Executive Summary

Q2 2024 net revenues were $58.3M (+3% YoY; +0.5% QoQ) on gross bookings of $678.0M; adjusted EBITDA rose 38% YoY to $6.1M with margin expanding to 10.5% .
Management announced a long-term refinancing expected to extend the term loan to June 30, 2028 and preferred equity to December 31, 2028, contingent on securing a $15M letter of credit; this aims to restore FinTech credit limits and working capital .
Mix shift to non-air accelerated: non-air reached 47% of net revenue; take rate increased 20 bps to 8.6% YoY, supported by hotel/package growth and direct supplier connections .
Near-term growth constrained by delayed refinancing and industry softening; FY24 guidance was lowered to net revenues of $240–$250M and adjusted EBITDA of $25–$30M (from $250–$260M and $30–$35M) .
Stock reaction catalysts: completion of refinancing/LOC, reinstatement of FinTech credit limits, AI rollout (ABI v2 and Infinity automation), and traction in hotel/package direct connections .

What Went Well and What Went Wrong

What Went Well

Adjusted EBITDA growth and margin expansion: Q2 adjusted EBITDA rose to $6.1M (+38% YoY) and margin to 10.5% (from 7.8%), driven by higher-margin non-air products and cost efficiencies .
Product and distribution initiatives: COO highlighted more traffic on airline NDC connections and direct hotel chains; North America hotel take rate increased by over 50% year-to-date, improving conversions and pricing .
Strategic refinancing: CEO/CFO emphasized favorable refinancing terms positioning Mondee for long-term growth and improved profitability: “securing favorable terms that position Mondee for long-term growth… expected to fuel our expansion, improve profitability, and solidify our AI leadership in travel” .

What Went Wrong

Net revenue growth constrained by working capital: Delays in refinancing reduced FinTech credit limits, materially limiting revenue growth in Q2 and expected to impact Q3; management estimates about “50/50” split of guidance impact between FinTech revenue down and market softness .
Industry softening and regional disruptions: Management saw beginnings of travel softening into 2025, with flooding in South America and re-escalating Middle East conflict, pressuring ARPT and lodging rates .
Higher GAAP net loss: Q2 net loss widened to $(25.5)M, including $19.1M of non-cash/non-recurring items (notably $12.0M stock-based comp), and operating cash flow used was $(7.6)M as cash reserves were deployed to offset reduced credit limits .

Financial Results

Metric	Q4 2023	Q1 2024	Q2 2024
Net Revenues ($USD Millions)	$61.1	$58.021	$58.326
Net Revenues YoY Growth (%)	78%	16%	3%
Net Revenues QoQ Growth (%)	12%	(7)%	0.5%
Gross Bookings ($USD Millions)	$619.3	$708.076	$677.957
Transactions (units)	829,698	1,075,437	1,133,997
Take Rate (%)	9.9%	8.2%	8.6%
Adjusted EBITDA ($USD Millions)	$6.9	$5.056	$6.111
Adjusted EBITDA Margin (%)	11.4%	8.7%	10.5%
Net Loss ($USD Millions)	$(12.5)	$(19.458)	$(25.512)
EPS (Basic & Diluted, $USD)	$(0.21)	$(0.30)	$(0.36)
Adjusted EPS ($USD)	$(0.13)	$(0.09)	$(0.17)

Note: CEO remarks referenced “take rate… 81.6%,” which appears to be a misstatement; press materials and tables consistently show 8.6% in Q2 2024 .

KPIs and Mix

KPI	Q4 2023	Q1 2024	Q2 2024
Non-Air (% of Net Revenue)	N/A	N/A	47%
Operating Cash Flow ($USD Millions)	$(10.6)	$18.661	$(7.599)
YTD Operating Cash Flow ($USD Millions)	—	—	$11.1
YTD Free Cash Flow ($USD Millions)	—	—	$3.3
Cash and Cash Equivalents ($USD Thousands)	$26,171	$38,889	$23,337
Restricted Cash and Short-term Investments ($USD Thousands)	$7,993	$8,493	$8,951
Total Debt (Management perspective, $USD Millions)	—	—	$169
Long-term Debt – current portion ($USD Thousands)	$10,828	$11,645	$5,182
Long-term Debt – excluding current ($USD Thousands)	$150,873	$154,549	$164,104

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Net Revenues ($USD Millions)	FY 2024	$250–$260	$240–$250	Lowered
Adjusted EBITDA ($USD Millions)	FY 2024	$30–$35	$25–$30	Lowered

Drivers: delayed refinancing constrained FinTech credit limits/working capital; industry softness also contributed; management expects reinstatement post-refinancing and improved traction in higher-take-rate products .

