Earnings release
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1/10 Travelzoo 590 Madison Avenue 35th Floor New York, NY 10022 Investor Relations: ir@travelzoo.com FOR IMMEDIATE RELEASE Travelzoo Reports Second Quarter 2026 Results NEW YORK, July 28, 2026 — Travelzoo® (NASDAQ: TZOO): • Revenue of $23.2 million, down 3% year-over-year • Consolidated operating loss of $2.8 million • Non-GAAP consolidated operating loss of $2.1 million • Cash flow from operations of $(1.7) million • Earnings per share (EPS) of $(0.21) Travelzoo, the club for travel enthusiasts, today announced financial results for the second quarter ended June 30, 2026. Consolidated revenue was $23.2 million, down 3% from $23.9 million year-over- year. In constant currencies, revenue was $23.1 million. Travelzoo's reported revenue consists of advertising revenues and commissions, derived from and generated in connection with purchases made by Travelzoo members, and membership fees. During Q2, international conflicts created uncertainty among advertisers and travelers. All of Travelzoo’s business segments were negatively impacted. Management considers this a temporary effect. In Q2, we continued to invest significantly in growing Club Members and accelerated the shift towards recurring membership revenues. Marketing costs were expensed immediately. Membership fees revenue is recognized ratably over the subscription period of 12 months. In Q2, the number of renewals of memberships jumped to the highest ever. Going forward, we expect renewals of memberships to further increase because of a growing base of members. We refer to our investor presentation.
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2/10 Net Loss attributable to Travelzoo was $2.1 million for Q2 2026, or $(0.21) per share, compared with $0.12 per share in the prior-year period. Non-GAAP operating loss was $2.1 million. Non-GAAP operating loss excludes stock option expenses ($684,000). Please refer to “Non-GAAP Financial Measures” and the tabular reconciliation below. “We will continue to leverage Travelzoo's global reach, trusted brand, and strong relationships with top travel suppliers to negotiate more Club Offers for Club Members and add new benefits, such as our popular complimentary airport lounge access worldwide in case of a delayed flight,” said Holger Bartel, Travelzoo's Global CEO. “Travelzoo members are affluent, active, and open to new experiences. We inspire travel enthusiasts to travel to places they never imagined they could. Travelzoo is the must-have membership for those who love to travel as much as we do." Travelzoo North America North America business segment revenue decreased 3% year-over-year to $15.7 million. Operating loss for Q2 2026 was $1.5 million, or 10% of revenue, compared to operating profit of $2.8 million or 17% of revenue in the prior-year period. Travelzoo Europe Europe business segment revenue decreased 2% year-over-year to $6.2 million. Operating loss for Q2 2026 was $1.2 million, or 19% of revenue, compared to operating loss of $0.9, or 14% of revenue in the prior-year period. Jack’s Flight Club Jack’s Flight Club is a membership subscription service in which Travelzoo has a 60% ownership interest. Revenue decreased 7% year-over-year to $1.3 million. Jack’s Flight Club’s revenue from subscriptions is recognized ratably over the subscription period (quarterly, semi-annually, annually). Operating loss for Q2 2026 was $34,000, compared to operating profit of $156,000 in the prior-year period. New Initiatives New Initiatives business segment revenue, which includes Licensing and Travelzoo META, was $17,000. Operating loss for Q2 2026 was $35,000. In 2020, Travelzoo entered into royalty-bearing licensing agreements with local licensees for the exclusive use of Travelzoo’s brand, business model, and members in Australia, Japan, New Zealand,
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3/10 and Singapore. Under these arrangements, Travelzoo’s existing members in Australia, Japan, New Zealand, and Singapore will continue to be owned by Travelzoo as the licensor. Licensing revenue from the licensee in Australia was $10,000 for Q2 2026. Licensing revenue from the licensee in Japan was $7,000 for Q2 2026. Licensing revenue is expected to increase going forward. Reach Travelzoo reaches 30 million travelers. This includes Jack's Flight Club. Comparisons to prior periods are no longer meaningful due to strategic developments of the Travelzoo membership. Income Taxes The reported income tax benefit for Q2 2026 was $(382,000). Balance Sheet As of June 30, 2026, cash, cash equivalents and restricted cash were $7.6 million. Cash flow from operations was $(1.7) million. Deferred revenue increased because membership fees are earned over the subscription period. Membership fees revenue is recognized ratably over the subscription period. Share Repurchase Program During Q2 2026, the Company repurchased 200,000 shares of its outstanding common stock. Looking Ahead For Q3 2026, we expect year-over-year revenue growth. We also expect revenue growth in subsequent quarters, as membership fees revenue is recognized ratably over the subscription period of 12 months, as we grow Club Members, and as more Legacy Members become Club Members. Over time, we expect profitability to increase as recurring membership fees revenue will be recognized. In the short- term, fluctuations in reported net income are likely. In 2024, we introduced a membership fee for Travelzoo. Legacy Members, who joined prior to 2024, continue to receive certain travel offers. However, Club Offers and new benefits are only available to Club Members, who pay the membership fee. Therefore, we are seeing many Legacy Members become Club Members over time—in addition to new members who join. Non-GAAP Financial Measures Management calculates non-GAAP operating income when evaluating the financial performance of the
