2 unchanged sentences
Report of KPMG LLP - Independent Registered Public Accounting Firm (PCAOB ID:
−Removed: Report of RSM US LLP - Independent Registered Public Accounting Firm (PCAOB ID:
Consolidated Balance Sheets 42
1 unchanged sentence
Consolidated Statements of Comprehensive Income 44
−Removed: Consolidated Statements of Stockholders’ Equity (Deficit) 50
+Added: Consolidated Statement of Stockholders' Equity 45
Consolidated Statements of Cash Flows 46
1 unchanged sentence
Report of Independent Registered Public Accounting Firm
−Removed: To the Stockholders and the Board of Directors
+Added: To the Stockholders and Board of Directors
Opinion on the Consolidated Financial Statements
−Removed: We have audited the accompanying consolidated balance sheet of Travelzoo and subsidiaries (the Company) as of December 31, 2023, the related consolidated statements of operations, comprehensive income, stockholders’ equity (deficit), and cash flows for the year then ended December 31, 2023, and the related notes (collectively, the consolidated financial statements).
−Removed: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023, and the results of its operations and its cash flows for the year then ended December 31, 2023, in conformity with U.S.
+Added: We have audited the accompanying consolidated balance sheets of Travelzoo and subsidiaries (the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income, stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2024, and the related notes (collectively, the consolidated financial statements).
+Added: In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2024, in conformity with U.S.
generally accepted accounting principles.
−Removed: We also have audited the adjustments to the 2022 consolidated financial statements to retrospectively apply the change in segment composition, as described in Note 12.
−Removed: In our opinion, such adjustments are appropriate and have been properly applied.
−Removed: We were not engaged to audit, review, or apply any procedures to the 2022 consolidated financial statements of the Company other than with respect to the adjustments and, accordingly, we do not express an opinion or any other form of assurance on the 2022 consolidated financial statements taken as a whole.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management.
−Removed: Our responsibility is to express an opinion on these consolidated financial statements based on our audit.
+Added: Our responsibility is to express an opinion on these consolidated financial statements based on our audits.
We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
−Removed: We conducted our audit in accordance with the standards of the PCAOB.
+Added: We conducted our audits in accordance with the standards of the PCAOB.
Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.
−Removed: As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.
+Added: As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.
Accordingly, we express no such opinion.
−Removed: Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
+Added: Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements.
−Removed: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
−Removed: We believe that our audit provides a reasonable basis for our opinion.
+Added: Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.
+Added: We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
5 unchanged sentences
Advertising revenue is recognized by the Company upon the delivery of the emails to its members or each time a user clicks on the respective advertisements.
−Removed: For the year ended December 31, 2023, the Company recorded $84.5 million in revenues, which included advertising fee revenues from email newsletters and cost-per-click advertising.
+Added: For the year ended December 31, 2024, the Company recorded $78.4 million in advertising revenues, which included advertising fee revenues from email newsletters and cost-per-click advertising.
We identified the evaluation of the sufficiency of audit evidence over revenue related to advertising fees for email newsletters and cost-per-click advertising as a critical audit matter.
3 unchanged sentences
We applied auditor judgment to determine the nature and extent of procedures to be performed.
−Removed: We involved IT professionals with specialized skills and knowledge, who assisted in evaluating the design and testing the operating effectiveness of certain internal controls over the Company’s revenue process, including general IT controls and IT application controls over the tracking of emails and clicks.
−Removed: For a sample of transactions, we assessed the recorded revenue by comparing the amounts recognized for consistency with underlying documentation, including contract terms, number of emails or clicks, and subsequent cash, if applicable.
+Added: We involved IT professionals with specialized skills and knowledge, who assisted in evaluating the design and testing the operating effectiveness of certain internal controls over the Company’s revenue process, including general IT controls and IT application controls over the tracking of emails and clicks recorded.
+Added: We performed a software-assisted data analysis to test relationships among certain revenue transactions.
+Added: For a selection of transactions, we assessed the recorded revenue by comparing the amounts recognized for consistency to underlying documentation, including contract terms, number of emails or clicks, and subsequent cash, if applicable.
We evaluated the sufficiency of audit evidence obtained by assessing the results of procedures performed, including the appropriateness of the nature and extent of such evidence.
2 unchanged sentences
March 19, 2025
−Removed: Report of Independent Registered Public Accounting Firm
−Removed: To the Stockholders and the Board of Directors of Travelzoo
−Removed: Opinion on the Financial Statements
−Removed: We have audited, before the effects of the adjustments to retrospectively apply the changes in the Company's disclosures about segments and related information in Note 12, the accompanying consolidated balance sheet of Travelzoo and subsidiaries (the Company) as of December 31, 2022, the related consolidated statements of operations, comprehensive income, stockholders' equity (deficit) and cash flows for the year then ended, and the related notes to the consolidated financial statements (collectively, the financial statements).
−Removed: The 2022 financial statements before the effects of the adjustments described in Note 12 are not presented herein.
−Removed: In our opinion, before the effects of the adjustments to retrospectively apply the changes in the Company's disclosures about segments and related information in Note 12, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2022, and the results of their operations and their cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.
−Removed: We were not engaged to audit, review, or apply any procedures to retrospectively apply the changes in the Company's disclosures about segments and related information in Note 12 and, accordingly we do not express an opinion or any other form of assurance about whether such adjustments are appropriate and have been properly applied.
−Removed: Those adjustments were audited by other auditors.
−Removed: Emphasis of Matter
−Removed: As discussed in Note 17 to the financial statements, the 2022 financial statements have been restated to correct a misstatement.
−Removed: Basis for Opinion
−Removed: These financial statements are the responsibility of the Company’s management.
−Removed: Our responsibility is to express an opinion on the Company’s financial statements based on our audit.
−Removed: We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with U.S.
−Removed: federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
−Removed: We conducted our audit in accordance with the standards of the PCAOB.
−Removed: Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
−Removed: Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.
−Removed: Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
−Removed: Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
−Removed: We believe that our audit provides a reasonable basis for our opinion.
−Removed: /s/ RSM US LLP
−Removed: We served as the Company's auditor from 2019 to 2023.
−Removed: San Jose, California
−Removed: March 31, 2023, except for Note 17 as to which the date is August 14, 2023
CONSOLIDATED BALANCE SHEETS
7 unchanged sentences
Prepaid expenses and other 1,148 1,461
−Removed: Assets from discontinued operations 1 11
Total current assets 31,773 30,768
25 unchanged sentences
Common stock, $ 0.01 par value ( 20,000 shares authorized as of December 31, 2024 and 2023, respectively;
−Removed: 13,575 shares issued and outstanding as of December 31, 2023, 16,505 shares issued and 15,704 shares outstanding as of December 31, 2022 )
−Removed: Treasury stock, at cost ( 801 shares as of December 31, 2022)
+Added: 11,836 shares issued and outstanding as of December 31, 2024 and 13,575 shares issued and outstanding as of December 31, 2023)
Additional paid-in capital — 439
3 unchanged sentences
Accumulated other comprehensive loss ( 5,327 ) ( 4,607 )
−Removed: Total Travelzoo stockholders’ equity 4,186 4,256
+Added: Total Travelzoo stockholders’ equity (deficit) ( 462 ) 4,186
Non-controlling interest 4,815 4,697
18 unchanged sentences
Income from continuing operations 13,682 12,008
−Removed: Income (loss) from discontinued operations, net of tax 460 ( 59 )
+Added: Income from discontinued operations, net of tax — 460
Net income 13,682 12,468
−Removed: Net income (loss) attributable to non-controlling interest 102 ( 5 )
+Added: Net income attributable to non-controlling interest 118 102
Net income attributable to Travelzoo $ 13,564 $ 12,366
Net income attributable to Travelzoo—continuing operations $ 13,564 $ 11,906
−Removed: Net income (loss) attributable to Travelzoo—discontinued operations $ 460 $ ( 59 )
+Added: Net income attributable to Travelzoo—discontinued operations $ — $ 460
Income per share—basic
19 unchanged sentences
See accompanying notes to consolidated financial statements.
−Removed: CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
+Added: CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands)
8 unchanged sentences
Balances, December 31, 2022 16,505 $ 165 $ ( 7,130 ) $ 23,274 $ ( 9,537 ) $ ( 4,753 ) $ 7,142 $ ( 4,905 ) $ 4,595 $ 8,851
−Removed: Reclassification of non-controlling interest — — — — — — — — 4,600 4,600
Stock-based compensation expense — — — 1,568 — — — — — 1,568
Repurchase of common stock (1) — — ( 16,781 ) ( 152 ) — — — — — ( 16,933 )
+Added: Retirement of treasury stock ( 3,095 ) ( 30 ) 23,911 ( 23,881 ) — —
Exercise of stock options and taxes paid for net share settlement 165 1 — ( 370 ) — — — — — ( 369 )
−Removed: Proceeds from short swing settlement — — — 46 — — — — — 46
−Removed: Issuance of common stock for cash, notes and other consideration, net 3,410 34 — 15,141 ( 9,537 ) ( 4,753 ) — — — 885
+Added: Proceeds from Note receivable from shareholder — — — — — 3,000 — — — 3,000
Foreign currency translation adjustment — — — — — — — 298 — 298
21 unchanged sentences
Deferred income tax ( 518 ) 48
−Removed: Impairment of intangible assets and goodwill — 200
Loss on sale of long-lived assets — 10
−Removed: Gain on sale of equity investment in WeGo — ( 196 )
Net foreign currency effect ( 33 ) ( 62 )
−Removed: Net recoveries of accounts receivable and refund reserves ( 1,016 ) ( 4,367 )
+Added: Provision for (net recoveries of) accounts receivable and refund reserves 40 ( 1,016 )
Changes in operating assets and liabilities:
5 unchanged sentences
Accrued expenses and other ( 282 ) ( 685 )
+Added: Deferred revenue 4,556 ( 191 )
Income tax payable 857 749
Other liabilities 1,888 2,401
−Removed: Net cash provided by (used in) operating activities 10,675 ( 23,121 )
+Added: Net cash provided by operating activities 21,100 10,675
Cash flows from investing activities:
−Removed: Purchases of intangible assets — ( 1,049 )
Proceeds from repayment of note receivable — 216
−Removed: Proceeds from sale of equity investment in WeGo — 196
Purchases of property and equipment ( 177 ) ( 255 )
3 unchanged sentences
Proceeds from payment of promissory note 1,753 3,000
−Removed: Proceeds from short swing settlement — 46
−Removed: Proceeds from issuance of common stock — 1,006
−Removed: Proceeds from exercise of stock options, net of taxes paid for net share settlement of equity awards ( 369 ) 1,872
−Removed: Net cash provided by (used in) financing activities ( 14,150 ) 1,282
+Added: Exercise of stock options, net of taxes paid for net share settlement of equity awards ( 1,797 ) ( 369 )
+Added: Net cash used in financing activities ( 18,973 ) ( 14,150 )
Effect of exchange rate changes on cash and cash equivalents ( 599 ) 525
−Removed: Net decrease in cash, cash equivalents and restricted cash ( 2,989 ) ( 25,611 )
+Added: Net increase (decrease) in cash, cash equivalents and restricted cash 1,351 ( 2,989 )
Cash, cash equivalents and restricted cash at beginning of year 16,389 19,378
6 unchanged sentences
Accrued excise tax for share repurchases $ 165 $ 152
−Removed: Non-cash consideration for purchase of intangible asset $ — $ 1,150
−Removed: Common stock issued for Metaverse Travel Experience, Inc.
