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What changed in TRAVELZOO's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of TRAVELZOO's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+228 added−238 removedSource: 10-K (2026-03-11) vs 10-K (2025-03-19)

Top changes in TRAVELZOO's 2025 10-K

228 paragraphs added · 238 removed · 180 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe believe developing a service for Metaverse travel experiences will enable us to be a first-mover in this fast-growing space. 6 Our Products and Services The following table presents an overview of our products and services: Product Content Publication Schedule Reach/Usage* Advertiser Benefits Consumer Benefits Travelzoo website Website available in the U.S., Canada, France, Germany, Spain, and the U.K., as well as via licensees in Australia and Japan, listing thousands of outstanding offers from more than 5,000 travel, entertainment and local businesses 24/7 over 6 million unique visitors per month Broad reach, sustained exposure, targeted placements by destination and travel segment 24/7 access to offers, ability to search and browse by destination or keyword Travelzoo Newsletters Including the Travelzoo Top 20 and Standalone emails 27.0 million travelers Travelzoo Top 20 Popular email newsletter listing 20 of the week's most outstanding offers Weekly Mass “push” advertising vehicle to quickly stimulate incremental travel and entertainment purchases Weekly access to 20 outstanding, handpicked offers chosen by our internal deal experts from among thousands Standalone emails Regionally targeted email newsletter service, usually with a single newsworthy travel and entertainment offer, which can include Local Deals and Getaways offers As needed Regional targeting, 100% share of voice for advertiser, flexible publication schedule Daily travel and local offers and ideas Travelzoo Network A network of third-party websites that list outstanding offers published by Travelzoo 24/7 Over 400 third-party websites Drives qualified users with substantial distribution beyond the Travelzoo audience Contextually relevant travel offers that have been handpicked and professionally reviewed by our internal experts Travelzoo mobile applications iOS and Android applications that allow users to discover the best travel, entertainment and local offers On-demand 7.8 million downloads Allows travel, entertainment and local offers advertisers to reach our audience that is on the go 24/7 access to travel, entertainment and local offers for consumers that are on the go Jack's Flight Club website Website available in the U.S, U.K., Germany, Netherlands, Luxembourg, Norway, Sweden, Denmark, Belgium, listing up to date exceptional airfares to paying members 24/7 417,000 visitors per month N/A 24/7 access to alerts, travel advice and guides.
Biggest changeWe plan to include Metaverse travel experiences as a benefit of Travelzoo club membership in 2026, allowing us to utilize and leverage all we have learned and developed over the past few years for Travelzoo META for the benefit of our Club Members. 6 Our Products and Services The following table presents an overview of our products and services: Product Content Publication Schedule Reach/Usage* Advertiser Benefits Consumer Benefits Travelzoo website Website available in the U.S., Canada, France, Germany, Spain, and the U.K., as well as via licensees in Australia and Japan, listing thousands of outstanding offers from more than 5,000 travel, entertainment and local businesses 24/7 Broad reach, sustained exposure, targeted placements by destination and travel segment 24/7 access to offers, ability to search and browse by destination or keyword Travelzoo Newsletters Including the Travelzoo Top 20 and Standalone emails 26.0 million travelers Travelzoo Top 20 Popular email newsletter listing 20 of the week's most outstanding offers Weekly Mass “push” advertising vehicle to quickly stimulate incremental travel and entertainment purchases Weekly access to 20 outstanding, handpicked offers chosen by our internal deal experts from among thousands Standalone emails Regionally targeted email newsletter service, usually with a single newsworthy travel and entertainment offer, which can include Local Deals and Getaways offers As needed Regional targeting, 100% share of voice for advertiser, flexible publication schedule Daily travel and local offers and ideas Travelzoo Network A network of third-party websites that list outstanding offers published by Travelzoo 24/7 Over 500 third-party websites Drives qualified users with substantial distribution beyond the Travelzoo audience Contextually relevant travel offers that have been handpicked and professionally reviewed by our internal experts Travelzoo mobile applications iOS and Android applications that allow users to discover the best travel, entertainment and local offers On-demand 8.1 million downloads Allows travel, entertainment and local offers advertisers to reach our audience that is on the go 24/7 access to travel, entertainment and local offers for consumers that are on the go Jack's Flight Club website Website available in the U.S, U.K., Germany, Netherlands, Luxembourg, Norway, Sweden, Denmark, Belgium, listing up to date exceptional airfares to members 24/7 470,000 visitors per month N/A 24/7 access to alerts, travel advice and guides.
To maintain and expand relationships with partners and suppliers, we attend and sponsor industry conferences and live events, meet with existing and future prospects virtually and in person, and employ public relations to create visibility for our brand. 9 To promote membership to consumers, we primarily utilize digital marketing efforts.
To maintain and expand relationships with partners and suppliers, we attend and sponsor industry conferences and live events, meet with existing and future prospects virtually and in person, and employ public relations to create visibility for our brand. To promote membership to consumers, we primarily utilize digital marketing efforts.
Newsletter includes paid and unpaid subscribers 1–12 per week depending on membership level and region 2.5 million emails per week N/A Breaking news flight offers and travel advice * For Travelzoo website, Top 20, Standalone e mails ( which can include Local Deals and Getaways), Travelzoo Network and Travelzoo mobile applications, reach/usage information is based on internal Travelzoo statistics as of December 31, 2024.
Newsletter includes paid and unpaid subscribers 1–12 per week depending on membership level and region 2.5 million emails per week N/A Breaking news flight offers and travel advice * For Travelzoo website, Top 20, Standalone e mails ( which can include Local Deals and Getaways), Travelzoo Network and Travelzoo mobile applications, reach/usage information is based on internal Travelzoo statistics as of December 31, 2025.
In 2023 we launched Travelzoo META to extend the range of travel, entertainment and local experiences we offer to consumers to the Metaverse. According to Precedence Research, the U.S. Metaverse market in 2025 is estimated at approximately $32.7 billion of revenue. The market is anticipated to grow rapidly and is forecasted to reach $395.15 billion by 2034.
Metaverse In 2023 we launched Travelzoo META to extend the range of travel, entertainment and local experiences we offer to consumers to the Metaverse. According to Precedence Research, the U.S. Metaverse market in 2025 is estimated at approximately $32 billion of revenue. The market is anticipated to grow rapidly and is forecasted to reach $395 billion by 2034.
Advertisers As of December 31, 2024, our advertiser base included more than 5,000 travel, entertainment and local providers, including airlines, hotels, cruise lines, vacations packagers, tour operators, destinations, car rental companies, travel agents, theater and performing arts groups, restaurants, spas, and activity companies.
Advertisers As of December 31, 2025, our advertiser base included more than 5,000 travel, entertainment and local providers, including airlines, hotels, cruise lines, vacations packagers, tour operators, destinations, car rental companies, travel agents, theater and performing arts groups, restaurants, spas, and activity companies.
As members submit their zip codes upon joining Travelzoo services, we are able to present offers to specific audiences that advertisers may perceive as geographically desirable, as well as presenting our Local Deals to members who live or work near those local businesses.
As members submit their zip codes upon joining Travelzoo services, we are able to present offers to specific audiences that advertisers may perceive as geographically desirable, as well as presenting our Local Deals to members who live or work near those local businesses. • Multichannel Approach.
We recognize a percentage of the face value of vouchers upon the sale of the vouchers, net of an allowance for refunds. Membership fee revenue consists of subscription fees paid by Travelzoo, Jack's Flight Club, and Travelzoo META members.
We recognize a percentage of the face value of vouchers upon the sale of the vouchers, net of an allowance for refunds. Membership fee revenue consists of subscription fees paid by Travelzoo and Jack's Flight Club.
Advertising revenue consists primarily of (a) advertising fees paid by travel companies for the publishing of their offers on Travelzoo’s media properties, (b) commission generated from the sale of Getaways vouchers and bookings on our hotel platform, and (c) publishing fees from high-quality local businesses, sale of Local Deals vouchers and entertainment offers.
Advertising revenue consists primarily of (a) advertising fees paid by travel companies for the publishing of their offers on Travelzoo’s media properties, (b) commissions and revenues generated from the sale of Getaways vouchers and bookings on our hotel platform, and (c) publishing fees from high-quality local businesses, sale of Local Deals vouchers and entertainment offers.
Information included on our website does not constitute part of this report. 10
Information included on our website does not constitute part of this report.
Benefits to Consumers Travelzoo m embership provides consumers with a valuable array of benefits that we believe distinguish our products and services from other providers and engender strong brand equity and loyalty. Key features of our products and services include: • Curation of Carefully Selected Offers From Extensive Array of Providers.
Benefits to Consumers Travelzoo membership provides consumers with a valuable array of benefits that we believe distinguish our products and services from other providers and engender strong brand equity and loyalty. Key features of our products and services include: • Curation of Carefully Selected Offers From Extensive Array of Providers.
The Company generates revenue from advertising, membership fees, and other sources.
The Company generates revenue from advertising and commerce, membership fees, and other sources.
We have over 5 million social media followers on Facebook, Instagram, X and WeChat and, to date, our iOS and An droid mobile applications have been downloaded 7.8 million times.
We have over 4.7 million social media followers on Facebook, Instagram, X and WeChat and, to date, our iOS and An droid mobile applications have been downloaded 8.1 million times.
To maintain their independence, flight alert newsletters are not sponsored by third parties and Jack’s Flight Club does not receive any commissions or payments for content published within the newsletters.
To maintain their independence, flight alerts are not sponsored by third parties and Jack’s Flight Club does not receive any commissions or payments for content published within the flight alerts.
Travelzoo Europe consists of the Company’s operations in France, Germany, Spain, and the UK. Jack’s Flight Club consists of subscription revenue from premium members to access and receive flight deals via email or mobile applications. New Initiatives consists of Travelzoo’s licensing business, Travelzoo META and MTE.
Travelzoo North America consists of the Company’s operations in the U.S. and Canada. Travelzoo Europe consists of the Company’s operations in France, Germany, Spain, and the UK. Jack’s Flight Club consists of subscription revenue from premium members to access and receive flight deals via email or mobile applications. New Initiatives consists of Travelzoo’s licensing business, Travelzoo META and MTE.
In addition, the application and interpretation of these laws, rules, and regulations are often uncertain, particularly in the rapidly evolving industry in which we operate. Employees As of December 31, 2024, we had 227 employees. Non e of our employees are represented under collective bargaining agreements. We consider our relations with our employees to be good.
In addition, the application and interpretation of these laws, rules, and regulations are often uncertain, particularly in the rapidly evolving industry in which we operate. 9 Employees As of December 31, 2025, we had 249 emp loyees. Non e of our employees are represented under collective bargaining agreements. We consider our relations with our employees to be good.
For the year ended December 31, 2024, Travelzoo North America operations comprised 66% of revenues, Travelzoo Europe operations comprised 29% of revenues and Jack’s Flight Club operations comprised 5% of revenues. Our principal business office is located at 590 Madison Avenue, 35th Floor, New York, New York 10022.
For the year ended December 31, 2025 , Travelzoo North America operations comprised 66% of revenues, Travelzoo Europe operations comprised 28% of revenues and Jack’s Flight Club operations comprised 6% of revenues. Our principal business office is located at 590 Madison Avenue, 35th Floor, New York, New York 10022.
Digital media also allows advertisers to advertise their sales and specials in a fast, flexible, and cost-effective manner. 5 We believe that travel, entertainment and local businesses often face the challenge of being able to quickly and effectively market and sell their excess inventory (i.e., airline seats, hotel rooms, cruise cabins, theater seats, spa appointments or restaurant seats that are likely to be unfilled) and, therefore, need a fast, flexible, and cost-effective solution for marketing excess inventory.
We believe that travel, entertainment and local businesses often face the challenge of being able to quickly and effectively market and sell their excess inventory (i.e., airline seats, hotel rooms, cruise cabins, theater seats, spa appointments 5 or restaurant seats that are likely to be unfilled) and, therefore, need a fast, flexible, and cost-effective solution for marketing excess inventory.
Our Travelzoo website and newsletters include Local Deals and Getaways listings that allow our members to purchase vouchers for offers from local businesses such as spas, hotels and restaurants. Jack's Flight Club is a subscription service that provides members with information about exceptional airfares.
Our Travelzoo website and newsletters include Local Deals and Getaways listings that allow our members to purchase vouchers for offers from local businesses such as spas, hotels and restaurants. Jack's Flight Club is a subscription service that provides members with information about exceptional airfares. Thousands of travel and local providers use our advertising and marketing services.
Item 1. Business Overview Travelzoo® (including its subsidiaries and affiliates, the “Company” or “we”), the club for travel enthusiasts, is a global Internet media company. We reach 30 million travelers. Club Members, who pay a membership fee, receive Club Offers personally reviewed by our deal experts around the globe.
Item 1. Business Overview Travelzoo (including its subsidiaries and affiliates, the “Company” or “we”) is a global Internet media company. We operate Travelzoo®, the club for travel enthusiasts, Jack’s Flight Club®, and Travelzoo META. We reach 30 million travelers. Club Members, who pay a membership fee, receive Club Offers negotiated and rigorously vetted by our deal experts around the globe.
Travelzoo® membership has historically been free, however, on January 1, 2024, Travelzoo introduced an annual membership fee of $40 (or local equivalent) for new members in the United States, Canada, United Kingdom and Germany, with the 2024 annual fee waived for existing members as of December 31, 2023. Jack’s Flight Club subscription options are quarterly, semi-annually, and annually.
Travelzoo membership has historically been free, however, on January 1, 2024, Travelzoo introduced an annual membership fee of $40 (or local equivalent) for new members in the United States, Canada, United Kingdom and Germany, with the 2024 annual fee waived for existing members as of December 31, 2023.
As of December 31, 2024, there wer e 11,835,976 sh ares of common stock outstanding. Ralph Bartel, who founded Travelzoo, is the sole beneficiary of the Ralph Bartel 2005 Trust, which is the controlling shareholder of Azzurro. Azzurro is the Company’s largest shareholder and, as of December 31, 2024, holds approximately 37.5% of the Company's outstanding shares.
