Expedia Group Inc. (EXPE, Financial) recently reported a fourth-quarter profit that surpassed analystsâ estimates, gaining from a holiday travel season that proved to be strong despite the outbreak of the Omicron variant. The stock outstripped competitors like TripAdvisor Inc. (TRIP, Financial), MakeMyTrip Ltd. (MMYT, Financial) and Travelzoo (TZOO, Financial).
Fourth quarter net income was $276 million and adjusted net income was $167 million. Adjusted Ebitda reached $479 million, the highest fourth quarter in the companyâs history.
Total revenue for the Seattle, Washington-based online travel company was $2.3 billion, down 17% compared to the fourth quarter of 2019. Total gross bookings were $17.5 billion, down 25% from 2019 levels, the lowest quarterly decline in 2021 despite the impact of Omicron (2019 is used for comparison rather than 2020 due to the pandemic).
Expedia had been âbuffeted by the ebb and flow of the pandemic,â Bloomberg noted. âAfter being pummeled initially by a near-complete halt in travel as the virus set in two years ago, Expedia saw a resurgence last year as borders and businesses opened and travel picked up, at least in some markets. Then, the omicron variant swooped in late last year, again shuttering businesses and prompting a massive disruption of flights and vacation plans.â
Peter Kern, Vice Chairman and CEO of Expedia, had the following to say:
âWhile we experienced yet another significant travel disruption from Covid this quarter, we were pleased to see that the impact was less severe and of shorter duration than previous waves. Notably, the travel industry and traveling public prove more resilient with each passing wave, and we continue to expect a solid overall recovery in 2022, barring a change in the trajectory of the virus... As we put more of the pandemic behind us, we focus on a brighter year ahead. We are increasing our speed of innovation for travelers, our breadth of tools to help power the travel ecosystem, and our effectiveness and efficiency as a company. This is a big year of delivery for Expedia Group, and we look forward to helping drive a robust revival of our industry and great traveler experiences.â
The company has been engaged in a rebuilding program for the past two years. Management âsaid it saw plenty of cause for optimism, but that itâs a wait-and-see game until the travel industry reverts to a semblance of normal to quantify the progress,â noted Skift. Expedia Group has been âreorganizing the internal workings of the company, combining brand teams that previously may have worked at cross-purposes, shedding brands that werenât core to the company, and trying to consolidate its tech stack.â
Kern added in an interview with Bloomberg, âIt burned bright and fast. It was increasingly like a bad news, good news, story for us. It was fortunate for us that weâre in that business and we clearly leaned into its moment as much as we could, and I think weâve been really successful at that.â
The company is made up of four pillars: Expedia Services, focused on the groupâs platform and technical strategy; Expedia Marketplace, centered on product and technology offerings across the organization; Expedia Brands, housing all of the consumer brands; and Expedia for Business, consisting of business-to-business solutions and relationships throughout the travel ecosystem. Expedia Groupâs family of brands includes Expedia, Hotels.com, Expedia Partner Solutions, Vrbo, trivago, Orbitz, Travelocity, Hotwire, Wotif, ebookers, CheapTickets, Expedia Group Media Solutions, CarRentals.com and Expedia Cruises.
On Feb. 1, Expedia Group provided notice to the holders of its 2.5% Senior Notes due June 2022 that the company will redeem all of the 650 million Euros ($741.2 million) of outstanding aggregate principal in March 2022.
