EXPE - Earnings call transcript Q1 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon. My name is Anne. And I’ll be your conference operator today. At this time, I would like to welcome everyone to the Expedia Group First Quarter 2021 Conference Call. After the speakers’ presentation, there will be a question-and-answer session. you. Thank Instructions] [Operator like Vice the President now Patrick over Thompson, Senior and to would call turn to I CFO. Thank you. Please go ahead.

Patrick Thompson

welcome any first XX, Kern, and Good call call today be And to CEO, financial the Group’s afternoon. Peter or XXXX our results our Hart. discussion, joined for on the following reflects this The CFO, do only. questions, today, I’m We as quarter XXXX. March update views of by including ended pleased management’s obligation not information. undertake Eric revise May to responses X, Expedia to conference to your

As confident words release these always, could actual cause the such that, or on we statements. we made by for Company’s today’s Please with plan, are filings to we anticipate, from SEC, our which today’s expect, similar we call some of as statements. materially information believe, forward-looking preceded or forward-looking, refer optimistic typically factors we differ statements and the about to earnings results are the

You the website against stock-based me to content. cost revenue, Peter. And turn be comparisons for compensation. discussed references most I results on call otherwise exclude technology all to at, you marketing let will selling content expense, and will and And Company’s general release, our earnings this visit Investor comparable the measures to And over expense of of important is with the which our ir.expediagroup.com. to non-GAAP XXXX. and and administrative comparable expense, in our on measures that, period the call Relations today encourage GAAP for website all reconciliations other periodically IR of find Unless posted stated,

Peter Kern

thank Good afternoon, joining everybody. Thank for call. you you, Pat. And our

find say, our start a the And Eric we’re days exciting [Technical core three Difficulty] just us. we really best-in-class GBT the some by it in a to to extremely of things and And But, announced Egencia is, corporate our That putting that in the do. brief corporate for I’ll details. have have. the deal, ownership trying case, very customer, a And minutes, with will a ago. few share services proposed really on we’re Amex to combined We great Egencia enterprise is new entirely best provide which excited highlights all could this we created to talking serve those opportunity focus deal questions. that suite that businesses. I’ll felt take One in about remarks few together company, customers.

BXB And and important and tech driving recall, move industry Secondly, we we you’ll lodging strategy our company. have for is broadly it the powering the agreement core a Partner long-term signed Services, and supply with long-term, a is big business. to us. an Expedia

in Egencia chance businesses, rest agility that’s with get our technology core position will should and to throughput we continue get core So, and travel innovate, And enhanced simplify us and on significantly, on our and technology home, [Technical great supply services in most we this finally, And And our opportunities. deal deal to business. a more the talked side a we our just can BXB proceed, we’ve and us a speed to and trying to BXC largest endlessly year, gives and be are this the new really platform. focus great provide simpler, ecosystem. entire about focus of past as great companies, to on both this the so the to great important for Difficulty] to in

to as on would recent travel a contrasts. remains said, I Moving study I trends, say, in

cities challenged, differences a business conventional international quite challenged. open travel is like big some, vacation travel still versus is And now. travel, the different in study for in U.S., domestic geographies, more some between are more As equally, shut rentals, lodging, are particularly down,

were it’s really benefited but say, parts and depends study domestic U.S. vaccinations our in summer rental in of are I business on beach, strong, other in conventional not to the for strongest, high-XX% levels in moderated that January the seeing U.S. the have So, but and our It where you’re lodging. and already, remain somewhere particularly looks greatly a period. mountains, little vacation for around To more markets business, for goes We cancellations would the the leisure And of are on improved we give that that said the contrasts. in our in where also vacation booking still challenged. That last rentals, we the color well other destinations, has down many April. XX% above March but, in down well et we net bookings has in reported only themselves. way, trends, in a XXXX gross and have call on cetera. already along business bookings

the overall still about seasonality and usual like, will that winter don’t And But a So, largely long look here. ambitious calendar are by excited I and summer about unknown. we’re just fall still, feeling trends still great recovery, what the strong, as that trends is are as driven very COVID mind, the trends good we would keep markets. know the and We are question in come the might and remain is mark. good, those strongest that. while in again looks

So, a about behavior, et with travel while following session, the excited will cetera in too quarters. it’s trends little those early to predict school into going whether change summer, extremely is we’re work-from-home, how

Vrbo the vacation that we end into in lean rentals front On continue general, to business.

the and landing heavily feel that great opportunity strongest be we in vacation a rentals. staying Vrbo to our share in continues in We like on for just markets have brand people not us future to and moment, this and but invested more grown marketing in and hosts, and we capitalize getting experience in acquiring in as all the

they I replacement some they’ll it, And nearby. good find as summer. seen something people so in conventional as are have We we’re say them can’t for destinations more people solution. vaccinated, leisure they say in some compression would very to portion actually seeing pretty willing And those And And the numbers. and stay lodging seeing it find in strong a are that and we way. of prefer something summer, ask frequently. Most People resorts happy that just lodging. are increasingly, about conventional look would for I’ll far, in

to marketing the campaign really and we side, course, marketing, table brands And the marketing far on of Expedia the skis. impactful. getting later get with of that back we a On that have out is money a Orbitz who and That’s quarters we campaign approached we sort We’ve Awards. of taking than plus. brand brand the form coming. of a ad of started changed on have demand the brand try in a Vrbo think how rollouts, on little that’s we’ve towards we for new brand each really their of summer at this course will we our Academy and particularly conservative that in half the relaunched number bias leave the brand focus marketing of a moved too have great again, focus that quarter I’ve wave new coming including be quarter, mentioned investing on our a differentiate as front of month, market past over relatively the bias rather And LGBTQIA is. more sort in But of in first think the taken

mind, So, in that direct us. going it’s consumption. talked about keep funnel, in like direct But not brand building love, We’ve really for brand quick to creating tool, investment is interactions, before a twitch important marketing. that up performance pushing

to over invest So, time we build to have that.

