How might TZOO improve future EPS performance?

To improve future EPS performance, Travelzoo (TZOO) should focus on enhancing profitability in its core segments and exploring innovative revenue streams: 1. **Increase Profitability in Core Segments**: - **Travelzoo North America**: Focus on growing advertising fees by leveraging its strong relationships with travel suppliers to negotiate exclusive offers. The 19% revenue increase in Jack’s Flight Club indicates success in this area. - **European Segment**: Address the revenue decline by improving operational efficiency and exploring new marketing strategies to boost demand. 2. **Expand Membership Models**: The transition to a paid membership model shows promise. Travelzoo should continue to enhance membership offerings and marketing efforts to drive subscription growth, which can increase revenue and potentially improve EPS. 3. **Optimize Revenue Mix**: Travelzoo's consolidated operating profit increased by 8% year-over-year, showing improved profitability. Maintaining and improving this trend requires optimizing revenue mix, focusing on high-margin activities, and controlling costs. 4. **Invest in Technology and Innovation**: The development of innovative travel platforms like the Metaverse travel platform can attract new customers and enhance user experience, potentially leading to increased revenue and profitability. 5. **Cost Management and Efficiency**: Travelzoo should focus on cost management and operational efficiency to improve gross and net margins. This includes optimizing marketing spend, reducing unnecessary expenses, and improving operational processes. 6. **Potential Share Buybacks**: If the company's cash position allows, share buybacks can reduce the number of outstanding shares, which can increase EPS if the company's net income remains stable or grows. By implementing these strategies, Travelzoo can work towards improving its EPS performance in the future.