−Removed: assets $ — $ 63
−Removed: Common stock issued for note receivable from shareholder $ — $ 4,753
−Removed: Common stock issued for tax indemnification $ — $ 9,537
See accompanying notes to consolidated financial statements.
3 unchanged sentences
Travelzoo (including its subsidiaries and affiliates, the “Company” or “we”), the club for travel enthusiasts, is a global Internet media company.
−Removed: Travelzoo® provides its 30 million members with exclusive offers and one-of-a-kind experiences personally reviewed by our deal experts around the globe.
−Removed: We have our finger on the pulse of outstanding travel, entertainment and local experiences.
−Removed: We work in partnership with more tha n 5,000 top travel suppliers—our long-standing relationships give Travelzoo members access to irresistible offers.
+Added: We reach 30 million travelers.
+Added: Club Members receive Club Offers personally reviewed by our deal experts around the globe.
+Added: We work in partnership with thousands of top travel suppliers—our long-standing relationships give us access to irresistible offers.
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 ® .
7 unchanged sentences
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.
−Removed: This paid membership service currently provides founding members with a limited edition “Travel Companion” non-fungible token (“NFT”) and future access to beta version metaverse travel experiences, as developed.
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.
3 unchanged sentences
(“Jack’s Flight Club”), which operates Jack’s Flight Club , a subscription service that provides members with information about exceptional airfares.
−Removed: As of December 31, 2023, Jack’s Flight Club had 2.4 million subscribers.
Jack’s Flight Club’s revenues are generated by subscription fees paid by members.
−Removed: See Note 3– Acquisitions to th e consolidated financial statements for further information.
APAC Exit and Pivot to Licensing Model
5 unchanged sentences
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.
−Removed: An interest free loan was provided to the licensee for JPY 46 million (approximately $ 430,000 ), of which $ 133,000 was repaid in 2021 and the remaining amount repaid in 2023.
−Removed: The Company recognized royalties of $ 36,000 and $ 0 from the licensee for the years ended December 31, 2023 and 2022, respectively.
−Removed: Global Funding for Pandemic
−Removed: In January 2022, July 2022 and May 2023, the Company’s German branch of Travelzoo (Europe) Limited, a wholly-owned subsidiary of the Company (“Travelzoo Germany”), received notification and funding of approximately $ 1.2 million, $ 494,000 and $ 205,000 from the German Federal Government under its Bridging Aid III, Bridging Aid III+ and Bridging Aid IV programs, respectively.
−Removed: These programs were for companies that suffered a Corona-related decrease in sales of at least 30% in one month compared to the reference month in 2019.
−Removed: Travelzoo Germany applied for the funding in 2021 and 2022, respectively, and was approved by the German government in January 2022, July of 2022, and May 2023.
−Removed: The Company is required to submit a final declaration in connection with the grants received by September 30, 2024.
−Removed: The Company believes it was eligible to participate in the programs and is entitled to the funding received and does not expect significant changes to the amounts already received to arise from the final submission.
−Removed: The Company recorded the $ 1.7 million and $ 205,000 as gains in Other income, net in 2022 and 2023, respectively.
−Removed: The Company also received $ 164,000 in job retention - related funding from the Canadian government in relation to its Canada office location in 2022.
−Removed: Such funding was recorded as a reduction of salary and related expenses.
−Removed: The Company did not receive any such funding in 2023.
−Removed: The Company did not receive pandemic-related funding from its non-German European locations in either of 2023 or 2022.
+Added: The Company recognized royalties of $ 30,000 and $ 36,000 and from the licensee for the years ended December 31, 2024 and 2023, respectively.
Going Concern
5 unchanged sentences
Azzurro is the Company’s largest shareholder, and as of December 31, 2024, holds approximately 37.5 % of the Company's outstanding shares.
−Removed: Holger Bartel, the Company's Global CEO, is Ralph Bartel's brother and separately holds 3.8 % of the Company's outstanding shares as of December 31, 2023 .
+Added: 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 .
Basis of Presentation and Consolidation
9 unchanged sentences
2014-09, “Revenue from Contracts with Customers” (Topic 606), under which revenue is recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
−Removed: The Company's revenues are primarily advertising fees generated from the publishing of travel and entertainment deals on the Travelzoo website, in Top 20 email newsletters, in Standalone email newsletters and through the Travelzoo Network .
−Removed: The Company also generates transaction-based revenues from the sale of vouchers (our Local Deals and Getaways offerings), operation of our hotel booking platform and limited offerings of vacation packages, as well as subscription revenues from Jack's Flight Club and, beginning in 2024, Travelzoo membership fees.
−Removed: The Company's disaggregated revenues are included in Note 12– Segment Reporting and Significant Customer Information .
−Removed: For fixed-fee website advertising, the Company recognizes revenues ratably over the contracted placement period.
+Added: The Company's revenues consist of (1) advertising revenues and commissions, derived from and generated in connection with purchases made by Travelzoo members, (2) membership fees and (3) other.
+Added: Advertising Revenues and Commissions
+Added: Advertising revenues are generated from the publishing of travel and entertainment deals on the Travelzoo website, in Top 20 email newsletters, in Standalone email newsletters and through the Travelzoo Network.
+Added: The Company also generates transaction-based commission revenues from the sale of vouchers (our Local Deals and Getaways offerings), operation of our hotel booking platform and limited offerings of vacation packages.
+Added: Specifically, for fixed-fee website advertising, the Company recognizes revenues ratably over the contracted placement period.
For Top 20 email newsletters and other email products, the Company recognizes revenues when the emails are delivered to its members.
For cost-per-click advertising, whereby an advertiser pays the Company when a user clicks on an ad (typically served on Travelzoo properties or Travelzoo Network partner properties), the Company recognizes revenues each time a user clicks on the ad.
−Removed: The Company also offers clients other advertising models whereby an advertiser pays the Company based on the number of times their advertisement is displayed (whether on Travelzoo properties, email advertisements, Travelzoo Network properties, social platforms or other media properties).
−Removed: For these instances, the Company recognizes revenues each time an ad is displayed.
−Removed: For transaction-based revenues, including from products such as Local Deals and Getaways prepaid voucher sales, hotel platform bookings and vacation package sales, the Company evaluates whether it is acting as principal (thereby reporting revenue on a gross basis) versus agent (thereby reporting revenue on a net basis).
−Removed: Accordingly, the Company reports transaction-based revenues on a net basis, as third-party suppliers are primarily responsible for fulfilling the underlying good or service, which the Company does not control prior to its transfer to the customer.
+Added: For transaction-based advertising revenues, including from products such as Local Deals and Getaways prepaid voucher sales, hotel platform bookings and vacation package sales, the Company evaluates whether it is acting as principal (thereby reporting revenue on a gross basis) versus agent (thereby reporting revenue on a net basis).
+Added: Accordingly, the Company reports transaction-based advertising revenues on a net basis, as third-party suppliers are primarily responsible for fulfilling the underlying good or service, which the Company does not control prior to its transfer to the customer.
For Local Deals and Getaways prepaid voucher sales, the Company earns a fee for acting as an agent on the sale, while vouchers can subsequently be redeemed for goods or services with third-party merchants.
−Removed: Revenues are, accordingly, presented net of amounts due to third-party merchants for fulfilling the underlying goods and services, and net of estimated future refunds to consumers, as the terms of the vouchers permit.
+Added: Commission revenues are, accordingly, presented net of amounts due to third-party merchants for fulfilling the underlying goods and services, and net of estimated future refunds to consumers, as the terms of the vouchers permit.
Certain merchant contracts allow the Company to retain the proceeds from unredeemed vouchers.
2 unchanged sentences
For bookings of non-cancelable reservations, where the Company’s performance obligation is deemed to be completed upon the successful booking, the Company records commission revenue at such time.
−Removed: Jack’s Flight Club generates revenues from subscription fees paid by members.
−Removed: Subscription options are quarterly, semi-annually and annually.
−Removed: We recognize subscription revenues ratably over the subscription periods.
In certain instances, the Company’s contracts with customers may include multiple performance obligations, whereby the Company allocates revenues to each performance obligation based on its standalone selling price.
4 unchanged sentences
In addition, the Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less, and contracts for which it recognizes revenues at the amount to which it has the right to invoice for services performed.
−Removed: Deferred revenue primarily consists of customer prepayments and undelivered Company performance obligations related to contracts comprising multiple performance obligations .
−Removed: At December 31, 2023, deferred revenue was $ 2.0 million, of which $ 1.5 million was for Jack's Flight Club, and $ 569,000 was for Travelzoo North America and Travelzoo Europe.
+Added: Membership Fee Revenues
+Added: Membership fee revenues are generated from subscription fees paid by Travelzoo, Jack's Flight Club and Travelzoo META members.
+Added: We recognize subscription revenues ratably over the subscription periods.
+Added: 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.
+Added: Other Revenues
+Added: Other revenues include licensing fees, fees generated from the existing retail business acquired by the Company when it acquired MTE.
+Added: Deferred Revenues
+Added: Deferred revenue primarily consists of deferred membership fees, customer prepayments and undelivered Company performance obligations related to contracts comprising multiple performance obligations.
+Added: At December 31, 2024, deferred revenue was $ 6.5 million of which $ 2 million was for Jack's Flight Club, and $ 4.5 million was for Travelzoo North America and Travelzoo Europe.
At December 31, 2023, deferred revenue was $ 2 million , of which $ 1.5 million was for Jack's Flight Club, and $ 569,000 was for Travelzoo North America and Travelzoo Europe.