As of December 31, 2025, there wer e 10,932,337 sh ares of common stock outstanding. Ralph Bartel, who founded Travelzoo, is the sole beneficiary of the Ralph Bartel 2005 Trust, which is the controlling shareholder of Azzurro. Azzurro is the Company’s largest shareholder and, as of December 31, 2025, holds approximately 33.5% of the Company's outstanding shares.
Ability to change user settings Jack's Flight Club mobile application App available in the U.S, U.K., Germany, Netherlands, Luxembourg, Norway, Sweden, Denmark, Belgium, listing up to date exceptional airfares to paying members 1–12 per week depending on membership level and region 208,083 sessions per month N/A Timely alerts and push notifications of new alerts, 24/7 access to alerts, ability to change user settings and select departure airport Jack's Flight Club newsletters Regionally targeted newsletter alerting of outstanding cheap airfares and including articles about travel destinations and other newsworthy travel content.
Ability to change user settings Jack's Flight Club mobile application App available in the U.S, U.K., Germany, Netherlands, Luxembourg, Norway, Sweden, Denmark, Belgium, listing up to date exceptional airfares to members 1–12 per week depending on membership level and region 147,905 sessions per month N/A Changed to benefit of premium (paying) members only in Q4 2025 Jack's Flight Club newsletters Regionally targeted newsletter alerting of outstanding cheap airfares and including articles about travel destinations and other newsworthy travel content.
Our mission, as the club for travel enthusiasts, is to provide our members with the highest quality information about the best travel, entertainment and local offers.
Our mission, as the club for travel enthusiasts, is to provide our members with the highest quality information about the best travel, entertainment and local offers and to provide unique benefits designed to support the lifestyle of a travel enthusiast.
For Jack’s Flight Club , reach/usage information is based on data from Google Analytics and internal Jack’s Flight Club statistics as of December 31, 2024. 7 Our Audience With reach of 30 million travelers worldwide, we attract a high-quality audience of travel enthusiasts. We inform our audience about compelling offers sourced from over 5,000 providers worldwide.
For Jack’s Flight Club , reach/usage information is based on data from Google Analytics and internal Jack’s Flight Club statistics from the Jack's Flight Club CRM platform as of December 31, 2025. 7 Our Audience With reach of 30 million travelers worldwide, we attract a high-quality audience of travel enthusiasts.
Under the licensing agreements, Travelzoo's existing members in the applicable territories continue to be owned by the Company. The Company has four reportable operating segments: Travelzoo North America, Travelzoo Europe, Jack’s Flight Club and New Initiatives. Travelzoo North America consists of the Company’s operations in the U.S. and Canada.
The Company recognized $68,000 and $71,000 in royalties in 2025 and 2024, respectively. Under the licensing agreements, Travelzoo's existing members in the applicable territories continue to be owned by the Company. The Company has four reportable operating segments: Travelzoo North America, Travelzoo Europe, Jack’s Flight Club and New Initiatives.
We are also subject to laws, rules, and regulations regarding data collection, privacy and data security, intellectual property ownership and infringement, sweepstakes and promotions and taxation, among others. We own and operate consumer-facing websites in the various regions in which we operate and are subject to the laws, rules, and regulations of those countries as they impact our operations.
We own and operate consumer-facing websites in the various regions in which we operate and are subject to the laws, rules, and regulations of those countries as they impact our operations.
Other benefits to advertisers of digital compared to traditional media include more precise audience targeting, real-time listings, real-time updates and performance tracking.
Other benefits to advertisers of digital compared to traditional media include more precise audience targeting, real-time listings, real-time updates and performance tracking. Digital media also allows advertisers to advertise their sales and specials in a fast, flexible, and cost-effective manner.
Holger Bartel, the Company's Global CEO, is Ralph Bartel's brother and separately holds less than 1% of the Company's outstanding shares as of December 31, 2024 .
Holger Bartel, the Company's Global CEO, is Ralph Bartel's brother and did not hold any of the Company's outstanding shares as of December 31, 2025 .
These offers are published by Travelzoo and its licensees in multiple languages across multiple digital channels and platforms, including email, websites, social media and mobile applications . We publish offers on Travelzoo and Jack’s Flight Club branded digital properties, as well as on third-party media properties via the Travelzoo Network, across which we syndicate our offer content.
We publish offers on Travelzoo and Jack’s Flight Club branded digital properties, as well as on third-party media properties via the Travelzoo Network, across which we syndicate our offer content.
Travelzoo provides members with dedicated member service which we manage, through telephone and email. Our dedicated service team enriches our value proposition for members and reinforces a positive brand association for Travelzoo and our advertiser clients.
Travelzoo provides members with dedicated member service which we manage, through telephone and email. Our dedicated service team enriches our value proposition for members and reinforces a positive brand association for Travelzoo and our advertiser clients. Club membership has also allowed us to add additional benefits for our members, which empowers them to live the lifestyle of a travel enthusiast.
Virgin Voyages Destination Weddings Travel Group Imagine Cruising Holland America Line Wingbuddy.com TripToGo Rocky Mountaineer Vacations Gate 1 Travel Transat Tours Canada Inc Visit Santa Barbara WestJet Airlines As discussed in Note 11 – Segment Reporting and Significant Customer Information to the accompanying consolidated financial statements included in Part II, Item 8 of this report and incorporated herein by refer ence, as of December 31, 2024, the Company had one customer that accounted for more than 10% of revenues across Travelzoo North America and Travelzoo Europe.
As discussed in Note 11 – Segment Reporting and Significant Customer Information to the accompanying consolidated financial statements included in Part II, Item 8 of this report and incorporated herein by refer ence, as of December 31, 2025, the Company did not have any customers that accounted for more than 10% of revenues across Travelzoo North America and Travelzoo Europe.
We also license Travelzoo products, services and intellectual property to licensees in (a) Australia, New Zealand, and Singapore and (b) Japan and South Korea, in each case, where the Company is entitled to quarterly royalty payments based on a percentage of net revenue. The Company recognized $71,000 and $71,000 in royalties in 2024 and 2023, respectively.
Other revenue consists of licensing fees from license agreements, as well as the retail business originally operated by Metaverse Travel Experiences LLC ("MTE") and acquired and maintained by the Company following the acquisition of MTE. 4 We also license Travelzoo products, services and intellectual property to licensees in (a) Australia, New Zealand, and Singapore and (b) Japan and South Korea, in each case, where the Company is entitled to quarterly royalty payments based on a percentage of net revenue.
We work in partnership with thousands of top travel suppliers—our long-standing relationships give us access to irresistible offers. Travelzoo attracts a high-quality audience of travel enthusiasts across multiple digital platforms, including email, websites, social media and mobile applications. The Travelzoo website is visit ed by over 6 million unique visitors monthly.
Our relationships with thousands of top travel suppliers—give us access to irresistible deals. Our club and its benefits are built around the lifestyle of a travel enthusiast. Travelzoo attracts a high-quality audience of travel enthusiasts across multiple digital platforms, including email, websites, social media and mobile applications.
The WTTC forecasts that the global value of Travel & Tourism will grow by over 50% in the coming decade, expanding the industry’s value, contribution to GDP and employment. The United States was revealed as the world’s most powerful Travel & Tourism market, with Germany, the United Kingdom and France in the third, fifth and sixth spots, respectively.
The United States was revealed as the world’s most powerful Travel & Tourism market, with Germany, the United Kingdom and France in the third, fifth and sixth spots, respectively.
Travelzoo is listed on the NASDAQ Global Select Market under the symbol “TZOO.” Our Industry According to the World Travel & Tourism Council (WTTC), the global Travel & Tourism industry grew 13% in 2023 to reach more than $1 trillion, with a return to pre-pandemic levels anticipated by 2025.
Travelzoo is listed on the NASDAQ Global Select Market under the symbol “TZOO.” Our Industry According to the World Travel & Tourism Council (WTTC), the global Travel & Tourism industry experienced significant growth in 2025, reaching historic record-breaking levels. The global sector's total economic contribution grew about 7% year-over-year in 2025, reaching $11.7 trillion (approximately 10% of global GDP).
According to Zenith, online advertising continues to lead as the fastest growing category of advertising and is expected to account for 59%, or approximately $550 billion, of global advertising spending in 2024, with continued growth in 2025.
According to Zenith, online advertising continues to lead as the fastest growing category of advertising. Digital channels were forecast to account for 59% of total global ad spend in 2025, reflecting annual growth of about 6.8%. Zenith projected that, going forward, digital advertising would keep expanding its share.
Sales and Marketing As of December 31, 2024, our advertising sales force and sales support staff consisted of 75 employees worldwide.
We had one customer that accounted for 10% or more of our total revenues during the years ended December 31, 2024. Sales and Marketing As of December 31, 2025, our advertising sales force and sales support staff consisted o f 65 emplo yees worldwide.
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Thousands of travel and local providers use o ur advertising and marketing services, including Exoticca, Inspiring Vacations, Prestige Travel+Cruise, TraveloDeals, Globus Family of Brands, Tripmasters Inc., Destination Weddings Travel Group, Holland America Line, TripToGo, Gate 1 Travel, Visit Santa Barbara, Online Vacation Center, Princess Cruises, Travel Discounters, Vacation Express, Fiji Airways, Virgin Voyages, Wingbuddy.com, Rocky Mountaineer Vacations, Transat Tours Canada Inc. and WestJet Airlines.
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On January 1, 2026, we increased the annual membership fee to $50 for new members in the United States only. For existing Club Members, the new pricing will apply from the next renewal of their membership after February 1, 2026. Jack’s Flight Club subscription options are quarterly, semi-annually, and annually. We recognize subscription revenues ratably over the respective subscription periods.
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We recognize subscription revenues ratably over the respective subscription periods. For Travelzoo META, a founding membership was launched in 2023 following a test-and-learn strategy. 4 Other revenue consists of licensing fees from license agreements, as well as the retail business originally operated by Metaverse Travel Experiences, LLC ("MTE") and acquired and maintained by the Company following the acquisition of MTE.
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This figure includes direct, indirect and induced contributions to global GDP and reflects a continued recovery and expansion of travel and tourism worldwide. The WTTC forecasts that the global value of Travel & Tourism will grow by over 50% in the coming decade, expanding the industry’s value, contribution to GDP and employment.
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In contrast, we believe that traditional media formats (print, TV and radio advertising) suffer from a number of limitations with respect to advertising excess inventory, which do not apply to digital advertising and media: • Advance commitments and scheduling are typically required prior to publication or airing dates, making it difficult to advertise last-minute inventory; • Ads often cannot be updated (e.g., change price or offer) once published, or deleted when an offer is sold out; • A small number of traditional media outlets can reduce competition in many markets, resulting in relatively high rates for traditional advertising; • Detailed performance tracking is often not available for offline advertising in a manner that enables optimization; • Creative content can be expensive to develop; and • Delivery of traditional media can be slow , with limited touchpoints to a consumer.
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In recent years, digital advertising has shifted towards social media. Social media ad spend continues to grow strongly, reaching approximately $247 billion in 2024, according to WARC Media. This represented a significant year-on-year increase of 14.3%.
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We believe Travelzoo is well-positioned to continue assisting travel partners with advertising their excess inventory, in ways that traditional print, TV and radio advertising cannot, particularly as the demand for travel returns to pre-pandemic levels. Subscription Services and the Metaverse Historically, Travelzoo has provided free membership for consumers, while generating revenue from advertising fees and commissions.
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Key drivers of the spend in 2024 were Meta, which accounted for roughly 63% of the total global social spend, and formats like TikTok and Instagram Reels (video), which saw explosive growth, with social video spend rising by 20% as brands shifted towards short-form engagement.
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We cannot yet predict trends in consumer adoption of paid membership for Travelzoo, although as anticipated, because of the waiver of the fee for existing members, it did not yet contribute materially to our financial results in 2024. We are scaling and diversifying our marketing and advertising strategies to acquire new paying members and convert existing free members.
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While email marketing still outperforms social media in conversions and return-on-investment, social media can be better for brand awareness, product discovery and broad audience engagement (e.g., around 51% of consumers say they discover new products through social ads). Companies are increasingly viewing social platforms as core advertising channels.
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Growth Strategy Our growth strategy is predicated on building our trusted travel, entertainment and local brands; increasing the value of our membership base and their engagement with our content; enticing advertisers to provide more exclusive and compelling offers for us to publish, and innovating with new experiences and revenue streams. 8 • Building Our Trusted Brands.
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While we have always had a strong presence on social media and offered advertising opportunities to our partners via various channels, we believe it is important to note the shift towards social media and the importance to provide a multi-channel solution to clients and partners that includes comprehensive social media support, in addition to traditional digital advertising channels.
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We believe that trust is an essential cornerstone to our brand and has been central to the growth and retention of our membership base over the past twenty-five years. We have built our reputation over time through publishing high-quality content featuring carefully curated offers which members value, and supporting member purchases with excellent service.
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We also note the importance of switching formats to video and supporting video throughout the Travelzoo user experience (acquisition, membership, etc.). This has become an integral priority and focus for us. Subscription Services Historically, Travelzoo has provided free membership for consumers, while generating revenue from advertising fees and commissions.
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As travel and entertainment can be complex and highly-considered purchases, we believe that satisfaction is essential to every interaction or transaction our members have with us, and that our brand and reputation support our future growth. • Increasing the Value and Engagement of Our Membership Base.
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In 2025, we began to increase the number of Club Members significantly and see positive adoption rates for the paid membership, however, we cannot yet predict whether this will continue at the same or a different rate. On January 1, 2026, we increased the annual membership fee for Travelzoo members in the United States to $50 for new members.
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While media brands often purport relevance and sell advertising placements based on audience size, we believe that advertisers increasingly value the quality of the audiences accessed, as measured by their responsiveness and ultimate purchase behaviors with advertisers’ offers.
