EXPE - Earnings call transcript Q2 2024

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Operator

Good day, everyone, and welcome to the Expedia Group Q2 2024 Financial Results Teleconference. My name is Elliot, and I will be your operator for today's call. [Operator Instructions].

For opening remarks, I will turn the call over to Senior Vice President, Corporate Development, Strategy and Investor Relations, Harshit Vaish. ahead. go Please

Harshit Vaish

Whalen. welcome Call. and call Group's Quarter CFO, Second our Good pleased to to Earnings Julie our and I'm Ariane today's be XXXX CEO, afternoon, Gorin; Expedia joined by on

certain compensation. As a reminder, measures the Reconciliations any commentary unless today are to to included these measures excludes comparable earnings reference non-GAAP release. otherwise references non-GAAP And will of most measures. include our to stock-based GAAP in expenses our stated,

during statements These the which will on also uncertainties forward-looking We difficult predict. statements are events. making projections that predictions, future current which to other and statements call, or to assumptions, be are based risks subject are expectations about and are

and filings forward-looking most and not in XX-K, XX-Q Actual we the by to with Forms update our these statements. factors could results differ call due recent other materially Except any responsibility do to law, as SEC. undertake required this discussed during

today's filings can Our SEC earnings Investor found at call be release, and website ir.expediagroup.com. our replay Relations at a of

that, turn the to Ariane. me with let call over And

Ariane Gorin

team All value growth more third, with and place. our X partners. us right First, the thank have most joining a in in all better making of to my for quarter sharpening been team the on spent our execution I've our and to Harshit, and accelerate travelers time and for leadership Thanks, goal consumer long-term now, sure in CEO strategy; our you and business; refocusing second, basics today. of about the we have to experiences areas: delivering

room bookings in revenue well expectations continued last and second the at by of of our signs end and BXB as in substantial by X% by was segment. This improvement advertising progress strength grew Brand of quarter gross pleased business Vrbo our in and demonstrated and was Expedia as our driven high really I'm some XX% see results. grew We by already our versus year. nights to as

well overheads in in quarters, to executed digits high The cost sales internationally with grew like and was also healthy saw mid-single double second we controlling the and to the few the of year, And last year-over-year. declining environment We in both in quarter. costs stronger low our digits travel U.S. demand in nights Europe the world. in the the rest U.S. the relative room teens of Compared last we

for hotel we both Prices saw air vacation for up but pressure held continued rentals, and and car. pricing

the But in In we're value. provide and terms in third we drive our regardless in and minutes. demand what executing of will trends some what's know the will a so Julie few market of this control long-term in seen on details far softness on environment, we've quarter, more focused

bit the which bookings grew let XXX an of second X%, about talk nearly business, Now improvement me by a themselves. Consumer gross the quarter we points our basis in In little quarter. results was first

rates the early accelerated conversion, XXX Hotels.com focus X traffic, showing conversion attach marketing continue traffic brands, Expedia rates Our and sequentially is basics, and our across to basis points results. on The core are improve. Vrbo roughly growth by and which efficiency solid

so us, when of our last to And they're X% basis And up also percent to terms from is The in year. product XXX likely getting increased, repeat. this attach, they're by compared more trips bookings than more apps important over through grew buy multi-item points of because more one year-on-year. travelers value,

and modest QX continued Vrbo booked consumer back performance quarter. its international Brand from some our the and exited markets, meaningfully growth. nights up Vrbo improved Expedia quarter the with On low business marketing marketing, investments excluding nearly showed to in strong leverage year-on-year in room its XX%, second point our while

in more product sequential One particular, better Brand improvement releases. on Nearly new with it Look, on Vrbo's app, Vrbo, we're from the Vrbo business. we our spend, specific and more Vrbo shoppers to and cross recovery marketing have or loyalty supply to in Key but then Cash and continued from from certainly our product do program. either Expedia on encouraged higher progress completely benefited XX% on Vrbo Hotels.com earned Vrbo. were of also redeemed the our One travelers Key that work

So is One brand. new a Key of the source great travelers for

this burn Cash member and anniversary repeat get One our in its Key great base X across large to see core Customers growing more often. use member enjoy redeem Cash or hit We're and One super Key Also, the discounts first member summer. who our One year Key the to pleased flexibility brands tiered discounts. U.S. earn

confidence gives the this Key over of One build that So us time. a benefits of will further lot

also in summer, we're reinforce co-branded and hitting expect launched In card Fargo with program. the more a market Key. U.S. the launching in credit U.S., consumer milestones quarter. a our big and X We're to Key in U.K. present. One MasterCard the proposition the we is X One brands July, all This value where of U.K. this Like the Wells are the in of the third

international Key. we're Hotels.com Brand though, Most at with scale operating pausing markets have One or U.K., further rollout Expedia Vrbo limited the of either international Beyond presence. only

to we're going to So proposition value tailor for time the these our take markets.