think marketing, well-loved more brands have we as does highly it ultimately for of. and returns thought So, performance become the more

leader the is about sense that They’ve SEM one to you year, -- just that combining been to and point I finally to some consolidated our at to that before, to is outside, wanted was starting length I and the is last wanted talked our We’ve yeoman’s came the XX%. a who new actually from in a I’ve put see technical terrific which the We past of doing team. platform. XX% teams. end performance of are the reference, at stat I’ve a acceleration spend new a on data And great give starting in said to job. we’re But just addition work and at of wins. give marketing now a get, for of new

So, accelerate. it to is starting

we’re we seeing getting key invest or We’re these to back as as and on we’re starting get get to the we products main to combine hope levels get And wins, these Difficulty]. share markets. aggressive, in more historic higher our our more go quick our and wins, [Technical we

the learn. we to continue in and We balancing continue we have learn last general, And call vacation as other last quarter, to be on we meta products we pulled will back players. I actually, our our off from and time refine rental mentioned there went meta spend have marketing and will for Google that say, last over will test vacation we But, we this rentals.

traffic hoped we traffic been the more better and returns or getting ways, terms as in the excellent, and efficiently. And far, could results we direct good have other for so than in have more have of seen

early, and that But, be wave be been believe we but into will on time be we focus now move. focused the will to will leaning upfront a leaning has But we will more, may and ahead. we accordingly. be in continue could to So, little in, that. great we a and again, bumpy we be is And the lean it

into our technical technical On that I going promise get stories of to platform. business the great platform and XXX I’m telling made about a side, not the

universally, And using to and the adapt improve a and a of a most a to the will area to they point. it coming specific strides where We not opportunity experience experience AI just for algorithm, more [Technical great products. putting journey, it. of to our business. learning as one but want. which us And it that’s improve we customer are money. We allows be the can customers. the in what and are we’re this most for all, is different going it shopping launched out is given it Difficulty] to time to related affect, the point customers. But, them customer wanted wins, using along. again, goes on be all reinforcement page in because the journeys how find to conversion is just and places. we us it’s making data a launched easier tech And I customer it make not in as because now energy, and improving are definitely opportunity power for business, But every And different the really great the It it then, day for of But recently

points, friction experience track using and taking it again, AI of and to track also customer to great. the We’re data and out customer friction focus telemetry making on experience that

So, companies that these love are, more drive And first it e-commerce world consumer experience. in make And we to tier are better. ways but a customer exciting customer many in technologies the exciting, best for our it’s great really experiences now better the business, can and that using even we use.

And cetera. ride, But it’s say, best some from clearly City. announcement are for York the say, would so, strength the hoping New we I’d markets, a benefiting about relative bumpy we’re in et of finally, BR, and reopenings. just I the our U.S.,

have and hopefully, will big open our nice to and we summer, just open in even everybody this cities announcement go report and progress, say, start travel it’s to like we’re we’re EMEA and but neither travel, doing up I’d forward. the the in as of are You’ll well, really of in making some that between York but friends colleagues to India. which international strong New remember, U.S. more we international about very been mindful And

get the India. We day. colleagues do doing members, thoughts worse should we do know markets. an We’ve in optimistic. every to happen. more. what’s big And can better. could are our don’t reminder we have time. everything many and many I would unpredictable before help, is happening are help, we Things whatever they We a with operation But, a to get still that Anything this world all in finally and can got say, them we but could family that’s are sick And

globe. the work We feeling across about good Company. doing the we at the are seeing improvement are a lot of we’re And

doubt tell to Hopefully, we hopefully, to I’ll that get vaccines vaccines that, you little a roll open with and roaring the So, and will all know vaccine. that out. continues, up your say, continue world have everybody you And travel come will as have back. just

you. with that, pass So to off will Eric. I it Thank

Eric Hart

Amex from details comments. more we Thanks, providing by echo the received Peter. I’d binding earlier offer to acquire start Peter’s GBT like I on to Egencia.

see the the success from would We the are company. very excited about optimistic we combined I’m about and deal,

major includes which two Difficulty] pieces. [Technical Now,

ownership combined currently estimate business, have approximately in at $XXX we approximately which million. we is XX% presuming First, the close, valued

lodging also volumes. perspective, XX Second, EPS, in have the And Amex enter between We deal into generated close to would then, we as into Peter and excess EBITDA GBT mentioned supply anticipate supply million deal in commercial a would XXXX put of would $XX X proposed agreement at to XX-year earlier. the agreement in months. this

Next, end I achieved on $XXX basis. the $XXX and by realize now wanted savings rightsizing cost our provide in fixed for rate still our largely all made our QX. we million XXXX. of to considerable higher In an end We the on these those be cost continued will targets towards initiatives. to we a efforts have of expect saving progress range remain to cost of base, We XXXX our $XXX to update cost of million rate, we on million savings run exit confident relative approximately and XXXX,