2 unchanged sentences
The Company estimates and records a reserve for future refunds on member purchases of Local Deals and Getaways vouchers, at the time revenue is recorded.
−Removed: We consider various factors such as historical refund timeframes from dates of sale, reasons for refunds, time periods remaining until expiration, changes in refund procedures and estimates of redemptions and breakage.
+Added: We consider various factors such as historical refund timeframes from dates of sale, reasons for refunds, time periods remaining until expiration, changes in refund procedures and estimates of redemptions and
Should any of these factors change, the estimates made by management will also change, which could impact the level of our future reserve for refunds to members.
Specifically, if the financial condition of our merchant partners, on behalf of whom vouchers are sold, were to deteriorate, affecting their ability to provide the goods or services to our members, additional reserves for refunds to members may be required and may adversely affect future revenues as the liability is recorded against revenue.
−Removed: In the second quarter of 2020, due to the pandemic and various stay-at-home protocols, the Company modified its voucher refund policy, providing for new voucher sales to be fully refundable until the earlier of voucher redemptions or their expiration dates.
−Removed: This refund policy was reverted in April 2022 to a 14-day refund period from date of purchase, with a newly introduced option to extend refund eligibility until voucher redemption or expiration, for a surcharge.
−Removed: As of December 31, 2023 , t he expiration dates of unexpired vouchers ranged from January 2024 through December 2025;
+Added: As of December 31, 2024 , t he expiration dates of unexpired vouchers are through December 2025;
provided, that expiration dates may sometimes be extended on a case-by-case basis and final payments to merchants upon expiration may not be due for up to a year later.
1 unchanged sentence
The Company estimated and recorded a refund reserve of $ 144,000 for these unredeemed vouchers as of December 31, 2024, which is recorded as a reduction of revenues on the consolidated statements of operations and accrued expenses and other on the consolidated balance sheet.
−Removed: As of December 31, 2022, the Company had approximately $ 8.1 million of unredeemed vouchers that had been sold, representing the Company’s commission earned, and estimated and recorded a refund reserve of $ 1.3 million for these unredeemed vouchers as of December 31, 2022, as a reduction of revenues on the consolidated statements of operations and accrued expenses and other on the consolidated balance sheet.
+Added: As of December 31, 2023, the Company had approximatel y $ 5.2 million of unredeemed vouchers that had been sold, representing the Company’s commission earned, and estimated and recorded a refund reserve of $ 268,000 for these unredeemed vouchers as of December 31, 2023, as a reduction of revenues on the consolidated statements of operations and accrued expenses and other on the consolidated balance sheet.
If our judgments regarding estimated member refunds are inaccurate, reported results of operations could differ from amounts previously accrued.
23 unchanged sentences
Advertising costs for Travelzoo North America and Travelzoo Europe amounted to $ 2.9 million and $ 8.1 million for the years ended December 31, 2024 and 2023, respectively.
−Removed: Advertising costs for Jack's Flight Club were $ 1.5 million and $ 545,000 for the years ended December 31, 2023 and 2022, respectively.
+Added: Advertising costs for Jack's Flight Club were $ 1 million and $ 1.5 million for the years ended December 31, 2024 and 2023, respectively.
Advertising costs for New Initiatives were $ 25,000 and $ 238,000 for the years ended December 31, 2024 and 2023, respectively.
14 unchanged sentences
The value of the portion of the award that is expected to vest is recognized as expense over the related employees’ requisite service periods in the Company’s consolidated statements of operations.
−Removed: See Note 10 to the cons olidated financial statements for a further discussion of stock-based compensation.
+Added: See Note 9 to the consolidated financial statements for a further discussion of stock-based compensation.
(k) Foreign Currency
25 unchanged sentences
The Company’s business is subject to risks associated with its ability to attract and retain advertisers and offer goods or services on compelling terms to our members.
−Removed: The outbreak of the coronavirus (COVID-19) in 2020 had an unprecedented impact on the global travel and hospitality industries.
−Removed: As the Company and many of our advertisers are part of the global travel and hospitality industries, the measures implemented to contain COVID-19 had a significant negative effect on our business, financial condition, results of operations and cash flows.
−Removed: During the pandemic, many of the Company’s advertising partners paused, canceled and/or stopped advertising.
−Removed: Additionally, there were significant levels of cancellations by members and partners for hotel and travel packages, and voucher refund requests.
−Removed: Now that COVID-19 and its lingering effects have largely subsided, many of our advertisers and partners are returning to advertise with us and we have altered certain policies to align with the changing environment (including reverting to a 14-day return window for voucher purchases and implementing a surcharge for vouchers to be fully refundable), although with the emergence of new variants, this trend could stop or even reverse, which could result in a material adverse impact on our business and financial performance.
−Removed: It is difficult to estimate the impact of the coronavirus, future variants or other events giving rise to a pandemic on the Company’s future revenues, results of operations, cash flows, liquidity or financial condition.
The Company’s cash, cash equivalents and a ccounts receivable are potentially subject to concentration of credit risk.
7 unchanged sentences
Payables to merchants are generally due upon the redemption of vouchers by members who purchased them from the Company.
−Removed: As of December 31, 2023 , unredeemed vouchers have maturities ranging from January 2024 through December 2025;
+Added: As of December 31, 2024 , unredeemed vouchers have maturities through December 2025;
however, expiration dates may be extended on a case-by-case basis and final payment to merchants upon expiration may not be due for up to a year after.
26 unchanged sentences
(r) Recently Adopted Accounting Pronouncements
−Removed: In June 2016, the FASB issued ASU No.
−Removed: 2016-13, “Financial Instruments-Credit Losses (Topic 326):
−Removed: Measurement of Credit Losses on Financial Instruments,” which provides new guidance on the measurement of credit losses for financial assets measured at amortized cost, which includes accounts receivable.
−Removed: The new guidance replaces the existing incurred loss impairment model with an expected loss methodology, which will result in more timely recognition of credit losses.
−Removed: This update is effective for public business entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.
−Removed: For Smaller Reporting Companies (as such term is defined by the SEC), such as Travelzoo, the standard is
−Removed: effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years.
−Removed: Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years.
−Removed: Entities are required to apply this update on a modified retrospective basis with a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption.
−Removed: The Company adopted the ASU prospectively on January 1, 2023.
−Removed: This ASU has not and is currently not expected to have a material impact on our consolidated financial statements.
−Removed: (s) Recent Accounting Pronouncements Not Yet Adopted
In November 2023, the Financial Standards Accounting Board (FASB) issued Accounting Standards Update (ASU) 2023-07 "Segment Reporting (Topic 280):
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ASU 2023-07 is effective for annual periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted.
−Removed: We are currently evaluating the potential effect that the updated standard will have on our financial statement disclosures.
+Added: ASU 2023-07 was adopted for the year ended December 31, 2024 retrospectively to all periods presented in the financial statements.
+Added: See Note 11–Segment Reporting and Significant Customer Information.
+Added: (s) Recent Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued ASU 2023-09 "Income Taxes (Topics 740):
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We are currently evaluating the ASU to determine its impact on our income tax disclosures.
+Added: On November 4, 2024, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU") 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):
+Added: Disaggregation of Income Statement Expenses.
+Added: The guidance requires more detailed disclosure for expenses.
+Added: This standard is effective for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.
+Added: We are currently evaluating the ASU to determine its impact on our disclosures.
Net Income (Loss) Per Share
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Net income (loss) per share—diluted $ 1.06 $ 0.83
−Removed: For the years ended December 31, 2023 and 2022, options to purchase 750,000 shares of common stock were not included in the computation of diluted net income per share because the effect would have been anti-dilutive.
+Added: For the years ended December 31, 2024 and 2023, options to purchase 0 and 750,000 shares of common stock were not included in the computation of diluted net income per share because the effect would have been anti-dilutive.
Stock Purchase Agreement between Travelzoo and Azzurro Capital Inc., a Related-Party
−Removed: In connection with the acquisition of MTE, formerly a wholly-owned subsidiary of Azzurro, the Company completed a private placement of newly issued shares with Azzurro.
+Added: In conn ection with the acquisition of Metaverse Travel Experiences (“MTE”), formerly a wholly-owned subsidiary of Azzurro, the Company completed a private placement of newly issued shares with Azzurro.
Ralph Bartel, who founded the Company, is the sole beneficiary of the Ralph Bartel 2005 Trust, which is the controlling shareholder of Azzurro.
−Removed: Azzurro was the Company’s largest shareholder at the time of the MTE acquisition and, as of December 31, 2022, Azzurro and Ralph Bartel, in his individual capacity, owned approximately 50.3 % the Company's outstanding shares.
+Added: Azzurro was the Company’s largest shareholder at the time of the MTE acquisition and, as of December 31, 2022, Azzurro and Ralph Bartel, in his individual capacity, owned approximately 50.3 % of the Company’s outstanding shares.
On December 28, 2022, the stockholders of Travelzoo approved the issuance and sale of 3.4 million shares of common stock (the “Shares”) of Travelzoo to Azzurro, in exchange for certain consideration, and on December 30, 2022 (the “Closing Date”), the transaction was consummated.
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and (c) the transfer to the Company of all outstanding capital stock of MTE, which was effected pursuant to a merger of MTE with a wholly-owned subsidiary of the Company on the Closing Date.
−Removed: The Company recorded the $ 4.8 million promissory note as Note receivable from shareholder in the stockholders' equity section on the consolidated balance sheet as of December 31, 2022.
+Added: The Company records the $ 4.8 million promissory note as Note receivable from shareholder in the stockholders ’ equity section.
In October 2023, the Company and Azzurro agreed to a payment plan for payment of the promissory note in five installments, ending in February 2024, with interest on the outstanding principal accruing at 16 % per annum beginning on July 1, 202 3.
−Removed: During the year ended December 31, 2023, Azzurro paid $ 3.0 million of principal and $ 604,000 of interest.
−Removed: The remaining principal amount of $ 1.8 million promissory note is collateralized by the Shares and is expected to be paid in 2024.
−Removed: Travelzoo acquired the entire business of MTE.
−Removed: The acquisition was accounted for as an asset acquisition in accordance with ASC Topic 805 – Business Combinations.
−Removed: The fair value of the consideration paid by Travelzoo and allocation of that amount to the underlying assets, on a relative fair value basis, was recorded by the Company as of the Closing Date.
−Removed: Additionally, costs directly related to the MTE acquisition of $ 184,000 were capitalized as a component of the Purchase Price.