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For existing members, the new pricing will apply from the next renewal of their membership after February 1, 2026. We are investing in acquiring new Club Members, so long as the return and efficiencies are attractive. We believe that we are currently able to achieve an attractive return on investment (ROI) and payback.
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We continue to strategically evolve our member acquisition strategies in terms of membership features and marketing campaigns, to increase the value of our membership base for our advertiser clients. • Sourcing More Exclusive and Compelling Offers From Advertisers .
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We inform our audience about compelling offers sourced from over 5,000 providers worldwide. These offers are published by Travelzoo and its licensees in multiple languages across multiple digital channels and platforms, including email, websites, social media and mobile applications .
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Growing our business entails an ongoing confluence of enhancing audience value with expanding the array and improving the value of offers we source from advertiser clients. We have an experienced salesforce that sources and services advertising clients, including through direct outreach and presence at industry conferences.
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While email continues to be our primary channel, we pursue a multichannel approach with presence on various social media channels, native ad networks, affiliate networks, paid search and more. This allows advertisers’ offers to reach Travelzoo members where they are spending most of their time online.
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We also maintain an active public relations effort, to drive awareness and promote our brand with trade organizations, other industry participants, consumers and advertisers. • Innovating With New Experiences and Revenue Streams. In addition to enhancing and growing our established businesses and revenue streams, we seek to leverage our core competencies to innovate and expand our offerings and market opportunities.
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These benefits include, but are not limited to: • Club Offers: With a true closed user group of highly engaged members, Travelzoo is able to use its negotiating leverage to secure high-quality offers from high-end partners, available only to Club Members.
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To date, this has included the acquisition of Jack's Flight Club in 2020, through which we added a subscription revenue stream, and the launch of Travelzoo META in 2023, which seeks to extend the range of travel and entertainment experiences we offer to the emerging Metaverse.
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These offers are available only on Travelzoo and cannot be found on other travel sites. • Member Days: 4x per year, Travelzoo provides access to Club Members only to 48-hour sale events. • Lounge Access for Delayed Flights: Club Members receive complimentary lounge access in case of a flight delay of one hour or more.
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In December 2023, we announced that Travelzoo membership, which had historically been free, would carry an annual fee beginning on January 1, 2024, provided the 2024 fee is waived for existing members as of December 31, 2023. As we transition our membership model, we are exploring various strategies to enhance value for our members, advertisers and business.
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This benefit is available for up to three companions and no matter where the Club Member booked the flight. 8 • Travel Enthusiast Hotline TM : Travelzoo now provides specialized travel assistance services (covering medical, personal and logistical needs) in partnership with Allianz Partners. These services provide support for Club Members whenever and wherever they are traveling.
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Some of our advertisers are: Exoticca Online Vacation Center Inspiring Vacations Princess Cruises Prestige Travel + Cruise Travel Discounters Travelodeal Vacation Express Globus Family of Brands Fiji Airways Tripmasters Inc.
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We are also subject to laws, rules, and regulations regarding data collection, privacy and data security, consumer protection, intellectual property ownership and infringement, sweepstakes and promotions and taxation, among others.
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We did not have any advertisers that accounted for 10% or more of our total revenues during the years ended December 31, 2023. Our agreements with certain advertisers are in the form of multiple insertion orders, hotel agreements and merchant agreements from groups of entities under common control.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFactors that may affect quarterly results include: consumer refund rate; mismatches between resource allocation and client demand due to difficulties in predicting client demand; changes in general economic conditions (perceived or actual) that could impair consumer spending; the magnitude and timing of marketing initiatives, including member acquisition and expansion efforts; the introduction, development, timing, competitive pricing and market acceptance of our products and services and those of our competitors; our ability to attract, hire and retain key personnel; our ability to maintain merchant and member satisfaction such that we are able to continue to attract high-quality merchants and members; our ability to manage our planned growth; our ability to encourage our existing members to engage with our products and services and to convert them to revenue-generating users; technical difficulties or system downtime affecting the Internet or our products and services; and volatility of our operating results in new markets.
Biggest changeFactors that may affect quarterly results include: level of investment in member acquisition, consumer refund rate; mismatches between resource allocation and client demand due to difficulties in predicting client demand; changes in general economic conditions (perceived or actual) that could impair consumer spending; the introduction, development, timing, competitive pricing and market acceptance of our products and services and those of our competitors; our ability to attract, hire and retain key personnel; our ability to maintain merchant and member satisfaction and continue to attract high-quality merchants and members; our ability to manage our planned growth; our ability to encourage member engagement with our products and services and convert non-paying members to Club Members; our ability to encourage renewals and retention of Club Members; and technical difficulties or system downtime.
You should not rely on our quarter to quarter comparisons of our results of operations, as they are not considered an indication of future performance.
You should not rely on quarter to quarter comparisons of our results of operations, as they are not considered an indication of future performance.
These transactions involve significant challenges and risks, including: diversion of management time; implementation or remediation of controls, procedures, and policies at the acquired company; integration of accounting, human resource, and other systems, and coordination of various functions; transition of operations, users, and customers; failure to obtain required approvals on a timely basis, if at all, or conditions placed upon approval, which could, among other things, delay or prevent us from completing a transaction, or otherwise restrict our ability to realize the expected goals of an acquisition; the need to integrate operations across different cultures and languages and to address the particular risks associated with specific countries; failure to successfully develop the acquired business; liability for activities of the acquired company; litigation or other claims in connection with the acquired company; challenges relating to the structure of an investment; expected and unexpected costs incurred in pursuing acquisitions; entrance into markets in which we have no prior experience and increased complexity in our business; inability to sell disposed assets or impairment of investments, goodwill and other assets acquired or divested; and failure to secure necessary financing in order to complete an applicable transaction.
These transactions involve significant challenges and risks, including: diversion of management time; implementation or remediation of controls, procedures, and policies at the acquired company; integration of accounting, human resource, and other systems, and coordination of various functions; transition of operations, users, and customers; failure to obtain required approvals on a timely basis, if at all, or conditions placed upon approval, which could, among other things, delay or prevent us from completing a transaction, or otherwise restrict our ability to realize the expected goals of an acquisition; the need to integrate operations across different cultures and languages and to address the particular risks associated with specific countries; failure to successfully develop the acquired business; liability for activities of the 18 acquired company; litigation or other claims in connection with the acquired company; challenges relating to the structure of an investment; expected and unexpected costs incurred in pursuing acquisitions; entrance into markets in which we have no prior experience and increased complexity in our business; inability to sell disposed assets or impairment of investments, goodwill and other assets acquired or divested; and failure to secure necessary financing in order to complete an applicable transaction.
Further, actions by third parties to block, impose restrictions on, or charge for the delivery of emails or other messages could also materially and adversely impact our business. From time to time, Internet service providers block bulk email transmissions or otherwise 14 experience technical difficulties that result in our inability to successfully deliver emails or other messages to third parties.
Further, actions by third parties to block, impose restrictions on, or charge for the delivery of emails or other messages could also materially and adversely impact our business. From time to time, Internet service providers block bulk email transmissions or otherwise experience technical difficulties that result in our inability to successfully deliver emails or other messages to third parties.
The costs of compliance, which may arise in the future as a result of changes in these laws and regulations or in their interpretation, could individually or in the aggregate make the Company’s services less attractive, delay the introduction of new products, or cause the Company to change or limit its business practices or incur more costs to comply or defend itself.
The costs of compliance, which may arise in the future as a result of changes in these laws and regulations or in their interpretation, could individually or in the aggregate make the Company’s services less attractive, delay the introduction of new 19 products, or cause the Company to change or limit its business practices or incur more costs to comply or defend itself.
Outside parties may attempt to fraudulently induce disclosure of sensitive information in order to gain access to our secure networks or to take over customer accounts. A party that is able to 21 circumvent our security systems could steal proprietary or other sensitive information. A security breach at any third-party supplier could result in negative publicity and exposure.
Outside parties may attempt to fraudulently induce disclosure of sensitive information in order to gain access to our secure networks or to take over customer accounts. A party that is able to circumvent our security systems could steal proprietary or other sensitive information. A security breach at any third-party supplier could result in negative publicity and exposure.
In addition, we could incur significant costs in investigating and defending such claims, even if we ultimately are not found liable. We are subject to risks associated with information disseminated through our websites and applications, including content that is produced by our editorial staff and errors or omissions related to our product offerings.
In addition, we 20 could incur significant costs in investigating and defending such claims, even if we ultimately are not found liable. We are subject to risks associated with information disseminated through our websites and applications, including content that is produced by our editorial staff and errors or omissions related to our product offerings.
Any disruption or restriction on the distribution of emails or other messages or any increase in costs would materially and adversely affect our revenue and profitability. In addition, the shift in our traffic originating from mobile devices accessing our services may decrease our members' willingness to use our services and could decrease their willingness to be an email member.
Any 13 disruption or restriction on the distribution of emails or other messages or any increase in costs would materially and adversely affect our revenue and profitability. In addition, the shift in our traffic originating from mobile devices accessing our services may decrease our members' willingness to use our services and could decrease their willingness to be an email member.
Azzurro previously held greater than 50% ownership until approximately 2018 and again from late 2022 until Q2 2023 and should Azzurro purchase additional shares or should the Company repurchase additional shares of its common stock, Azzurro’s ownership percentage could increase again, potentially above 50%, resulting in the Company being a controlled company again.
Azzurro previously held greater than 50% ownership until approximately 2018 and again from late 2022 until Q2 2023 and should Azzurro purchase additional shares or should the Company repurchase additional shares of its common stock, Azzurro’s ownership percentage could increase again, potentially above 50%, resulting 22 in the Company being a controlled company again.
We may not be able to add enough additional revenue to replace the lost revenue. Further, the new revenue may cost more to generate, impacting our operating results. If our advertisers do not meet the needs and expectations of our members, our business could suffer.
We may not be able to add enough additional revenue to replace the lost revenue. Further, the new revenue may cost more to generate, impacting our operating results. If our advertisers and content do not meet the needs and expectations of our members, our business could suffer.
If we are unable to acquire new members who purchase our membership and deals in numbers sufficient to grow our business, or if members cease to purchase, the revenue we generate may decrease and our operating results will be adversely affected.
If we are unable to acquire new members who purchase our membership and deals, and renew, in numbers sufficient to grow our business, or if members cease to purchase or renew, the revenue we generate may decrease and our operating results will be adversely affected.
It is possible in the future that the Company may strategically move away from offering the surcharge or vouchers in general, or the Company may invest further in voucher offerings to expand them from a product perspective.
It is possible in the future that the Company may strategically move away from offering the surcharge option or vouchers in general, or the Company may invest further in voucher offerings to expand them from a product perspective.
If bidding restrictions are held to be illegal or otherwise unenforceable, our performance marketing costs may increase if bidding on affected key words (especially those related to us) becomes more expensive, which could adversely affect our marketing efficiency and results of operations. 12 Trends in consumer use of mobile devices continue to create challenges.
If bidding restrictions are held to be illegal or otherwise unenforceable, our 11 performance marketing costs may increase if bidding on affected key words (especially those related to us) becomes more expensive, which could adversely affect our marketing efficiency and results of operations. Trends in consumer use of mobile devices continue to create challenges.
Additionally, we could also experience a loss of continuity, loss of accumulated knowledge and/or inefficiency, adverse effects on employee morale and productivity and adverse effects on our ability to attract and retain highly skilled employees. Any of these consequences could adversely impact our business. 17 We may not be able to continue developing awareness of our brand names.
Additionally, we could also experience a loss of continuity, loss of accumulated knowledge and/or inefficiency, adverse effects on employee morale and productivity and adverse effects on our ability to attract and retain highly skilled employees. Any of these consequences could adversely impact our business. 16 We may not be able to continue developing awareness of our brand names.
We may continue to invest in marketing as well as additional employees to support our operations (including licensing arrangements) o r develop new products, such as Travelzoo META or the Travelzoo paid membership, whic h may generate operating losses. Furthermore, operating losses in certain jurisdictions may not have any recognizable tax benefit.
We may continue to invest in marketing as well as additional employees to support our operations (including licensing arrangements) o r develop new products, such as Travelzoo META or the Travelzoo club membership, whic h may generate operating losses. Furthermore, operating losses in certain jurisdictions may not have any recognizable tax benefit.
Impairments of goodwill, long-term investments and long-lived assets have a negative impact on our results of operations. We perform our impairment test annually in October unless there are events that trigger the need for an interim test. No impairment was identified in connection with the annual impairment test for 2024.
Impairments of goodwill, long-term investments and long-lived assets have a negative impact on our results of operations. We perform our impairment test annually in October unless there are events that trigger the need for an interim test. No impairment was identified in connection with the annual impairment test for 2025.
This could have a material adverse effect on our business and results of operations. 13 Our business model may not be adaptable to a changing market. Our current revenue model depends primarily on advertising fees paid by travel and entertainment companies and still relies significantly on email communications with our members.
This could have a material adverse effect on our business and results of operations. Our business model may not be adaptable to a changing market. 12 Our current revenue model depends primarily on advertising fees paid by travel and entertainment companies and still relies significantly on email communications with our members.
We do not carry business interruption insurance to compensate us for losses that may occur as a result of any of these events. We are subject to payments-related and fraud risks. We accept payments for the sale of vouchers using a variety of methods, including credit cards and debit cards.
We do not carry business interruption insurance to compensate us for losses that may occur as a result of any of these events. We are subject to payments-related and fraud risks. We accept payments for the sale of vouchers and for membership fees using a variety of methods, including credit cards and debit cards.
If any of these platforms are successful in offering similar services to consumers who would otherwise use our platforms or if we are unable to offer our services to consumers within these super-apps, our customer acquisition efforts could be less effective and our customer acquisition costs could increase, either of which would harm our business and results of operations.
If any of these platforms are successful in offering similar services to consumers who would otherwise use our platforms or if we are unable to offer our services to consumers within these super-apps, our member acquisition efforts could be less effective and our member acquisition costs could increase, either of which would harm our business and results of operations.
