On June 25, Trip.com (TCOM) fell 13.28% in pre-market trading, trading at $40.25/share, with turnover of $1.3569 million.

The sharp decline was triggered by the company's Q1 earnings report and disappointing forward guidance. While Q1 revenue reached RMB 16.2 billion, up 17% year-over-year and slightly beating market expectations, net profit attributable to shareholders plunged 41.57% to RMB 2.499 billion. Non-GAAP adjusted net profit was RMB 3.905 billion, down 6.76% year-over-year. The profit decline was primarily driven by fair-value losses on investments and exchangeable bonds, as well as expanded losses from equity-method affiliates.

More critically, the company guided Q2 net revenue growth of only 3%-8% year-over-year, a sharp deceleration from Q1's 17% pace. Management attributed the slowdown to elevated energy prices, geopolitical volatility, and proactive operational adjustments following an investigation by China's State Administration for Market Regulation. This could mark the slowest quarterly growth in four years. Citigroup maintained a Buy rating, noting revenue and adjusted operating margins slightly exceeded expectations, but flagged the regulatory investigation and hotel compliance restructuring as key monitoring points.

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