−Removed: As a result of the MTE acquisition, the Company also assumed MTE’s historical net operating loss carryforwards of approximately $ 64.7 million.
−Removed: While these net operating losses (NOLs) may be used to offset future taxable income, given certain accounting considerations for the transaction, the Company determined it is appropriate to record an uncertain tax benefit liability in accordance with ASC Topic 740— Income Taxes .
−Removed: Subject to the provisions of the SPA, Azzurro agreed to indemnify Travelzoo for tax related liabilities in the event of the inability of the Company to utilize any NOLs of MTE as a result of any breach of or inaccuracy in any representation or warranty made by Azzurro, which included the representation that NOLs will be available for use by the Company after the closing for federal and analogous state income tax purposes, including pursuant to section 381(a) of the U.S.
−Removed: tax code, and that, as of the date of the SPA, no NOLs of MTE are subject to any limitation, restriction or impairment on its use.
−Removed: Based on the terms of the agreement, the Company believes that with the uncertain tax position recognized related to the acquired NOLs, the Company has the right to claim losses against Azzurro if NOLs are not able to be utilized.
−Removed: Therefore, the Company recorded an indemnification asset of $ 9.5 million for the relative fair value of this indemnification.
−Removed: Any losses indemnified by Azzurro related to the inability to utilize MTE’s net operating loss carryforwards shall be satisfied by Azzurro returning to the Company the number of shares of common stock of Travelzoo corresponding to the value of the loss.
−Removed: Accordingly, the Company has classified this tax indemnification asset as contra-equity in the accompanying consolidated financial statements.
−Removed: The following table represents the allocation of the total cost of the MTE acquisition to the assets acquired (in thousands):
−Removed: Consideration for MTE assets
−Removed: Fair value of Travelzoo common stock issued $ 15,175
−Removed: Direct transaction costs 184
−Removed: Cash received from Azzurro Capital Inc.
−Removed: Notes receivable from Azzurro Capital Inc.
−Removed: Total consideration for MTE assets $ 9,606
−Removed: Relative fair value of the assets acquired
−Removed: Cash and cash equivalents $ 6
−Removed: Prepaid expenses and other 45
−Removed: Property and equipment 18
−Removed: Tax indemnification asset 9,537
−Removed: Total assets acquired $ 9,606
−Removed: Travelzoo (Europe) Limited, Sucursal en España, Acquired Secret Escapes Limited’s Spanish Business Unit
−Removed: On March 3, 2022, Travelzoo (Europe) Ltd, Sucursal en España, the Spanish branch of Travelzoo (Europe) Limited, a wholly-owned subsidiary of the Company (“Travelzoo Spain”), entered into a Business Unit Purchase Agreement (“BUPA”) with Secret Escapes Limited (“Secret Escapes”) for the purchase of its Spanish business unit, which included, among other things, a database of approximately 940,000 members.
−Removed: The purchase price was 400,000 Euros, with an earn-out opportunity of an additional 100,000 Euros payable by the Company upon the achievement of certain metrics by the business unit in six months (September 2022).
−Removed: The metrics were not achieved and thus no payments were made on the earn-out.
−Removed: Travelzoo was granted the right to use the Secret Escapes name exclusively in Spain for a continuity period of six ( 6 ) months.
−Removed: The BUPA contained typical representations and warranties and indemnification protections, as well as a restrictive covenant, whereby Secret Escapes agreed to leave the Spanish market for at least three ( 3 ) years, subject to a right to purchase a waiver.
−Removed: Asset Purchase Agreement between Metaverse Travel Experiences, Inc.
−Removed: f/k/a Azzurro Brands Inc.
−Removed: and Travelzoo
−Removed: On March 17, 2022, the Company, as Buyer, entered into an Asset Purchase Agreement (the “APA”) with Metaverse Travel Experiences, Inc.
−Removed: f/k/a Azzurro Brands Inc., a New York corporation (the “Seller”) and a wholly-owned subsidiary of Azzurro Capital Inc., the Company’s largest stockholder.
−Removed: Pursuant to the APA, the Company acquired certain assets, primarily comprised of all U.S.
−Removed: members of Secret Escapes Limited, which Seller acquired in March 2021 and licensed exclusively to Travelzoo pursuant to the previously disclosed License Agreement, dated as of March 12, 2021 (the “License Agreement”), in accordance with data privacy and other applicable laws.
−Removed: The License Agreement allowed the Company to exclusively utilize the assets in exchange for a license fee of $ 412,500 per quarter with a one-year term that automatically renewed.
−Removed: The License Agreement was reviewed and unanimously approved by the Audit Committee of the Board of Directors, which consists solely of independent directors.
−Removed: The purchase price for the transaction was $ 1.75 million, with $ 600,000 paid in cash upon closing in March 2022 and the remaining $ 1.15 million payable in the form of a credit with Seller relating to prepaid license fees, under the License Agreement.
−Removed: The remaining commitment of the Company under the License Agreement for the then-current remaining term (equal to $ 825,000 ) was eliminated.
−Removed: The Company recorded the transactions with both Secret Escapes Limited and Metaverse Travel Experiences, Inc.
−Removed: as asset acquisition s as the assets acquired and liabilities assumed do not meet the definition of a business in Accounting Standards Codification (“ASC”) 805-10.
−Removed: C ost accumulation model was used to account for the cost of the acquisition and the 100,000 Euros earn-out was considered as contingent consideration based on ASC 805-50.
−Removed: Travelzoo acquired the database of members and recorded $ 2.2 million intangible assets from both agreements.
+Added: During the year ended December 31, 2023, Azzurro paid interest of $ 604,000 and principal of $ 3.0 million , respectively.
+Added: During the year ended December 31, 2024, Azzurro paid interest of $ 229,000 and the remaining principal amount of $ 1.8 million, respectively.
Intangible Assets
−Removed: The following table presents the gross fair values and estimated useful lives of intangible assets (in thousands):
+Added: The following table presents the gross fair values and estimated useful lives of intangible assets from acquisitions (in thousands):
Fair Value Estimated Life (Years)
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The indefinite-lived intangible assets assessment was performed using the relief-from-royalty method, which includes unobservable inputs, classified as Level 3 inputs, including projected revenues and an approximate 5 % royalty rate.
−Removed: The Company performed an annual impairment test in October 2023 and did not identify any indicators of impairment for the year ended December 31, 2023.
−Removed: The Company performed its annual test as of October 31, 2022 and a Trade name impairment charge of $ 200,000 was recorded as “ General and administrative expenses ” for Jack's flight club, as revenue for Jack's Flight Club was negatively impacted by the pandemic and did not meet forecasted growth expectations.
−Removed: No impairment charge was identified and recorded for goodwill in 2022.
−Removed: In 2020, t he Company recorded a goodwill impairment of $ 2.1 million and a Trade name impairment of $ 810,000 for Jack's Flight Club, due to the pandemic .
+Added: The Company performed an annual impairment test in October 2024 and 2023, and did not identify any indicators of impairment for the years ended December 31, 2024 and 2023.
Amortization of Acquired Intangible Assets
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member database
−Removed: Intangible assets, net—January 1, 2022 $ 3,426 — —
−Removed: Acquisitions—March 2022 — 445 1,751
+Added: Intangible assets, net—December 31, 2022 $ 2,351 $ 327 $ 973
Amortization of intangible assets with definite lives ( 641 ) ( 141 ) ( 778 )
−Removed: Impairment of trade name—December 31, 2022 ( 200 ) — —
Intangible assets, net—December 31, 2023 1,710 186 195
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Intangible assets, net—December 31, 2024 $ 1,460 $ 38 $ —
−Removed: Amortization expense for acquired intangibles was $ 1.6 million and $ 1.8 million for the years ended December 31, 2023 and 2022, respectively.
+Added: Amortization expense for acquired intangibles was $ 593,000 and $ 1.6 million for the years ended December 31, 2024 and 2023, respectively.
Expected future amortization expense of acquired intangible assets as of December 31, 2024 is as follows (in thousands):
Years ending December 31,
−Removed: The Company performed its annual impairment testing of Trade name as of October 31, 2023 using a relief from royalty method.
−Removed: No impairment was identified in 2023.
+Added: The Company performed its annual impairment testing of Trade name as of October 31, 2024 and 2023 using a relief from royalty method, respectively.
+Added: No impairment was identified in 2024 and 2023.
As of December 31, 2024, the carrying value of the Trade name was $ 1.5 million.
−Removed: The Company's annual impairment test as of October 31, 2022 indicated that Jack’s Flight Club’s indefinite lived intangible assets (“Trade name”) was impaired and an impairment charge of $ 200,000 was recorded as general and administrative expenses.
−Removed: On April 24, 2020 and May 5, 2020, the Company received $ 3.1 million and $ 535,000 , respectively, pursuant to loans under the Paycheck Protection Program (the “PPP”) of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the Small Business Association.
−Removed: The loans had a maturity of two ( 2 ) years from the disbursement of the funds and an annual interest rate of 1 %.
−Removed: The Company used the funds from these loans only for the purposes included in the PPP, including payroll, employee benefits, and rent, and also intends to apply for forgiveness of a portion of the loans in compliance with the CARES Act.
−Removed: In 2021, the Company settled the $ 535,000 PPP loan, $ 494,000 was forgiven and the remaining outstanding principal balance of the loan and interest of $ 111,000 was repaid.
−Removed: During 2021, the principal and the interest of the $ 3.1 million PPP loan were forgiven .
−Removed: It is possible that the SBA could subsequently audit the forgiven loans.
−Removed: The Company believes it was eligible to participate in PPP, calculated the loan amount correctly, spent loan proceeds on allowable uses and is entitled to loan forgiveness.
−Removed: The Company will hold onto its financial documents relating to the PPP loans for six years as required.
Balance Sheet Components
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Prepaid expenses $ 921 $ 1,084
−Removed: Notes receivable — current — 232
Deposits 83 286
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Changes to the allowance for credit losses and reserve for member refunds are as follows (in thousands):
−Removed: accounts Reserve for
+Added: for credit losses Reserve for
Balance at December 31, 2022 $ 1,468 $ 1,278
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Regardless of outcome, litigation can have an adverse impact on the Company because of defense costs, negative publicity, diversion of management resources and other factors.
−Removed: The Company was formed as a result of a combination and merger of entities founded by Ralph Bartel.
−Removed: Azzurro, of which the Ralph Bartel 2005 Trust (of which he is the sole beneficiary) is the controlling shareholder, holds approximately 40.2 % of the Company’s outstanding shares as of December 31, 2023.
