalents will be sufficient to fund our foreseeable working capital requirements, capital expenditures, existing business growth initiatives, debt and interest obligations, lease commitments, and other financial commitments through at least the next twelve months. Our future capital requirements may also include capital needs for acquisitions and/or other expenditures in support of our business strategy, which may potentially reduce our cash balance and/or require us to borrow under the Credit Facility or to seek other financing alternatives.

Our cash flows for the nine months ended September 30, 2025 and 2024, as reflected in our unaudited condensed consolidated statements of cash flows, are summarized in the following table:

During the nine months ended September 30, 2025, our primary source of cash was from operations, while our primary use of cash was from financing activities (including $411 million to repurchase our outstanding common stock pursuant to the Merger, including transaction costs, $40 million in repurchases of our outstanding common stock under the existing share repurchase program, and $15 million in payments of withholding taxes on net share settlements of equity awards) and investing activities (including $63 million in capital expenditures). This use of cash was funded with existing cash and cash equivalents and operating cash flows generated during the period, as well as, financing activities which includes $341 million in borrowings from our Tack-On Incremental Term Loan B Facility, net of financing costs.

During the nine months ended September 30, 2024, our primary source of cash was from operations, while our primary use of cash was from financing activities (including $25 million in repurchases of our outstanding common stock under the existing share repurchase program, $17 million in payments of withholding taxes on net share settlements of equity awards, and $7 million in financing costs related to the issuance of the Term Loan B Facility) and investing activities (including $51 million in capital expenditures). This use of cash was funded with existing cash and cash equivalents and operating cash flows generated during the period.

Net cash provided by operating activities for the nine months ended September 30, 2025, increased by $201 million when compared to the same period in 2024, primarily due to an improvement in net income of $74 million, an increase in working capital of $107 million, and an increase in non-cash items of $20 million, primarily due to a decrease in deferred income tax benefits. The increase in working capital was primarily driven by U.S. federal tax payments and various state tax payments totaling approximately $160 million during the second and third quarters of 2024 related to an IRS audit settlement, as discussed above, which did not reoccur in 2025, partially offset by a decrease in our income tax provision of approximately $73 million, as discussed above under "(Provision) Benefit for Income Taxes." In addition, changes in working capital related to the timing of collection of cash from customers, the timing of vendor payments and deferred merchant payments to experiences operators, contributed to the fluctuation in working capital.

Net cash used in investing activities for the nine months ended September 30, 2025 increased by $14 million when compared to the same period in 2024, largely due to an increase in capital investment primarily in technology and office space across the business.

Net cash used in financing activities for the nine months ended September 30, 2025 increased by $82 million when compared to the same period in 2024, primarily due to $411 million for the repurchase of our outstanding common stock pursuant to the Merger, a $15 million increase in net cash used to repurchase shares of our outstanding common stock under the existing share repurchase program, and a net decrease in proceeds received from the issuance of debt under the Term Loan B Facility during 2025 of $152 million, net of financing costs, partially offset by the repayment of the 2025 Senior Notes of $500 million during the third quarter of 2024.

Contractual Obligations, Commercial Commitments and Off-Balance Sheet Arrangements

There have been no material changes outside the normal course of business to our contractual obligations and commercial commitments since December 31, 2024. As of September 30, 2025, other than our contractual obligations and commercial commitments, we did not have any off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of Regulation S-K promulgated by the SEC. Refer to "Liquidity and Capital Resources" in Part II, Item 7. -Management's Discussion and Analysis of Financial Condition and Results of Operations of our 2024 Annual Report for a discussion of our contractual obligations and commercial commitments.

