TripAdvisor 2015 Annual Report Download - page 33

AdjustedEBITDAasnetincome(loss)plus:(1)provisionforincometaxes;(2)otherincome(expense),net;(3)depreciationofpropertyandequipment,
includingamortizationofinternalusesoftwareandwebsitedevelopment;(4)amortizationofintangibleassets;(5)stock-basedcompensationandother
stock-settledobligations;(6)goodwill,long-livedassetandintangibleassetimpairments;and(7)othernon-recurringexpenses.Suchamountsaredetailed
below.Seeadiscussionof“AdjustedEBITDA”inItem7.“Management’sDiscussionandAnalysisofFinancialConditionandResultsofOperations”
withinthisAnnualReportonForm10-K.
WehaveprovidedareconciliationbelowofAdjustedEBITDAtonetincome,themostdirectlycomparableGAAPfinancialmeasure.

Year Ended December 31,
  2015 2014 2013 2012 2011
(in millions)
Adjusted EBITDA $ 466 $ 468 $ 379 $ 352 $ 323
Depreciation(1)  (57)  (47)  (30)  (20)  (18)
Amortizationofintangibleassets  (36)  (18)  (6)  (6)  (8)
Stock-basedcompensation  (72)  (63)  (49)  (30)  (17)
Non-cashcharitablecontribution(2)  (67)  —  —  —  —
Spin-offcostsandothernon-recurringexpenses (2)  —  —  —  (7)
Otherincome(expense),net(3)  7  (18)  (10)  (14)  (1)
Provisionforincometaxes  (41)  (96)  (79)  (87)  (94)
Net income $ 198 $ 226 $ 205 $ 195 $ 178

(1) Includesamortizationofinternalusesoftwareandwebsitedevelopmentcosts.
(2) Representsacharitablefoundationobligationwhichwassettledinstock.Referto“Note12–Commitments and Contingencies ”inthenotestoour
consolidatedfinancialstatementsinItem8foradiscussionofcharitablecontributionstotheFoundation.
(3) Includesa$20milliongainonsaleofsubsidiaryfortheyearendedDecember31,2015.Referto“Note3–Acquisitions and Dispositions ”inthenotesto
ourconsolidatedfinancialstatementsinItem8.


Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Certainrevenueinformationinthissectionentitled"—RevenuebyProduct—ForeignExchangeImpactonRevenue"ispresentedonaconstantcurrency
basis.Thisinformationisanon-GAAPfinancialmeasure.Tocalculaterevenueonaconstantcurrencybasis,wetranslatedrevenuefortheyearendedDecember
31,2015usingtheprioryear'squartertodateaverageexchangeratesforoursettlementcurrenciesotherthantheU.S.dollar.Thisnon-GAAPfinancialmeasureis
notintendedtobeconsideredinisolationorasasubstitutefor,orsuperiorto,financialinformationpreparedandpresentedinaccordancewithGAAP.This
measuremaybedifferentfromnon-GAAPfinancialmeasuresusedbyothercompanies,limitingitsusefulnessforcomparisonpurposes.Moreover,presentationof
revenueonaconstantcurrencybasisisprovidedforyear-over-yearcomparisonpurposes,andinvestorsshouldbecautionedthattheeffectofchangingforeign
currencyexchangerateshasanactualeffectonouroperatingresults.Webelievethisnon-GAAPfinancialmeasureprovidesinvestorswithusefulsupplemental
informationaboutthefinancialperformanceofourbusiness,enablescomparisonoffinancialresultsbetweenperiodswherecertainitemsmayvaryindependentof
businessperformance,andallowforgreatertransparencywithrespecttokeymetricsusedbymanagementinoperatingourbusiness.
Overview
TripAdvisor,Inc.ownsandoperatesaportfolioofleadingonlinetravelbrands.TripAdvisor,ourflagshipbrand,istheworld’slargesttravelsite.Our
missionistohelppeoplearoundtheworldplanandbooktheperfecttrip.Weaccomplishthisby,amongotherthings,aggregatingmillionsoftravelers’reviews
andopinionsaboutaccommodations,destinations,activitiesandattractions,andrestaurantsthroughouttheworldsothatourusershaveaccesstotrustedadvice
wherevertheirtriptakesthem.Ourplatformnotonlyhelpsusersplantheirtripwithouruniqueuser-generatedcontent,butalsoenablesuserstocomparereal-time
pricingandavailabilitysothattheycanbookhotels,vacationrentals,flights,activitiesandattractions,andrestaurants.
OurTripAdvisor-brandedwebsitesincludetripadvisor.comintheUnitedStatesandlocalizedversionsoftheTripAdvisorwebsitein46countries
worldwide.OurTripAdvisor-brandedwebsitesreached350millionaveragemonthlyuniquevisitorsduringtheyearendedDecember31,2015,accordingtoour
internallogfiles.Wecurrentlyfeature320millionreviewsandopinionson6.2millionplacestostay,placestoeatandthingstodo–including995,000hotelsand
accommodationsand770,000vacationrentals,3.8millionrestaurantsand625,000attractionsaroundtheworld.Inadditiontouser-generatedcontent,ourwebsites
featurepricecomparisontoolsandlinkstopartnerwebsites,includingtraveladvertisers,onwhichuserscanbooktheirtravelarrangements.Usersmaynowalso
completehotelbookingsdirectlywithourpartnersthroughtripadvisor.comandalsothroughtheTripAdvisormobile

30