Chinese online travel agency Trip.com Group reported its first quarterly profit Wednesday since the Covid-19 outbreak, showing the domestic travel industry is slowly recovering as the country aggressively fights to contain the pandemic.

The company posted a net profit of 1.58 billion yuan ($240 million) in the quarter ended Sept. 30, compared with a net loss of 476 million yuan in the same period last year. Revenue declined 48% year-over-year to 5.5 billion yuan.

The net loss in the year-ago period was mainly due to a sharp decline in investment gains. Excluding investment gains, stock-based compensation and convertible debt, the company’s adjusted net profit declined 39% year-over-year to 1.4 billion yuan.

Even though domestic travel has recovered somewhat, Trip.com’s core travel booking business still hasn’t resumed its pre-Covid-19 pace. In the third quarter, hotel booking revenue declined 39%, and transportation ticket revenue fell 49%, although both increased robustly from the second quarter.

As mass vaccination takes time, cross-border travel, especially outbound business from China, will remain low for the next few months, said James Liang, co-founder and executive chairman of Trip.com. Chief Financial Officer Wang Xiaofan projected that the recovery in domestic business will continue in the fourth quarter, though the travel industry still faces uncertainty in 2021.

Searches for international destinations on Trip.com have returned to the same level as last year, showing that people have a strong desire to travel abroad, but quarantine requirements and vaccinations are still factors, Chief Executive Sun Jie said Wednesday during an earnings teleconference.

Contact reporter Denise Jia (huijuanjia@caixin.com) and editor Bob Simison (bobsimison@caixin.com).

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