By Wallace Witkowski and Tomi Kilgore
Booking’s robust results follow a disappointing report from fellow travel-bookings site Expedia
Shares of Booking Holdings Inc. (BKNG) soared into record territory Friday, after the travel and booking site calmed investor fears by reporting a big earnings beat and strong revenue growth, citing the continued strength and resiliency of overall travel demand.
“In the second quarter, we continued to see robust leisure travel demand, which helped drive stronger-than-expected room-nights and gross-bookings results in the quarter,” said Chief Executive Glenn Fogel. “We have seen these strong trends continue into July, and we are currently preparing for what we expect to be a record summer travel season in the third quarter.”
The stock (BKNG) shot up 8.7% in morning trading, to put it well above the record closing price of $3,012.25 seen on July 28. It was also headed for the biggest one-day gain since it rallied 18.8% on Nov. 9, 2020.
The company reported late-Thursday second-quarter net income of $1.29 billion, or $34.89 a share, compared with $857 million, or $21.07 a share, in the year-ago period.
Adjusted earnings, which exclude stock-based compensation expenses and other items, were $37.62 a share, compared with $19.08 a share in the year-ago period, and well above the FactSet consensus of $28.98 a share.
Revenue rose 27.2%, to $5.46 billion from $4.29 billion in the year-ago quarter, and beat the FactSet consensus of $5.17.
Booking’s profit and revenue beats followed a disappointing report from rival Expedia Group Inc. (EXPE), in which revenue rose less than forecast, and the stock plunged 16.4% to close at a two-month low.
Room nights booked rose 8.9% to 268 million, beating the FactSet consensus of 261.5 million, and bookings increased 14.9% o $39.69 billion, topping forecasts of $38.07 billion.
In comparison, Expedia reported room nights booked and bookings that missed expectations.
Booking raised its full-year outlook for gross booking growth to over 20% from its previous projection for growth in the low-teens percentage range.
“And that, ladies and gentlemen, is how it is done,” said Benchmark analyst Daniel Kurnos in a note to clients. Following a disappointing result from their “primary legacy competitor,” he said Booking reminded everyone why “they are still the model.”
The stock has run up 53.2% year to date, while Expedia shares have gained 18.0% and the S&P 500 index SPX has advanced 17.8%.
-Wallace Witkowski
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08-04-23 1046ET
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