Contingencies

In the ordinary course of business, we are party to legal, regulatory and administrative matters, including threats thereof, arising out of, or in connection with our operations. These matters may involve claims involving, but not limited to, intellectual property rights (including privacy rights), tax matters (including value-added, excise, digital services, sales and use, transient occupancy and

accommodation taxes), regulatory compliance (including competition, consumer protection matters, data privacy and cybersecurity matters), contractual claims (including related to our material agreements or other contracts), defamation and reputational claims, personal injury claims, labor and employment matters and commercial disputes. Periodically, we review the status of all significant outstanding matters to assess any potential financial exposure. We record the estimated loss in our consolidated statement of operations when (i) it is probable that an asset has been impaired or a liability has been incurred; and (ii) the amount of the loss can be reasonably estimated and is material. We provide disclosures in the notes to the consolidated financial statements for loss contingencies that do not meet both of these conditions if there is a reasonable possibility that a loss may have been incurred that would be material to the consolidated financial statements. We base accruals on the best information available at the time, which can be highly subjective. Although occasional adverse decisions or settlements may occur, we do not believe that the final disposition of any of these matters will have a material adverse effect on our business, except for certain known income tax matters discussed below. However, the final outcome of these matters could vary significantly from our estimates. Finally, there may be claims or actions pending or threatened against us of which we are currently not aware and the ultimate disposition of which could have a material adverse effect on us.

We are under audit by the IRS and various other domestic and foreign tax authorities with regards to income tax and non-income tax matters. We have reserved for potential adjustments to our provision for income taxes that may result from examinations by, or any negotiated agreements with, these tax authorities. Although we believe our tax estimates are reasonable, the final determination of audits could be materially different from our historical income tax provisions and accruals. The results of an audit could have a material effect on our financial position, results of operations, or cash flows in the period for which that determination is made.

Refer to "Note 7: Income Taxes" and "Note 8: Commitments and Contingencies" in the notes to our unaudited condensed consolidated financial statements in Item 1 in this Quarterly Report for further information on other potential contingencies, including ongoing audits by the IRS and various other domestic and foreign tax authorities, and other tax and legal matters. Over recent years, the Organization for Economic Cooperation and Development ("OECD") through its "Inclusive Framework" has been working on a "two-pillar" global tax consensus project that, if implemented, would result in certain changes to the current global tax regulatory framework. The OECD's "Pillar One" initiative proposes to reallocate certain profits from the largest and most profitable multinational businesses to countries where the customers of those businesses are located, and the "Pillar Two" initiative proposes a global minimum income tax rate on corporations of 15%. In response to these proposals, certain jurisdictions have enacted legislation to implement a global minimum income tax of 15%, which currently has no impact on our financial results, as well as legislation to impose new forms of gross receipts taxes, such as digital services taxes imposed on digital advertising and online marketplace platforms/services.

If consensus is reached on Pillar One, unilateral digital services taxes should be repealed, however until such time we continue to be subject to these taxes and are currently subject to unilateral digital services taxes. While the future of the global tax regulatory landscape remains uncertain, we continue to monitor the OECD's and members ongoing discussions to determine the current and potential impact on our unaudited condensed consolidated financial statements. During the three and nine months ended September 30, 2025, we recorded $6 million and $13 million, respectively, of digital service taxes to cost of sales on our unaudited condensed consolidated statements of operations. During the three and nine months ended September 30, 2024, we recorded $7 million and $18 million, respectively, of digital service taxes to cost of sales on our unaudited condensed consolidated statements of operations, which includes a one-time charge of $4 million during the second quarter of 2024, resulting from enacted tax legislation in Canada during June 2024 related to digital service taxes, which required retrospective application back to January 1, 2022.

Due to the one-time transition tax on the deemed repatriation of undistributed foreign subsidiary earnings and profits in 2017, as a result of the 2017 Tax Act, the majority of previously unremitted earnings have been subjected to U.S. federal income tax. To the extent future distributions from these subsidiaries will be taxable, a deferred income tax liability has been accrued on our unaudited condensed consolidated balance sheet, which was not material as of September 30, 2025. As of September 30, 2025, $597 million of our cumulative undistributed foreign earnings were no longer considered to be indefinitely reinvested.