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EXPE Earnings: Expedia May Disappoint - Oak Park Journal

EXPE Earnings: Expedia may disappoint

Last week, I told you guys what to do for both META and AMZN. Now what? Well it’s finally time, Expedia is releasing their earnings today. Yes, I’ve been looking forward to this one. For those who don’t know, they’re a travel company providing everything from airline tickets, hotel rooms, and car rentals, to cruises. Last earnings, Expedia beat analysts’ revenue expectations by 2.8% last quarter, reporting revenues of $2.89 billion, up 8.4% year on year. It was an ok quarter, with solid growth in its bookings but slow revenue growth. It reported 101.2 million nights booked, up 7.1% year on year. So what are we going to do for today’s earnings? Why am I getting puts?

I expect Expedia’s stock to likely see little to no movement with revenues and earnings matching consensus estimates in Q2 results, and as a result the stock will most likely drop after hours today. We have to keep in mind that the company will benefit from increasing travel demand that has remained resilient despite macro-economic issues. The B2B and B2C segment has performed well for the company’s retail side in terms of growth, while also driving margins higher. However, Vrbo segment’s recovery post-technical migration was slower than expected, impacting the overall performance in Q1. Vrbo is the vacation rentals portion of the company. Expedia expects its full-year revenue growth to be lower than initially anticipated for 2024, prompting a revision of the full-year guidance to a range of mid- to high single-digit top-line growth. Take a look though, Expedia’s stock is down 23% so far YTD. In comparison, Expedia’s peer Booking Holdings (BKNG) stock fell 3% year-to-date to $3417.

From what I’ve read, analysts are expecting Expedia’s revenue to grow 5.2% year on year to $3.53 billion this quarter, in line with the 5.6% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $3.16 per share. Here’s a chart I found with more numbers.

Reading up on what the analysts have written, I’ve noticed that a lot of people are just reconfirming their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. But with that, it’s important to note that Expedia has missed Wall Street’s revenue estimates twice over the last two years.

Looking at Expedia’s peers in the consumer internet segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Booking delivered year-on-year revenue growth of 7.3%, beating analysts’ expectations by 1.5%, and Airbnb reported revenues up 10.6%, in line with consensus estimates. Booking traded down 8.6% following the results.