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On February 22, Ctrip Group (NASDAQ: TCOM; Hong Kong Stock Exchange: 9961) announced its unaudited financial results for the fourth quarter and full year of 2023. In the fourth quarter, the company's net operating income was 10.3 billion yuan, and the net operating income for the whole year of 2023 was 44.5 billion yuan, an increase of 105% and 122% year-on-year, respectively. While its performance is growing rapidly, Ctrip focuses on high-quality development. In 2023, it will continue to increase technological innovation, continuously improve user satisfaction and the ability to serve partners. It will also actively take responsibility in promoting low-carbon industry development, employment, and rural revitalization, and enhance its sustainable development capabilities.

"In 2023, driven by the tourism boom, China embarked on an important journey of reconnecting with the world. Thanks to our expanding market influence, our international business has achieved significant growth." said Liang Jianzhang, co-founder and chairman of the board of directors of Ctrip Group, "We will continue to pay attention to globalization and artificial intelligence innovation, and have confidence in building upon our success in 2023 and further exploring future opportunities."

Co recovery with the tourism industry in the fourth quarter and significant growth in annual performance

Ice and snow tourism, as well as local cultural and tourism activities, have caused the traditional off-season tourism market to maintain high heat in the fourth quarter, driving the growth of Ctrip's various businesses. In the fourth quarter, Ctrip's accommodation booking revenue was 3.9 billion yuan, a year-on-year increase of 131%; The operating revenue of transportation ticketing was 4.1 billion yuan, a year-on-year increase of 86%; The operating revenue of tourism and vacation business was 704 million yuan, a year-on-year increase of 329%; The operating revenue of business travel management business was 634 million yuan, a year-on-year increase of 129%. In the fourth quarter, Ctrip's net operating revenue increased by 105% year-on-year, reaching 10.3 billion yuan.

In 2023, the tourism industry is accelerating its recovery, with a significant year-on-year increase in both the number of tourists and the amount of tourism consumption. Seizing the momentum of tourism recovery, Ctrip has increased investment in AI technology and continuously improved service quality from multiple dimensions such as products, content, and services, achieving rapid business growth throughout the year. In 2023, Ctrip's net operating income was 44.5 billion yuan. Among them, the revenue from accommodation booking was 17.3 billion yuan, the revenue from transportation ticketing was 18.4 billion yuan, the revenue from tourism and vacation business was 3.1 billion yuan, and the revenue from business and tourism management business was 2.3 billion yuan, with year-on-year growth of 133%, 123%, 294%, and 109%, respectively.

"We are excited about the strong performance of our businesses over the past year," said Sun Jie, CEO of Ctrip Group. "The global tourism industry has shown excellent resilience and is expected to maintain its growth trend. To seize this trend and create new opportunities, we will continue to invest in technology and product innovation, improve customer service, and promote sustainable development of the tourism industry."

At present, the Ctrip International OTA platform has been operating in 39 countries and regions in Asia, Europe, and the Americas, fully leveraging international resources and capabilities. Ctrip actively helps promote the development of outbound tourism. In the fourth quarter, Ctrip signed a strategic framework agreement with the China Association for International Cultural Exchange. Ctrip will cooperate with the implementation of the "Hello China" plan, build a Chinese tourism entry guidance service platform, and assist in organizing related supporting activities such as the China France Tourism Year, the China US Tourism Summit, and the World Tourism Development Conference.

The international layout and service capabilities have enabled Ctrip to benefit from the recovery of inbound and outbound tourism earlier, achieving rapid growth in international business. In the fourth quarter, Ctrip's outbound hotel and flight bookings recovered to over 80% of the same period in 2019, while the international aviation industry's passenger volume recovered to 60%. The total bookings of international OTA platforms under Ctrip Group increased by over 70% year-on-year.

Technology driven high-quality development continuously enhances B-end and C-end service capabilities

Compared to its growth rate, Ctrip places more emphasis on quality development, continuously improving user satisfaction, and empowering its partners. In 2023, Ctrip's product research and development expenses reached 12.1 billion yuan, a year-on-year increase of 45%, accounting for approximately 27% of net operating income. Nearly 30% of Ctrip's net revenue is invested in research and development, providing underlying support for business innovation and ensuring the improvement of service quality for C-end users and B-end partners.

The positive results of technological research and development are reflected in many aspects such as customer service, content innovation, and partner empowerment. Last July, Ctrip launched the vertical model of the tourism industry, Ctrip Quest (internal testing), and the AI travel assistant TripGenie, providing users with personalized itinerary arrangements, real-time booking and other services. As of the end of 2023, with the help of intelligent customer service, the self-service problem-solving rate of Ctrip's flight and hotel services has reached over 70%. Combined with manual customer service, in 2023, Ctrip user satisfaction remained at a high level, with a 20% increase in NPS (net recommendation value) in Q4 compared to Q3. In addition, Ctrip has also built 7 x 24 hours of multilingual customer service support and global SOS emergency support services to safeguard global tourists and continuously improve user satisfaction.