−Removed: In 2002, Travelzoo.com Corporation was merged into Travelzoo.
−Removed: Under and subject to the terms of the merger agreement, holders of promotional shares of Travelzoo.com Corporation (“Netsurfers”) who established that they had satisfied certain prerequisite qualifications were allowed a period of 2 years following the effective date of the merger to receive one share of Travelzoo in exchange for each share of common stock of Netsurfers.
−Removed: In 2004, two years following the effective date of the merger, certain promotional shares remained unexchanged.
−Removed: As the right to exchange these promotional shares expired, no additional shares were reserved for issuance.
−Removed: Thereafter, the Company began to offer a voluntary cash program for those who established that they had satisfied certain prerequisite qualifications for Netsurfers promotional shares as further described below.
−Removed: From 2010 through 2014, the Company became subject to unclaimed property audits of various states in the United States related to the above unexchanged promotional shares and completed settlements with all such states.
−Removed: Although the Company has settled the unclaimed property claims with all such states, the Company may still receive inquiries from certain potential Netsurfers promotional stockholders that had not provided their state of residence to the Company by April 25, 2004.
−Removed: Therefore, the Company is continuing its voluntary program under which it makes cash payments to individuals related to promotional shares for individuals whose residence was unknown by the Company and who establish that they satisfy the original conditions required for them to receive shares of Netsurfers, and who failed to submit requests to convert their shares into shares of Travelzoo within the required time period.
−Removed: This voluntary program is not available for individuals whose promotional shares have been escheated to a state by the Company, except those individuals for whom their residence was unknown to the Compan y.
−Removed: The Company did not make any such payments in 2023 or 2022.
−Removed: The total cost of this program cannot be reliably estimated because it is based on the ultimate number of valid requests received and future levels of the Company’s common stock price.
−Removed: The Company’s common stock price affects the liability because the amount of cash payments under the program is based in part on the recent level of the stock price at the date valid requests are received.
−Removed: The Company does not know how many of the requests for shares originally received by Netsurfers in 1998 were valid, but the Company believes that only a portion of such requests were valid.
−Removed: In order to receive payment under this voluntary program, a person is required to establish that such person validly held shares in Netsurfers.
The Company leases office space in Canada, France, Germany, Spain, the U.K., and the U.S.
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Se e Note 14– Leases for more information.
−Removed: The Company has purchase commitments aggregating approximately $ 535,000 as of December 31, 2023, which represent the minimum obligations the Company has under agreements with certain third-party service providers.
+Added: The Company has purchase commitments aggregating approximately $ 1.3 million as of December 31, 2024, which represent the minimum obligations the Company has under agreements with certain third-party service providers.
These minimum obligations are less than the Company's projected use for those periods.
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State taxes, net of federal income tax benefit 520 584
−Removed: Change of valuation allowance — ( 34 )
Uncertain tax positions 263 43
Foreign income taxed at different rates 586 539
−Removed: Stock-based compensation expense
+Added: Stock-based compensation
Total income tax expense $ 5,404 $ 5,105
−Removed: The tax effects of temporary differences that give rise to significant portions of the Company’s deferred tax assets and liabilities are as follows (in thousands):
+Added: Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.
+Added: Significant components of the Company's deferred tax assets and liabilities as of December 31, 2024 and December 31, 2023 are as follows:
Deferred tax assets:
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Operating lease right-of-use assets ( 932 ) ( 1,138 )
−Removed: Property, equipment and intangible assets — ( 146 )
Total deferred tax liabilities ( 932 ) ( 1,138 )
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(*) Amounts not charged (credited) to expenses are charged (credited) to stockholders' equity or deferred tax assets (liabilities).
−Removed: As of December 31, 2023, the Company has a valuation allowance of approximately $ 2.3 million related to foreign net operating loss (“NOL”) carryforwards of approximately $ 18.2 million primarily related to the Company's Asia Pacific entities (whose operations were classified as discontinued operations as of March 2020), for which it is more likely than not that the tax benefit will not be realized.
−Removed: The liquidations of Travelzoo Australia, Travelzoo (Hong Kong) Limited and Travelzoo Local (Hong Kong) were completed in 2023, resulting in a write-off of the remaining net deferred tax assets of approximately $ 1.8 million for these entities, offset by the release of the corresponding valuation allowance.
−Removed: If not utilized, $ 10.9 million of the remaining foreign NOL may be carried forward indefinitely, and $ 7.3 million will exp ire at various times between 2024 and 2027.
+Added: As of December 31, 2024, the Company has a valuation allowance of approximately $ 2.4 million related to foreign net operating loss (“NOL”) carryforwards of approximately $ 14.6 million primarily related to the Company's Asia Pacific entities, and 0.4 million related to capital loss carryforwards, for which it is more likely than not that the tax benefit will not be realized.
+Added: The amount of the valuation allowance represented an increase of approximately $ 0.1 million over the amount recorded as of December 31, 2023, and was due to the increase of deferred tax assets and related valuation allowance for Travelzoo Asia.
+Added: If not utilized, $ 14.6 million of the remaining foreign NOL may be carried forward indefinitely.
As of December 31, 2024, the Company has U.S.
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Gross unrecognized tax benefits balance at December 31, 2022 $ 16,877
−Removed: Increase related to current year tax positions 15,833
+Added: Increase related to prior year tax positions 7,018
Settlements —
Gross unrecognized tax benefits balance at December 31, 2023 23,895
−Removed: Increase related to prior year tax positions 7,018
+Added: Increase related to current year tax positions —
Settlements —
Gross unrecognized tax benefits balance at December 31, 2024 $ 23,895
−Removed: The Company’s policy is to include interest and penalties related to unrecognized tax positions in income tax expense.
−Removed: To the extent accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction in the overall income tax provision in the period that such determination is made.
−Removed: At December 31, 2023, the Company had approximately $ 803,000 in accrued in terest and penalties.
The Company files income tax returns in the U.S.
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federal and certain state tax examinations for certain years after 2020 and is subject to California tax examinations for years after 2019.
−Removed: The IRS and taxing authorities can also audit the NOL carryforwards acquired through the MTE acquisition, which were generated starting in 2008.
+Added: The Company’s policy is to include interest and penalties related to unrecognized tax positions in income tax expense.
+Added: To the extent accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced and reflected as a reduction in the overall income tax provision in the period that such determination is made.
+Added: At December 31, 2024, the Company had approximately $ 1.1 million in accrued in terest and penalties.
Although the timing of any initiation, resolution and/or closure of any audits is highly uncertain, it is reasonably possible that the balance of the gross unrecognized tax benefits related to the method of computing income taxes in certain jurisdictions and losses reported on certain income tax returns could significantly change in the next 12 months.
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The value of the portion of awards expected to vest is recognized on a straight-line basis as expense over the related employees’ requisite service periods in the Company’s consolidated statements of operations.
−Removed: On May 29, 2020, the shareholders of the Company approved certain amendments to the Bartel Option Agreements, which increased and repriced all outstanding, unexercised options granted to Mr.
−Removed: Holger Bartel (the “Option Agreement Amendments”).
−Removed: Pursuant to the Option Agreement Amendments and subject to shareholder approval, the exercise price for the options was repriced to the official NASDAQ closing share price on March 30, 2020 (the date of execution of the Option Agreement Amendments, which immediately followed the date of approval of the grants from the Board of Directors of the Company), which was $ 3.49 .
−Removed: Additionally, the Option Agreement Amendments made the following increases:
−Removed: (a) 400,000 additional options to purchase the Company’s common stock pursuant to the 2015 Option Agreement, (b) 150,000 additional options to purchase the Company’s common stock pursuant to the 2017 Option Agreement, and (c) 400,000 additional options to purchase the Company’s common stock pursuant to the 2019 Option Agreement, which resulted in a total of 1,900,000 options granted to Mr.
−Removed: Bartel pursuant to the Option Agreement Amendments.
−Removed: Bartel’s amended options pursuant to the 2015 Option Agreement and the 2017 Option Agreement were fully vested upon the execution of the applicable Option Agreement Amendment.
−Removed: Therefore, stock-based compensation related to these options was fully expensed in the second quarter of 2020.
−Removed: In 2021, 800,000 options granted pursuant to the 2015 Option Agreement, 300,000 options granted pursuant to the 2017 Option Agreement and 260,000 options granted pursuant to the 2019 Option Agreement were exercised by Mr.
−Removed: Bartel, 681,902 shares of common stock were issued as the result of a cashless exercise or net settlement with respect to the option exercise price or taxes which were approved by Travelzoo's Board of Directors.
−Removed: As of December 31, 2021, stock-based compensation related to the 2019 Option Agreement and applicable Option Agreement Amendment was fully expensed.
−Removed: Bartel exercised the remaining 540,000 options granted pursuant to the 2019 Option Agreement in 2022.
−Removed: The Company received aggregate cash proceeds of $ 1.9 million.
In September 2019, pursuant to executed Option Agreements, the Company granted six employees stock options to purchase 50,000 shares of common stock each ( 300,000 in the aggregate) with an exercise price of $ 10.79 , of which 75,000 options vest and become exercisable annually starting on September 5, 2020 and ending on December 31, 2023.
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As of December 31, 2023, stock-based compensation related to these Option Agreements and applicable Option Agreement Amendments were fully expensed.
+Added: In 2024, 75,000 options were exercised and 27,546 shares of common stock were issued as the result of the cashless exercises or net settlement with respect to the option exercise price which was approved by Travelzoo’s Board of Directors.
+Added: As of December 31, 2024, all options granted under these Option Agreements have been exercised or forfeited.
On May 29, 2020, pursuant to an executed Option Agreement, the shareholders of the Company approved the grant of stock options to purchase 800,000 shares of common stock to Mr.
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In 2021, 600,000 options were exercised and 390,809 shares of common stock were issued as the result of the cashless exercises which were approved by Travelzoo’s Board of Directors.
+Added: Stock-based compensation related to this grant was fully expensed in 2022.
In 2023, 200,000 options were exercised and 121,307 shares of common stock were issued as the result of the cashless exercises which were approved by Travelzoo’s Board of Directors.
−Removed: As of December 31, 2022, stock-based compensation related to this grant was fully expensed.
On May 29, 2020, pursuant to an executed Option Agreement, the shareholders of the Company approved the grant of stock options to purchase 200,000 shares of common stock to two key employees, with an exercise price of $ 3.49 with annual vesting starting March 30, 2021 a nd ending on March 31, 2024.