the disruption by minimize was impacted should Key's further Hotels.com, In rollout. most One addition, near-term brand to U.S. this which

on discounts to our and continue a programs reminder, as and launched the from we legacy our that summer. members benefit last Hotels.com improved Expedia importantly, worldwide More loyalty all member

on good international expansion. made Finally, we progress our

UAE May, Expedia early we launched the As and with we've example, days, Arabia. an in point Saudi so been pleased it's Though sale of in results far.

growing strong quarter was BXB. XXX last this deceleration. to point XX%, though Turning another with basis a like quarter, bookings had We

grew partner growth a the partners, came always, portion well. existing our on-boarded segments significant new while of quarter's of And we All partners. from

Trip.com White Cathay the renewal our a our A couple using highlights new partnership with Template. from of with and quarter the of lodging Pacific Label deal were

offerings. Moving our on to consumer continue which and our supply, powers we to both segments, improve BXB

with Vacation our supply removing more with signed and will while flexible supply our digits partnership just discounts. listings a Rentals, we marketplace. their grew Ryanair cancellation add properties acceptable that soon For policies experiences, guest and we and we double weren't providing flights, In source to

proposition. All of Vrbo reinforces this the value

We're in of what partners grew a boosters to are investing more the they hotel tools XX% supply in and that's win-win. attract More our first over call also using tools, travelers these rooms, and we to from hotels products fill great our our help half want. visibility these revenue year, the this powerful

capitalizing to financial our want our of Improving path I our talk for focusing while years, investments same at over product we the the last into We're to capabilities the the what turn strengthen priority. where touch brand. and performance configurations, time, biggest I and to our Julie Vrbo teams. on tech our our to Hotel.com few and I'm need the results Before remains guidance, about call consumer digging on and business forward

to usage, We're our products in right adopting whether clear Key One propositions the it's and have all Vrbo to price getting value core Hotels.com making surgical growth, like AI-enabled app we're and healthy brands, and repeat in we ensure burning Cash predictions. adjustments identifying addition to loyalty behavior of Expedia, focus. have drivers of or and want We drive

partnerships continue booking In and expect lead BXB, to and in to XX% normalization segment. we technology, extend after over supply growth, quarters invest our the we'll XX in our and continued

exploring to over sales, Finally, reduced we've our we opportunities the AI gross using cost with quarters. discipline technology marketing substantially We're several spend to execute margins on and and last boost further additional spend continue cost On productivity. of overhead, rationalize improved and we're everywhere. to

ambition, our I'm to proud who employees great and In results, and quarter of help to together the and closing, trips thankful tirelessly on and memories. around I'm our encouraged world incredibly create by are lifelong travelers working our deliver second rallied experience to

over And to with hand that, me let it Julie.

Julie Whalen

everyone. good and Ariane, you, Thank afternoon,

basis pleased acceleration including approximately night in X% margins double-digit results growth, BXC expanding quarter EBITDA are half. with our driving sequential second gross points in room and first bookings our the We business, XX to a

happy key see the Vrbo as As which details we by hotel $XX.X the lodging in booking bookings, XX% X%, held of for in We gross driven second by the markets. quarter, bookings billion grown our financial that have or total X% last gross were of grew share virtually total up our gross all to year, business versus were led and our hotel growing business. improvement far

In the first from as our through bookings moved we quarter, gross which saw basis the XXX we business, total drove acceleration points Vrbo approximately quarter. a significant sequential our acceleration of

revenue advertising pricing of and last was billion the Easter X% into $X.X year, arising lower and business, revenue offset as Revenue given uplift the the gross fewer was Total quarter Expedia Brand in by growth the the the versus grew stays shift actions. of led business. first quarter, our bookings first our from from contra flat year-over-year BXB by stays margin advertising

revenue recorded stay. negatively impacted periods as a actions of revenue the at reminder, this the time is revenue pricing prior contra quarter it margins from As both and as

and versus basis of or million Cost year-over-year. of approximately sales XX% revenue combined leverage which was XXX $XXX million the quarter $XX a last drove as lower our of points revenue growth, with strong percentage year, for

in in higher Sales growth quarter planned international are our expense as as $X.X gross to strong and XX% up this quarter in year. to deleverage grew Direct as partners to marketing over initiatives incremental business, bookings our was growth. XX% the and see We marketing last and due ongoing continue commissions efficiencies. our ramp percentage transactional delivering the to of versus a BXB primarily well which second from billion, sales in the drive was markets spend Vrbo marketing which

more to than stated sales revenue have and are and our percentage BXB our expensive marketing BXC business. commissions in are paid as a line we direct of As our previously, partners

