Expedia Group (No. 2 on Travel Weekly’s Power List) has started to see softness in demand in the third quarter, CEO Ariane Gorin said during the company’s Q2 earnings call Thursday, mirroring reports from other sectors of the travel industry.
But the company’s second-quarter results were at the high end of its expectations, with gross bookings up 6%, to $28.8 billion. Revenue grew 6%, to $3.6 billion, and net income was $386 million, about on par with the second quarter last year, when net income was $385 million.
Gorin attributed the increases to improvement in alternative accommodations brand Vrbo as well as “continued strength” in the Expedia brand, the company’s advertising business and its B2B business.
Wall Street took notice, with Expedia’s stock jumping more than 10% in after-hours trading after the call.
However, the third quarter has brought with it “a more challenging macro environment and a slowdown in travel demand, consistent with recent commentary from others in the travel industry,” CFO Julie Whalen said.
Consumers are moving toward lower-priced accommodations, Whalen said, and air ticket prices have “seen more continued softness.”
Both Expedia’s consumer and B2B business have seen weaker growth so far in the quarter, she said. Expedia is expecting gross bookings and revenue to be up 3-5% in the third quarter compared to the same period last year.
