Tongcheng Travel Q1 revenue reached 5 billion yuan: hotel management became the largest growth driver, while vacation business declined by 5%.
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After the market closed on May 21, Tongcheng Travel released its unaudited financial report for the first quarter of 2026.
Financial report data shows that the company achieved operating revenue of 5.006 billion yuan during the period, a year-on-year increase of 14.4%; net profit attributable to the parent company was 779 million yuan, a year-on-year increase of 16.5%; adjusted EBITDA (profit before interest, taxes, depreciation, and amortization) was 1.389 billion yuan, a year-on-year increase of 19.8%.
Against the backdrop of normalized overall demand in the tourism industry, Tongcheng Travel maintained double-digit growth in its fundamental performance this quarter.
Through the financial report data, the structural differentiation of its core OTA business, conversion efficiency in lower-tier markets, and the substantive application of AI technology in both B-end and C-end of the industry chain, constitute the key coordinates to evaluate the evolution of its business model.
Analyzing its 5.006 billion yuan in revenue, the core online travel agency (OTA) revenue was 4.45 billion yuan, a year-on-year increase of 17.34%. Within this core segment, various sub-businesses showed differentiated growth curves.
Transportation ticketing, as Tongcheng Travel’s traditional foundation for traffic, achieved revenue of 2.124 billion yuan during the period, a year-on-year increase of 6.2%. The stability of this business mainly derives from the continued enrichment of value-added products and services, demonstrating strong anti-cyclical resilience, and is also key in maintaining large user activity.
Accommodation booking business revenue reached 1.365 billion yuan, a year-on-year increase of 14.7%. According to the financial report, the growth momentum in this segment mainly comes from the rising demand for high-quality accommodation, with the proportion of high-star hotel nights on the platform continuously expanding.
This means that while Tongcheng is deepening its reach in the mass market, it is gradually increasing both ARPU (average revenue per user) and profit margin for individual customers.
Notably, "other revenue" including hotel management business reached 961 million yuan, soaring 59.6% year-on-year. This exceptionally eye-catching high growth is mainly attributed to the expansion in hotel management business scale.
This indicates Tongcheng Travel is moving beyond simply being a channel, and by extending upstream in the industry chain, is constructing a moat of both physical and light asset management matrices.
However, not all performance indicators were on the rise. The financial report shows that vacation business revenue during the period was 556 million yuan, a year-on-year decrease of 5%. Management attributed this to suppressed demand for outbound group tours due to geopolitical risks.
This structural drop objectively reflects the substantive impact of macro uncertainties on the cross-border tourism chain.
In the era of saturating internet traffic, Tongcheng Travel’s user data offers another observation perspective.
In the twelve months ending March 31, 2026, the company’s annual paying users reached 254 million, hitting a historical high; annual cumulative serviced transactions reached 2.047 billion, a year-on-year increase of 4.5%. In the first quarter, Tongcheng’s average monthly paying users remained at 46.4 million.
The core supporting this large user base remains its very high penetration in lower-tier markets. By the end of the first quarter, over 87% of registered users on Tongcheng Travel’s platform were from non-first-tier cities in China.
Thanks to its long-term binding with Tencent’s WeChat ecosystem, Tongcheng’s cost advantage in customer acquisition in lower-tier cities remains significant. Meanwhile, its proprietary app's daily active users also maintained strong growth this quarter, and by introducing a dynamic platinum membership system, they are attempting to transform low-frequency travel transactions into high-frequency member stickiness.
In lower-tier markets, this shift from traffic acquisition to fine-tuned stock operation is key to maintaining its profit margin.
On the technology evolution and business integration front, Tongcheng Travel’s quarterly financial report reflects a clear trend of internet platforms evolving towards “industrial AI”.
On the C-end user service, Tongcheng Travel’s AI agent DeepTrip is now capable of supporting 17 languages, with nearly ten million global accumulated visit users. Its core skills have been listed on mainstream AI large model platforms.
Accompanying a 2.9-fold growth in consumption users on the international platform HopeGoo in the first quarter, these multilingual, end-to-end AI smart planning capabilities are evolving from early hype into infrastructure for expanding overseas markets, substantially lowering service and customer acquisition costs across borders.
On the B-end industry chain empowerment, the eLong Hotel Tech platform, through AIoT solutions such as "ZhiYi Smart Stay", has cumulatively provided system support for over 100,000 accommodation enterprises.
In previous business models, the traditional accommodation industry faced severe constraints from labor costs and digital gaps. Tongcheng, by providing SaaS and AIoT solutions, on the one hand, spreads its own system R&D costs, and on the other, improves single store operations efficiency, thus achieving deep data collection and binding at the industry chain’s bottom layer.
This deep AI implementation within physical industries essentially aligns with the fundamental logic of physical AI emphasized in manufacturing: using technology to reshape the cost structure of offline fulfillment chains.
Overall, Tongcheng Travel delivered a stable answer sheet in the first quarter of 2026 that meets market expectations.
With both transportation and accommodation fundamentals maintained, the hotel management business has shown strong potential to become a second growth curve, while full-chain penetration of AI technology provides tools for long-term cost optimization.
However, macro geopolitical disturbances for outbound tourism business still exist. In the future, how Tongcheng Travel can solidify its WeChat ecosystem foundation while effectively controlling upstream extension in the industry chain—such as hotel management—and the associated capital and management costs, will be the core proposition in determining whether its profit model can sustain upward momentum.
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