On million have invest annual the track annual we and of increases see in to the on of comp levels. where expect $XXX areas about in savings, looking attractive cost in items we based forward, have over XXXX on annual opportunities. will cost from business increases, previously, remaining basis revenue, like As for we volume we spoken remain we when variable

Similar customer end these the As initiatives, these platform, largely variable costs variable expansion our lower through still to are three of conversations to our platform cloud a and the costs. XXXX. expect cost realize drivers reduce reminder, we to of payments economics improved by savings all key service of

we Peter marketing I mentioned. improvements clear, we’ve But, business levels. make very the to be we also more the into until want the will QX. costs spending And reach given Although driving are efficiencies. savings volume-based, about be not as We’ve in normalized the evident spoken fully are in continued to past recovery,

a our increased As look on the the further of to half and relates expect back [Technical QX, within continued increase QX it in further of Difficulty] and travel we U.S. to in pace the quarter recovery, we particularly the investments, as also particularly capitalize that we

occurs, the expense but realize marketing the actually don’t revenue As lodging incur a reminder, the we we it until any in stay quarter if happens. associated

leverage continues also our to back rated to we today, terms and are cost of the In to levels, we of remain while the continuing reduce as capital. balance committed sheet, investment-grade unfold, delevering recovery to more historical

and and new the of of million as ultimate restart took the proceeds XXXX X% approximately of in be issuances Our This annual savings. that primarily in last being -- we liquidity in billion position To return in X.XX%. QX, about $X the billion end, is goal billion a premium. of to to XX-year early a capital unrestricted market our $X.X have compelling in strong in due of investments, used a notes, to coupons have cash coupon conversion $X talked we about a flow. shareholders, positive than debt position, with at of ended debt part billion XX.X% debt convertible yield program short-term with zero and due free we standpoint, in conditions $X the advantage rate year. we $XX higher interest strong a which coupon and redeem which recently we to Together, X-year billion unsecured X.XX% cash $X.X increase From and will raised

essentially also $X capacity. have We revolver untapped billion in

billion total each height end of it since a it QX. the of improved and of the merchant As the has to deferred relates bookings, pandemic in at $X with quarter

shape pace of and are have optimistic recovery. the We about trends witnessed the and cautiously recent positive

down we stock, regarding we And pay over book do ability that be to to balance when in this so, also Difficulty] to at is that and stock elected preferred confident also in therefore, issued XX% And later reminder, are XXXX position. have coming off a the the something months. [Technical any time pay liquidity our month. we’ll watching preferred as of the we We have the

contra shifting that’s improvement And the with year-on-year. was which Now quarter, down down quarter was revenue for in revenue of XX% normalized revenue from QX notable to first we and XX% the XXXX, Total of that approximately quarter. occurred impact insurance P&L. some in last last approximately versus a to expenses Overhead came timing better than slightly benefits. QX XXXX $XXX about spoke due anticipated that totaled in million

reminder, define indirect As a and we G&A, stock-based overhead content, excluding while as compensation. marketing, tech sales and

tools content, prior which talked Moving on, we managing maintenance a and previously, made better our basis, approximately the billion costs, centralized was to and increased and was in sales software modest decentralized There from to each reallocated for $X.X XXXX, led marketing over the to in licensing where individual from being time and no more change coming approach, down reclassification down which a a versus we we’ve costs change negative In QX approximately $XX adjusted during moved or million quarter, EG. EBITDA adjusted QX than costs EBITDA duplicative million On an sales have resulted was majority XXXX, manages while from reclassification. million about a our resulted the results, this which the from total, in total with and of slightly In revenue period. to costs spend, own $XX absolute was EBITDA to and change $XXX expectations. approximately which team across same in cost their G&A. the approach remainder tech much was

flow, reported billion totaled basis. which in $X free a on the cash QX On

deferred by restricted bookings, cash, million. was flow free you exclude which the change approximately If cash $XXX driven in merchant primarily is Vrbo’s

about $XX be to approximately this from to we and In and talked of sequentially bonus million our QX to last issues QX year, it the continue closing, quarter. by other expect the recent by very payments relative quarter, up encouraged the the to remain step we in within mentioned cost But, ready our last do forward, optimistic throughout we Looking the in overhead down have the we given for that first rest further in especially change business, year. improvements are preferred. we travel increasingly cautiously as head trends made, position, of we the confidence question. we recovery liquidity paying Operator, just about our and

Operator

Our Mahaney the of comes line first Instructions] Mark question [Operator from

Mark Mahaney

questions. improved I and down March and One, Peter, on clarification, had about your two XX Thanks. the a January XX down April. comments and just

you for And domestic that. secondly, misunderstood think, things just you’re could of those bookings trends I a referring so, then, maybe that’s basis? global on question. bookings. I And high give to just If kind a level the

with If doing you what to think you’re about the business help.

done of lot of bookings improve structure was try the would growth revenue as COVID. you reaccelerate you. done What think where the you growth are have post-COVID? things You’ve to prior cost best going the business done to how the about a and into you the -- pre get to and you’ve growth -- describe what to what you’re out do improve What COVID? ways to the versus to to Thank from