on and upon However, contractually basis returns percentages, guaranteed immediate. paid because are to they the are generally stayed agreed a more

our market we business, BXC to in our drive quarter this our we and expansion. Vrbo some back improving saw business growth global reinvested deleverage into markets international as In

the investments, some our we second these in leverage business quarter. in Excluding saw BXC marketing

business. across overhead leverage, P&L, X%. $XXX taken, growth continue were XXX across expenses our to we costs hires we're versus of cost areas This of and see the approximately as salary-related primarily year the $XX costs capitalized timing in and tech resulted Overhead and that both actions basis driving to last new of announced, previously our people savings remain headcount million have of in costs. actions We committed by cost or as rationalize other well of from products pleased across our efficiencies decrease points lower the drive labor, our and million, to driven sales key to as a

which On strong with for points XX an million, year-over-year basis of XX.X%, of line, year-over-year. quarter up X% EBITDA margin slightly delivered second deleveraging approximately bottom the $XXX we was EBITDA

margins, despite our from impact exceeded in pricing basis due actions strong to first the Our our approximately XX management marketing. by points expectations however, half and our year-over-year, investments which EBITDA expanded expense

and first depreciation points XX.X%, compensation, our as million expansion XX we quarter and impact a amortization, which far the As EBIT stock-based basis margin includes year-over-year performance, in half. of delivering with in expansion basis of the XX of EBIT delivered the approximately $XXX of second of points

The basis leverage as compensation from compared that of additional XX as cost year-over-year revenue. driven to EBITDA by well is than points from flat slower from stock-based as depreciation grew leverage expansion

at capital expenditures. Our first by year-to-date remained flow strong cash year-over-year, growth billion, robust half X% driven our lower $X EBITDA free up and

We revolving billion. Moving to our of line sheet. billion balance of $X.X cash undrawn balance strong our ended the liquidity on by driven credit quarter of $X.X with $X.X unrestricted billion, of our and

$X.X Our cost average debt approximately level with remains of an X.X%. billion at

driven gross leverage X.Xx, target leverage to growth. towards our ratio further ongoing by had continue strong reduced gross ratio make Our Xx EBITDA our of progress

billion shares In X.X year-to-date. enabled position addition, our $X.X to or us repurchase strong cash million

continue business. long-term the of believe that expected our remains stock undervalued reflect We not our does performance to and

of opportunistically. $X.X remaining expect our such, business to continue authorization and repurchase buy As cash-generating to billion our utilize our stock to power the we back share strong

to Moving for of the rest now the outlook year. our

lower-priced third a accelerated from recent quarter, a And in travel QX, seen challenging environment commentary and while more basis air prices. demand, decline properties. consumers And gross in stemming our throughout a in ticket we seen macro FX in bookings the we've saw the with from we others consistent on also down headwinds we entering continued softness a slowdown and to in more July trading have While like-for-like industry. we from ADRs flat QX, saw travel

factors consumer for new In Xst pricing kicked businesses the in addition, influencing monitoring drove closely. and on growth off These are and California, collectively we outlook it some our and July full both BXB across we from weaker-than-expected headwinds that regulations are our July and have display in year. seen QX

our possible a be last result this backdrop, the of to range and and of points year. third growth X% marketing growth quarter international last third as we line bookings quarter we EBIT and margins markets, range approximately expect investments our Given in deleverage expect gross top revenue to in basis versus EBITDA Vrbo our to And the year. X% and of of XXX versus

we gross EBIT growth low year, holding higher range and X% last to mid- full the in communicated and revenue to earnings bookings to for EBITDA margins year. expect approximately of line digits our of with single As high our be X% relatively at with at the be previously points X at at outlook end approximately

deliver to In with And pleased our growth. growth challenging, the while environment with position closing, Vrbo us give initiatives, market saw is to confidence during profitable the our second are execution recent it performance we long-term combined ongoing this in in acceleration is our our and against our the opportunity financial quarter. we more strong business

call for open And questions. the with let that, me

Operator

first Mahaney Evercore Our question Mark with from ISI. Instructions] [Operator comes

Mark Stephen Mahaney

please. questions, Two

It quarter. Any going that know exiting you've of about to on that recovery back growth into like. like the And can isolate First the if what is on to started the what year, out like? Vrbo. looks headwinds, growth but path you talk got that's just half thoughts trajectory sounds recover I headwinds the

real XX%. maintain how And of for advertising that's think there. trending? able solid sort you to growth was had Are that quick expectations you've revenue, hit kind of I And then on the

Julie Whalen

it mean, growth be. back I July we're used make obviously, to call Yes. trends. staring it at to Vrbo, drive business it's that to expectation But our to to where hard get right certainly, that because is and now for this