These examinations may lead to ordinary course adjustments or proposed adjustments to our taxes or our net operating income. The Company’s use of the net operating losses (“NOLs”) of MTE or the NOLs themselves maybe audited by the Internal Revenue Service (“IRS”) or other taxing agency.
These examinations may lead to ordinary course adjustments or proposed adjustments to our taxes or our net operating income. The Company’s use of the net operating losses (“NOLs”) of MTE or the NOLs themselves may be audited by the Internal Revenue Service (“IRS”) or other taxing agency.
Future events and changing market conditions may lead us to re-evaluate the assumptions reflected in the current forecast which may result in additional impairment charges, which could have a material adverse effect on our results of operation s. Our business could be negatively affected by changes in search engine algorithms or other traffic-generating arrangements.
Future events and changing market conditions may lead us to re-evaluate the assumptions reflected in the current forecast which may result in additional impairment charges, which could have a material adverse effect on our results of operation s. Our business could be negatively affected by reliance on digital platforms and changes in search engine algorithms or other traffic-generating arrangements.
If our key management personnel are not able to work together effectively, our business could be materially adversely affected. 18 Intense competition may adversely affect our ability to achieve or maintain market share and operate profitably.
If our key management personnel are not able to work together effectively, our business could be materially adversely affected. 17 Intense competition may adversely affect our ability to achieve or maintain market share and operate profitably.
In particular, we cannot predict what, when and how the new administration in the U.S. may take actions to rollback or otherwise revise existing laws or regulations, or the ultimate impact such changes may have on our results of operations. 20 The CARD Act and similar state and foreign laws may harm our Local Deals and Getaways business.
In particular, we cannot predict what, when and how the current administration in the U.S. may take actions to rollback or otherwise revise existing laws or regulations, or the ultimate impact such changes may have on our results of operations. The CARD Act and similar state and foreign laws may harm our Local Deals and Getaways business.
The expiration dates of vouchers are through December 2025; however, these expiration dates may sometimes be extended on a case-by-case basis and final payment may not be due for up to a year after expiration.
The expiration dates of vouchers are through December 2026; however, these expiration dates may sometimes be extended on a case-by-case basis and final payment may not be due for up to a year after expiration.
In addition, a significant amount of traffic is directed to our websites through our participation in pay-per-click and display advertising campaigns on search engines, travel metasearch engines, and Internet media properties. Pricing and operating dynamics for these traffic sources can experience rapid change, both technically and competitively. Also, we may scale back our expenditures at any time.
A significant amount of traffic is directed to our websites through our participation in pay-per-click, pay-per-acquisition and display advertising campaigns on social media channels, search engines, travel metasearch engines, and Internet media properties. Pricing and operating dynamics for these traffic sources can experience rapid change, both technically and competitively. Also, we may scale back our expenditures at any time.
To the extent any such regulations require "opt-in" consent before certain cookies can be placed on a user's computer or mobile device, our ability to serve certain consumers in the manner we currently do might be adversely affected and our ability to continue to improve and optimize performance on our website might be impaired, either of which could negatively affect a consumer's experience using our services and our business, market share and results of operations.
To the extent any such regulations require "opt-in" consent before certain tracking technology may be placed on a user's computer or mobile device, our ability to serve certain consumers in the manner we currently do might be adversely affected and our ability to continue to improve and optimize performance on our website might be impaired, either of which could negatively affect a consumer's experience using our services and our business, market share and results of operations.
We spent $2.5 million and $7.0 million on marketing initiatives relating to member acquisition for the years ended December 31, 2024 and 2023, respectively, and expect to continue to spend significant amounts to acquire members. Our long-term success depends on our continued ability to attract, retain and engage members.
We spent $9.7 million and $2.5 million on marketing initiatives relating to member acquisition for the years ended December 31, 2025 and 2024 , respectively, and expect to continue to spend significant amounts to acquire members. Our long-term success depends on our continued ability to attract, retain and engage members.
Events like war, political instability or other conflicts (including the war in Ukraine and the Israel-Hamas war), terrorist attacks, mass shooting incidents, strikes, natural disasters and extreme weather situations (e.g., hurricanes, fires, droughts and floods), plane crashes, major public health events and logistical challenges such as widespread travel disruptions may have a negative impact on the travel industry and affect travelers’ behavior by limiting their ability or willingness to visit certain locations.
Events like war, political instability, international trade disputes or other conflicts (including the war in Ukraine, the 14 Israel-Hamas war and the recent Iran conflict), terrorist attacks, mass shooting incidents, strikes, natural disasters and extreme weather situations (e.g., hurricanes, fires, droughts and floods), plane crashes, major public health events and logistical challenges such as widespread travel disruptions may have a negative impact on the travel industry and affect travelers’ behavior by limiting their ability or willingness to visit certain locations.
You should also keep these risk factors in mind when you read forward-looking statements. Risks Related to Our Financial Condition and Business Model We cannot assure you that we will be profitable. In the year ended December 31, 2024, we generated consolidated net income of $13.7 million, of which $13.6 million income was attributable to Travelzoo.
You should also keep these risk factors in mind when you read forward-looking statements. Risks Related to Our Financial Condition and Business Model We cannot assure you that we will be profitable. In the year ended December 31, 2025 , we generated consolidated net income of $5 million, of which $4.7 million income was attributable to Travelzoo.
We may not be able to obtain sufficient funds to grow our business and equity or debt financing may be on adverse terms. For the year ended December 31, 2024, our cash and cash equivalents was $17.1 million, of which $13.8 million was held outside the U.S. in our foreign subsidiaries.
We may not be able to obtain sufficient funds to grow our business and equity or debt financing may be on adverse terms. For the year ended December 31, 2025, our cash and cash equivalents was $10 million, of which $7.8 million was held outside the U.S. in our foreign subsidiaries.
We may not be able to access third-party technology upon which we depend. We use data technology and software products from third parties (such as hosting and cloud services), and technology from our vendors may not continue to be available to us on commercially reasonable terms, or at all.
We use data technology and software products from third parties (such as hosting and cloud services), and technology from our vendors may not continue to be available to us on commercially reasonable terms, or at all.
There has been an increased focus on ESG practices of companies, including climate change, diversity, equity and inclusion, human capital management, data privacy and security, supply chains (including human rights issues), among other topics, by institutional, individual, and other investors, proxy advisory services, regulatory authorities, consumers, employees and other stakeholders.
There has been continued focus on the ESG practices of companies, including climate change, greenhouse gas emissions, diversity, equity and inclusion, human capital management, data privacy and security, supply chains (including human and civil rights issues), among other topics, by institutional, individual, and other investors, proxy advisory services, regulatory authorities, consumers, employees and other stakeholders.
In turn, that could have a negative impact on demand for our services. We are not in a position to evaluate the net effect of these circumstances as many of these events cannot be reliably forecasted. In the longer term, our business might be negatively affected by financial pressures on or changes to the travel industry and the economy overall.
We are not in a position to evaluate the net effect of these circumstances as many of these events cannot be reliably forecasted. In the longer term, our business might be negatively affected by financial pressures on or changes to the travel industry and the economy overall.
Azzurro is the Company’s largest shareholder, and as of December 31, 2024, holds approximately 37.5% of the Company's outstanding shares.
Azzurro is the Company’s largest shareholder, and as of December 31, 2025, holds approximately 33.5% of the Company's outstanding shares.
In the future, depending on various factors, including but not limited to, market conditions, changes in the general economy and the travel industry, we may need to cut expenses to preserve profitability or, alternatively, we may find it necessary to significantly accelerate expenditures to meet increased demand or to maintain brand awareness.
In the future, depending on various factors, including but not limited to, market conditions, changes in the general economy and the travel industry, we may need to cut expenses to preserve profitability or, alternatively, we may find it necessary to significantly accelerate expenditures to acquire Club Members.
We believe that continuing to build awareness of the Travelzoo and Jack’s Flight Club brand names, and starting to build awareness of the Travelzoo META brand name, are critical to achieving widespread acceptance of our business. Brand recognition is a key differentiating factor among providers of online advertising opportunities.
We believe that continuing to build awareness of the Travelzoo, Travelzoo META, and Jack’s Flight Club brand names, are critical to achieving widespread acceptance of our business. Brand recognition is a key differentiating factor among providers of online advertising opportunities. In order to maintain and build brand awareness, we must succeed in our marketing efforts.
In the year ended December 31, 2023, we generated consolidated net income of $12.5 million, of which $12.4 million income was attributable to Travelzoo. We forecast our future expense levels based on our operating plans and our estimates of future revenues.
In the year ended December 31, 2024 , we generated consolidated net income of $13.7 million, of which $13.6 million income was attributable to Travelzoo. We forecast our future expense levels based on our operating plans and our estimates of future revenues.
We are unable to predict if we may have future ineffective controls and procedures, if we 22 will be able to effectively and efficiently remediate any such deficiencies and whether these deficiencies or the corresponding remediation efforts could result in a negative impact to our business.
Our internal control over financial reporting may not be effective which could impact our business. 21 We are unable to predict if we may have future ineffective controls and procedures, if we will be able to effectively and efficiently remediate any such deficiencies and whether these deficiencies or the corresponding remediation efforts could result in a negative impact to our business.
In order to maintain and build brand awareness, we must succeed in our marketing efforts. Our marketing spend is influenced by the marketing spend of our competitors as we seek to maintain and increase our brand recognition and to maintain and grow traffic to our platforms through performance marketing channels.
Our marketing spend is influenced by the marketing spend of our competitors as we seek to maintain and increase our brand recognition and to maintain and grow traffic to our platforms through performance marketing channels.
To be successful, we must provide online marketing solutions that achieve broad market acceptance by travel and entertainment companies. In addition, we must attract sufficient Internet users with attractive demographic characteristics to our products.
To be successful, we must provide online marketing solutions that achieve broad market acceptance by travel and entertainment companies. In addition, we must attract sufficient Internet users with attractive demographic characteristics to our products via channels, such as social media, that they are frequently using.
As of December 31, 2024, we had negative working capital of $4.7 million. Merchant payables was $16.3 million as of December 31, 2024. The payable to merchants is generally due upon redemption of the voucher.
As of December 31, 2025, we had negative working capital of $10.8 million. Merchant payables was $11.7 million as of December 31, 2025. The payable to merchants is generally due upon redemption of the voucher.
Risks Related to Legal Uncertainty We may become subject to shareholder lawsuits over alleged securities violations due to volatile stock price. Shareholder lawsuits for securities violations are often launched against companies whose stock price is volatile. Such lawsuits involving the Company would require management’s attention to defend, which may distract attention from operating the Company.
Shareholder lawsuits for securities violations are often launched against companies whose stock price is volatile. Such lawsuits involving the Company would require management’s attention to defend, which may distract attention from operating the Company.
If we are unable to protect our rights, a key element of our strategy could be disrupted and our business could be adversely affected. We may not always be able to detect unauthorized use or take appropriate steps to enforce our IP rights.
We have registered the Travelzoo and Jack’s Flight Club trademarks in various jurisdictions. If we are unable to protect our rights, a key element of our strategy could be disrupted and our business could be adversely affected. We may not always be able to detect unauthorized use or take appropriate steps to enforce our IP rights.
For example, the business of MTE which Travelzoo acquired in December 2022 will require management resources to grow strategically and we cannot guarantee that MTE as part of Travelzoo will be able to source Metaverse travel experiences as successfully as anticipated.
For example, the business of MTE which Travelzoo acquired in December 2022 will require management resources to grow strategically and we cannot guarantee that MTE as part of Travelzoo will be able to source Metaverse travel experiences as successfully as anticipated. The pre-purchasing of vouchers and hotel inventory could create additional risks or liabilities for our business.
“Cookie” laws could negatively impact the way we do business. A "cookie" is a text file that is stored on a user's computer or mobile device. Cookies are common tools used by thousands of websites and mobile apps to, among other things, store or gather information (e.g., remember log-on details), market to consumers and enhance the user experience.
“Cookie”, “pixel” and tracking technology laws could negatively impact the way we do business. Cookies, pixels and other similar tracking technologies are common tools used by thousands of websites and mobile apps to, among other things, store or gather information (e.g., remember log-on details), market to consumers and enhance the user experience.
However, a successful challenge to our position or expansion of laws could subject us to increased compliance costs and delay our ability to offer our products or services in certain jurisdictions, pending receipt of necessary licenses. Our internal control over financial reporting may not be effective which could impact our business.
However, a successful challenge to our position or expansion of laws could subject us to increased compliance costs and delay our ability to offer our products or services in certain jurisdictions, pending receipt of necessary licenses.
It is possible that we will be required to further adapt our business model and products in response to changes in the online advertising market or travel industry or if our current or planned business model is not successful.
It is possible that we will be required to further adapt our business model and products in response to changes in the online advertising market or travel industry or if our current or planned business model is not successful. If we do not adapt to these trends fully or quickly enough, we may lose revenue as consumer usage may decline.
If revenues fall below our expectations in any quarter and we are unable to quickly reduce our operating expenses in response, our operating results would be lower than expected and our stock price may fall. Expansion of product offerings may result in additional costs that exceed revenue and may trigger additional stock price volatility.
If revenues fall below our expectations in any quarter and we are unable to quickly reduce our operating expenses in response, our operating results would be lower than expected and our stock price may fall.
We do not believe that we are a financial institution subject to these regulations based, in part, upon the closed loop nature and other characteristics of vouchers and our role with respect to the distribution of vouchers to members.
For these purposes, financial institutions are broadly defined to include money services businesses such as providers of prepaid access cards. We do not believe that we are a financial institution subject to these regulations based, in part, upon the closed loop nature and other characteristics of vouchers and our role with respect to the distribution of vouchers to members.
Cookies are valuable tools to improve the customer experience and increase conversion. Many jurisdictions, including the European Union and more recently, California, have adopted regulations governing the use of cookies.
They are valuable tools to improve the customer experience and increase conversion. Many jurisdictions, including the European Union and several U.S. states, have adopted regulations governing the use of tracking technology.