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In 2023, 50,000 options were exercised and 16,619 shares of common stock were issued as the result of the cashless exercise which were approved by Travelzoo’s Board of Directors.
−Removed: As of December 31, 2023, there was approximately $ 25,000 of unrecognized stock-based compensation expense relating to these options.
−Removed: This amount is expected to be recognized over the next 0.3 years.
+Added: In 2024, 25,000 options were exercised and 8,420 shares of common stock were issued as the result of the cashless exercises or net settlement with respect to the option exercise price which was approved by Travelzoo’s Board of Directors.
+Added: Stock-based compensation related to this grant was fully expensed in 2024 and all options granted under this Option Agreement have been exercised or forfeited as of December 31, 2024.
On June 1, 2021, pursuant to a n executed Option Agreement, the shareholders of the Company approved the grant of stock options to purchase 50,000 shares of common stock to one employee, with an exercise price of $ 9.44 , with annual vesting starting January 1, 2022 and ending on January 1, 2025.
The options expire in January 2026.
−Removed: As of December 31, 2023, there was approximately $ 144,000 of unrecognized stock-based compensation expense relating to these options.
−Removed: This amount is expected to be recognized over the next 1.0 year.
+Added: In 2024, 37,500 options were exercised and 3,358 shares of common stock were issued as the result of the cashless exercises or net settlement with respect to the option exercise price which was approved by Travelzoo’s Board of Directors.
+Added: Stock-based compensation related to this grant was fully expensed in 2024.
In March 2022, pursuant to an executed Option Agreement, the Company granted its Global Chief Executive Officer, Holger Bartel, options to purchase 600,000 shares of common stock of the Company, with an exercise price of $ 8.14 and vesting 25 % every six months over two years beginning on June 30, 2022 and ending on December 31, 2023.
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This grant was approved at the 2022 Annual Meeting of the shareholders.
−Removed: As of December 31, 2023, stock-based compensation related to this grant was fully expensed.
−Removed: In June 2022, the Company granted an employee options to purchase 100,000 shares of common stock with an exercise price of $ 6.78 and quarterly vesting beginning on September 30, 2022 and ending on June 30, 2025 with vesting based on both time-based service condition and also performance conditions.
+Added: In 2024, 200,000 options were exercised and 53,753 shares of common stock were issued as the result of the cashless exercises or net settlement with respect to the option exercise price which was approved by Travelzoo’s Board of Directors.
+Added: Stock-based compensation related to this grant was fully expensed in 2023.
+Added: In June 2022, the Company granted an employee options to purchase 100,000 shares of common stock with an exercise price of $ 6.78 and quarterly vesting beginning on September 30, 2022 and ending on June 30, 2025 with vesting based on both
+Added: time-based service condition and also performance conditions.
However, if the performance targets are not met as of the first date on which the time condition is met, the time condition may be extended by one quarter up to three times.
1 unchanged sentence
The Company did not recognize stock-based compensation expense for this grant as the performance targets were not achieved and thus no shares were vested in 2022.
−Removed: As of December 31, 2023, there was approximately $ 239,000 of unrecognized stock-based compensation expense relating to these options.
−Removed: This amount is expected to be recognized over 1.5 years.
−Removed: In March 2023, the Company granted its General Counsel and Head of Global Functions, Christina Sindoni Ciocca, options to purchase 200,000 shares of common stock of the Company, with an exercise price of $ 4.96 and vesting 12.5 % every six months over four years beginning on June 30, 2023 and ending on December 31, 2026.
+Added: Total stock-based compensation related to this option grant of $ 89,000 was recorded in sales and marketing expenses for 2023, with 25,000 shares were vesting.
+Added: Total stock-based compensation related to this option grant of $ 119,000 was recorded in sales and marketing expenses for 2024, with 25,000 shares vesting.
+Added: In March 2023, the Com pany granted its General Counsel and Head of Global Functions, Christina Sindoni Ciocca, options to purchase 200,000 shares of common stock of the Company, with an exercise price of $ 4.96 and vesting 12.5 % every six months over four years beginning on June 30, 2023 and ending on December 31, 2026.
This grant was approved at the Annual Meeting of Stockholders held in June 2023.
The options expire in March 2025.
−Removed: As of December 31, 2023, there was approximately $ 417,000 of unrecognized stock-based compensation expense relating to these options.
−Removed: This amount is expected to be recognized over 3.0 years.
−Removed: The Company recorded $ 1.6 million and $ 1.8 million of stock-based compensation in general and administrative expenses for the years ended December 31, 2023 and 2022, respectively.
+Added: In 2024, 75,000 options were exercised and 19,584 shares of common stock were issued as the result of the cashless exercises or net settlement with respect to the option exercise price which was approved by Travelzoo’s Board of Directors.
+Added: In March 2024, the Compensation Committee of the Board of Directors granted Holger Bartel 600,000 stock options that vest through December 31, 2025.
+Added: On April 26, 2024, pursuant to an executed Option Agreement, the shareholders of the Company approved to grant Holger Bartel, options to purchase 600,000 shares of common stock of the Company, with an exercise price of $ 8.58 and vesting 25.0 % every six months over two years beginning on June 30, 2024 and ending on December 31, 2025.
+Added: The options expire in March 2029.
+Added: The Company recorded $ 1.5 million of stock-based compensation in general and administrative expenses for each of the years ended December 31, 2024 and 2023 .
The Company utilizes the Black-Scholes option pricing model to value the stock options, with an expected life as defined under the simplified method, using an average of the contractual term and vesting period of the stock options, and risk-free interest rates based on the U.S.
21 unchanged sentences
Exercised options ( 462,500 ) $ 6.74
+Added: Options forfeited and canceled ( 8,333 ) 6.78
Outstanding at December 31, 2024 1,179,167 $ 7.99 3.33 years $ 1,813
18 unchanged sentences
$ 8.58 600,000 4.24 years $ 8.14 300,000 4.24 years
−Removed: $ 9.44 50,000 2.01 years $ 9.44 25,000 2.01 years
+Added: $ 9.44 12,500 1.00 year $ 9.44 — 1.00 year
Stock Repurchase Program
3 unchanged sentences
In 2022, the Company repurchased 306,375 shares of common stock for an aggregate purchase price of $ 1.6 million, which was recorded as part of treasury stock as of December 31, 2022.
−Removed: The Company repurchased 34,687 shares of common stock in the first quarter of 2023 for $ 186,000 and repurchased 658,938 shares of common stock in the second quarter of 2023 for $ 4.7 million.
+Added: In 2023, the Company repurchased 693,625 shares of common stock for an aggregate purchase price of $ 4.9 million.
The shares repurchased were retired and recorded as a reduction of additional paid-in capital.
4 unchanged sentences
On October 24, 2023, the Company announced that its board of directors authorized the repurchase of up to 1,000,000 shares of the Company's outstanding common stock.
−Removed: The Company repurchased 600,000 shares of common stock for an aggregate purchase price of $ 5.0 million, excluding excise tax due under the Inflation Reduction Act of 2022, with such shares retired and recorded as a reduction of additional paid-in capital.
+Added: In 2023, the Company repurchased 600,000 shares of common stock for an aggregate purchase price of $ 5.0 million, excluding excise tax due under the Inflation Reduction Act of 2022, with such shares retired and recorded as a reduction of additional paid-in capital.
+Added: In 2024, the Company repurchased the remaining 400,000 shares of common stock for an aggregate purchase price of $ 3.9 million, excluding excise tax due under the Inflation Reduction Act of 2022, with such shares retired and recorded as a reduction of additional paid-in capital until extinguished with the remaining amount reflected as a reduction of retained earnings.
+Added: This stock repurchase program was completed in 2024.
+Added: On April 30, 2024, the Company announced that its board of directors authorized the repurchase of up to 1,000,000 shares of the Company's outstanding common stock.
+Added: The Company repurchased 1,000,000 shares of common stock for an aggregate purchase price of $ 8.8 million, excluding excise tax due under the Inflation Reduction Act of 2022, with such shares retired and recorded as a reduction of additional paid-in capital until extinguished with the remaining amount reflected as a reduction of retained earnings.
+Added: This stock repurchase program was completed in 2024.
+Added: On October 23, 2024, the Company announced that its board of directors authorized the repurchase of up to 1,000,000 shares of the Company's outstanding common stock.
+Added: The Company repurchased 135,792 shares of common stock for an aggregate purchase price of $ 2.3 million, excluding excise tax due under the Inflation Reduction Act of 2022, with such shares retired and recorded as a reduction of additional paid-in capital until extinguished with the remaining amount reflected as a reduction of retained earnings.
As of December 31, 2024, there were 911,529 shares remaining to be repurchased under this program.
Segment Reporting and Significant Customer Information
−Removed: The Company determines its reportable segments based upon the chief operating decision maker’s management of the business.
During 2024, the Company had four reportable operating segments:
4 unchanged sentences
New Initiatives consists of Travelzoo’s licensing activities in certain Asia Pacific territories, the Travelzoo META subscription service and MTE.
−Removed: In 2022, the Company managed its business and operated in three reportable segments, including Travelzoo North America, Travelzoo Europe and Jack’s Flight Club.
−Removed: Following the acquisition of MTE in December 2022 and the development and announcement of Travelzoo META, the Company’s chief operating decision maker evaluated New Initiatives as an additional reportable segment beginning in 2023.
−Removed: Accordingly, segment operating results reported below for the year ended December 31, 2022 have been restated in accordance with GAAP under the FASB’s Segment Reporting (Topic 280).
−Removed: Specifically, the 2022 Travelzoo North America segment financial information was adjusted to exclude results related to the 2022 New Initiatives segment, which is now presented separately.
+Added: Our chief operating decision maker ("CODM") is our Global Chief Executive Officer.
+Added: The CODM primarily use operating income (loss) to evaluate each segment's performance allocate resources and make capital investments.
+Added: We allocate certain software and license costs, such as IT and customer support, across all segments but do not allocate expenses such as legal-related costs or income taxes.
+Added: Financial information is utilized along with forecasts to enable decision maker to manage our business across all operating segments.
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 co mprised 5 % of revenues.
−Removed: Management relies on an internal management reporting process that provides revenue and segment operating profit (loss) for making financial decisions and allocating resources.
−Removed: Management believes that segment revenues and operating profit (loss) are appropriate measures of evaluating the operational performance of the Company’s segments.
−Removed: As noted above, the reported financial information for 2022 has been reclassified to conform to the current segment presentation.
