By Angela Chen
Expedia Inc. posted weaker-than-expected earnings on Thursday,
as higher bookings were unable to offset a 10% decline in revenue
per room night.
Shares fell 4.9% in after-hours trading.
Launched in 1996 by a small division within Microsoft Corp.,
Expedia went public in 1999 and has since grown into a travel
giant. Among the brands in its portfolio are Hotels.com, Hotwire,
eLong Inc. and Trivago.
The travel industry is under pressure from new players, such as
referral sites, like Kayak and Hipmunk, that search multiple sites
and startups that offer unpublished discounts and stays in
apartments and spare rooms. Travel websites have responded by
offering discounts and loyalty programs. Earlier this month,
Expedia agreed to buy longtime rival Travelocity from Sabre Corp.
for $280 million, joining two of the most prominent travel sites as
they face pressure from industry newcomers.
In the December quarter, Expedia reported that its gross
bookings climbed 24%, led largely by growth in hotel-room nights
and air tickets. International gross bookings grew 18%.
Overall, Expedia reported a profit of $66 million, or 50 cents a
share, down from $95 million, or 70 cents a share, a year earlier.
Excluding stock-based compensation and other items, earnings fell
to 86 cents, from 92 cents a year earlier.
Revenue grew 18% to $1.36 billion, bolstered by 38% growth in
advertising and media revenue.
Analysts polled by Thomson Reuters expected a profit of $1.01 a
share and revenue of $1.37 billion.
Write to Angela Chen at angela.chen@dowjones.com
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