And we year. as move we the beginning substantial acceleration said, so of from they as saw the

but the expectation. hard business. So we bit ended our term, where modest growth, certainly, basically, quarter July, that a to moment But some this in as the in with is now long little we're read it's

I fire. business as is As the on advertising mean, far business, that

the that growth. drive that's I going that reason been least We any its for have at got with to have you lot opportunity mean, we I to business and if in of believe a it's forward. don't to XXs if a now, while back, change going think continue significantly look to high

Ariane Gorin

supply actually, the more would be. business, on of just spend I demand the And gets know that want they market our partners that advertising could some that in when you imagine advertising add is will the soft, travel where to to going

supply think getting we can at looking be our market will the at partners obviously, looking how in So the evolves, as teams I how we're help volume. our

Operator

from comes Our Eric Goldman next with Sachs. Sheridan question

Eric Sheridan

Maybe bigger questions, of could, a if X I more bit a picture in nature.

of of the side macro your the insights the up of role about In of couple and recovery little speed longer Hotels.com. there. you've some the that deeper to the take for sort the And of what might that go you've possibly from learnings isolating like key of terms learned of CEO you've leaving pieces and know some the turnaround some now had or if of on wanted bit to ability just of brands some had months, the implement Vrbo could a you or time on that a of aspects some of to variables reflect

And out then come BXB the the you of second, business.

of to into continue out broader role, remains about Expedia? or this it inside you the you and CEO BXB underappreciated As what business, do think sits now move misunderstood relatively BXB

Ariane Gorin

Thanks for the Eric. question,

allow had in, always that the had to across I the In done us going . appreciated the stepped work was we innovation business, consumer terms of I platform the that Board. think I as accelerate on to

big that, same second have to wouldn't not platform had So of the brands all been And for we time. able at flexible to search release example, X we were done work. do in the quarter, the date in able our we

Vrbo of to collaboration but the our of it did lost work On up onto onto the end, move front that something trip Vrbo. we functionality the Vrbo, that unique. made a And and was of big Hotels.com when got migrated a was did more we things planning we good was in when some in common the Expedia, we some the we -- thing brands bit Vrbo. it, said, Brand sort lot used being was give That those a collaboration

migration a time But we news to the meant we've bunch still and just it back a It Key, it that to we period in downplayed move the where back. Now had. we sort Hotels.com, is, work good big done. that had when a an and One be with of differentiator of of Similarly moved Hotels.com through we advantage really program. there's loyalty added went its

have take to to want. both brand back is come love news realized that great the to awareness, get going it's brands who have back I've we them work So them. good those to where But to people just of

of configured But so figure built the good ahead, and needs sort out get take it's as in going it's do capabilities about the for just sort some Vrbo the overall, that to about how built And quarters of we to there. all I across on platform feel differently horizontal the a time or to the what take Hotel.com. be and basis, months and think board that. -- I It's we've

I results. international. back markets it of and the like those go into is we in Hotels.com, leaning And Hotels.com a is back of recognition these what early got that also some for And will days international elsewhere. would as we've benefit places seen brand great we're Nordics brand into seeing in good that's add

what terms And what's BXB business I over when or the sort the differentiated it's of are concluded things. combination I what's moats have is it, years of the what a In ago, on the years XX thinking, and it. around maybe took business about around Funny, of misunderstood I underappreciated. remember

We're to supply. a lodging we supply. supply, doing to work have You BXB-specific lodging of great get have great really and have lot

aggressive and open excellent to partner to partnerships. of super team, have and and a very relationships hungry sales be an lot You be great have technology,

I I -- there What is, So a $X.X industry. I massive is is it way think guess just travel at of the trillion.

small own it. have part Our a of brands

could look have with we can innovation to in help the power business, the out what players And really all BXB other so there. we the travel of our company is all that

Operator

Lee comes Horowitz from question with next Our Bank. Deutsche

Lee Horowitz

Two, if I could.

disposal have priorities back Vrbo, also pressures, look have which of some as you to into ADR that go-forward the So your you I you impact. sort you building in margin you markets, own international priorities? mind, ahead take of think a their you lean expansion marketing with facing in on do that investment clearly a out, at drive basis given those how while number levers of have called margin share guess about to as

BXC And one any then programs, super that of in business another guess, X presumably partners success BXB BXC? If the where do the Expedia travel how have Is piece you to interplay can that's on the maybe, to I compelling you more. and business? of business. a prove core BXB of between think about Ariane, that actually those rewards world sort BXB think managing about help there you of your a pie How doesn't do access sort create environment? your cannibalistic the

Ariane Gorin

Julie, the Okay. you Lee. one first and to the take the do second. Thanks want question, for take I'll

Julie Whalen

Sure.