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4/10 business. Calculation of non-GAAP operating income, also called “non-GAAP operating profit” in this press release and today’s earnings conference call, excludes the following items: amortization of intangibles, stock option expenses, and severance-related expenses. This press release includes a table which reconciles GAAP operating income to the calculation of non-GAAP operating income. Non- GAAP operating income is not required by, or presented in accordance with, generally accepted accounting principles in the United States of America ("GAAP"). This information should be considered as supplemental in nature and should not be considered in isolation or as a substitute for the financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similarly titled measures reported by other companies. Conference Call Travelzoo will host a conference call to discuss second quarter 2026 results today at 11:00 a.m. ET. Please visit http://ir.travelzoo.com/events-presentations to • download the management presentation (PDF format) to be discussed in the conference call • access the webcast. About Travelzoo We, Travelzoo®, are the club for travel enthusiasts. We reach 30 million travelers. Club Members receive Club Offers negotiated and rigorously vetted by our deal experts around the globe. Our relationships with thousands of top travel companies give us access to irresistible deals. Our club and its benefits are built around the lifestyle of a modern travel enthusiast. Certain statements contained in this press release that are not historical facts may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. These forward-looking statements may include, but are not limited to, statements about our plans, objectives, expectations, prospects and intentions, markets in which we participate and other statements contained in this press release that are not historical facts. When used in this press release, the words “expect”, “predict”, “project”, “anticipate”, “believe”, “estimate”, “intend”, “plan”, “seek” and similar expressions are generally intended to identify forward-looking statements. Because these forward- looking statements involve risks and uncertainties, there are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including changes in our plans, objectives, expectations, prospects and intentions and other factors discussed in our filings with the SEC. We cannot guarantee any future levels of activity, performance or achievements. Travelzoo undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of this press release.
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5/10 Travelzoo Condensed Consolidated Statements of Operations (Unaudited) (In thousands, except per share amounts) Three months ended Six months ended June 30, June 30, 2026 2025 2026 2025 Revenues $ 23,208 $ 23,906 $ 47,481 $ 47,046 Cost of revenues 7,104 5,163 12,340 9,335 Gross profit 16,104 18,743 35,141 37,711 Operating expenses: Sales and marketing 13,734 11,483 24,850 21,708 Product development 602 698 1,266 1,332 General and administrative 4,530 4,502 8,343 8,807 Total operating expenses 18,866 16,683 34,459 31,847 Operating income (loss) (2,762) 2,060 682 5,864 Other income, net 274 161 270 790 Income (loss) before income taxes (2,488) 2,221 952 6,654 Income tax expense (benefit) (382) 740 561 1,912 Net income (loss) (2,106) 1,481 391 4,742 Net income attributable to non-controlling interest 30 79 51 172 Net income (loss) attributable to Travelzoo $ (2,136) $ 1,402 $ 340 $ 4,570 Net income (loss) per share—basic $ (0.21) $ 0.13 $ 0.03 $ 0.39 Net income (loss) per share—diluted $ (0.21) $ 0.12 $ 0.03 $ 0.38 Shares used in per share calculation—basic 10,319 11,139 10,577 11,617 Shares used in per share calculation—diluted 10,319 11,505 10,658 12,088
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6/10 Travelzoo Condensed Consolidated Balance Sheets (Unaudited) (In thousands) June 30, 2026 December 31, 2025 Assets Current assets: Cash and cash equivalents $ 6,838 $ 10,007 Accounts receivable, net 14,543 10,723 Prepaid income taxes 1,827 1,364 Prepaid expenses and other 2,064 1,302 Total current assets 25,272 23,396 Deposits and other 193 166 Deferred tax assets 4,744 4,202 Restricted cash 754 756 Operating lease right-of-use assets 4,334 4,047 Property and equipment, net 132 231 Intangible assets, net 1,450 1,450 Goodwill 10,944 10,944 Total assets $ 47,823 $ 45,192 Liabilities and Equity Current liabilities: Accounts payable $ 7,811 $ 7,761 Merchant payables 10,723 11,665 Accrued expenses and other 5,544 3,926 Deferred revenue 13,400 8,728 Income tax payable 71 279 Operating lease liabilities 2,026 1,811 Total current liabilities 39,575 34,170 Long-term tax liability 10,770 9,260 Long-term operating lease liabilities 4,074 4,184 Total liabilities 54,419 47,614 Common stock 102 109 Tax indemnification (9,537) (9,537) Retained earnings 3,105 7,243 Accumulated other comprehensive loss (5,410) (5,331) Total Travelzoo stockholders’ equity (deficit) (11,740) (7,516) Non-controlling interest 5,144 5,094 Total stockholders' equity (deficit) (6,596) (2,422) Total liabilities and stockholders' equity $ 47,823 $ 45,192