Our other stockholders will therefore have limited influence and control on matters requiring stockholder approval and this significant ownership position could discourage others from initiating any potential merger or takeover that may otherwise be beneficial to Travelzoo stockholders. Item 1B. Unresolved Staff Comments None.
As a result of Azzurro’s ownership interests and voting power, they could be in a position to influence significant corporate actions. Our other stockholders will therefore have limited influence and control on matters requiring stockholder approval and this significant ownership position could discourage others from initiating any potential merger or takeover that may otherwise be beneficial to Travelzoo stockholders.
Any failure to implement or adapt to new technologies in a timely manner or at all could adversely affect our ability to compete, increase our costs or otherwise adversely affect our business, brand, market share, and results of operations. 19 Acquisitions, investments, licensing arrangements and joint ventures could result in operating difficulties, dilution, and other harmful consequences that may adversely impact our business and results of operations.
Any failure to implement or adapt to new technologies in a timely manner or at all could adversely affect our ability to compete, increase our costs or otherwise adversely affect our business, brand, market share, and results of operations.
Our vouchers typically have a 14-day refundability period, but as of April 2022, also have a surcharge option, where members can pay an extra fee for full refundability of the voucher. However, since before 2021, we have seen a general decline in demand for voucher products.
Our vouchers typically have a 14-day refundability period and also have a surcharge option. However, since before 2021, we have seen a general decline in demand for voucher products.
The Company already has in place applicable corporate governance processes and procedures necessary for a controlled company to ensure independence (e.g., board of directors with majority independent directors, committees comprised solely of independent directors, etc.). Holger Bartel, the Company’s Global Chief Executive Officer, is Ralph Bartel’s brother and holds less than 1% of t he Company’s outstanding shares.
The Company already has in place applicable corporate governance processes and procedures necessary for a controlled company to ensure independence (e.g., board of directors with majority independent directors, committees comprised solely of independent directors, etc.).
We may be unable to protect our registered trademark or other proprietary intellectual property rights and may face liability from intellectual property litigation. Our success depends to a significant degree upon the protection of the Travelzoo brand name. We rely on a combination of copyright and trademark laws, non-disclosure and other contractual arrangements to protect our intellectual property (“IP”) rights.
However, we may be obligated to do so if we were no longer a smaller reporting company. We may be unable to protect our registered trademark or other proprietary intellectual property rights and may face liability from intellectual property litigation. Our success depends to a significant degree upon the protection of the Travelzoo brand name.
Risks Related to Investment in our Shares Our stock price has been volatile historically and may continue to be volatile. The trading price of our common stock has been and may continue to be subject to wide fluctuations. During the twelve months ended December 31, 2024, the closing price of our common stock on NASDAQ ranged from $7.12 to $22.44.
Risks Related to Investment in our Shares Our stock price has been volatile historically and may continue to be volatile. The trading price of our common stock has been and may continue to be subject to wide fluctuations.
The voucher product typically has a 14-day refund policy, but we may in the future alter or update the product, including refund windows, or invest in upgraded technology or new technology or products.
In March of 2022, we announced the creation of our Metaverse business. We plan to include Metaverse travel experiences as a benefit of Travelzoo membership in 2026. The voucher product typically has a 14-day refund policy, but we may in the future alter or update the product, including refund windows, or invest in upgraded technology or new technology or products.
These companies have significantly greater financial, technical, marketing and other resources and larger advertiser bases. They may be able to research, develop and deploy new products and technologies (including in the area of generative AI) faster than us.
Many of our competitors have significantly greater financial, technical, marketing and other resources and larger advertiser bases. They may be able to research, develop and deploy new products and technologies faster than us, including developing or deploying generative AI-powered travel planning and booking tools that could reduce reliance on our services.
Such 11 product modifications and expansions may result in an increase in costs in the near-term and an increase in cost structure in the long-term, which may be in excess of incremental revenue.
Such product modifications and expansions may result in an increase in costs in the near-term and an increase in cost structure in the long-term, which may be in excess of incremental revenue. If we are unsuccessful in our efforts to monetize these initiatives, our business and financial results could be adversely affected.
In addition, advertisers may choose to limit advertising spend, which can adversely impact our business. Macroeconomic factors and uncertainties such as tariffs, rising interest rates, persistently high inflation and/or recession fears 15 may have a negative impact on consumer behavior by reducing consumers’ ability or willingness to engage in discretionary spending on travel.
Macroeconomic factors and uncertainties such as the implementation of tariffs (by the United States and other governments), rising interest rates, persistently high inflation and/or recession fears may have a negative impact on consumer behavior by reducing consumers’ ability or willingness to engage in discretionary spending on travel (e.g., we have seen some reluctance from our Canadian members to travel to the United States).
The steps we have taken to protect our IP rights, however, may not always succeed in deterring misappropriation of proprietary information or preventing improper utilization of the Travelzoo brand name. We have registered the Travelzoo and Jack’s Flight Club trademarks in various jurisdictions.
We rely on a combination of copyright and trademark laws, non-disclosure and other contractual arrangements to protect our intellectual property (“IP”) rights. The steps we have taken to protect our IP rights, however, may not always succeed in deterring misappropriation of proprietary information or preventing improper utilization of the Travelzoo brand name.
However, if redemption activities accelerate, if our business is not profitable, and if our planned targets for cash flows from operations are not met, we may need to obtain additional financing in the future. We may not be able to obtain financing on commercially reasonable terms, or at all, especially due to volatile market conditions.
However, if redemption activities accelerate, if our marketing activities are no longer efficient, if our renewal rates are lower than expected, if our business is not profitable, or if our planned targets for cash flows from operations are not met, we may need to obtain additional financing in the future.
Additionally, in some of our contracts we or the other party have agreed to bidding restrictions.
We could also face a significant decrease in traffic to our websites, decreased efficiencies and/or increased costs. Additionally, in some of our contracts we or the other party have agreed to bidding restrictions.
Competition could result in reduced margins on our services, loss of market share or less use of Travelzoo by advertisers and consumers. If we are not able to compete effectively with current or future competitors as a result of these and other factors, our business could be materially adversely affected.
If we are not able to compete effectively with current or future competitors as a result of these and other factors, our business could be materially adversely affected. We may not be able to access third-party technology upon which we depend.
We can give no assurances that any of our product offerings will yield the benefits we expect and will not result in additional costs. Our voucher products may be adversely impacted by competition and changing consumer demand for vouchers. Our Local Deals and Getaways products include the sale of vouchers directly to consumers to advertise promotional offers provided by merchants.
Our voucher products may be adversely impacted by competition and changing consumer demand for vouchers. Our Local Deals and Getaways products include the sale of vouchers directly to consumers to advertise promotional offers provided by merchants. In some instances, we pre-purchase vouchers/hotel rooms in bulk. The voucher format may require additional investments to maintain and grow the business.
We may significantly increase our operating expenses for a certain period if, among other reasons, we see a unique opportunity for a brand marketing campaign, if we find it necessary to respond to increased brand marketing by a competitor, or if we decide to accelerate our acquisition of new members or engagement of existing members.
We may significantly decrease our operating expenses in response to changes in general economic conditions, performance and/or declines in consumer demand. We may significantly increase our operating expenses for a certain period if, among other reasons, we see a unique opportunity to accelerate our acquisition of new members or engagement of existing members.
The markets for the services we offer are intensely competitive, constantly evolving and subject to rapid change, and current and new competitors can launch new services at a relatively low cost. We compete for advertising dollars with large Internet portal sites, such as Tripadvisor, that offer listings or other advertising opportunities to travel, entertainment and local businesses.
The markets for the services we offer are intensely competitive, constantly evolving and subject to rapid change, and current and new competitors can launch new services at a relatively low cost. There has also been substantial consolidation of the global travel industry and we believe this trend will continue.
Should the $2,000 limit be exceeded or should more than $10,000 in aggregate vouchers be sold to any individual person (sales to businesses for resale or distribution are excluded) then we may be deemed either a seller or provider of prepaid access subject to regulation.
Should these limits be exceeded, then we may be deemed either a seller or provider of prepaid access subject to regulation.
The cost of these changes may negatively impact our results of operations during the transition. 16 Increased focus on environmental, social, and governance ("ESG") responsibilities have and will likely continue to result in additional costs and risks, and may adversely impact our business.
The cost of these changes may negatively impact our results of operations during the transition. 15 Failure to meet environmental, social, and governance ("ESG") expectations or standards or achieve the Company's voluntary ESG-related goals may adversely impact our business, reputation, brand, results of operations, and/or financial condition.
In December of 2023, we announced that effective January 1, 2024, we would be moving to a paid membership model, with existing Travelzoo members grandfathered in through the end of the year.
Expansion of product offerings may result in additional costs that exceed revenue and may trigger additional stock price volatility. 10 On January 1, 2024, we moved to a paid membership model, with existing Travelzoo members grandfathered in through the end of the year. Since then, we have introduced additional Club Member benefits.
We utilize Internet search engines such as Google, principally through the purchase of travel-related keywords and through organic search, to generate additional traffic to our websites.
We rely heavily on our ability to attract and convert users into Club Members through our websites and mobile apps in a cost-effective manner. We utilize digital advertising platforms (including social media), Internet search engines (through the purchase of travel-related keywords and through organic/algorithmic search) and other online sources to generate additional traffic to our websites.
It is possible that the interests of Azzurro may conflict with those of the Company or its other stockholders in the future. As a result of Azzurro’s 23 ownership interests and voting power, they could be in a position to influence significant corporate actions.
Holger Bartel, the Company’s Global Chief Executive Officer, is Ralph Bartel’s brother and did not hold any of the Company’s outstanding shares as of December 31, 2025. It is possible that the interests of Azzurro may conflict with those of the Company or its other stockholders in the future.
If our expanded product offerings are not embraced by our users or our advertising partners, or if we are unsuccessful in our efforts to monetize these initiatives, our business and financial results could be adversely affected. If we cannot attract members to our product offerings, our financial results could be affected.
If we cannot attract members to our product offerings or our advertisers do not embrace the changes in our product offerings, our financial results could be affected. We can give no assurances that any of our product offerings will yield the benefits we expect and will not result in additional costs.
Removed
We may significantly decrease our operating expenses in response to changes in general economic conditions, performance and/or declines in consumer demand.
Added
These platforms increasingly incorporate generative AI features, such as AI-generated answers, assistants, and recommendations, that may satisfy user intent without directing users to our websites or may favor the platform's own or affiliated offerings.
Removed
In Q4 2024, we introduced additional member benefits, including but not limited to, Club Offers, early access to the Top 20, airport lounge access for delayed flights and a weekly giveaway.
Added
In addition, changes in algorithms, ranking methodologies, user interfaces, access terms, pricing, or the placement of AI-generated content by these platforms could reduce the visibility of our services, increase member acquisition costs or decrease traffic.
Removed
In March of 2022, we announced the creation of our new Metaverse business, following a test and learn strategy, with plans for the launch of a subscription membership service that provides members with exclusive access to Metaverse travel experiences to follow.
Added
In addition, web and mobile browser developers, such as Apple, Microsoft or Google, have implemented and may continue to implement changes, including requiring additional user permissions, in their browser or device operating system that impair our ability to measure and improve the effectiveness of advertising on our platform.
Removed
This format may require additional investments to maintain and grow the business including the hiring of additional sales personnel and additional spend on customer service, marketing, technology tracking systems and payment processing.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAlthough we expend significant internal resources to protect against security breaches, our existing security measures may not be successful in preventing all attacks on our systems. We have experienced cybersecurity incidents and threats, including malware, phishing, partner and customer account takeover attacks, and denial-of-service attacks on our systems.
Biggest changeWe define expected security and privacy requirements through our contracting processes with third parties and we perform third-party cyber risk assessments to monitor the cyber risk management efforts of third parties as needed. 23 Although we expend significant internal resources to protect against security breaches, our existing security measures may not be successful in preventing all attacks on our systems.
The Incident Response Team is led by the Company’s Systems Administrator and Cybersecurity Analyst, and includes employees from different functions and levels of the organization, including the Head of Engineering (most senior IT leader), the General Counsel and Head of Global Functions (executive-level legal), the Global Head of Business Services (most senior business operations leader), as well as representatives from finance, marketing, and customer service.
The Incident Response Team is led by the Company’s Systems Administrator and Cybersecurity Analyst, and includes employees from different functions and levels of the organization, including the Head of Engineering (most senior IT leader), the Chief Membership Officer and General Counsel (executive-level legal), the Global Head of Business Services (most senior business operations leader), as well as representatives from finance, marketing, and customer service.
Starting in Q1, the team reviews the Company’s plan and policy for cybersecurity incident response, making updates as needed to reflect changes in the systems, processes or requirements of the organization.
The Incident Response Team follows industry best-practices for Payment card industry (PCI) compliance and cybersecurity. Starting in Q1, the team reviews the Company’s plan and policy for cybersecurity incident response, making updates as needed to reflect changes in the systems, processes or requirements of the organization.
The team is also supported by external vendors and consultants, as needed (for example, specialized cybersecurity legal counsel, specialized IT cybersecurity agencies and Sarbanes-Oxley (SOX) compliance/audit consultants to assist with internal controls review). The Incident Response Team follows industry best-practices for Payment card industry (PCI) compliance and cybersecurity.
The team is also supported by external vendors and consultants, as needed (for example, specialized cybersecurity legal counsel, specialized IT cybersecurity agencies and Sarbanes-Oxley (SOX) compliance/audit consultants to assist with internal controls review). We also carry cyber liability insurance to compensate us for losses that may occur as a result of certain cybersecurity incidents.
These third-party business partners, service providers, and consultants need to access certain of our member and other data, and connect to our computer networks. We define expected security and privacy requirements through our contracting processes with third parties and we perform third-party cyber risk assessments to monitor the cyber risk management efforts of third parties as needed.
These third-party business partners, service providers, and consultants need to access certain of our member and other data, and connect to our computer networks.