−Removed: The following is a summary of operating results and assets by business segment (in thousands):
+Added: The following is a summary of operating results by business segment (in thousands):
Year Ended December 31, 2024 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Consolidated
2 unchanged sentences
Total net revenues 55,092 24,071 4,632 107 83,902
+Added: Sales and marketing (1) 19,748 12,561 1,881 280 34,470
+Added: Other costs and expenses (2) 19,461 8,429 2,707 337 30,934
Operating income (loss) $ 15,883 $ 3,081 $ 44 $ ( 510 ) $ 18,498
+Added: Other income, net $ 588
+Added: Income from continuing operations before income taxes $ 19,086
+Added: (1) Includes advertising and promotional costs, employee-related expenses for sales, marketing, and production teams, conference participation costs, professional services, public relations expenses, and facilities costs.
+Added: (2) Includes costs and expenses related to cost of revenues, product development, and general and administrative.
+Added: Travelzoo North America and Travelzoo Europe general and administrative expenses include stock based compensation of $ 1.5 million and $ 0 , respectively.
Year Ended December 31, 2023 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Consolidated
2 unchanged sentences
Total net revenues $ 56,080 $ 24,021 $ 4,172 $ 204 $ 84,477
+Added: Sales and marketing (1) 22,029 13,636 1,788 321 37,774
+Added: Other costs and expenses (2) 18,797 9,068 2,406 859 31,130
Operating income (loss) $ 15,254 $ 1,317 $ ( 23 ) $ ( 976 ) 15,572
−Removed: As of December 31, 2023 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Elimination Consolidated
−Removed: Long-lived assets $ 152 $ 106 $ — $ 320 $ — $ 578
−Removed: Total assets $ 96,865 $ 22,655 $ 19,472 $ 3,570 $ ( 87,181 ) $ 55,381
−Removed: As of December 31, 2022 Travelzoo North America Travelzoo Europe Jack's Flight Club New Initiatives Elimination Consolidated
−Removed: Long-lived assets $ 357 $ 86 $ — $ 214 $ — $ 657
−Removed: Total assets $ 97,960 $ 19,253 $ 18,737 $ 336 $ ( 69,023 ) $ 67,263
−Removed: Revenues for each segment are recognized based on customer locations within a designated geographic region.
−Removed: Property and equipment are attributed to the geographic region in which the assets are located.
−Removed: For the years ended December 31, 2023 and 2022, the Company did not have any customers that accounted for 10% or more of revenue.
−Removed: As of December 31, 2023 and 2022, the Company did not have any customers that accounted for 10% or more of accounts receivable.
−Removed: The following table sets forth the breakdown of revenues (in thousands) by category and segment.
−Removed: Travel revenue includes travel publications (such as Top 20 newsletter , Standalone newsletters , Travelzoo website , Travelzoo Network ), Getaways vouchers, hotel platform and vacation packages.
−Removed: Local revenue includes Local Deals vouchers and entertainment offers.
+Added: Other income, net $ 1,541
+Added: Income from continuing operations before income taxes $ 17,113
+Added: (1) Includes advertising and promotional costs, employee-related expenses for sales, marketing, and production teams, conference participation costs, professional services, public relations expenses, and facilities costs.
+Added: (2) Includes costs and expenses related to cost of revenues, product development, and general and administrative.
+Added: Travelzoo North America and Travelzoo Europe general and administrative include stock based compensation of 1.2 million and $ 194,000 , respectively.
+Added: A measure of segment assets is not currently provided to the Chief Operating Decision Maker and has therefore not been provided.
+Added: As of December 31, 2024, the Company had one customer that accounted for more than 10% of revenues at $ 8.8 million across Travelzoo North America and Travelzoo Europe.
+Added: For the years ended December 31, 2023, the Company did not have any customers that accounted for 10% or more of revenue.
+Added: As of December 31, 2024, the Company did not have any customers that accounted for 10% or more of accounts receivable.
+Added: The following table sets forth the breakdown of revenues (in thousands) by category Advertising, Membership Fees, and Other.
+Added: 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).
+Added: Membership Fees includes subscription fees paid by Travelzoo, Jack’s Flight Club and Travelzoo META members.
+Added: Other includes licensing fees from license agreements and the retail business acquired with MTE.
Year Ended December 31,
−Removed: Travelzoo North America
−Removed: Travel $ 53,448 $ 44,446
−Removed: Local 2,632 3,196
−Removed: Total Travelzoo North America revenues 56,080 47,642
−Removed: Travelzoo Europe
−Removed: Travel 22,415 18,053
−Removed: Local 1,606 1,402
−Removed: Total Travelzoo Europe revenues 24,021 19,455
−Removed: Jack's Flight Club 4,172 3,477
−Removed: New Initiatives 204 25
−Removed: Travel 75,863 62,499
−Removed: Local 4,238 4,598
−Removed: Jack's Flight Club 4,172 3,477
−Removed: New Initiatives 204 25
+Added: Advertising $ 78,396 $ 80,128
+Added: Membership Fees 5,399 4,145
+Added: Other 107 204
Total revenues $ 83,902 $ 84,477
−Removed: Revenue by geography is based on the billing address of the advertiser.
−Removed: Long-lived assets attributed to the U.S.
−Removed: and international geographies are based upon the country in which the asset is located or owned.
The following table sets forth revenues for individual countries that comprised 10% or more of total revenue (in thousands):
4 unchanged sentences
Total revenues $ 83,902 $ 84,477
−Removed: The following table sets forth long-lived assets by geographic area (in thousands):
−Removed: United States $ 115 $ 274
−Removed: Rest of the world 463 383
−Removed: Total long-lived assets $ 578 $ 657
Related Party Transactions
1 unchanged sentence
Azzurro is the Company’s largest shareholder, and as of December 31, 2024, holds approximately 37.5 % of the Company's outstanding shares.
−Removed: Holger Bartel, the Company's Global CEO, is Ralph Bartel's brother and separately holds 3.8 % of the Company's outstanding shares as of December 31, 2023 .
+Added: 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 .
Stock Purchase Agreement between Travelzoo and Azzurro Capital Inc.
2 unchanged sentences
See Note 3 – Acquisitions in the consolidated financial statements for further information.
−Removed: Service Agreement with Metaverse Travel Experiences, Inc.
−Removed: On March 1, 2022, Travelzoo (Asia) Limited, a Hong Kong limited company and wholly-owned subsidiary of the Company (“Travelzoo Asia”), entered in a four year Service Agreement (the “Service Agreement”) with a wholly-owned subsidiary of Azzurro Capital Inc., MTE, formerly Azzurro Brands Inc.
−Removed: Azzurro Capital Inc.
−Removed: is the Company’s largest shareholder.
−Removed: The Service Agreement was reviewed and unanimously authorized and approved by the Audit Committee of the Board of Directors, which is comprised solely of independent and disinterested directors.
−Removed: Pursuant to the Service Agreement, MTE will source curated Metaverse experiences in exchange for $ 25,000 per month, payable in advance each quarter.
−Removed: $ 250,000 was paid to MTE from Travelzoo (Asia) Limited in 2022 for Metaverse experiences which was expensed as Sales and marketing expenses in 2022 .
−Removed: MTE is also entitled to receive commission equal to 25 % of any subscription revenue generated by the Company.
−Removed: The Service Agreement is for a term of four ( 4 ) years but may be terminated for convenience after two ( 2 ) years.
−Removed: No commission was paid to MTE in 2022.
−Removed: Upon consummation of the Stock Purchase Agreement between the Company and Azzurro Capital Inc.
−Removed: as described above, the Service Agreement was terminated.
−Removed: License Agreement with Azzurro Brands Inc.
−Removed: and subsequent Asset Purchase Agreement
−Removed: On March 12, 2021, the Company, with the approval of the Audit Committee of the Board of Directors, which consists solely of independent directors, entered into a License Agreement (the “License Agreement”) with Azzurro Brands Inc., a New York corporation (“Azzurro Brands”) and wholly-owned subsidiary of Azzurro, the Company’s largest shareholder.
−Removed: Pursuant to the terms of the License Agreement, the Company was granted the exclusive right and license to use a database of 2.2 million non-duplicated subscribers that Azzurro Brands purchased from a competitor of Travelzoo.
−Removed: The License Agreement requires that the Company pay a license fee of $ 413,000 per quarter with an initial payment of $ 894,000 due upon execution, which covers the period from execution until September 30, 2021.
−Removed: The License Agreement has a term of one ( 1 ) year with an automatic renewal, terminable by either party with sixty ( 60 ) days’ written notice before the end of the term.
−Removed: The License Agreement contains customary representations and warranties.
−Removed: The payment of $ 894,000 was made in the first quarter of 2021 and recorded in sales and marketing expenses in 2021.
−Removed: The second payment of $ 701,000 was made in the second quarter of 2021 which covers the period from October 2021 through March 2022 and recorded in sales and marketing expenses and prepaid expenses and other.
−Removed: Travelzoo renewed the License Agreement in January 2022 for a license fee of $ 413,000 per quarter and made the payment of $ 800,000 to cover the period from April 2022 to September 2022 in the fourth quarter of 2021 and was recorded in Prepaid expenses-Related party, which totaled $ 1.15 million as of December 31, 2021.
−Removed: On March 17, 2022, the Company, as Buyer, entered into an Asset Purchase Agreement (the “APA”) with Azzurro Brands Inc.
−Removed: to purchase the database previously utilized by Travelzoo in accordance with the License Agreement.
−Removed: The purchase price for the transaction was $ 1.75 million, with $ 600,000 paid in cash upon closing in March 2022 and the remaining $ 1.15 million payable in the form of a credit with Seller relating to prepaid license fees, under the License Agreement.
−Removed: The remaining commitment of the Company under the License Agreement for the then-current remaining term (equal to $ 825,000 ) was eliminated.
−Removed: Stock Option Agreement
−Removed: In March 2022, the Compensation Committee of the Board of Directors granted Holger Bartel 600,000 stock options that vest through December 31, 2023.
−Removed: This grant was approved by the stockholders of the Company at the 2022 Annual Meeting of Stockholders.
−Removed: Holger Bartel is the brother of Ralph Bartel and is our Global Chief Executive Officer.
−Removed: See Note 10 above for further information.
+Added: Stock Repurchase Agreements
+Added: Travelzoo, from time to time, engages in share repurchases.
+Added: On June 15, 2024, the Company entered into a Stock Repurchase Agreement (the “First SRA”) with Holger Bartel, the Company's Global Chief Executive Officer, to repurchase an aggregate of 200,000 shares of the Company’s common stock at a price of $ 7.66 per share.
