While it's interesting to note Skyscanner's growth in hotels and car hire, commission from flight searches is still the source of most of its revenue. It seems likely that the company will look to take a bigger slice of the airline market rather than push too hard into other areas.
As the name suggests, Skyscanner has almost always been about flight metasearch but its latest set of results show how much it is improving its offering in other areas.
The company collected revenues totalling $205.7 million (£158.3 million) in 2016, a rise of 44 percent on the previous year. Of this total the company’s hotel and car hire products made up 9 percent, up from 6 percent.
While this is still a relatively small amount — only $16.8 million (£12.9 million) — it clearly shows the company’s intent in areas where it is relatively underserved.
Pre-tax profits fell by 33.4 percent to $9.5 million (£7.3 million). The drop was down to two one-off charges totalling $12.6 million (£9.6 million) relating to the sale of the company to Ctrip.
This potential in other areas is likely one of the reasons Ctrip shelled out $1.74 billion for Skyscanner at the end of 2016, something CEO Jane Jie Sun spoke about in an interview with Skift.
“Skyscanner is strong in air,” she said. “So, air definitely is the important piece for their business. So we will be focusing on building global coverage of air ticketing first. And then add other services to it. For example, if you look at our inventory, we also have train product, we also have rental car, we also have local attraction tickets. Ctrip offers comprehensive products. In all of these, we will be able to open all these products to them.”
As well as diversifying away from flights, Skyscanner Ltd’s accounts show how the company’s geographical reach has also grown.
The UK and Ireland is now Skyscanner’s smallest market by revenue behind both Europe and the rest of the world.
In their strategic report, the directors said: “The company’s long term strategy is centered on owning a greater part of the travel journey from destination selection through to post travel engagement.”
Skyscanner’s vision was articulated in plenty of detail in a white paper published earlier this year, which talked about metasearch sites becoming market places for branded airline products.
Airlines are increasingly looking to sideline the old order of global distribution systems and Skyscanner hopes it will be able to take advantage through a new cheaper offering.
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Photo credit: Skyscanner has seen revenue growth from hotel and car rental searches. This promotional image from the company highlights its flight, hotel, and car rental search capabilities. Skyscanner