We do not believe these cybersecurity incidents have had a materially adverse effect on our Company, including our business strategy, results of operations, or financial condition. For further discussion, please review our Risk Factors. 24 Governance The Board, in coordination with the Audit Committee, oversees the Company’s risk management program, which includes evaluation of material cybersecurity-related risks as needed.
We have historically experienced cybersecurity incidents and threats, including malware, phishing, partner and customer account takeover attacks, and denial-of-service attacks on our systems. We do not believe these cybersecurity incidents have had a materially adverse effect on our Company, including our business strategy, results of operations, or financial condition. For further discussion, please review our Risk Factors.
Added
Governance The Board, in coordination with the Audit Committee, oversees the Company’s risk management program, which includes evaluation of material cybersecurity-related risks as needed.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Programs Maximum Shares that May Yet be Purchased Under the Programs October 1, 2024 - October 31, 2024 52,418 $ 16.64 52,418 947,582 November 1, 2024 - November 30, 2024 83,374 $ 17.51 83,374 864,208 December 1, 2024 - December 31, 2024 0 $ — 0 864,208 135,792 135,792 26 Performance Graph The following graph compares, for the dates specified, the cumulative total stockholder return for Travelzoo, the NASDAQ Composite Index (the “NASDAQ Market Index”), and the Russell 2000 Index.
Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Programs Maximum Shares that May Yet be Purchased Under the Programs January 1, 2025 - March 31, 2025 590,839 $ 15.09 590,839 320,690 April 1, 2025 - June 30, 2025 172,088 $ 14.53 172,088 148,602 July 1, 2025 - September 30, 2025 148,602 $ 10.40 148,602 — October 31, 2025 - December 31, 2025 — $ — — — 911,529 911,529 25 Performance Graph The following graph compares, for the dates specified, the cumulative total stockholder return for Travelzoo, the NASDAQ Composite Index (the “NASDAQ Market Index”), and the Russell 2000 Index.
Measurement points are the last trading day of each of the Company's fiscal years ended December 31, 2019, December 31, 2020, December 31, 2021, December 31, 2022, December 31, 2023 and December 31, 2024.
Measurement points are the last trading day of each of the Company's fiscal years ended December 31, 2019, December 31, 2020, December 31, 2021, December 31, 2022, December 31, 2023, December 31, 2024, and December 31, 2025.
Measurement Point 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Travelzoo $ 100 $ 109 $ 96 $ 96 $ 45 $ 97 $ 202 NASDAQ Market Index $ 100 $ 135 $ 194 $ 236 $ 158 $ 226 $ 291 Russell 2000 Index $ 100 $ 124 $ 146 $ 167 $ 131 $ 150 $ 165
Measurement Point 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 Travelzoo $ 100 $ 109 $ 96 $ 96 $ 45 $ 97 $ 202 $ 72 NASDAQ Market Index $ 100 $ 135 $ 194 $ 236 $ 158 $ 226 $ 291 $ 350 Russell 2000 Index $ 100 $ 124 $ 146 $ 167 $ 131 $ 150 $ 165 $ 184
As of March 17, 2025, there were approximately 161 stockholders of record of our shares. Dividend Policy Travelzoo has not declared or paid any cash dividends since inception and does not expect to pay cash dividends for the foreseeable future.
As of March 9, 2026, there were approximately 155 stockholders of record of our shares. Dividend Policy Travelzoo has not declared or paid any cash dividends since inception and does not expect to pay cash dividends for the foreseeable future.
The Shares were registered by the Company pursuant to an S-3 registration statement made effective on February 15, 2023. Repurchases of Equity Securities We repurchased 135,792 of our equity securities during the quarter ended December 31, 2024.
The Shares were registered by the Company pursuant to an S-3 registration statement made effective on February 15, 2023. Repurchases of Equity Securities We repurchased 911,529 of our equity securities during the year ended December 31, 2025.
High Low 2024: Fourth Quarter $ 22.44 $ 11.37 Third Quarter $ 15.23 $ 7.12 Second Quarter $ 10.65 $ 7.39 First Quarter $ 11.23 $ 8.02 2023: Fourth Quarter $ 10.45 $ 5.08 Third Quarter $ 8.83 $ 5.83 Second Quarter $ 10.42 $ 5.64 First Quarter $ 6.04 $ 4.51 On March 17, 2025, the last reported sales price of our common stock on the NASDAQ Global Select Market was $14.42 per share.
High Low 2025: Fourth Quarter $ 10.69 $ 6.59 Third Quarter $ 14.05 $ 9.20 Second Quarter $ 16.56 $ 10.39 First Quarter $ 24.85 $ 12.95 2024: Fourth Quarter $ 22.44 $ 11.37 Third Quarter $ 15.23 $ 7.12 Second Quarter $ 10.65 $ 7.39 First Quarter $ 11.23 $ 8.02 On March 9, 2026, the last reported sales price of our common stock on the NASDAQ Global Select Market was $6.64 per share.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeWe do not know if we will have market acceptance of our new products or whether the market will continue to accept our existing products. 31 Results of Operations The following table sets forth, as a percentage of total revenues, the results from our operations for the periods indicated. 2024 2023 Revenues 100.0 % 100.0 % Cost of revenues 12.5 12.9 Gross profit 87.5 87.1 Operating expenses: Sales and marketing 41.1 44.7 Product development 2.9 2.5 General and administrative 21.5 21.4 Total operating expenses 65.5 68.6 Operating income 22.0 18.5 Other income, net 0.7 1.7 Income from continuing operations before income taxes 22.7 20.2 Income tax expense 6.4 6.0 Income from continuing operations 16.3 14.2 Income from discontinued operations, net of tax — 0.5 Net income 16.3 14.7 Net income attributable to non-controlling interest 0.1 0.1 Net income attributable to Travelzoo 16.2 % 14.6 % Net income attributable to Travelzoo—continuing operations 16.2 % 14.1 % Net income attributable to Travelzoo—discontinued operations — % 0.5 % 32 Revenues The following table sets forth the breakdown of revenues (in thousands) by category Advertising, Membership Fees, and Other.
Biggest changeWe expect fluctuations in our income taxes from year to year and from quarter to quarter, which may be significant and have a material impact on our results of operations. 30 Results of Operations The following table sets forth, as a percentage of total revenues, the results from our operations for the periods indicated. 2025 2024 Revenues 100.0 % 100.0 % Cost of revenues 19.7 12.5 Gross profit 80.3 87.5 Operating expenses: Sales and marketing 49.4 41.1 Product development 2.8 2.9 General and administrative 20.6 21.5 Total operating expenses 72.8 65.5 Operating income 7.5 22.0 Other income, net 0.8 0.7 Income from operations before income taxes 8.3 22.7 Income tax expense 2.9 6.4 Income from operations 5.4 16.3 Net income 5.4 16.3 Net income attributable to non-controlling interest 0.3 0.1 Net income attributable to Travelzoo 5.1 % 16.2 % Net income attributable to Travelzoo operations 5.1 % 16.2 % 31 Revenues The following table sets forth the breakdown of revenues (in thousands) by category Advertising, Membership Fees, and Other.
Factors relating to the travel industry include lingering effects of the global pandemic, geopolitical tensions affecting consumer travel to certain regions, and risk of future unforeseeable macro events that impact travel, while factors relating to the online advertising business include shifts in consumer use of different digital media formats such as from desktop to mobile, from mobile web to mobile app, and from email to push notifications and SMS text messaging.
Factors relating to the travel industry include lingering effects of the global pandemic, geopolitical tensions affecting consumer travel to certain regions, and risk of future unforeseeable macro events that impact travel, while factors relating to the online advertising business include shifts in consumer use of different digital media formats such as from desktop to mobile, from mobile web to mobile app, and from email to push notifications and text messaging.
Advertiser shifts between advertising services could result in no incremental revenue or less revenue than in previous periods, depending on amounts purchased, and in particular with Local Deals and Getaways , depending on how many vouchers are purchased by members. Factors relating to competitors include the willingness of certain competitors to grow their business unprofitably.
Advertiser shifts between advertising services could result in no incremental revenue or less revenue than in previous periods, depending on amounts purchased, and in particular with Local Deals and Getaways , depending on how many vouchers are purchased by members. 28 Factors relating to competitors include the willingness of certain competitors to grow their business unprofitably.
We cannot be sure that any such financing will be available in amounts or on terms acceptable to us. If the development of our business is less favorable than expected, we may decide to significantly reduce the size of our operations and marketing expenses in certain markets with the objective of reducing cash outflows.
We cannot be sure that any such financing will be available in amounts or on terms acceptable to us. 35 If the development of our business is less favorable than expected, we may decide to significantly reduce the size of our operations and marketing expenses in certain markets with the objective of reducing cash outflows.
Factors relating to members include their willingness to purchase the deals we advertise, their demand for vouchers as a promotional format, and with the introduction of membership fees for new members in 2024 and existing members in 2025, our 29 ability to enroll new paying members and transition existing members to paid membership, without adversely affecting our membership base and existing advertising revenue streams.
Factors relating to members include their willingness to purchase the deals we advertise, their demand for vouchers as a promotional format, and with the introduction of membership fees for new members in 2024 and existing members in 2025, our ability to enroll new paying members and transition existing members to paid membership, without adversely affecting our membership base and existing advertising revenue streams.
If we sell additional equity or convertible debt securities, such sale could dilute the ownership of our existing stockholders. If we issue debt securities or establish a new credit facility, our fixed obligations could increase and we may be 36 required to agree to operating covenants that would restrict our operations.
If we sell additional equity or convertible debt securities, such sale could dilute the ownership of our existing stockholders. If we issue debt securities or establish a new credit facility, our fixed obligations could increase and we may be required to agree to operating covenants that would restrict our operations.
With the introduction of membership fees in 2024, our former user acquisition strategies and marketing tactics are no longer applicable for the Travelzoo membership base, and we are developing new user acquisition strategies whose timeframes to become effective are inherently uncertain.
With the introduction of membership fees in 2024, our former user acquisition strategies and marketing tactics are no longer applicable for the Travelzoo membership base, and we are developing new member acquisition strategies whose timeframes to become effective are inherently uncertain.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which temporary differences are expected to be recovered or settled. 37 Significant judgment is required in evaluating the Company's uncertain tax positions and determining the Company's provision for income taxes.
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which temporary differences are expected to be recovered or settled. 36 Significant judgment is required in evaluating the Company's uncertain tax positions and determining the Company's provision for income taxes.
Payables to merchants are generally due upon redemption of vouchers. The vouchers expire through December 2025; however these expiration dates may sometimes be extended on a case-by-case basis and final payment upon expiration may not be due for up to a year after expiration.
Payables to merchants are generally due upon redemption of vouchers. The vouchers expire through December 2026; however these expiration dates may sometimes be extended on a case-by-case basis and final payment upon expiration may not be due for up to a year after expiration.
Based on current projections of redemption activity, we expect that cash and cash equivalents on hand as of December 31, 2024 will be sufficient to provide for working capital needs for at least the next twelve months.
Based on current projections of redemption activity, we expect that cash and cash equivalents on hand as of December 31, 2025 will be sufficient to provide for working capital needs for at least the next twelve months.
The "Membership Fees" category consists of subscription fees paid by Travelzoo, Jack's Flight Club, and Travelzoo META members.
The "Membership Fees" category consists of subscription fees paid by Travelzoo and Jack's Flight Club members.
We also license Travelzoo products, services and intellectual property to licenses in (a) Australia, New Zealand, and Singapore and (b) Japan and South Korea, in each case, where the Company is entitled to a quarterly royalty payment based on a percentage of net revenue. The Company recognized $71,000 and $71,000 in royalties in 2024 and 2023, respectively.
We also license Travelzoo products, services and intellectual property to licenses in (a) Australia, New Zealand, and Singapore and (b) Japan and South Korea, in each case, where the Company is entitled to a quarterly royalty payment based on a percentage of net revenue. The Company recognized $68,000 and $71,000 in royalties in 2025 and 2024, respectively.
However, as we test new strategies and gain more learnings as to acquiring paying members, our expenditures may increase significantly. In addition, there may be a significant number of members that cancel or we may cancel their subscriptions for various reasons, which may prompt us to spend more on member acquisition in order to replace lost members.
However, as we test new strategies and gain more learnings as to acquiring paying members, our expenditures may fluctuate. In addition, there may be a significant number of members that cancel or we may cancel their subscriptions for various reasons, which may prompt us to spend more on member acquisition in order to replace lost members.
We continue to see a shift in users accessing our services through mobile devices and social media and, therefore, anticipate continuing to address this growing channel through increased marketing on social media channels.
We continue to see a shift in members accessing our services through mobile devices and social media and, therefore, anticipate continuing to address this growing channel through increased marketing on social media channels.
In the Company’s financial statements presented in this 10-K report, following U.S. generally accepted accounting principles (“GAAP”), we classified all merchant payables as current. When all merchant payables are classified as current, there is negative net working capital (which is defined as current assets minus current liabilities) of $4.7 million .
In the Company’s financial statements presented in this 10-K report, following U.S. generally accepted accounting principles (“GAAP”), we classified all merchant payables as current. When all merchant payables are classified as current, there is negative net working capital (which is defined as current assets minus current liabilities) of $10.8 million .
General and Administrative General and administrative expenses consist primarily of salary and related expenses associated with administrative and executive employees, professional service expenses, legal expenses, amortization of intangible assets, general office expense, facilities costs and bad debt expense. General and administrative expenses were $18.1 million and $18.1 million for the years ended 2024 and 2023, respectively.
General and Administrative General and administrative expenses consist primarily of salary and related expenses associated with administrative and executive employees, professional service expenses, legal expenses, amortization of intangible assets, general office expense, facilities costs and bad debt expense. General and administrative expenses were $18.9 million and $18.1 million for the years ended 2025 and 2024, respectively.
The "Advertising" category consists primarily of (a) advertising fees paid by travel companies for the publishing of their offers on Travelzoo’s media properties, (b) commission generated from the sale of Getaways vouchers and bookings on our hotel platform, and (c) publishing fees from high-quality local businesses, sale of Local Deals vouchers and entertainment offers.