Peter Kern

answer Thank you, to Mark. I’m those. Sure. happy

your U.S. are the But, -- collectively, all, of is, entire U.S. that The numbers. That not the just question first numbers for business, those answer our to global. that is sure, global helping First up. those are is number stronger

future unfortunately, product effective work say, doing relationship. and do start for work, We the more the to customer and create marketing to cost course, getting the tons side huge in capabilities, the As to of then, improving And better post doing simplify direct compete for technology, the apps, we’re way the that tools, and us ways. doing performance the our channels beyond benefit that COVID most structure, side, our Difficulty] customer believe importance by, the into building on experience. bleeds down the a the the through, right, we work the engagement of to the post we’re into improving I’d can go the on do AI reiterating doing using we analytics, all team, right, brand the data we’re that’s all of performance improve I’ll combine the in and the marketing, ability [Technical into as and

in sort virtuous them the classic what it of it those love you door, -- you of find great, experience of is does you, are the can they cycle can things want. all get So, help make the them them do

although a and and What All customer there’s side it ton that work. I to is ability create to efficiencies, the repeat work about customer and better value. that on talked really of So, tie and platform efficiencies. and the it does loyalty agility not a serve the creates create about stronger lifetime is

really the all experience an proposition whether all what getting it’s on end, whether the every pieces, to brand the we geographic service. is the And all So, proposition then in and it’s for those sharper for brand, elements, brand, it’s geo all customer are every like way it’s pieces. the exercise but through that and

more the investing Difficulty] and think of as were. I on board will across start time. in across we of them terms [Technical more to the those of pieces as road energy So, and it themselves And our get multiply sort

of going good work on. lots So,

across are continue than but see things think those to all lot Some a improvement I further along others, categories. you’ll

Operator

comes the of next BofA. Your Post Justin question line from from

Justin Post

of questions. couple A

obviously, First And that or it biggest about growth Wondering rates very And last and marketing you understand said valuations can years. help the on Expedia high I Vrbo, secondly, disclosure percentage spend. of interesting to the us then sector. bookings the in quarter five be in the obviously, revenue. you the the for maybe believe if bookings in

are first seeing you very in So, And you. could how -- that think spend kind affecting second that us give Thank all, of of help encouraging you the you quarter? to returns positive you you much? understand, EBITDA about marketing that are

Peter Kern

across proposition, brand That just by brand multiple of our opportunity. bunch and early the all that maybe and science, performance campaign. are to not Justin. just its it believe we Yes. we and though But one a it the out take consumers things to markets, do time rolling pay clear, brand mean, more to Brand talk rewards. in new the first. somewhat fair and a amount Thanks, I to wanted We spent capabilities we think to take be put being we’ve money long-term a greater does a more second upfront, returns. by is time Expedia us to drive I’ll being a can campaign funnel, more great of and stages efficient getting at marketing of has is Yes. new heavy about allowing

not it’s twitch muscle. a Now, quick

As I said, to everybody rewards that run across It marketing rewards getting and like brand your proposition name, focused is now of it ad books. repeat. everybody It takes to takes in a you on starts things. and and tomorrow, pay then a brand It pay and sinking and performance. direct. starts great pay rewards starts to lot It

So, that opportunity. we believe in

It’s We like opportunity. out. take to And buying it time you’re some will will do the you It’s not it. transaction pay like time that invest performance. every in not

percent front just growth me the Vrbo On at of bookings rates. let the -- look and

as I in I separately. share numbers, doing strong, and don’t clearly don’t is markets, is break vacation but we territory, great. So, our general, Vrbo strongest positive very showing doubt. up our rentals out think And U.S., we those I in But, that is gains. said, separately. bring all The -- them numbers and all say out we particularly clearly are break no Vrbo helping in would

our long-term customer. And in brands more optimal said of as view it And for is just through generally, as all Vrbo the the the rentals, I or before, the vacation so, we to it’s way have them most for I’ve think business. available plan part

we are. So, where that’s

Eric Hart

to as that. a XXXX, is things of side, those. Eric. a rental opportunity down a getting spending inventory spend then, voice, you and continuing standpoint, seeing, two XXXX, year-over-year Also teams wallet, percent will, brand, of to that you on good quite vacation Yes. to bit compare Service EPS we’re we This you a against revenue at done, quick where share are -- of we’ve given distributing that’s spend that through as ROAs in And the well. come traditionally And if all Partner from We than ultimately share into and yet, our as or meaningful are Expedia we’re things going on And as heavily think And performance marketing channels work for when marketing have higher at seen. the we’re the look well. us XXXX well. also that if has

So, Peter good feel the this still lot to through the making P&L at mentioned, that a we about time. to over we’re as going investments flow how learn but that’s time, pretty

Operator

Your from next Deutsche comes Lloyd line the question Walmsley of from Bank.

Lloyd Walmsley

Thanks. side in start investment? on then, you to things areas able side, positioning of you any to the If could get and efficiencies channel volume? that to brand we kind Are in there or side and you the as performance would there? the cost of hoping tempo business operationally, stable benefits have you on that handle posture ad in some you leaning your more the kind the neutral of the during on taken studs as increases be in are market? about the as allow you’ve How brand focus the down share pandemic. of the would characterize you lean feeling running strong into you Do fashion helpful. performance upticks secondly, like that need of there feel are that campaign, your of kind new the a in will kind might And Anything kind kind

Peter Kern

Lloyd. lots talent, have of of marketing, we studs. all things lot in didn’t people, the of all, down would we that did health to right Company. kinds for the take the of But things, a were Thanks, the We I long-term do invested technology. things we of say, to it Yes. first thought

before business. to as done So, we’ve set right that shape right I the thought think, to out the do And the you’ll stuff even was hit. recall, we across way what we COVID

that is we’ve been the that -- feel good the that the plan, gone has about and we plan, to. So, where was

to in places at talent want the invest we bring and are to we Absolutely. Now, retain Company? Absolutely. best the our Do want in?

are those great brought moves. We’ve making of We in lots new talent.