obviously, our efficiencies fees further of we're and where merchant got We drive time, have go And will less line. on our sorts leverage We've So a and year-over-year, can't to efficiencies over to of leveraging. there on great really to and to that from of leverage at that costs in technology sales, across there. perpetuity. to whether opportunities a a actually been all perspective, it's that drive cost with obviously, while operations, on that have down do because looking been expect start to able moderate we continue things job much still lot drive AI incredible

see, we to a At have the well. little is last bit overhead quarter down was although of that this anomaly, can did year as time, same you

and as And the earlier line we every That's certainly, opportunity so actions from see at help P&L we're P&L. the on did -- so line that to drive are total it. we to benefiting we we're helping the we still is year, in And after go how what the in can looking cost several focused very announced leverage and those.

take can it money the deliver it to the body [ either reinvest we So or to that business. in ]

And it We in international however, saw are to, works. year, the did making this those markets to in in the say as and marketing, we second investments businesses. reinvigorate because we clearly, by want that we Vrbo what you quarter, alluded

that important that keep it's that continue going. we do So and to momentum

this to So to leverage the we've as going investing time. to all guided and and direct line more this we're on But leverage we said, term, on 'XX that year, driving overhead. and to much leverage. we to forward all don't should at term, more But things because the expect cost margin longer towards longer bring marketing we guiding as absolutely traffic expect of the to not have of enable work we're addition we're in us in sales get good doing certainly

marketing if got could think And disrupted we've line least we've just I've growth strong I the you Expedia doing Brand see it's got that. the And said brand, is if strong before, top P&L, who leverage. and of

And brands towards that over get the so we're it's time. other with there something to working

And BXB question and then on the on second BXC.

say, aren't would in certain geography, which very I there are brands geographies in our the present. BXC So

incremental. have are places many going go that it's And which we is there BXB many we're in true travel. But in to so that both it's geographies doing obvious for and consumers to anything there be different businesses

OTA, program any travel ours, think one to their come favorite I have personal they're bookings be They spend those airline company corporate sometimes have travel consumers course, of for in them. to hopefully, would consumers they points travel on and an loyalty only their rule. and points. love where might travel But Of have business shop may want to will using

think but power that technology and supply to game. to more them cases. easier through opportunity not make us And to it also And own demand every driver up be big for the competitive and just inventory our one it see brands our because fundamentally, bring to only those through partners to our even value reach I BXC BXB forces partners. a we the actually in it's our we of we so And that

Operator

Our from next with Barclays. Young question comes Trevor

Trevor Young

July First the it the July expand step that bit the growth question, nuance and steady can just you throughout on then in saw And any geos? down? of down was across cadence there a step quarter? Was around

in of second the done a bigger picture then platform is one. confidence And work the What completion now the tech and from migration. that quarters gives the question, past will of working years off? in We're pay more few that a transformation you've all few you

Ariane Gorin

want Julie, I'll take to the do first take the one? you second.

Julie Whalen

Yes, sure. In the the Vrbo. second quarter, we because, basically saw we've driver comps as was accelerating accelerating, and said, that's main

we came the to business. and the to drive basically low, by at the year quarter beginning the a and speak, so And full main the from acceleration driver of of so accelerated was

accelerating on So and lot going with that's July, we there's said, a like in understand hard I saw in then QX just precision. to comps

a question, U.S. sort And it's business. lot the answer noise so of a your other We're focused. we're perspective, a U.S. of areas, you saw to in from in we it's our this P&L mostly geo it when that seeing in at couple And really, but look seeing.

Ariane Gorin

In have terms that lot really earlier, of as said a it's capabilities the of unlocked I we before. replatforming, didn't

on something place of One them, of than more brands. customer testing of all Already we've One all platform. like have of is migrations, to in platform Key able we've Vrbo done put our a example, did view for year, a where this we our we tests been across

able our across release second of we're do the in said, ability brands. flexible I all to quarter shopping date the We, to as

the I to brands our a are out across of, say, basics multiple of do roll number able would So that work to e-commerce there having without all we're times.

top maybe going are rebuilding the true forward, to our that last capacity need foundations of sort some the years, features and few much what that to on some because where migrations. of to Now we their we're or into it's configurations brand-specific so digging is build even went of

Operator

comes Cunningham Conor with Research. Melius question next Our from

Conor Cunningham

a quarter you in But over remarks, BXB, XX%, on deceleration. think of prepared in the in sort I comp Just your I was the tough a pretty mentioned think growth process.