The "Advertising and Commerce" category consists primarily of (a) advertising fees paid by travel companies for the publishing of their offers on Travelzoo’s media properties, (b) commissions and revenues generated from the sale of Getaways vouchers and bookings on our hotel platform, and (c) publishing fees from high-quality local businesses, sale of Local Deals vouchers and entertainment offers.
For the years ended December 31, 2024 and 2023, advertising expenses accounted for 13% and 26%, respectively, of total sales and marketing expenses. The goal of our advertising is to acquire new members, increase our audience through mobile and social media channels, drive traffic to our websites and increase brand awareness.
For the years ended December 31, 2025 and 2024, advertising expenses accounted for 26% and 11%, respectively, of total sales and marketing expenses. The goal of our advertising is to acquire new members, increase our audience through mobile and social media channels, drive traffic to our websites and increase brand awareness.
Cash used in operating assets and liabilities was primarily due to a $12.1 million decrease in merchant payables, offset partially by a $3.8 million decrease in prepaid expenses and other, $2.4 million increase in other liabilities and $1.2 million decrease in prepaid income taxes. Cash paid for income tax, net of refunds received, in 2024, was $1.9 million.
Cash used in operating assets and liabilities was primarily due to a $4.1 million decrease in merchant payables, offset partially by a $950,000 decrease in prepaid expenses and other and $1.9 million increase in other liabilities. Cash paid for income tax, net of refunds received, in 2025, was $3.8 million.
Sales and marketing expenses were $34.5 million and $37.8 million for the years ended December 31, 2024 and 2023, respectively. Advertising expenses consist primarily of online advertising, which we refer to as user acquisition costs and member acquisition costs.
Sales and marketing expenses were $45.3 million and $34.5 million for the years ended December 31, 2025 and 2024, respectively. Advertising expenses consist primarily of online advertising, which we refer to as user acquisition costs and member acquisition costs.
Cost of revenues as a percent of revenues declined from 12.9% in 2023 to 12.5% in 2024. Operating Expenses Sales and Marketing Sales and marketing expenses consist primarily of advertising and promotional expenses, salary and related expenses associated with sales, marketing and production employees, expenses related to participation in industry conferences, public relations expenses and facilities costs.
Cost of revenues as a percent of revenues increased from 12.5% in 2024 to 19.7% in 2025. Operating Expenses Sales and Marketing Sales and marketing expenses consist primarily of advertising and promotional expenses, salary and related expenses associated with sales, marketing and production employees, expenses related to participation in industry conferences, public relations expenses and facilities costs.
Travelzoo® membership has historically been free, however, on January 1, 2024, Travelzoo introduced an annual membership fee of $40 (or local equivalent) for new members in the United States, Canada, United Kingdom and Germany, with the 2024 annual fee waived for existing members as of December 31, 2023. We recognize subscription revenues ratably over the respective subscription periods.
Travelzoo membership has historically been free, however, on January 1, 2024, Travelzoo introduced an annual membership fee of $40 (or local equivalent) for new members in the United States, Canada, United Kingdom and Germany, with the 2024 annual fee waived for existing members as of December 31, 2023.
The forward-looking statements included in this report reflect the beliefs of our management on the date of this report. Travelzoo undertakes no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other circumstances occur in the future. Overview Travelzoo, the club for travel enthusiasts, is a global Internet media company.
The forward-looking statements included in this report reflect the beliefs of our management on the date of this report. Travelzoo undertakes no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other circumstances occur in the future.
The following table provides a summary of our cash flows from operating, investing and financing activities: Year Ended December 31, 2024 2023 (In thousands) Net cash provided by operating activities $ 21,100 $ 10,675 Net cash used in investing activities (177) (39) Net cash used in financing activities (18,973) (14,150) Effect of exchange rate changes on cash, cash equivalents and restricted cash (599) 525 Net increase (decrease) in cash, cash equivalents and restricted cash $ 1,351 $ (2,989) Net cash provided by operating activities for 2024 was $21 million, as compared to $10.7 million in 2023, consisting of net income of $13.7 million, $2 million of adjustments for non-cash items and $5.4 million used in changes in operating assets and liabilities.
The following table provides a summary of our cash flows from operating, investing and financing activities: Year Ended December 31, 2025 2024 (In thousands) Net cash provided by operating activities $ 5,661 $ 21,100 Net cash used in investing activities (65) (177) Net cash used in financing activities (13,068) (18,973) Effect of exchange rate changes on cash, cash equivalents and restricted cash 495 (599) Net increase (decrease) in cash, cash equivalents and restricted cash $ (6,977) $ 1,351 Net cash provided by operating activities for 2025 was $5.7 million, as compared to $21.1 million in 2024, consisting of net income of $5 million, $1.2 million of adjustments for non-cash items and $478,000 used in changes in operating assets and liabilities.
For the year ended December 31, 2024, Travelzoo North America operations comprised 66% of revenues, Travelzoo Europe operations comprised 29% of revenues and Jack's Flight Club comprised 5% of revenues.
For the year ended December 31, 2025, Travelzoo North America operations comprised 66% of revenues, Travelzoo Europe operations comprised 28% of revenues and Jack's Flight Club comprised 6% of revenues.
Beside member acquisition costs, we may see a unique opportunity for a brand marketing campaign, experience increases in the cost of retaining or sourcing new advertiser clients, or change the number of personnel or compensation structure for the Sales and marketing function, any of which would result in an increase in sales and marketing expenses.
All else equal, increased competition may require us to increase advertising for our brand and advertisers’ deals. 29 Beside member acquisition costs, we may see a unique opportunity for a brand marketing campaign, experience increases in the cost of retaining or sourcing new advertiser clients, or change the number of personnel or compensation structure for the Sales and marketing function, any of which would result in an increase in sales and marketing expenses.
Net cash provided by operating activities for 2023 was $10.7 million, consisting of net income of $12.5 million and $2.4 million adjustments for non-cash items, offset partially by $4.2 million used in changes in operating assets and liabilities.
Net cash provided by operating activities for 2024 was $21 million, consisting of net income of $13.7 million, $2 million of adjustments for non-cash items and $5.4 million used in changes in operating assets and liabilities.
The "Other" category consists of licensing fees from license agreements, as well as the retail business originally operated by MTE and acquired and maintained by the Company following the acquisition of MTE.
We recognize subscription revenues ratably over the respective subscription periods. The "Other" category consists of licensing fees from license agreements, as well as the retail business originally operated by MTE and acquired and maintained by the Company following the acquisition of MTE.
Advertising includes travel publications ( Top 20 , Travelzoo website, Standalone email newsletters, Travelzoo Network ), Getaways vouchers, hotel platform, vacation packages, Local Deals vouchers and entertainment offers (vouchers and direct bookings). Membership Fees includes subscription fees paid by Travelzoo, Jack’s Flight Club and Travelzoo META members.
Advertising includes travel publications ( Top 20 , Travelzoo website, Standalone email newsletters, Travelzoo Network ), Getaways vouchers, hotel platform, vacation packages, Local Deals vouchers and entertainment offers (vouchers and direct bookings). Membership Fees includes subscription fees paid by Travelzoo and Jack’s Flight Club members. Other includes licensing fees from license agreements and the retail business acquired with MTE.
Liquidity and Capital Resources As of December 31, 2024, we had $17.1 million of cash and cash equivalents , of which $13.8 million was held outside the U.S., and we had $675,000 in restricted cash held in the U.S.
Liquidity and Capital Resources As of December 31, 2025, we had $10 million of cash and cash equivalents , of which $7.8 million was held outside the U.S., and we had $756,000 in restricted cash held in the U.S.
General and administrative expenses remained flat year-over-year. Other Income, net Other income, net consisted primarily of foreign exchange transactions gains and losses, sublease income, German federal government funding for Corona-related pandemic relief, interest income and interest expense. Other income was $588,000 and $1.5 million for the years ended December 31, 2024 and 2023, respectively.
Other Income, net Other income, net consisted primarily of foreign exchange transactions gains and losses, sublease income, German federal government funding for Corona-related pandemic relief, interest income and interest expense. Other income was $753,000 and $588,000 for the years ended December 31, 2025 and 2024, respectively.
Cash, cash equivalents and restricted cash increased by $1.3 million to $17.7 million as of December 31, 2024 from $16.4 million as of December 31, 2023, primarily due to cash provided by operating activities, offset partially by cash used to repurchase common stock. 35 As of December 31, 2024 , we had m erchant payables of $16.3 million related to unredeemed vouchers.
Cash, cash equivalents and restricted cash decreased by $7.0 million to $10.8 million as of December 31, 2025 from $17.7 million as of December 31, 2024, primarily due to cash used to repurchase common stock, offset partially by cash provided by operating activities. 34 As of December 31, 2025 , we had m erchant payables of $11.7 million related to unredeemed vouchers.
When evaluating the financial condition and operating performance of the Company, management focuses on financial and non-financial indicators such as growth in the number of members to the Company’s newsletters, operating margin, growth in revenues in the absolute and relative to the growth in reach of the Company’s publications measured as revenue per member and revenue per employee as a measure of productivity.
When evaluating the financial condition and operating performance of the Company, management focuses on financial and non-financial indicators such as growth in the number of members to the Company’s newsletters, operating margin, growth in revenues in the absolute and relative to the growth in reach of the Company’s publications measured as revenue per member and revenue per employee as a measure of productivity. 27 How We Generate Revenues Revenues from the Travelzoo brand and business are generated primarily from three categories: Advertising and Commerce, Membership Fees, and Other.
With the introduction of membership fees in 2024, we expect the cost of acquiring new paying members to increase significantly, as compared with the cost of acquiring non-paying members prior to 2024.
With the introduction of membership fees in 2024, we expected the cost of acquiring new paying members to increase significantly, as compared with the cost of acquiring non-paying members prior to 2024. In 2025, advertising expenditures increased significantly as we implemented new strategies to acquire Club Members.
Jack's Flight Club Year Ended December 31, 2024 2023 (In thousands) Revenues 4,632 $ 4,172 Income (Loss) from operations $ 44 $ (23) Income (Loss) from operations as a % of revenues 1 % (1) % Jack’s Flight Club revenues increased $460,000, or 11%, in 2024 as compared to 2023 due to increase of subscription fees and increase of premium members.
Jack's Flight Club Year Ended December 31, 2025 2024 (In thousands) Revenues 5,371 $ 4,632 Income (Loss) from operations $ 338 $ 44 Income (Loss) from operations as a % of revenues 6 % 1 % Jack’s Flight Club revenues increased $739,000, or 16%, in 2025 as compared to 2024 due to increase of subscription fees paid by the members .
Cash used in operating assets and liabilities was primarily due to a $4.1 million decrease in merchant payables, offset partially by a $950,000 decrease in prepaid expenses and other and $1.9 million increase in other liabilities.
Cash used in operating assets and liabilities was primarily due to a $5.2 million decrease in merchant payables, offset partially by a $2.4 million increase in accounts receivable and a $2 million increase in deferred revenue.
Segment Information Travelzoo North America Year Ended December 31, 2024 2023 (In thousands) Revenues $ 55,092 $ 56,080 Income from operations $ 15,883 $ 15,254 Income from operations as a % of revenues 29 % 27 % North America revenues decreased $988,000, or 1.8%, in 2024 as compared to 2023.
Segment Information Travelzoo North America Year Ended December 31, 2025 2024 (In thousands) Revenues $ 60,292 $ 55,092 Income from operations $ 8,996 $ 15,883 Income from operations as a % of revenues 15 % 29 % North America revenues increased $5.2 million, or 9%, in 2025 as compared to 2024.
New Initiatives Year Ended December 31, 2024 2023 (In thousands) Revenues $ 107 $ 204 Loss from operations $ (510) $ (976) New Initiatives revenues decreased $97,000 in 2024 as compared to 2023. New Initiatives cost of sales and operating expenses decreased $604,000 in 2024 as compared to 2023, primarily due to decreases in sales and marketing and headcount.
Jack’s Flight Club cost of sales and operating expenses increased $446,000 in 2025 as compared to 2024, primarily due to an increase in advertising and marketing expenses. New Initiatives Year Ended December 31, 2025 2024 (In thousands) Revenues 80 $ 107 Loss from operations $ (115) $ (510) New Initiatives revenues decreased $27,000 in 2025 as compared to 2024.
Product development expenses were $2.4 million and $2.1 million for each of the years ended December 31, 2024 and 2023, respectively. Product development expenses increased by $300,000, or 14%, in 2024 as compared to 2023, primarily due to increased salary and related expenses. Product development expenses as a percent of revenues were 2.9% and 2.5% in 2024 and 2023, respectively.
Product development expenses increased by $144,000, or 6%, in 2025 as compared to 2024 , primarily due to increase in salary and related expenses. Product development expenses as a percent of revenues were 2.8% and 2.9% in 2025 and 2024, respectively.
Cash received for income tax refunds, net of payments in 2023, was $1,000. Net cash used in investing activities for 2024 was $177,000 for purchases of property and equipment. Net cash used in investing activities for 2023 was $39,000 which consisted of $255,000 for purchases of property and equipment and $216,000 proceeds from repayment of note receivable from a licensee.
Cash received for income tax refunds, net of payments in 2024, was $1.9 million. Net cash used in investing activities for 2025 was $65,000 for purchases of property and equipment. Net cash used in investing activities for 2024 was $177,000 for purchases of property and equipment.
Europe cost of sales and operating expenses decreased $2.9 million in 2024 as compared to 2023, primarily due to decreased member acquisition costs. Foreign currency movements relative to the U.S. dollar impacted local currency income from our operations in Europe by approximately $106,000 and negatively $40,000 in 2024 and 2023, respectively.
Foreign currency movements relative to the U.S. dollar impacted local currency income from our operations in Europe by approximately negatively $97,000 and positively $106,000 in 2025 and 2024, respectively.
Income Taxes Our income is generally taxed in the U.S., Canada and U.K. Our income tax provision reflects federal, state and country statutory rates applicable to our worldwide income, adjusted to take into account expenses that are treated as having no recognizable tax benefit.