We Eric our to, and for bonus structure our to reward alluded growth. have equity changed, people as

people will in and to the the and externalize of the tech people continue on and will course on things products which business, tools the all stuff ability much is to consumer and their build building great our help we to side. side that So, great services and then and drive BXB we’re of invest

So, we lot a the we don’t There’s a continue And like question. opportunities. or feeling no trying twice? general, of something of will. once we all have we the change come the will position. are lot. feel unstable in sure think break along invest anything, Where in parts, we’re stumble like, we’ll in in good we But to we great way, And to it any an into I’m we’re moving are returns has we growth if as position. way, in. And a

as are campaigns no, money just we come around. -- and works about shifting far hoping concerned, not As that brand are

is push more positive Google whole and better Our be marketing by can proposition We That’s to the that, had as funnel other side. impact. up for VR VR. tested into up better, capital, performance brand meta way coming we’ve upstream, Difficulty] a off just for go really [Technical believe will, we be so, doing meta the and through side. free can more efficient, on do we that to if you be competitive, all

things. We test more will

before. algorithms into as never And being build to point smarter. do our are been for and to is where we’ve get do quarters the able goal we I ago, maximize can able just getting getting will -- we alluded We to to multi-brand things

And from technical we market more yes, And of we both the back. standpoint. So, a now is coming into are opportunity. that’s leaning spending that are the up that

awareness, we some more things back in that true, think we that better drive as end believe capital to those both also that front historically and of do it but more brand Eric to spend So, we do have higher of said, we then efficiently, maintain we and where can redeploy than the are ROAs that efficiently. can money

So, effect. efficient virtuous its We again, and be and it’s money want it’s We Difficulty] parts. not got we sort can marketing brand as performance of, all and around. just a buy greatest good to as prayer [Technical cycle. a It’s in use where Difficulty] [Technical to to but a moving want hope lot do and to those growth a we

Operator

of Khan Naved Securities. line from the Your Truist next question comes from

Naved Khan

a Yes. A couple Thanks lot. questions. of

So, about maybe, ROAs. Peter, you talked

think it think it -- between ROAs and discovering to been advertising you about you your as look can And then secondarily, do budget past? how towards where you a push has ad how Where we in forward? the we As making do brand split whether big think are be, of optimum the compares -- you split loyalty. between are should performance

of a talked about in new that rewards? does announcement, How loyalty P&L gaining you I accrue recent loyalty in affect the the think members. for XX around you, terms how million

Peter Kern

Yes.

on they like we to a -- higher side, they not those become better returns So, much those the they to more. loyalty. go in I’ll particularly opportunity, And who cetera. there’s were like of consume people brands no were to Brand help felt had loyalty how again, the those And we because a on experience a maybe Expedia they get in customer, what member, felt leaving is us. Naved, loyal the They which learnings are lot drive made we if get is, they to than them it’s other -- general, the customers loyalty in big of -- side a for see a sign we take loyalty rates. get are reverse a through, doubt And returns will the et we lot customers for But of benefits. truth members. on the And up, on

much over may there greater. is It’s on accrued be and that our for time, performance been while the that brands. again get over has So, proven return in accounting to over customer’s

just stuff for them the will. benefits earlier, the see And think and if I but window, So, upside there’s better see the for customer. them nothing and customer, this is for it a allowing helping benefits, easier Company and you there, up making opening the good both to really the so

goes, it’s this as As don’t ROAs about balance the lot. far really know going to We out. a talk where we

are driving and We returns trying take scientific marketing through as to approach area. a can we our to

we of bunch learnings a as it be go. So, will

testing different we even From seeing things different and learning, spend be as into by geographies are as bunch brand off speak, by brands and We a performance geography brand. across in what a we marketing happens. on testing will well and and of standpoint,

on really the we outperform get in really for take we’re just a be time, a learn. we going going competition in position the and going and So, benefit strong and to way, believe haven’t the side, perform it’s these it of first going working to time, we -- for to a have the consolidated, performance some a right on -- way things technology once with the -- team It’s the are going time. strong long to the been a a to we fight, to but marketing be we’re team brand side all fair

Eric Hart

account add forward. This on going And to I working side, for those are would is loyalty through Eric. ultimately we how just the

that have have teams look robust separately. it and three different quantify at We We actually teams.

We an provider, and internal our it as go through a then have team, auditors well. third-party

getting probability be at effectively, be with more the through a get that to don’t there’s go is engaged which so, going that we that respective to working And to it lot least actively perhaps redemption, as going but journey. those provide of actively math we’re say, But, through, in points engaged, something lower is we’re updates through. them again, going a for that we’ll point

Operator

Stanley. comes question Nowak from the Brian next line Your of from Morgan

open. is line Your

Brian Nowak

questions. Thanks for taking two. my have I

you cetera. one, into sort you outlined First level number a reductions, of brand Peter, merchandising, high strategic one. your improved et product When priorities, a cost the role, of reorg, came

Then as about summer. on improve your within the most marketing there where sort traffic line think you and your sort us mix then, Just fruit to to continue the little direct both priorities one, ‘XX, you the look you overall And Talk seeing bit help what into Company, the made the of and execution second you’re of of which just ROIs to sort of understand, are top low-hanging marketing. into progress on of ‘XX, us performance most OpEx? and on? head of as a you’ve still sort of spring