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7/10 Travelzoo Condensed Consolidated Statements of Cash Flows (Unaudited) (In thousands) Three months ended Six months ended June 30, June 30, 2026 2025 2026 2025 Cash flows from operating activities: Net income (loss) $ (2,106) $ 1,481 $ 391 $ 4,742 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 54 106 110 182 Stock-based compensation 684 339 719 708 Deferred income tax (728) 1 (753) 5 Net foreign currency effects (24) (188) 52 (295) Provision of loss (net recoveries) on accounts receivable and refund reserve (157) (83) (146) 124 Changes in operating assets and liabilities: Accounts receivable (1,039) 1,309 (3,857) 1,743 Prepaid income taxes (322) 301 (575) 238 Prepaid expenses, deposits and other 1,008 277 (521) (144) Accounts payable (492) (36) 18 (180) Merchant payables (2,723) (2,790) (814) (4,441) Accrued expenses and other 1,179 975 1,733 1,842 Deferred revenue 2,780 478 4,763 1,720 Income tax payable (57) (1,058) (121) (2,007) Other liabilities 276 188 1,186 345 Net cash (used) provided by operating activities (1,667) 1,300 2,185 4,582 Cash flows from investing activities: Purchases of property and equipment (6) (14) (14) (34) Net cash used in investing activities (6) (14) (14) (34) Cash flows from financing activities: Repurchase of common stock (1,938) (2,500) (5,205) (11,418) Exercise of stock options and taxes paid for net share settlement of equity awards — (104) — (104) Net cash used in financing activities (1,938) (2,604) (5,205) (11,522) Effect of exchange rate on cash, cash equivalents and restricted cash (122) 289 (137) 432 Net increase (decrease) in cash, cash equivalents and restricted cash (3,733) (1,029) (3,171) (6,542) Cash, cash equivalents and restricted cash at beginning of period 11,325 12,227 10,763 17,740 Cash, cash equivalents and restricted cash at end of period $ 7,592 $ 11,198 $ 7,592 $ 11,198
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8/10 Travelzoo Segment Information from Continuing Operations (Unaudited) (In thousands) Three months ended June 30, 2026 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Consolidated Revenues from unaffiliated customers $ 15,548 $ 6,376 $ 1,267 $ 17 $ 23,208 Intersegment revenues 131 (139) 8 — — Total net revenues 15,679 6,237 1,275 17 23,208 Sales and marketing expenses 8,307 4,821 606 — 13,734 Other expenses 8,866 2,615 703 52 12,236 Operating profit (loss) (1,494) (1,199) (34) (35) (2,762) Other income, net 274 Income (loss) from operations before income taxes (2,488) Three months ended June 30, 2025 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Consolidated Revenues from unaffiliated customers $ 15,737 $ 6,740 $ 1,410 $ 19 $ 23,906 Intersegment revenues 395 (355) (40) — — Total net revenues 16,132 6,385 1,370 19 23,906 Sales and marketing expenses 6,453 4,427 603 — 11,483 Other expenses 6,861 2,841 611 50 10,363 Operating profit (loss) 2,818 (883) 156 (31) 2,060 Other income, net 161 Income from operations before income taxes 2,221
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9/10 Six months ended June 30, 2026 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Consolidated Revenues from unaffiliated customers $ 30,875 $ 13,961 $ 2,611 $ 34 $ 47,481 Intersegment revenues 473 (448) (25) — — Total net revenues 31,348 13,513 2,586 34 47,481 Sales and marketing expenses 14,310 9,342 1,198 — 24,850 Other expenses 15,285 5,091 1,470 103 21,949 Operating profit (loss) 1,753 (920) (82) (69) 682 Other income, net 270 Income from operations before income taxes 952 Six months ended June 30, 2025 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Consolidated Revenues from unaffiliated customers $ 30,567 $ 13,710 $ 2,733 $ 36 $ 47,046 Intersegment revenues 693 (613) (80) — — Total net revenues 31,260 13,097 2,653 36 47,046 Sales and marketing expenses 12,153 8,329 1,226 — 21,708 Other expenses 12,695 5,423 1,259 97 19,474 Operating profit (loss) 6,412 (655) 168 (61) 5,864 Other income, net 790 Income from operations before income taxes 6,654
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10/10 Travelzoo Reconciliation of GAAP to Non-GAAP Information (Unaudited) (In thousands, except per share amounts) Three months ended Six months ended June 30, June 30, 2026 2025 2026 2025 GAAP operating expense $ 18,866 $ 16,683 $ 34,459 $ 31,847 Non-GAAP adjustments: Amortization of intangibles (A) — 16 — 42 Stock option expenses (B) 684 339 719 709 Severance-related expenses (C) — 6 15 227 Non-GAAP operating expense 18,182 16,322 33,725 30,869 GAAP operating income (loss) (2,762) 2,060 682 5,864 Non-GAAP adjustments (A through C) 684 361 734 978 Non-GAAP operating income (loss) (2,078) 2,421 1,416 6,842 ###