I could how visibility, you you lot if just a here? unpack you the curious you but bit, can a kind slowdown. little fourth have for the Just implied about of realize that evolving And driving see talk of don't on what's quarter, that from guide the just booking window then

Julie Whalen

Yes.

you yes, on still And bit So of XX%. we've little BXB, to, as at alluded course, a deceleration. seen we're of

alluded that that, normalizes. it's that strong we of really still that growth So as demand a as the see business come also some down fact to normalizes, business. would it And global

So not that's us unusual for see. to too

Obviously, in the July they a in by alluded the going July. period are mentioned that of impacted what's lot I to, as that also far dynamics as on we've

little moment there. so more it. some drive leadership was it. of business. than health of underlying that bit of right macro the strong just and But we incredibly they all opportunity about global really impact a have the that but seeing we're now, of impacting just is can the what so we're Ariane got much this about And an excited And to given where growth. sort the It's There's just continue normalization, spoke we've our strong. opportunities position see going should forward, business it this

of for while business a they as we but seen now bit we've the actually that hotel little booking lot, or as actually seeing that year-over-year. been shortened during we have little, And far the windows month a the in BXC time month. a our not in first July, just a been in that's interesting, As slightly the have entered it's But that July, they while. windows, actually just expanding a

of they're shortening just been a they've thing. similar while, kind doing and for side, a Vrbo the On

wasn't the things. of see anything July, hotel in that So but there side did a material we that in changed little of bit

Ariane Gorin

little just a on I'll add first BXB. And on bit the maybe part

geographically more BXB business. much diverse said, a consumer Julie than is As business our

over travel really a from benefited demand, of so it's in the quarters, in And particular, last Asia. lot few the

which of growth, seen was quarters, And was coming -- of we've for last couple growth, deceleration from very strong in so the that normalization the still couple the particular, a a in Asia.

Now business. as that the U.S. headed we more of saw some into part slowdown, and we with as July, Julie the was said,

Operator

from Our next Khan comes B. question Riley. Naved with

Naved Khan

double on little to Julie wanted the just Yes. click annual I a guide, bit.

and revenue prior digits I bookings bookings X%. for mid- think to both and guiding the So were was and now high single to revenue X% you're guidance of

some and -- the you airfare. weakening So in also noted

trying how I weakening. to should figure the you I'm just So about talked out ADR lodging think about business,

faster the to or on give or lodging night some maybe ADRs. room there goal nights and So just the thoughts us is post think to room X% how business just grow your going and about than

Julie Whalen

numbers presented mean, year. we have of lodging we that item. the we all line here full don't I mentioned that for Yes. -- the the by fortunately, impacts guide everything But obviously, to business. And that in has assumed the haven't certainly, I level been

be an those business, providing right the we're impact for not on that lodging will there all now. but on to those So metrics guidance

Naved Khan

follow-up Okay. have cost then on I of the side And things. a

So the the half? year, much announced second has has earlier how this been how you of action in that and that restructuring much yet follow of to

Julie Whalen

mean we just But we're little doesn't a cost every action looking almost that's where not but The the It's on particular because of and that's that efficiencies that action the action through QX you're we favorability getting single of action you're QX action at bit full through. QX majority in it we're There's find overhead There it. that why significant. QX, stopped of left so we been coming in the and getting seeing has the took that, line Yes. on some then on that that's additional we were you're that mentioned, elsewhere. can on action. quarter some course, took and

Operator

Securities. Kopelman Our from question TD Kevin comes with next

Kevin Kopelman

Just quickly on one, so macro. the

on in the softness. backdrop? seeing ADR Are softness you the half second You then given called more could just in color managing BXC nights? how expenses give And you any you're the advertising out

Julie Whalen

-- you can part repeat the said the you question? of Sorry, first

Kevin Kopelman

quarter-to-date, was softness, ADR the a part the that seeing called activity, are first softness also slowdown out particularly The on seeing you're kind you macro in but underlying stays. you of with nights

Julie Whalen

Yes, you said? we stage, are. particular, In

Kevin Kopelman

much actually Well, they're going to kind window traveling. the versus separating like just of look out how be we

Julie Whalen

ADR I booking But it. in Yes. if a the all demand, travel it's nights. No, There's true. about you're of just play, those a we're we other it's impacting a certainly an combo there's seeing transactions which also talking mean what definitely said, of I window been is reduction factors all, some or in right? that's play. are as -- side definitely, there's just mean softening not

expense the and that As from said year. margins assumed year obviously, far to are we on to the plans that I been mean, what your we last advertising gave, that's BXC line as guiding that's are guidance question, with we our relatively in be EBITDA

to managing in we're markets. investing international that, So while Vrbo still

that be line the at And what goes. full to that relatively sense so line last managing we in will on and certainly, where EBITDA seeing costs But what other makes the we're any with that year is year. variable advertising, top depending to associated top with line looking margins relative

Ariane Gorin

the or say, then same looking what said, the just as I do other channels. where or looking And effective where are very at most and advertising. is to social at where getting going pricing trends, need the time Julie to marketing obviously, money performance marketing to into and closely trends, the to to within team we're returns, demand best given our marketing, of back where the bucket the put what we And then be remind just are look we're into I want like. in, you, at leaning spent sort we and And of in even more lot of would promotions a do marketing, and loyalty in going which and are into these macro And we spend environment. all we with pull

