Despegar.com, Corp.

Q3 revenue was $194 million, up 8.9%-9% year over year; FX-neutral revenue growth was 53% year over year. Gross bookings were $1.3 billion, with constant-currency growth of 35% year over year, while reported gross bookings were slightly down due to FX headwinds. Gross margin was 73.8% (described as almost 74%), and gross profit was $143.1 million, up 18.7% year over year. Adjusted EBITDA was a record $48 million, up 94.2% year over year, with adjusted EBITDA margin at 24.8% to 25%. Adjusted net income was $36.1 million, up from $8.8 million a year ago, and adjusted EPS was $0.34 versus $0.01 last year. Operating cash flow was $26.6 million, capex was $7.7 million, and cash balance ended at $220 million, up $15.2 million sequentially despite a $7 million preferred shareholder payment. For full year 2024, management kept revenue guidance at at least $760 million (8% growth) and raised adjusted EBITDA guidance from at least $160 million to at least $170 million (47% growth).

Damián Scokin said the quarter showed Despegar’s business model is delivering profitable growth even with FX headwinds in Latin America. He highlighted the record take rate of 14.6%, the recovery in Argentina, the expansion of B2B, the new 10-year Expedia lodging outsourcing agreement, and early momentum in SOFIA as key strategic wins. His tone was confident and upbeat, emphasizing stronger competitive positioning, broader supply access, and new growth avenues through partnerships and AI.

Amit Singh emphasized that the quarter featured solid demand plus strong cost discipline, which drove record gross profit margin of 73.8% and record adjusted EBITDA of $48 million. He cited lower installment costs, lower credit card processing fees in Mexico, reduced card expenses from fraud prevention improvements, and lower interest rates in Argentina as margin drivers. He also noted financial expense of $29 million, operating cash flow of $26.6 million, capex of $7.7 million, and cash of $220 million, while describing capital allocation as disciplined and focused on acquisitions that create long-term shareholder value. He said the Expedia agreement should begin showing up in the P&L as early as Q1 next year, and reiterated full-year guidance of at least $760 million revenue and at least $170 million adjusted EBITDA.

Analysts focused on whether the record take rate is sustainable, when the Expedia renegotiation will benefit the P&L, what changed in Argentina, and how FX and Mexico air-capacity issues affect demand. Management said the long-term take-rate target is around 13%, though current profitability and product mix are supporting higher levels in the near term. On Expedia, Damián said direct sourcing benefits should start showing in the P&L as early as Q1 next year, and that the bigger upside is strategic flexibility for B2B growth beyond Latin America. Management also said Argentina improved because of market recovery plus company payment solutions, while Mexico is still under pressure from FX and reduced air capacity.