Booking Holdings continues to set records post-pandemic, and growth is projected to keep going.
Booking Holdings reported a record number of room nights booked in the third quarter and strong gains in its flights business. It expects growth to continue but noted a caveat: Business has slowed down in the Middle East because of the Israel-Hamas war and the company’s current forecast assumes no further expansion of the conflict.
Customers booked 276 million room nights, an increase of 15% from the previous year, Booking said. The value of gross bookings totaled $39.8 billion, up 24%.
“Given current trends, we expect customers and consumers will continue to prioritize travel over other discretionary spend in 2024,” said Glenn Fogel, CEO of Booking Holdings, during an earnings call Thursday.
Booking Holdings owns a number of travel booking brands, including Booking.com, Kayak, Priceline, Agoda, and OpenTable.
Total revenue last quarter was $7.3 billion, an increase of 21%. The stock is up nearly 18% this year.
Booking Holdings’ Growing Flights Business
Booking Holdings sold 9 million flights last quarter, a 57% increase. The growth came from a partnership with eTravli, a tech platform for selling flights. Booking was planning to acquire Sweden-based eTravli for $1.8 billion, but the European Commission blocked the deal after it was in limbo for nearly two years. Fogel said Booking plans to appeal the decision and that it has extended its partnership with eTraveli through at least the end of 2028.
He said improving the flights business aligns with the company’s vision of the “connected trip,” which means giving travelers a way to book and manage all aspects of a trip in one place.
The CEO of eTraveli told Skift last month that the company is 2.4 times larger than before the pandemic, so if Booking wins the appeal, the companies will have to renegotiate a price.
Hamas-Israel War Impact
Fogel said there was a “significant negative impact” on business in Israel and related business outside of Israel.
Israel typically accounts for 1% of the company’s global room nights. The Middle East, including Turkey and Egypt, accounts for 4% of global room nights.
“Globally, we saw a slowdown starting the second week of October due to cancellations and a drop in new bookings after the start of the war in the Middle East,” said David Goulden, chief financial officer of Booking Holdings. “The cancellations we saw that started in the second week of October were concentrated in Israel, but we also saw some impact on travel trends outside the country as people absorb the news. We are pleased to see room night growth recover towards the end of the month.”
Depending on what happens next, business could be impacted further.
“Our comments for the fourth quarter make the assumption that room night growth will be up about 9% year-on-year. When comparing versus 2019, this means we expect Q4 room night growth to be about 20%. This outlook assumes there’s no further expansion of the war in the Middle East,” Goulden said.
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