Kevin Kopelman

maybe marketing were noted share you you If spend. color? What you more could some there? to And any rationalizing referring

Ariane Gorin

I we're international if making -- that just an the we looking efficiency for working bit We so need we nonworking returns doing understand especially And It's for important of be bit in of volatile. every at marketing -- time up spend, mean, dollar that the we're going elsewhere. the each returns more dollar. interrogating in every marketing into more example, our investing we've of been last is environment spend. is the Vrbo, a understanding and we when versus really one on things because So to

Operator

Ken Fargo. from Gawrelski question next with Our comes Wells

Kenneth Gawrelski

if may. X, I Just

and X talked about how First, sorry. in you your look term, the Conference plan, about not short in marketing years, continue the not your talk Could next to plans, a I should your opportunities, about plans robustly media opportunities to you've you but advertising like? over X of say, and marketing EXPLORE could May what and the the necessarily kind business that can grow lot

just second more is then tactical. And

the Key about year? that do expect material be on think half expansion how One that expect to the you to the of you As Hotels.com to U.K. the back Do a in and be you material

Ariane Gorin

Thanks for question. the

one. first the with start me Let

you're the excited about at we're and about and value we our media to So advertisers. to travel to really talked the network EXPLORE, grow advertising bring opportunity right,

Today, a happens the business lot funnel. on advertising the of moments of booking and shopping travel our

booking when the So in not the when in isn't as or dreaming for of funnel, they're booking. much, results example, as someone's very in search there much the and they're upper process, when and in there's post sort

think an that opportunity there's So there. we

that partners the number think using opportunity who there's to in our also We an are of advertising expand tools.

destination, more listings, sponsored or the we having So can a and bring as growth new whether of think listings products opportunity well. to lot that hotels or it's sponsored and management airlines there there's organizations that using

also call some advertisers. I'd interesting tools to we're that these out providing on work more doing

make on for we're advertising video it sort targeting products, about on sort think self-serve making So which to easier some our for the of of them better. of of them, perform we do us -- some introduce self-serve letting getting those ads, our more will into to

long for opportunity there's say the of term, just would I we a think lot here. So

but like learned might level. value in U.S. of U.K., I value, about from using in it's sort sort don't the the U.K., the One customers feel expansions treat that question material Hotels.com the of rollout at I it's who and they're Key think a Certainly, downstep going and you higher the getting at in level, material. on not to On the their we're Key company of a think One have the in how impact to company a

Operator

Clarke Our Generale Societe next Group. question from Bernstein, with comes Richard

Richard Clarke

of North all the pause in mean Key. from remain get that free. on Just in the question markets, One XX the rollout That U.K.? nights Does America apart on X a that will buy the Hotels.com

deal of And different I with does to multiple the for mean were sort your supply it of schemes. you awkward partners rollout. is the offering One BXB your loyalty got in of as to of they've things think part what BXB that that rollout? Key one And was you sort

would how markets? that So non-U.S., sort non-U.K. affect the rollout in of BXB of

Ariane Gorin

Yes.

the for Thanks question. Okay.

In simple yes. will program. terms Hotels.com of for the is the remain the same the outside U.K., whether It's the of and a X U.S. answer XX

what work it's to the remaining out be. forward now, as way we would that figure path For

different members For for supply member to of our it's our for actually we example, partners, into that our provide and completely in them. hotels, program. deals Hotels.com transparent levels translate discount they tiers of They where participate rewards different

to U.S. I'm I'm hotel, that they're or the a rewards XX if whether able in So for stamps Hotels.com X members, whether they're a those existing country has reach in the

In terms out of we're program. is business. business where of One their That's inventory a BXB, rolled but to have actually, our a lot not BXB and partners the loyalty Key providing own technology,

their to for our out -- accelerate about about advertising to allowing of dollars rolling hotels. partners thinking advertising to be talked earn use One we've Key Key and One may them You their some

They the why again, It one can in programs this we But scale. for countries that, won't have where that and loyalty we about difference. can U.K. do to a time is in are we going big something think U.S. that. what make that is to our be at proposition take brand the the the do value again, only won't outside really of And

Operator

Our John Jefferies. Colantuoni next from question with comes

John Colantuoni

ones quick Two me. for Great.

