Booking Holdings (BKNG, Financial) has seen a notable rise today, gaining back some of the ground lost last month after surpassing Q1 earnings and sales forecasts due to robust growth in bookings. Despite facing competition from Expedia Group (EXPE, Financial) and Airbnb (ABNB, Financial), BKNG reported sustained strong demand for travel, continuing a trend that has persisted over several quarters. Although BKNG has indicated a potential slowdown, its outlook remains more optimistic than EXPE's recent downbeat FY24 guidance, highlighting BKNG's superior performance and market share gains amidst EXPE's ongoing challenges.
- BKNG reported a 76% year-over-year increase in adjusted EPS to $20.39, with revenue up 17% to $4.42 billion in Q1. It also saw a 10% increase in gross bookings and a 9% rise in room nights booked, significantly outpacing EXPE's growth.
- EXPE is currently struggling, particularly with its Vrbo platform, which has faced technical issues and reduced marketing efforts during its integration into the Expedia platform. This has led to Vrbo losing market share to both ABNB and BKNG, especially in urban accommodations.
- BKNG enjoyed an 11% year-over-year increase in its global alternative accommodation listings in Q1. Its global mix of alternative accommodation room nights also grew by 3 percentage points year-over-year and sequentially to 36%.
- Despite geopolitical tensions in the Middle East and economic softness in Europe, BKNG experienced less impact than anticipated. Its airline ticket bookings surged 33% year-over-year, indicating robust growth across various regions, with Asia leading and the U.S. showing slower growth.
- For Q2, BKNG anticipates a slowdown with expected gross bookings growth of 3-5% and revenue growth of 4-6%, primarily due to foreign exchange impacts and potential geopolitical escalations. However, BKNG remains optimistic about FY24, predicting continued strong performance.
In conclusion, BKNG's Q1 performance not only reflects ongoing strong travel demand but also its ability to capture more market share from its main competitor, EXPE. Despite potential near-term economic uncertainties, BKNG's strategic position in the travel sector appears robust.