Peter Kern

Brian. Thanks, Yes.

lot think, So, I fronts. many headway we’ve standpoint, made of strategic the a in on priority

I think the product. drive technology more we hardest, under journey the the before right this way that’s this of And biggest lift the had getting could from siloed is really that right getting to high-efficiency, on complicated pieces so have the platform to organizational, been the together a and and the clean, of the Company to in technology organized drive we we lot agile a right much construct. leaders, and

checkout question, And where that of going creates, that’s a most opportunity going So, would the a energy states -- Different of I of different in. would to speed becoming higher I’ve features and redeploy there, win ability experience identity other consumer journey most the your most the are completeness. frankly, say, stories. as well and improve it one and tale in ability because the But or X,XXX past, it’s in multiple we the one talked identity, time you that both parts I second opportunities. to multiple every better about whether forward, as to is say on get that gives it’s resource checkouts return better that to efficiency becoming and

that into go both, an growth, but it new would invest that’s as to we So, think more I opportunity forward. as of talent opportunity, efficiency the

equipped or many So, those separate were run things. being X we they as as are or in still X of XX the of fully if still middle things

continue already I have place Many resources cost terms come just side one a again, described. returns. cost talked We can to as And of we like -- fruit of running more about I of Eric thing those see resources those the strong, marketing don’t robust what then, and as we some have the go more will and -- borne have voice has that higher-value and get and to much our platform, the savings, can et will room. to in to other cetera, where costs, things far opportunity opportunities. get from think cutting

that see happen. to we continuing So,

the service on which not customers through through great new side, more creating assisting serve creating our opportunity technology, technology also are but much We’re the efficiently, to tools humans. just

I have all there’s for Eric the it that as we I get do more more opportunity But, opportunity to there’s efficiencies of the places we keep really just to to, as back those we margins. kinds more it, So in and really it’s I cutting business view reinvest about think when think efficient. opposed think

traffic I go I on opportunity of travel. the plenty say, side, there’s as to for did lot warning on a sort miss? there’s a for direct and I And would margin of traffic, long -- What Sorry, mix made on, side, way the of ROIs would we’ve progress, but and opportunity. direct the flip reinflate good So, a believe here. we still say, we with

and marketing it our when numbers Most weren’t be a COVID, misleading. otherwise we on good all use of think, mix traffic, as customers, seen very in be. can us were much most because direct space the have than they during travel mobile really bigger part on our that might I of loyal

travel shift think on usage, But the as reinflate start out those to on in natural continue direct terms somewhat. to we may I again as getting of much dynamics can. app push on we all a as of auctions in more relationships market, definitely, we

favor I globally. sure in terms to shifted it So, out the don’t it’s mix when not direct too and But returns on app definitely mobile much I’m put normalize et use, our going has in where the cetera. terms want of traffic, market in because of to

Operator

Wolfe from from the Research. question line comes Deepak Your of Mathivanan next

Deepak Mathivanan

Couple Thanks guys. the Hey, for taking ones. questions.

So traditional talk side period How on can bookings? to can color of -- summer I demand the more you nicely be Are supply first the this wanted the one, booking now optimizing about recovery talked up? about you bit. during trends. you a there your Vrbo, supply lodging about is provide into coming are spiking? little You any on then, on that mostly attributable And ask efforts these where notable side? to second rotation kind helpful. or the would there changes Any near-term bookings seeing you’re Is for window

Peter Kern

Vrbo the it. take I’ll part of Deepak. Thanks, Yes.

you in or has It investment our up host, amped we’ve will, if successful. So, and attracting owners. marketing been Vrbo

than rebuild that hosts the are We take highly lot of platforms, We as much take that elsewhere. a areas the them can. And proxy, of reviewed you if hosts Vrbo make And and their in experience than on up need driving program, There as the sell can having are opportunity with and situated rated Start of And that put assets. sort Airbnb focused, we used demand, and to successful we properties we it platform, as stature highly host, from new sort similarly would increasingly we the and great of is it’s quickly for high business people ubiquitous imagine, new very introduced us. Fast essentially a a most launch will, our get. instead reality more people a them, are hosts But to we’re them we other average. becoming start high-traffic We monetize brand most called as of as a our their as more and becomes inventories aware we think we to any and one. can is better become owners where fast it’s their as on we in -- to product, their into balance you as think the where products. the other more we allow which

our for more that get out story get stats spending So, We great to have we’re make a to all and there, sales it out story. just there.

Eric Hart

on listen, is as experience part or nearby There’s a you also, there this supply whether out, or there’s alternative are alternatives Eric, a compression if or well. whatever that, will, product when providing. that selling as peer then else. of to add just we’re it’s there I’ll And a the Yes. That’s

it, trends, days, that So, from regards what we next the, elevated working the down has depths in continue standpoint. lodging, XX on booking the question we to the it In your product pandemic. from see a unconventional during but call we’re saw come it’s something to of the

period demand very healthy demand the well. small base, we’re to as a very even strong And holiday seeing off obviously, for summer. continuing see, the We’re for

Vrbo would has similar it I that to typically, well. to from booking distributed into a So, that’s term we’re we And away historically. well very But we say, seen story well. near X as zero to time periods as or the healthy extend it and on and have see continue more more see longer what starting days to the into side as cycles,