+Added: The Compensation Committee of the Board of Directors negotiated the purchase price with Holger Bartel after receiving advice from an independent financial adviser.
+Added: The aggregate purchase price of $ 1.5 million was paid during the second quarter of 2024, following the execution of the First SRA.
+Added: On September 5, 2024, the Company entered into a Stock Repurchase Agreement (the “Second SRA”) with Holger Bartel, the Company's Global Chief Executive Officer, to repurchase an aggregate of 200,000 shares of the Company’s common stock at a price of $ 11.44 per share.
+Added: The Compensation Committee of the Board of Directors negotiated the purchase price with Holger Bartel after receiving advice from an independent financial adviser.
+Added: The aggregate purchase price of $ 2.4 million was paid in 2024, following the execution of the Second SRA.
+Added: Consulting Agreement with Ralph Bartel
+Added: On January 1, 2023, with the unanimous approval of the Audit Committee, the Company entered into a Consulting Agreement with Ralph Bartel (the "Consulting Agreement").
+Added: The Consulting Agreement was amended and renewed, effective January 1, 2025.
+Added: Ralph Bartel, who founded Travelzoo, is the sole beneficiary of the Ralph Bartel 2005 Trust, which is the controlling shareholder of Azzurro.
+Added: Azzurro is the Company's largest shareholder.
+Added: Pursuant to the Consulting Agreement, Mr.
+Added: Bartel provides strategic advisory for Travelzoo META, advisory on talent search, performance management consulting, strategic advisory to IT and brand strategy and public relations support.
+Added: In 2024, the fee payable to Mr.
+Added: Bartel pursuant to the Consulting Agreement was $ 164,000 , included within General and Administrative expenses.
+Added: In 2023, the fee payable to Mr.
+Added: Bartel was less than $ 120,000 .
Profits from Sale and Purchase of Travelzoo Common Stock within Six Month Period
−Removed: Holger Bartel completed sales and purchases of 25,000 shares of Travelzoo common stock within a six month period ended July 29, 2022.
−Removed: Per Section 16(b) of Securities and Exchange Act, he agreed to immediately remit to the Company $ 46,000 in profits gained from these transactions in 2022.
On May 23, 2023, Travelzoo was named as a nominal defendant in a complaint for recovery of short swing profits filed in the Southern District of New York under Section 16(b) of the Securities Exchange Act, by Dennis J.
1 unchanged sentence
This case is ongoing but as Travelzoo is a nominal defendant, it did not accrue any expense as of December 31, 2024.
+Added: Non-Controlling Interest
+Added: The Company’s consolidated financial statements include Jack's Flight Club, which the Company has operating control over but owns a 60 % equity interest in.
+Added: Non-controlling interest for the years ended December 31, 2024 and 2023 was as follows (in thousands):
+Added: Non-controlling interest—January 1, 2023
+Added: Net Income attributable to non-controlling interest
+Added: Non-controlling interest—December 31, 2023
+Added: Net Income attributable to non-controlling interest
+Added: Non-controlling interest—December 31, 2024
The Company has operating leases for real estate and certain equipment.
12 unchanged sentences
Total lease cost $ 3,173 $ 2,807
−Removed: Cash payments against the operating lease liabilities totaled $ 3.2 million for each of the years ended December 31, 2023 and 2022.
−Removed: ROU assets obtained in exchange for lease obligations was $ 602,000 and $ 1.7 million for the year ended December 31, 2023 and 2022, respectively.
+Added: Cash payments against the operating lease liabilities totaled $ 3.4 million for each of the years ended December 31, 2024.
+Added: ROU assets obtained in exchange for lease obligations was $ 1.3 million and $ 602,000 for the year ended December 31, 2024 and 2023, respectively.
The following table summarizes the presentation in our consolidated balance sheets of our operating leases (in thousands):
+Added: Year Ended December 31,
Operating lease right-of-use assets $ 5,655 $ 6,015
10 unchanged sentences
Present value of operating lease liabilities $ 8,118
−Removed: Discontinued Operations
−Removed: On March 10, 2020, Travelzoo issued a press release announcing that it will exit its loss-making business in Asia Pacific.
−Removed: The decision supports the Company's strategy to focus on value creation for shareholders by focusing on growing the businesses in North America and Europe.
−Removed: The Asia Pacific business ceased operations as of March 31, 2020, except for the Company's Japan and Singapore units, which were held for sale.
−Removed: The Company classified Asia Pacific as discontinued operations at March 31, 2020.
−Removed: Prior periods have been reclassified to conform with the current presentation.
−Removed: The following table provides a summary of amounts included in discontinued operations for the years ended December 31, 2023 and 2022 (in thousands):
−Removed: Year Ended December 31,
−Removed: Revenues $ — $ —
−Removed: Cost of revenues — —
−Removed: Gross profit — —
−Removed: Operating expenses:
−Removed: Sales and marketing — —
−Removed: Product development — —
−Removed: General and administrative 12 —
−Removed: Total operating expenses 12 —
−Removed: Loss from operations ( 12 ) —
−Removed: Other income (loss), net 472 ( 35 )
−Removed: Income (loss) before income taxes 460 ( 35 )
−Removed: Income tax expense — 24
−Removed: Net income (loss) from discontinued operations $ 460 $ ( 59 )
−Removed: On June 16, 2020, in connection with its Asia Pacific exit plan, the Company completed a sale of 100 % of the outstanding capital stock of Travelzoo Japan to Mr.
−Removed: Hajime Suzuki (the “Japan Buyer”) for consideration of 1 Japanese Yen.
−Removed: The Company recognized a pre-tax loss of $ 128,000 .
−Removed: T he parties also entered into a License Agreement, whereby Travelzoo Japan obtained rights to use the intellectual property of Travelzoo exclusively in Japan in exchange for quarterly royalty payments based on revenue over a 5-year term, with an option to renew.
−Removed: A n interest free loan was provided to the licensee for JPY 46.0 million (approximately $ 430,000 ), of which $ 133,000 was repaid in 2021 and the remaining repaid in 2023.
−Removed: The Company recognized royalties of $ 36,000 and $ 0 for its licensing arrangements from the licensee in Japan for the years ended December 31, 2023 and 2022.
−Removed: On August 24, 2020, the Company completed a sale of 100 % of the outstanding capital stock of Travelzoo Singapore, to an unaffiliated entity, Finest Hotels Pty Ltd d/b/a Travelzoo (“AUS Buyer”), which is fully owned by Mr.
−Removed: Julian Rembrandt, the Company's former General Manager of Southeast Asia and Australia for consideration of 1 Singapore Dollar.
−Removed: The parties also entered into a License Agreement, whereby the AUS Buyer obta ined a license to use the intellectual property of Travelzoo exclusively in Australia, New Zealand and Singapore and non-exclusively in China and Hong Kong for quarterly royalty payments based upon revenue over a 5-year term, with an option to renew.
−Removed: The non-exclusive license in China and Hong Kong was terminated by Travelzoo.
−Removed: The Company recognized royalties of $ 35,000 and $ 25,000 for its licensing arrangements from AUS Buyer for the years ended December 31, 2023 and 2022, respectively.
−Removed: The following table presents information related to the major classes of assets and liabilities classified as assets and liabilities from discontinued operations in the Consolidated Balance Sheets (in thousands):
−Removed: 2023 December 31,
−Removed: Cash, cash equivalents and restricted cash $ 1 $ 10
−Removed: Prepaid expenses and other — 1
−Removed: Total assets from discontinued operations $ 1 $ 11
−Removed: Accounts payable $ — $ 403
−Removed: Accrued expenses and other — 13
−Removed: Income tax payable 24 24
−Removed: Deferred revenue — 12
−Removed: Total liabilities from discontinued operations $ 24 $ 452
−Removed: Net cash used in operating activities and investing activities for discontinued operations for the for the years ended December 31, 2023 and 2022 are as follows (in thousands):
−Removed: Year Ended December 31,
−Removed: Net cash used in operating activities $ ( 9 ) $ ( 21 )
−Removed: Non-Controlling Interest
−Removed: The Company’s consolidated financial statements include Jack's Flight Club, which the Company has operating control over but owns a 60 % equity interest in.
−Removed: Non-controlling interest for the years ended December 31, 2023 and 2022 was as follows (in thousands):
−Removed: Non-controlling interest—January 1, 2022 $ 4,600
−Removed: Net loss attributable to non-controlling interest ( 5 )
−Removed: Non-controlling interest—December 31, 2022 4,595
−Removed: Net loss attributable to non-controlling interest 102
−Removed: Non-controlling interest—December 31, 2023 $ 4,697
−Removed: Restatement of previously issued financial statements.
−Removed: The Company restated its previously issued Consolidated Financial Statements as of and for the year ended December 31, 2022.
−Removed: In connection with the preparation of our second quarter 2023 condensed consolidated financial statements, Travelzoo realized that the non-controlling interest (NCI) classification during the first quarter of 2022, the second quarter of 2022, the third quarter of 2022, the year ended December 31, 2022 and the first quarter of 2023 had not been correctly updated.
−Removed: When the put/call option in the Company’s stock purchase agreement with JFC Travel Group Co.
−Removed: expired in January 2022, the Company did not reclassify the NCI from temporary equity to permanent equity.
−Removed: The reclassification of NCI from temporary equity to permanent equity reduced temporary equity and increased permanent equity by $ 4.6 million but did not have any impact on the Company's previously reported total assets, total liabilities and stockholders’ equity (deficit) , results of operations or cash flows.
−Removed: The impacts from the restatement as of and for the year ended December 31, 2022 are as follows (in thousands):
−Removed: Consolidated Balance Sheet:
−Removed: December 31, 2022
−Removed: As Reported Adjustments As Restated
−Removed: Non-controlling interest $ 4,595 $ ( 4,595 ) $ —
−Removed: Stockholders’ equity:
−Removed: Total Travelzoo stockholders’ equity 4,256 — 4,256
−Removed: Non-controlling interest — 4,595 4,595
−Removed: Total stockholders’ equity $ 4,256 $ 4,595 $ 8,851
−Removed: Consolidated Statement of Stockholders’ Equity:
−Removed: December 31, 2022
−Removed: As Reported Adjustments As Restated
−Removed: Total Travelzoo stockholders’ equity $ 4,256 $ — $ 4,256
−Removed: Non-controlling interest — 4,595 4,595
−Removed: Total stockholders’ equity $ 4,256 $ 4,595 $ 8,851
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.