By combining intelligent algorithms with manual verification, Ctrip has upgraded its word-of-mouth ranking, providing users with more reliable content references and inspiring more travel inspiration. The Ctrip word-of-mouth ranking saw a year-on-year increase of over 150% in daily visits in 2023, bringing more exposure and transaction opportunities to the listed merchants: contributing 23% of traffic and nearly 10% of GMV to the merchants throughout the year. Trip The daily average visit volume of overseas users on the Best List in 2023 has increased by more than 5 times year-on-year.

In terms of empowering partners, Ctrip assists partners in various fields such as destinations, hotels, travel agencies, stores, car rentals, and business travel customers to accelerate recovery and create incremental value. In 2023, Ctrip launched the "China Tourism Revitalization A Plan", which received responses from more than 30 provinces, cities, and autonomous regions, promoting the recovery of cultural and tourism in various regions, inbound tourism marketing, and smart tourism construction. In November last year, Ctrip landed its first national cultural and tourism industry incubation center in Fuzhou. In 2023, Ctrip also jointly distributed cultural and tourism consumption vouchers with more than 20 provinces and municipalities across the country, with an overall leverage ratio of 1:4.2, that is, issued 1 yuan consumption vouchers, which will drive a direct transaction volume of approximately 4.2 yuan.

Ctrip always insists on creating win-win value for its partners. In 2023, through refined operations, the number of airport segments in small and medium-sized cities on the Ctrip platform has significantly increased, with a year-on-year increase of 127% from 2022 and a 13% increase from 2019. The number of new homestay merchants admitted by Ctrip increased by 122% year-on-year throughout the year. Through professional training, traffic exposure, and other measures, the GMV of new homestay merchants in 2023 increased by more than three times compared to 2022. The number of cooperative merchants in Ctrip's tourism and vacation business increased by 54% year-on-year, and the transaction amount increased by more than three times year-on-year. As of the end of 2023, Ctrip Business Travel has provided digital empowerment to 960000 growth oriented enterprises and 15000 large enterprises, helping to reduce travel management expenses by up to 30%. In 2023, it helped corporate customers save travel costs by 3.58 billion yuan.

Promoting employment and rural revitalization to support sustainable development of industries

In the past few years, many people have left the tourism industry. With the recovery of the industry, Ctrip has taken multiple measures to cultivate tourism talents and help talent return and sustainable development of the tourism industry. In 2023, Sun Jie, CEO of Ctrip Group, collaborated with tourism industry partners such as First Travel Home, Wuzhen Tourism, Haichang Ocean Park, and Intercontinental Hotels to launch a recruitment plan for women - the "Travel Mulan Plan", which has provided over 21000 women with tourism industry jobs. Ctrip stores have launched the "New Youth, New Tourism, New Start" college student employment and entrepreneurship support plan, providing specialized recruitment channels and exclusive training for newly graduated college students. Ctrip also collaborates with Chongqing Hailian Vocational and Technical College and Sanya Zhongrui Hotel Management Vocational College to establish an industry learning center, guided by industry demand, to provide talent for the tourism industry. Currently, it has trained nearly a thousand college students.

As of 2023, through self recruitment and platform registration of tour guides, customized instructors, and other means, Ctrip has directly driven the employment of over 100000 people. In addition, practitioners who provide services such as hotels, air tickets, tickets, and transportation on the platform have indirectly driven the employment of over 10 million people. The World Tourism and Travel Council predicts that in 2023, the number of direct or indirect employment opportunities in China's tourism and travel industry may account for 10% of the total employment opportunities. Promoting employment in the tourism industry will effectively help solve the employment problem of the whole society.

The tourism industry has a significant driving effect on consumption such as accommodation, catering, and shopping, and is an effective way to consolidate the achievements of rural poverty alleviation and rural revitalization. Based on Ctrip Vacation Farm, Ctrip delves into rural areas and uses high-quality homestay products as a driving force to drive multi industry linkage such as rural environmental construction, farmer employment, and intangible cultural heritage inheritance, achieving the unity of economic and social benefits.

In 2023, Ctrip opened 8 new vacation farms, with a total of 28 currently. These Ctrip vacation farms have driven an average annual income growth of 40000 yuan per capita for local employees, creating a cumulative value of 860 million yuan, indirectly bringing about a growth of 580 million yuan in related industry chain output value, and more than 20000 new jobs in related industries.

Sun Jie said, "By creating more job opportunities and actively promoting economic development, we strive to have a positive impact on the communities we serve. We firmly consider sustainable development as an integral part of our long-term growth strategy, formulate sustainable development strategies, always prioritize service quality, and promote sustainable industry development through community friendliness, environmental friendliness, family friendliness, and ecological chain friendliness."