Operator

of Your next from Cowen. comes line the Kevin question from Kopelman

Kevin Kopelman

the a follow-up had a lot. mentioned. I on Thanks April Great. trends that you

-- versus and what it on April a And dramatic talk any between So, was improvement give the that, did bit additional color seen you about versus to pretty January then, you have March you did to yet market total U.S. little that And return you March. can because more? extent within the U.S. saw XXXX? you better? us note a improved you Can growth

Peter Kern

high-XXs far would Kevin, not March. off April linear I’ll I -- of improvement It’s going. we’ve to goes, as as say negative that from the and seen modest XXs keep

hope summer. and to So, do will don’t Obviously, has that continue. you period, for their excited. bookings directionally that can comfortable But, booking believe more with too positive, there’s we and get spring holidays that and appropriately it vaccinated summer a through is lot a being Americans lot assume the of and getting

and lot remarks, performance, to frankly. and my get was still while. the again, strong. on used travel be the we disclosing need be if to we a to back travel the lot used as in market continue we’re open. travel travel we’ve that, need up, not, Having XXXX, trend markets It’s but growth But mentioned or for driving terms other that effect. cities closed, our -- a not market’s we things domestic of other that itself but U.S. of a need U.S. yes, is I a domestic carrying than weight to seen higher to are cannot U.S. And U.S. is where the in in -- U.S. open, it’s we something said international So, we basis. domestic like that standalone expect us to for

more about of for where the where a U.S. lives. of comes for is. So, their back, our we the we but not feel reasons that’s But, world lot own up. rest to hope business just very the need We good that open for

Kevin Kopelman

timing helpful. the Thanks, here? close That’s just on then on And expected Amex, did mention really you

Peter Kern

XX X Yes. to Expect months.

Operator

comes question Fitzgerald from next from line Brian Wells of Fargo. the Your

Brian Fitzgerald

or the on agreement. the all value Egencia. I just first or So, either enterprise A then, will that supply just clarifications relying to the combined entity to all slice on Naved’s be Egencia. And forward? second going deal. of of guys. biz, for one question the Thanks, on apply want on organization a that on follow-up ask was one EPS Egencia And Does about the Egencia Vrbo. the to couple of of then, at clarification

you’re other the inroads and rented California? If Thanks. this you urban travel been inventory, in again competition seen areas any has the with what behavior, tailwinds where have summer or resort of like we’re seeing tougher, maybe long-term shifts last centers indications making hey, summer, in doing usage, we repeat

Eric Hart

of Eric. in call in we This We of around did take or that Great. estimate have and approximately I is we the just that mentioned first worth combined ownership -- that $XXX million. part mention the entity, be the Egencia. XX% to question, I’ll

math backwards the and enterprise to do equity to overall essentially can get for estimated value the business. the you think I So, value

On well. of we’re the much in $XX that a And putting there in. the have for excess And XXXX that’s that commercial components of itself, have to million relationship are obviously, the Egencia entire that based with agreement that is as them That on business. distribution supply volume. we obviously we will with relationship larger and combined want

the estimate does that full combined of it and represent agreement. So, the

Peter Kern

there it many COVID experience. frequently. seen case, use me still you’re as times, Great. it. again, sure, to Vrbo data as extrapolate this a ton in the much I are a general, we too last COVID. comfortable in that haven’t that things And from with suggest comfortable are more lot to But we I’m as think for in I’ll of one, long is, they going But And say back the And users are which new you’re of And with heard are the to changing. suggests loath jump period. on you’ve

sustainable? publicly the Now, of one I more of were case trends continue. the I’ve to Will said of that use resorts was getting is more things? that the people in that the believe, will and past go trends general, of back But, vacation and past people other into the rentals.

of will category. that’s vacation we choices don’t don’t going they think we’re not. rental of a and as But, higher think where long-term reset -- shift long-term maybe good that think necessarily a I the at sustains accelerated people had part their have seeing rentals trend level off for and it before to growing huge make maybe for consider exposed a We’ve that. that I So, that. be vacation as people much a more I to itself then so But, product. And

Operator

next Credit from line Ju question Suisse. the comes from of Your Stephen

open. Your line is

Stephen Ju

Okay. Thank you so much.

of more macro guess, a question I Peter, here. So

in to maybe the in the our be XX, So, as at probably it’s the to reasons I industry years. the travel we been look personal be be to rate may that think seeing savings next growth country especially believe years, there highest next year, XX may as elevated seems for few

So, to travel. some and go there maybe revenge do are consumers ready out maybe the

the thing? think sort the Whether So, that And anything level accommodations and seeing splash or to reducing you’re or deny customer-by-customer think activity seeing? where bookings friction, OTA either of owners, into I the out they been and of Anything otherwise seem I more your real-time Vrbo up luxurious so data property confirm you so notion your staying how willing you that longer, brands you’re can now to brought the far be you in of terms of prepared or can much share out that may your terms integrated Vrbo more for in remarks. in has in inventory far? rolling among

Peter Kern

the of whatever or travel happy we’re kind whatever at that do, for -- one. question, for Stephen. the crack accommodate want the I’m I’ll rooting people is. revenge a Thanks -- first it, revenge take more to travel, to We otherwise.