Our income tax provision reflects federal, state and country statutory rates applicable to our worldwide income, adjusted to take into account expenses that are treated as having no recognizable tax benefit. Income tax expense was $2.7 million and $5.4 million, respectively, for the years ended December 31, 2025 and 2024.
North America cost of sales and operating expenses decreased by $1.9 million in 2024 as compared to 2023, primarily due to a $2.5 million decrease in member acquisition costs and $631K decrease in software expenses, offset by various increases including $811K in salary costs. 34 Travelzoo Europe Year Ended December 31, 2024 2023 (In thousands) Revenues $ 24,071 $ 24,021 Income from operations $ 3,081 $ 1,317 Income from operations as a % of revenues 13 % 5 % Europe revenues increased $50,000, or 0.2%, in 2024 as compared to 2023.
North America cost of sales and operating expenses increased by $12 million in 2025 as compared to 2024, primarily due to a $5.7 million increase in cost of revenue related to purchase of vouchers and gift cards which were sold during the year ended December 31, 2025, and a $4.7 million increase in member acquisition costs. 33 Travelzoo Europe Year Ended December 31, 2025 2024 (In thousands) Revenues 25,976 $ 24,071 Income from operations $ (2,315) $ 3,081 Income from operations as a % of revenues (9) % 13 % Europe revenues increased $1.9 million, or 8%, in 2025 as compared to 2024.
Adjustments for non-cash items primarily consist of $1.9 million for depreciation and amortization and $1.6 million for stock-based compensation, offset partially by a $1.0 million reversal of reserve for accounts receivable and refunds.
Adjustments for non-cash items primarily consist of $305,000 for depreciation and amortization and $1.4 million for stock-based compensation, offset partially by $558,000 of deferred income tax change.
This decrease was primarily due to $2.1 million decrease in revenues from Top 20 and offset by increases in other revenue products. Membership Fees Revenues from Membership fees increased $1.3 million, or 30%, from 2023 to 2024 due to the increase of members paying subscription fees for both Travelzoo and Jack's Flight Club.
Membership Fees Revenues from Membership fees increased $7.8 million, or 144%, from 2024 to 2025 due to the increase of members paying subscription fees for both Travelzoo and Jack's Flight Club. Other Revenues from Other decreased $27,000 due to decrease in activities attributable to MTE.
Cost of revenues was $10.5 million and $10.9 million for the years ended December 31, 2024 and 2023, respectively. Cost of revenues decreased $465,000 for the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to a decrease in software and license costs .
Cost of revenues was $18.1 million and $10.5 million for the years ended December 31, 2025 and 2024, respectively. Cost of revenues increased $7.6 million for the year ended December 31, 2025 compared to the year ended December 31, 2024 primarily due to an increase in costs recognized upon the sale of pre-purchased vouchers .
The following summarizes our principal contractual commitments as of December 31, 2024 (in thousands): Operating Lease Commitments Long-term Operating Lease Commitments Short-term Total Operating Lease Commitments Purchase Obligations Total Commitments 2025 $ 2,723 $ 264 $ 2,987 $ 586 $ 3,573 2026 1,800 — 1,800 584 2,384 2027 1,458 — 1,458 133 1,591 2028 1,458 — 1,458 — 1,458 Thereafter 1,674 — 1,674 — 1,674 Total $ 9,113 $ 264 $ 9,377 $ 1,303 $ 10,680 We also have contingencies related to net unrecognized tax benefits, including interest, of approximately $25 million as of December 31, 2024.
The following summarizes our principal contractual commitments as of December 31, 2025 (in thousands): Operating Lease Commitments Long-term Operating Lease Commitments Short-term Total Operating Lease Commitments Purchase Obligations Total Commitments 2026 $ 1,852 $ 1,132 $ 2,984 $ 592 $ 3,576 2027 1,464 45 1,509 141 1,650 2028 1,464 — 1,464 — 1,464 2029 1,454 — 1,454 — 1,454 2030 225 — 225 — 225 Total $ 6,459 $ 1,177 $ 7,636 $ 733 $ 8,369 We also have contingencies related to net unrecognized tax benefits, including interest, of approximately $23.9 million as of December 31, 2025.
Jack’s Flight Club cost of sales and operating expenses increased $690,000 in 2024 as compared to 2023, primarily due to an increase in headcount to support Canadian expansion and advertising and marketing expenses.
New Initiatives cost of sales and operating expenses decreased $422,000 in 2025 as compared to 2024, primarily due to decreases in sales and marketing and headcount.
Net cash used in financing activities for 2024 was $19 million primarily for the repurchase of common stock. Net cash used in financing activities for 2023 was $14.2 million, which primarily consisted of $16.8 million for the repurchase of common stock and $3.0 million payment of promissory notes.
Net cash used in financing activities for 2025 was $13 million primarily for the repurchase of common stock. Net cash used in financing activities for 2024 was $18.9 million primarily for the repurchase of common stock.
Under the licensing agreements, Travelzoo's existing members in the applicable territories continue to be owned by the Company. In March 2022 we announced the development of, and in May 2023 we launched Travelzoo META, to extend the range of experiences we offer consumers to the emerging metaverse.
Under the licensing agreements, Travelzoo's existing members in the applicable territories continue to be owned by the Company.
Sales and marketing expenses decreased $3.3 million, or 9%, in 2024 as compared to 2023, primarily due to decrease in member acquisition.
Sales and marketing expenses increased $10.8 million, or 31%, in 2025 as compared to 2024 , primarily due to increase in member acquisition. Sales and marketing expenses as a percent of revenues increased from 41% in 2024 to 49.4% in 2025.
Sales and marketing expenses as a percent of revenues declined from 44.7% in 2023 to 41.1% in 2024. 33 Product Development Product development expenses consist primarily of salary and related expenses associated with software development employees, fees for professional services, software maintenance, amortization and facilities costs.
Product Development 32 Product development expenses consist primarily of salary and related expenses associated with software development employees, fees for professional services, software maintenance, amortization and facilities costs. Product development expenses were $2.6 million and $2.4 million for each of the years ended December 31, 2025 and 2024, respectively.
On December 30, 2022, we acquired Metaverse Travel Experiences, Inc., now Metaverse Travel Experiences, LLC (“MTE”), to support Travelzoo META in sourcing prospective travel experiences. MTE also continues to operate its legacy business in retail and fashion, which is included in but not material to the Company’s consolidated results.
MTE also continues to operate its legacy business in retail and fashion, which is included in but not material to the Company’s consolidated results Reportable Segments The Company determines its reportable segments based upon the Company's chief operating decision maker managing the performance of the business.
For any subscription revenue derived from the paid membership, we recognize revenue monthly pro rata over the subscription period.
On January 1, 2026, we increased the annual membership fee to $50 in the United States for new members, For existing members, the new pricing will apply from the next renewal of their membership after February 1, 2026. For any subscription revenue derived from the paid membership, we recognize revenue monthly pro rata over the subscription period.
We reach 30 million travelers. Club Members receive Club Offers personally reviewed by our deal experts around the globe. We work in partnership with thousands of top travel suppliers—our long-standing relationships give us access to irresistible deals.
Our relationships with thousands of top travel suppliers—give us access to irresistible deals. Our club and its benefits are built around the lifestyle of a travel enthusiast.
Income tax expense was $5.4 million and $5.1 million, respectively, for the years ended December 31, 2024 and 2023. Our effective tax rate was 28.3% and 30% for 2024 and 2023, respectively. Our effective tax rate decreased for 2024 as compared to 2023, primarily due to a decrease in non-deductible stock compensation .
Our effective tax rate was 35% and 28.3% for 2025 and 2024, respectively. Our effective tax rate increased for 2025 as compared to 2024, primarily due to higher interest expense related to uncertain tax positions .
Other includes licensing fees from license agreements and the retail business acquired with MTE. Year Ended December 31, 2024 2023 Advertising $ 78,396 $ 80,128 Membership Fees 5,399 4,145 Other 107 204 Total revenues $ 83,902 $ 84,477 Advertising Advertising revenue decreased $1.7 million, or 2%, from 2023 to 2024.
Year Ended December 31, 2025 2024 Advertising and Commerce $ 78,446 $ 78,396 Membership Fees 13,193 5,399 Other 80 107 Total revenues $ 91,719 $ 83,902 Advertising and Commerce Advertising and Commerce revenue remained flat year over year.
Jack’s Flight Club subscription options are quarterly, semi-annually, and annually. We recognize subscription revenues ratably over the respective subscription periods. For Travelzoo META, a founding membership was launched in 2022 following a test-and-learn strategy.
On January 1, 2026, we increased the annual membership fee to $50 for new members in the United States only. For existing members, the new pricing will apply from the next renewal of their membership after February 1, 2026. We recognize subscription revenues ratably over the respective subscription periods. Jack’s Flight Club subscription options are quarterly, semi-annually, and annually.
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Our most important products and services are the Travelzoo website (travelzoo.com), the Travelzoo iOS and Android apps, the Top 20® email newsletter, Standalone email newsletters, the Travelzoo Network , and Jack's Flight Club® .
Added
Overview Travelzoo (including its subsidiaries and affiliates, the “Company” or “we”) is a global Internet media company. We operate Travelzoo®, the club for travel enthusiasts, Jack’s Flight Club®, and Travelzoo META. We reach 30 million travelers. Club Members, who pay a membership fee, receive Club Offers negotiated and rigorously vetted by our deal experts around the globe.
Removed
Our Travelzoo website and newsletters include Local Deals and Getaways listings that allow our members to purchase vouchers for offers from local businesses such as spas, hotels and restaurants. Jack's Flight Club is a subscription service that provides members with information about exceptional airfares.
Added
Through Travelzoo META, we plan to include Metaverse travel experiences as a benefit of Travelzoo club membership in 2026, allowing us to utilize and leverage all we have learned and developed over the past few years for Travelzoo META for the benefit of our Club Members.
Removed
APAC Exit and Pivot to Licensing Model In March 2020, Travelzoo exited its loss-making Asia Pacific business and pivoted to a licensing model. The Company’s Asia Pacific business was classified as discontinued operations at March 31, 2020. Travelzoo currently has license agreements covering Australia, New Zealand and Singapore, as well as Japan and South Korea.
Added
In certain scenarios, the Company will pre-purchase vouchers or hotel inventory (in the form of credit amounts, vouchers or gift cards) in bulk from clients and partners (e.g. hotel or spa partners). In those scenarios, the Company is not acting as the agent, but rather as the principal.
Removed
The license agreement for Australia, New Zealand and Singapore provides the licensee exclusive rights to use the Travelzoo products, services and intellectual property in Australia, New Zealand and Singapore in exchange for quarterly royalty payments based upon net revenue over a 5 year term, with an option to renew.
Added
The pre-purchased vouchers are recorded as inventory, within prepaid expenses and other on the condensed consolidated balance sheet until sold to and purchased by Travelzoo members, at which point, the amount for which the vouchers were sold to Travelzoo members is recognized fully as revenue and the amount for which the vouchers were purchased from the hotel or spa partners is recognized as cost of revenues.
Removed
The Company recognized royalties of $41,000 and $35,000 from the licensee for the years ended December 31, 2024 and 2023, respectively.
Added
Cost of Revenues Cost of revenues consists primarily of network expenses related to powering the Company's websites, database services, sending e-mails, amortization of capitalized website development costs, software and license expenses, publishing fees to partners of the Travelzoo Network , costs incurred upon the sale of pre-purchased vouchers and other products, including directly attributable member services (call center), cost of certain membership benefits that are considered integral to the contractual obligation to Club Members, fees to payment processors.
Removed
The license agreement for Japan and South Korea provides the licensee exclusive rights to use Travelzoo products, services, and intellectual property in exchange for quarterly royalty payments based on net revenue over a 5 year term, with an option to renew.
Added
General and administrative expenses increased by $863,000, or 5%, in 2025 as compared to 2024 , primarily due to increase in a one-time expense related to a global company meeting. General and administrative expenses as a percent of revenues were 20.6% and 21.5% in 2025 and 2024, respectively.
Removed
The Company recognized royalties of $ 30,000 and $36,000 from the licensee for the years ended December 31, 2024 and 2023, respectively. 28 Reportable Segments The Company determines its reportable segments based upon the Company's chief operating decision maker managing the performance of the business.
Added
Other income increased $165,000, or 28%, in 2025 as compared to 2024, primarily due to a $210,000 release of JFC VAT liabilities after a four-years statute of limitations in 2025. Income Taxes Our income is generally taxed in the U.S., Canada and U.K.
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How We Generate Revenues Revenues from the Travelzoo brand and business are generated primarily from three categories: Advertising, Membership Fees, and Other.
Added
This increase was primarily due to the increase in paid membership fees and sales of pre-purchased vouchers or hotel inventory.
Removed
Initially, we are reducing our advertising expenditures, as we are no longer offering free memberships for new members 30 and, accordingly, prior user acquisition strategies are not in use. Further, we are early in the development of new strategies to acquire paying members, so our test budgets have not yet fully scaled.
Added
This increase was primarily due to the increase in paid membership fees and sales of pre-purchased vouchers or hotel inventory.
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All else equal, increased competition may require us to increase advertising for our brand and advertisers’ deals.
Added
Europe cost of sales and operating expenses increased by $7.3 million in 2025 as compared to 2024, primarily due to a $1.9 million increase in cost of revenue related to purchase of vouchers and gift cards which were sold during the year ended December 31, 2025, a $2.5 million increase in member acquisition costs, and a $1 million increase in salary and related expenses.
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We expect fluctuations in our income taxes from year to year and from quarter to quarter, which may be significant and have a material impact on our results of operations.
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The key elements of our growth strategy include building our trusted travel, entertainment and local brands, increasing the value and engagement of our membership base, sourcing more exclusive and compelling offers from advertisers, and innovating with new experiences and revenue streams. We expect to continue our efforts to grow; however, we may not grow or we may experience slower growth.

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