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Coronavirus Will Hurt Trivago Financials, but Likely Won't Last Three Quarters, CEO Says

Coronavirus continues to spread across Europe and the Middle East and has officially made its first appearance in South America, sending officials scrambling to keep up and pushing businesses that are struggling to adapt to the economic effects of an outbreak showing no signs of pause. 
With the uncertainty of a new virus whose vaccine the U.S. Centers for Disease Control and the U.S. Department of Health and Human Services said is 12-18 months away, travelers are pausing vacation plans. 
Travel website Trivago's CEO Axel Hefer told Cheddar Tuesday the company has seen "quite a significant effect" on its markets across Asia. 
But the spread of the infectious disease is hard to predict, as seen in Europe over the past week, where the number of cases ballooned in Italy over a few days. 
"In travel, it's all about uncertainty, obviously," Hefer said. "So if there is insecurity, whether you can travel healthy, then it has a big impact on the short term travel and people tend to push out the travel to a later point in time." 
To accommodate, Trivago has reduced its marketing spend and shifted it to a later time. Hefer said the company has worked with its marketing partners to alter their schedules even past a point where they can typically pull back spending.
Germany, and the European Union more broadly, are struggling to contain small outbreaks in the economic region known for its open borders. 
"Things can change very quickly," he said. "Europe was pretty much isolated until last week. And then it all changed in the last seven days. So it's impossible to quantify [the financial impact on Trivago this quarter] and as a reason why, for the first time ever, we've not given any guidance." 
However, the Düsseldorf-based company is treating the virus as a temporary setback, one that is unlikely to last for the next three to four quarters, Hefer said.
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