earlier were Vacation space, pandemic, in I definitely think, these the et rental we’ve cetera. longer in certainly seen seeing -- the we stays,

that. higher and general, on And ADRs think are I -- have in things for days more. an and from average are think basis. I we’re somewhat are seeing us, people those longer normalized But still spending

both but Miami to People a travel that desire push don’t it. demand know hotels And where The otherwise, been of hotels able to experience and are say are can pent-up you’ve are or if have huge Miami And to and places would but is a it little consumers also have go is I people Vacation it’s experience. Restaurants been there and revenge I full. that’s pay price, Now to like packed. mix, out normal relatively for places places that willing bit that full. been to everywhere. rentals demonstrate recently,

above well booking think levels their years are I ago. So, that -- and two

they can huge they’re you demand just you they comfortable words that where whatever are, experience, if a macro amount for that. okay, where have like where say, normal way, there people think travel, is can about So, your a in free, feel a of

But, will out the So, can for places there across demonstrates spread sense the globe, people things money. is where Miami. I the as a that obviously, it pent-up spend like think that in more are places demand and

Eric Hart

And Vrbo the this getting of the second around is question, brands. Eric. and distribution I’ll take part on the OTA just

increase and distributing higher was we it is make we’re So, to in But we brands in more than inventory. of progress. our on QX live number I add it’s OTA two other we are the things. say It we properties continue properties. continue what to the don’t QX, And disclose that so One is was number we OTA QX higher also, to -- continue QX, continue than brands. and in that will that of where

on to to has a It use different progress we ultimately continuing What is It do customer improve different need good the product. making though a is So, both of case. those. experience.

experience. progress to experience. invest again, and need made to has that behind intention user better I to customer which we’ve to get As And a it more. is flow different Peter more then mentioned, operational there. and We full booking properties, better think make will get it continue And higher our that, continue experience, customer a and

more progress, making all, in all to So, do.

Operator

line Oppenheimer. comes of Kelly Jed next question from Your from the

Jed Kelly

to Just into they managers following Vrbo of Vrbo. you -- sort last I like. talked over been some with slower guess, up has you’ve a of a integration Expedia property just probably Where five the the follow-up since the think, than would little years, on

actually trends update So, And seems give travel benefit integrating leisure some Vrbo giving these Expedia? flexibility. it doing could an with that you people you’re could how more with work-from-home just on of then, by

So, leaning as how from you of are any stuff sort how can that? trends, this I up, brand opens into there mean, from anywhere and thinking of campaigns, you mean, is or work benefit I

Eric Hart

question. This the for Thanks is Eric.

was the moments I on, we customer giving It’s invest to some to it. a the I something think, Just of your first in ago. question number have are components progress disclose we invest improving touch made properties But, few experience OTA excited through distributing we the and but continue further our I to brands. of think, don’t And improvement, that and we’re we’re product. need it on about

the ago, However, QX, also we a number. increasing than increasing that as QX, QX higher mentioned we’re distributing are the where minutes number inventory. OTA than of we’re It’s of -- was QX higher couple I and brands is

So, we’re making progress.

weight I we slower than it big have be, but it behind we we’re wanted to the would think, call was on certainly us. because opportunity will it think everyone it’s this organization’s agree, a for putting

Peter Kern

It’s us Peter. Yes. too taken right. I This management is would echo were long. that the companies

the us as them, key it it’s we’re Eric right what for us, thing experience, is working But consumer. to really -- We and making working successful We’re on. of consumer and for want that’s all change the it. on the hard for getting for it to said,

far from school and this making was sure trends into as people understood we’ve were. stay sort lot go, the things beginning. the yes, As pushing the staycations, work-from-home other Vrbo home, leaning been nearby, and a of of what from Wi-Fi

tried lean to that we understood to we’ve extent we’ve consumer could, interest. the these trends and So, into

future, weekends and longer places, And and the clearly, the from from are be opportunity company, with that have will longer work of flexible whether questions work-from-home tech think, et we’ve that and means will think, flexible. to people somewhere, take the I like world cetera. more we, work suggests other seen term, the every every what company certainly, I like work the dealing

We’re to have it out. how hope We too plays to to travel, that tell. to early But, going see adds obviously. it’s

Operator

the We from question our of final coming from line will Barclays. take Mario Lu

Mario Lu

the on one per just room revenue night. So,

XX% This quarter, was accommodations. mix you the shift mentioned alternative it to up by driven year-on-year,

it revenue you trending And levels? how that of the kind room do on think higher was XXXX looked if these at based approach room demand? continue we off of trends what we the pent-up curious Just sustainable as per Is same basis? are to night Thanks.

Eric Hart

Eric. Yes. is This

of given But, it, but nice individual that improving. mix where ADRs XX%. to, would ADRs. anecdotally, Vrbo be continue levels, some seeing obviously relative room to as mix per improve. to well, is As ADR say, XXXX release the mentioned, certainly call the have night Vrbo They components. what typically We higher out we down and into was U.S. revenue is is That you primary up in get factors, I seeing two And then breaking in demand due just there’s to the don’t to improvements, sector. the detail sequentially we’re

Operator

There’ll this over I be to for now turn Peter the Kern question will closing call at remarks. no time.

Peter Kern

hope for joining Thanks, operator. your we Thank questions you, answered. got us. I everyone,

our We’re about good next Please vaccines us. quarter. talk joining thoughts or all in we you friends and thank up. India. your to your your keep world improvement, our feeling to for you please hope really the We’ll get with tell And continues open and friends,

Eric Hart

Thank you.

Operator

This for all you conference Thank call. concludes participating. today’s

disconnect. You may now

Expedia (EXPE) 7 May 212021 Q1 Earnings call transcript