What happened

Shares of TripAdvisor (TRIP -0.83%) were heading lower today after the travel-recommendation site posted underwhelming results in its fourth-quarter earnings report. Weak performance in the hotel segment continued to weigh on overall growth, and the company missed earnings estimates.

As of 11:27 a.m. EST, the stock was down 7.5%.

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Image source: Getty Images.

So what 

Overall revenue rose 8% to $346 million, which topped estimates of $342.7 million. However, in the hotel segment, TripAdvisor's primary business, revenue fell 2%, though that was due in part to the company's decision to reduce the marketing expenses in order to drive profits in the segment.

Its non-hotel segment, which is made up of experiences and restaurants, saw another round of strong growth with revenue increasing 38%. That and the rebalancing in marketing expenses, which fell from $167 million to $157 million, drove adjusted earnings per share up from $0.06 to $0.27. Still, that came up short of estimates for $0.29.

Though the company is on the right track with its turnaround, the stock had already gained more than 50% over the last year prior to today's report, so the stock had perhaps gotten ahead of the company's turnaround progress.

CEO Steve Kaufer summed up the performance, saying: "We reinvigorated Hotel segment profitability, reinforced our leading positions in Experiences and Restaurants and laid important groundwork for future growth. We are pleased with our progress and will continue to balance growth and margin to deliver maximum shareholder value."

Check out the latest TripAdvisorearnings call transcript.

Now what 

Looking ahead to 2019, management called for double-digit growth in adjusted EBITDA and said it will focus on profit growth in hotels and revenue growth in experiences and restaurants to capture the market opportunity. It also said revenue and profit growth would be weighted to the second half of the year and would be stronger in the second quarter than the first. 

Though management didn't give specific numbers, that forecast seems to indicate that first-quarter results may be weaker than expected. Still, despite today's sell-off, there's no reason for investors to change their thesis on the stock. The company's transition remains on track.