First, of second XQ assumes does outlook that question, and seeing just relative you there's now there. to a a on talk in recovery little August quarter how in third lean to to some September that for bit outlook, night whether you in your making more July? And the the last trade quarter the and reductions have started pricing impacted might down, you're conversion. And some

Julie Whalen

Yes.

at far not scenarios outlook, on something in We've we land. and for sort based of into or consideration out the As as and obviously have happened what's fruition the revenue we come our in the run also baked in information as July the to you question at quarter. third on where any to Certainly, that looked that the take September. will what happening to because XQ in first have think what states prior we in have least various ran upside the then quarters it's quarter

that just let out. there but QX accordingly, data But scenarios in have our and assumed. any of data, play some on to run play we that So we the certainly, and for out based of already going that's we've sort September all July, it just new wasn't step-up in

only made actions the did returns. the pricing had some pricing be a in. we we had far that quarter, the end. As that coming actions last then remember we probably from as you yes, we're come done And towards That pricing actions, if to call, into we see going we those do quarter this get

And so conversion are certainly, for us. they driving

continue doing, a that, good returning us. going as for we going forward lever as we're it have so with been marketing is to And

Operator

Oppenheimer. Jed question next from with comes Kelly Our

Jed Kelly

Great.

when to a potentially that just the Vrbo, the us you just have growth frame then usually just campaign. contracts think give that sort a thinking of that's talk way are the how you can If large back brand backlog you strategy, can going of marketing amount impacts on softness Just can there? fourth opportunity. about this or continues, strategy? drive just BXB Is there up quarter your like of like marketing any you And

Ariane Gorin

questions. thanks the on for So one, so first the

to On for. the first pipeline. I the is will details share going which bid say want one, I'm thoughtful about we not deals about What we're to

for. ones when decide not decide to deals you an and team, BXB to which you often bid think as it's you important I bid which for have

say a growth great but want comes we to And do thoughtful come our super play team that also finding also development existing team, growth can about a where that's do business I'd being from we partners not. and new have experienced we partners. where from

sale that growing they're powering into partner their as sometimes their you to powering points couple the a going team that X it's to of them ones we're expand have they decide they're we're incumbent might and So then that business. on and another of our countries make of sure

it's existing business, grow win them. BXB also pipeline of order not that our doing business, to actions new are about with in along sort partners either of it's think to the all you when share just the we're the just So what or in

Julie Whalen

marketing marketing we QX because the that strategy, the time too much learned in spend big QX Vrbo. for from entering is last to Vrbo as sorry, on want year as don't As pull you're certainly, back really -- a far you

QX that part the to EBITDA for that's pressure we So in reason longer of we're to very for term. in continue because Vrbo because even investing guiding why reason investing on want we're the

we would to so Vrbo. invest in continue And

not it obviously, of table. there's the things expecting all it's but massive been that, we're mean, level off not I we've guiding. are softness how that depends But some if

is that's Vrbo, continue expectation we our guidance the to last to relatively within line so year And and be obviously, on invest to in with in year. our assumed, margin

Operator

from with Ron question Josey comes final Our Citigroup.

Ronald Josey

a really Ariane, a key growth room in investment on follow-up Brand there thought XX% comment highlight. nights to your in was Expedia Maybe, marketing. I the in

say geographic the And rates as think in attach multiproduct of quarter I conversion maybe here, to rates. benefits So And I more the wanted mix. on really, a evolve. the heard I to improved the understand in then continues drivers just little the brand advertising side from you

And just overall. a little how to wanted dive going how product deeper on are the hear so bit Expedia to the again, funnel, transactions on

Ariane Gorin

question. the for Ron, Thanks, Yes.

with the we back strong travelers. also flight Expedia confidence and said, over a brands, it's built have you because us. base hotel of to shopping a app we're buying then member Brand least booking the We've marketing the our proposition the path and innovation our As number mean, going all the on great repeat, We a value because leverage bit coming of also, whether installed it's rate, base, disruptive over multi-item brand in that's there. gives seeing and really value through a it. later years, scripts, great for has really been and a spent great what gotten is time, was buying it's quite now a discounted and directly for all highlight at of a Brand it a brand I And into up and strong Expedia or package it of me

my to as like a more say, really internationally. growth So it. I in highlight. But focused. to you see just I consumer is general, to our we feel mean, It's we'd is about Expedia liking would whole business, good say, U.S. still as

question. So the for thank you

Operator

will hand the I closing back remarks. now over to call Gorin for Ariane

Ariane Gorin

But just questions. Well, environment I appreciate want the volatile. becoming want regardless, know opportunity is Okay. to leave again thank we I more so thought you and for lot ahead. all Julie a you to the I joining we believe just the us. that, we of with have

tech a consumer business, ever brands powerful differentiated great BXB love, travelers that been diverse platform. and really a the have We supply, strongest it's

profitable So as to use we're to to we growth. look these the future, going Thank all. drive assets you

Operator

That concludes today's call.

You may now day. disconnect your a nice lines. Have

Expedia (EXPE) 8 Aug 242024 Q2 Earnings call transcript