Earnings Call Themes & Trends

Topic	Q4 2023 (Prior 2Q)	Q1 2024 (Prior 1Q)	Q2 2024 (Current)	Trend
AI/Technology initiatives	Acquired Purplegrids to accelerate AI; focus on Abhi	Raised guidance; continued AI deployment across business	ABI usage <2% of transactions; ABI v2 targeted for Q4; Infinity automation reducing S&M by ~5% and expanding across functions by Q4/Q1	Execution progressing; adoption early but expanding
Market/macro	Record growth; strong leisure demand	Strong start; term loan maturity extended to 6/30/25	Softening demand into 2025; regional disruptions (LATAM flooding, Middle East conflict); airfare/lodging softness	Softer near term
Distribution/content	NDC and supplier programs; widening marketplace	International expansion; marketplace content build	More NDC traffic; direct hotel connections; NA hotel take rate +50% YTD	Strengthening
Working capital/FinTech	Term loan maturity extended to 3/31/25	Extended to 6/30/25; working to finalize long-term facility	Refinancing to 2028 contingent on $15M LOC; FinTech credit limits curtailed; expect reinstatement → FinTech carries highest take rate	Constraint easing post-refi
Product mix/ARPT	Take rate 9.9%; packages and non-air emphasized	Take rate 8.2%; non-air expansion	Non-air reached 47% of net revenue; ARPT pressured by short-haul international; expected stabilization then recovery into 2025	Mix shift favorable; ARPT stabilizing
Guidance posture	FY24 net revenue $250–$255; adj EBITDA $30–$35	FY24 net revenue $250–$260; adj EBITDA $30–$35	Lowered to $240–$250 and $25–$30 on constraints/softness	Lowered near term

Management Commentary

CEO: “Mondee delivered a strong second quarter, with net revenue, take rate, and adjusted EBITDA up year over year—the latter by 38%… This new capital structure is expected to fuel our expansion, improve profitability, and solidify our AI leadership in travel” .
CFO: “We delivered net revenue of $58 million—up 3% year over year… delays in completing the refinancing caused a reduction in FinTech credit limits and working capital, materially limiting net revenue growth” .
COO: “We did see the beginnings of industry softening by the end of the second quarter… disruptive events in Q2, such as catastrophic flooding in South America… We’re seeing more traffic on our NDC connections… material improvement in our hotel take rate; increase of over 50% in our North America hotel take rate so far this year” .
CFO: “Sales and marketing… declined from 71% to 65% as a percentage of net revenue… Adjusted EBITDA margin increased from 7.8% to 10.5%” .

Q&A Highlights

Working capital and FinTech priorities: Management expects ~$20M working capital (LOC $15M plus ~$5M cash) to revamp growth, prioritizing FinTech solutions given their highest take rate and the most-affected area during delays .
AI traction: ABI currently <2% of transactions; ABI v2 expected in Q4. Infinity automation is being deployed across CRM, ops, sales/marketing, revenue management; early results include ~5% reduction in S&M expenses .
ARPT and mix: Transaction growth strong; ARPT pressured by short-haul international mix; management expects moderation and recovery into 2025 as mix shifts back to more global travel and as ancillaries attach .
Guidance impact: ~50% of the lowered FY24 guidance driven by FinTech revenue down from credit limit constraints; remainder due to market softness; Q3 is expected to be impacted as credit limits reopen post-refi .
Competitive landscape: Mondee views AI differentiation and marketplace deployment as strong competitive advantages; capital constraints have been the primary headwind rather than strategy .

Estimates Context

S&P Global consensus estimates for MOND were unavailable due to missing CIQ mapping, preventing a formal comparison versus Wall Street estimates for Q2 2024 and the next quarter. As a result, no “vs. estimates” deltas can be presented at this time. Management lowered FY24 guidance as detailed above .

Key Takeaways for Investors

Near-term setup: Refinancing completion and $15M LOC are pivotal to restore FinTech credit limits and unlock higher-take-rate growth; watch for reinstatement timelines and Q3/Q4 cadence .
Margin progression: Mix shift to non-air and direct supplier connections (NDC/hotel) plus Infinity automation are expanding take rate and EBITDA margin; continued execution should support further margin gains .
Demand and ARPT: Industry softness and short-haul mix are depressing ARPT; management expects stabilization and gradual recovery into 2025 as mix normalizes and ancillaries attach .
Cash/debt posture: Cash plus restricted cash totaled ~$32M, with total debt ~$169M; refinancing is expected to extend maturities to 2028, improving flexibility and working capital .
Guidance reset: FY24 net revenue and adjusted EBITDA guidance lowered; upside exists if credit limits are reinstated faster and AI/hotel/package initiatives continue to lift take rate .
Tracking catalysts: ABI v2 launch in Q4; Infinity rollout across functions by end of Q4/beginning of Q1; additional hotel direct connections in pipeline .
Action: Monitor IR updates on refinancing close, LOC, and credit limit reinstatement; watch Q3 commentary for FinTech revenue normalization and ARPT trend inflection .

Citations: Q2 2024 earnings release and 8-K ; Q2 2024 earnings call transcript ; Q1 2024 earnings release and 8-K ; Q4 2023 preliminary release .

Mondee Holdings, Inc. (MOND)·Q2 2024 Earnings Summary