Booking Beats Expectations as Travel Demand Remains Strong

Booking Holdings Inc., owner of travel brands Kayak and Priceline, reported first-quarter room night reservations that beat analysts’ expectations, a sign that global travel remains resilient.

Bloomberg
First Published3 May 2024
Booking Beats Expectations as Travel Demand Remains Strong
Booking Beats Expectations as Travel Demand Remains Strong

Booking Holdings Inc., owner of travel brands Kayak and Priceline, reported first-quarter room night reservations that beat analysts’ expectations, a sign that global travel remains resilient.

Room nights booked for the three months ended March 31 grew 8.5% to 297 million, the company said in a statement Thursday. That surpassed the average analyst expectation for a 6.2% increase and 290.9 million room nights sold. Gross travel bookings, which includes taxes and fees, were $43.5 billion, compared with a projection of $42.2 billion. 

The company’s adjusted earnings before interest, depreciation and amortization were $898 million. Wall Street was expecting $718.6 million. Adjusted earnings per share were $20.39, compared with analysts’ estimate of $13.94.

“We are pleased to report a strong start to 2024,” said Booking Chief Executive Officer Glenn Fogel. “As we continue our work to deliver a better planning, booking, and traveling experience for our travelers, we are seeing encouraging results at Booking.com with increasing direct mix, higher frequency, and more of our travelers moving into the upper Genius loyalty tiers.”

The board also declared a cash dividend of $8.75 per share payable on June 28.

The shares rose 7.3% in late trading. The stock has risen about 26% in the past 12 months, outpacing the S&P 500 Index.

Following several blockbuster quarters reflecting a post-pandemic travel boom, online travel companies like Booking, Expedia Group Inc. and Airbnb Inc have cautioned that it will be difficult to top their strong performance during the comparable early 2023 travel season. 

Thursday’s results from Norwalk, Connecticut-based Booking are a bellwether for global travel more generally, because they own properties across the industry from flight aggregator Kayak, to rentalcars.com and restaurant reservation site OpenTable, offering clues as to whether demand is still fundamentally strong or is indeed tapering off ahead of the peak summer season. 

The global travel recovery has been uneven. Growth in the US has stagnated while demand in Europe and Asia Pacific markets has been more enduring, according to analysts at Jefferies. That could bode well for Booking, which has a bigger presence in the Europe and the Middle East than US competitors like Expedia, which also reported results Thursday afternoon.

Expedia posted first-quarter gross bookings of $30.2 billion, missing analysts’ average estimate of $30.5 billion as the company cited “slower than anticipated” recovery in its vacation rental business Vrbo. That, combined with slower-than-expected growth in the rest of its consumer business so far, led the company to lower its full-year sales guidance to “a range of mid to high single digit top line growth with margins relatively in line versus last year,” it said in a statement. Room nights growth and revenue were otherwise in-line with estimates. Shares slid 8.7% in post-market.

“Vrbo’s recovery following the recent re-platforming has been slower than anticipated, which has put pressure on gross bookings,” said Expedia CEO Peter Kern. “As we enter the second quarter, we are seeing some acceleration in the rest of our B2C business and expect it to continue throughout the year.”

This article was generated from an automated news agency feed without modifications to text.

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