Trip.com Group Ltd (TCOM.US): 2Q26 results: Solid margin outlook against muted near-term revenue momentum

We believe the solid margin outlook for 2H26 provides meaningful downside protection, even as top-line growth is under pressure from domestic demand and faces a high base through 1Q27. Trip.com continues to deliver strong growth with improved operating efficiency. Management guided for 1-6% top-line growth in 3Q26, vs. 5.5% in 2Q26. Domestic revenue is expected to be largely flat or down slightly, reflecting weak demand driven by extreme weather and muted consumption, along with slight take-rate volatility. While outbound transportation revenue will likely be flat, outbound accommodation revenue is expected to continue growing at HSD. Trip.com should sustain fast revenue growth of >50% YoY, acting as the company's primary growth driver. Positive surprises could come from flattish GPM, supported by trip.com's customer service optimization, and mild growth in S&M expenses, driven by savings in the domestic business and improved operating efficiency at trip.com. These should help TCOM kee