European OTA eDreams Odigeo cited a shift to a subscription model for a 44% surge in annual profitability.
The company reported adjusted net profit of €22.9 million in the 12 months to March 31 against a loss of €34.7 million in the same period the previous year.
This came as membership of its Prime subscription scheme rose by 34% to more than 5.8 million. More than three quarters of profits for the owner of eDreams, GO Voyages, Opodo and Travellink now come from Prime.
The “exponential growth” was driven by strong consumer advocacy and rising satisfaction rates, according to the company, which forecast membership to increase to 7.25 million by the end of the current financial year.
“This success is attributed to its unique value proposition: personalised travel plans powered by cutting-edge AI, exclusive member-only deals, and the convenience of a global one-stop shop for travel, which consolidates the entire travel market onto a single platform – a first in the travel industry,” eDreams Odiego said.
Chef executive Dana Duane added: “These outstanding results prove that eDreams Odigeo and its unique business model have come of age.
“We are a world-leading, scalable subscription platform that delights customers and achieves superior financial performance.
“It is clear that our strategy and delivery have resulted in remarkable value creation, with a substantial opportunity for even greater value generation as our stock is yet to reflect our impressive performance and the considerable growth we have both achieved and expect.”
He added: “As we progress into the final year of our ambitious 3.5-year strategic plan, it’s evident that we have come a very long way.
“In 2021, when no one else was giving guidance, we boldly promised our shareholders that we would become the largest travel subscription company in the world – and we have successfully done that.
“Prime is now one of the fastest-growing subscription platforms in the world, growing over 10-fold since just before the pandemic. And we accomplished this despite the pandemic, travel restrictions, high inflation, macroeconomic uncertainty, and two wars. That is remarkable by any standards.
“Our results demonstrate that Prime is not just an innovative idea or a nascent business; it is a proven success model.
“Our subscribers have higher satisfaction rates, book significantly more often, and value an AI-tailored, personalised experience. This strengthens our business, making it more predictable and stable while also benefiting consumers and industry partners too.
As we continue to develop, our focus is on leveraging this solid foundation to continue to achieve further sustained and scalable long-term growth.
“With our current penetration rate in the low single digits, we see a vast addressable market ahead. Our potential beyond fiscal year 2025 is enormous. We are confident that we can make significant further progress in the years to come”.