After amazing run, travel giant revenue drops in Q1
After nearly 15 years of quarterly revenue marching ever higher, Booking Holdings’ impressive run came to an end in the first quarter of 2019 in part due to the timing of last year’s Easter — but with the company booking another big profit gain regardless to send its stock up 4 percent in after-hours trading.
Booking Holdings has its headquarters in Norwalk under CEO Glenn Fogel, overseeing several subsidiaries focused on travel tickets and hospitality reservations including Booking.com, Priceline.com and Kayak based in Stamford.
This month the company added to its OpenTable restaurant reservations platform in acquiring Venga, whose app helps hosts cater to individual diners based on their preferences, with Fogel saying on a Thursday conference call he is eager to see OpenTable fully integrated with Booking Holdings’ other websites to provide travelers a better service. In May, the Sherman-based travel market research firm Phocuswright described as “exceptionally complex” the efforts by travel vendors to add personalization to travel experiences.
“That is part of our overall strategy, of the ‘connected’ trip,” Fogel said Thursday. “We talked about this in the past — about providing a service, a value to a traveler. There’s much more than just going on to a site and booking a hotel. What we’re trying to do is create all these different things together in a way that provides significantly more value than any single service could do on its own.”
Booking Holdings earned $765 million in the first quarter, up 26 percent from a year ago despite revenue dropping 3 percent to $2.8 billion, including the impact of currency rates.
It was the first period in which the company was unable to post a year-overyear gain since the third quarter of 2004, when the company was known as Priceline.com under then CEO Jeff Boyd, who remains board chair today. From less than $22 under Priceline entering October
2004, Booking Holdings shares trade today at more than $1,800 today for an increase of more than
80-fold.
The board chaired by Boyd authorized Booking Holdings last month to repurchase up to $15 billion of its stock over the next few years, with the company currently midway through an existing,
$10 billion buyback. Like archrival Expedia, Booking Holdings continued to increase gross bookings in the first quarter, up about $400 million or 2 percent inclusive of exchange rates to $25.4 billion; and with the company reporting a 10 percent bump in hotel nights booked on its websites.
But for Booking Holdings that did not translate to an overall increase in revenue, with the yearover-year comparisons impacted by Easter arriving on April 1 last year, pushing holiday travel up to the first quarter of 2018.
The company anticipates it will return to sales growth in the current second quarter, projecting a year-over-year gain of between 5 percent and 7 percent and profits between $920 million and $940 million.
Booking Holdings recently launched new ad campaigns, including for its alternative accommodations listings through which people can rent out their homes as on Airbnb or Expedia’s Home-Away website.
“We have pointed out in the past, in terms of awareness, that if you went to somebody on the street and said, ‘where can I get a home in the U.S.,’ they probably would not go to Booking.com; but if you’re walking in the capital city in Europe, (there’s) a much higher likelihood that they would say Booking.com,” Fogel said Thursday.