Booking Holdings Inc. (NASDAQ:BKNG) Q3 2023 Earnings Conference Call November 2, 2023 4:30 PM ET Company Participants Glenn Fogel - Chief Executive Officer David Goulden - Chief Financial Officer Conference Call Participants Mark Mahaney - Evercore Justin Post - Bank of America Kevin Kopelman - TD Cowen Lloyd Walmsley - UBS Doug Anmuth - JPMorgan Lee Horowitz - Deutsche Bank Eric Sheridan - Goldman Sachs Ron Josey - Citigroup John Colantuoni - Jefferies Operator Welcome to Booking Holdings Third Quarter 202 ...

Marketing expenses consist primarily of the costs of: • other performance-based marketing. • credit card and other payment processing fees associated with merchant transactions; | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |-----------------------------|-------|---------------------------------|--------------------|-------|---------------------|-------------|---------------------|--------------------|---------------------| | Personnel \n(in millions) | | Three Months September \n2023 | Ende ...

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Financial Data and Key Metrics Changes - In Q2 2023, revenue grew by 27% year-over-year, significantly outperforming expectations, with adjusted EBITDA reaching approximately $1.8 billion, a 64% increase compared to Q2 2022 [12][31][88] - Gross bookings increased by 15% year-over-year to $39.7 billion, marking the highest quarterly gross bookings ever [43][29] - Non-GAAP net income for Q2 was $1.4 billion, resulting in a non-GAAP EPS of $37.62, up 97% year-over-year [62] Business Line Data and Key Metrics Changes - Room nights booked increased by 9% year-over-year, with alternative accommodations growing faster at 11% year-over-year, representing 34% of total room nights [52][43] - Airline tickets booked rose by 58% year-over-year, driven by the expansion of Booking.com's flight offerings [31] - The mix of customers booking directly on platforms continued to increase year-over-year, with 48% of room nights booked through mobile apps, up six percentage points from Q2 2022 [53][23] Market Data and Key Metrics Changes - In July 2023, room night growth accelerated to approximately 20% year-over-year, with Asia showing over 45% growth [44][63] - The U.S. market saw mid-single-digit growth, with a notable recovery compared to 2019 levels, indicating strong demand [63][124] - Cancellation rates in Q2 were higher than in Q2 2022 but remained below 2019 levels [28][58] Company Strategy and Development Direction - The company is focused on advancing its "Connected Trip" vision, which aims to enhance the travel experience through technology and AI integration [45][47] - Investments are being made to strengthen and grow the enterprise while remaining cost-conscious, with a focus on alternative accommodations and direct relationships with travelers [13][22] - The company is leveraging AI technology to improve personalization and efficiency in booking experiences [16][51] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strength of travel demand and expects a record summer travel season [24][13] - The company anticipates gross bookings to grow slightly over 20% for the full year, up from previous expectations of low teens growth [38] - Management remains cautious about the potential impacts of external factors, including competition and regulatory changes in the AI space [99] Other Important Information - The company repurchased $5.1 billion of its shares in the first half of the year, reducing the total authorization to $19 billion [89] - Marketing expenses increased by 4% year-over-year, with improved efficiency noted in paid channels [32][72] - The company expects adjusted EBITDA margins to expand by a couple of percentage points versus 2022 [39] Q&A Session All Questions and Answers Question: Changes in travel demand types - Management noted no significant changes in travel demand types, such as length of stay or star ratings, indicating stable consumer behavior [102] Question: Impact of AI on business - Management acknowledged the uncertainty surrounding AI's impact but emphasized ongoing experimentation to identify the best returns from AI investments [76][99] Question: Performance in Asia and market share - Management expressed satisfaction with performance in Asia, attributing growth to effective marketing and recovery from previous restrictions [80] Question: North America vacation rental market progress - Management highlighted ongoing efforts to improve the vacation rental product and increase awareness among potential customers [107] Question: Connected Trip impact on growth - Management clarified that while the Connected Trip is a long-term vision, it has not yet produced significant increases in current performance metrics [134]

Financial Performance - Merchant gross bookings for Q2 2023 were $21.1 billion, a 39.9% increase from $15.1 billion in Q2 2022; total gross bookings increased by 14.9% to $39.7 billion[203]. - Total revenues for Q2 2023 reached $5.46 billion, a 27.2% increase from $4.29 billion in Q2 2022, with total revenues as a percentage of gross bookings rising to 13.8%[228]. - Airline ticket gross bookings surged by 58.3% in Q2 2023, driven by higher demand and ticket price increases[227]. - Rental car days increased by 24.0% in Q2 2023, reflecting a recovery in travel demand and lower average daily rental prices[224]. - Information technology revenue for the three months ended June 30, 2023, was $144 million, a 5.5% increase from $137 million in the same period of 2022[234]. - Interest and dividend income surged to $266 million for the three months ended June 30, 2023, representing a 1,024.2% increase from $24 million in the same period of 2022[239]. - Interest expense rose significantly to $241 million for the three months ended June 30, 2023, compared to $76 million in the same period of 2022, marking a 216.2% increase[258]. Operational Metrics - Room nights reserved through the services increased for Q2 2023 compared to Q2 2022, driven primarily by the continued recovery in Asia and Europe[201]. - The average daily rate (ADR) increased approximately 5% on a constant currency basis in Q2 2023 compared to Q2 2022, primarily driven by higher ADRs in Europe[192]. - The cancellation rate in Q2 2023 was lower than the comparable period in 2019, despite an increase compared to Q2 2022[190]. - The mix of room nights booked for alternative accommodations rose to approximately 34% in Q2 2023, up from 32% in Q2 2022, indicating growing consumer demand[216]. - The ongoing shift from agency revenues to merchant revenues at Booking.com contributed to the increase in merchant revenues for Q2 2023[208]. Expenses and Investments - Marketing expenses as a percentage of total gross bookings decreased in Q2 2023 compared to Q2 2022 due to higher performance marketing ROIs and an increase in direct traffic[210]. - Total marketing expenses for Q2 2023 were $1.8 billion, a 4% increase from Q2 2022, driven by improved demand and marketing investments[215]. - Personnel expenses, excluding stock-based compensation, increased by 18.7% year-over-year for Q2 2023, driven by an increase in salary and bonus expenses[212]. - Personnel expenses rose by 18.5% to $752 million in Q2 2023, reflecting increased staffing and related costs[232]. - General and administrative expenses increased by 47.6% to $304 million in Q2 2023, influenced by higher indirect taxes and professional fees[233]. - Sales and other expenses increased by 43.2% to $666 million in Q2 2023, primarily due to higher merchant transaction costs[231]. - The company plans to continue investing in marketing, technology, and personnel to improve long-term operating results, even if it pressures operating margins[197]. Cash Flow and Financing - Net cash provided by operating activities for the six months ended June 30, 2023, was $4.6 billion, driven by a net income of $1.6 billion and a favorable net change in working capital of $2.6 billion[249]. - Net cash used in financing activities for the six months ended June 30, 2023, was $3.8 billion, driven by common stock repurchases of $5.2 billion and debt repayments of $500 million[271]. - The company entered into a new five-year unsecured revolving credit facility of up to $2.0 billion in May 2023, replacing a previous facility[246]. - The company issued senior notes totaling €1.75 billion ($1.9 billion) in May 2023, with interest rates of 3.625% and 4.125%, to be used for general corporate purposes including share repurchases[267]. - Net cash used in financing activities for the six months ended June 30, 2022, was $3.4 billion, with common stock repurchases of $2.3 billion and debt repayments of $1.1 billion[271]. Regulatory and Compliance - The company anticipates that regulatory changes, such as the Digital Markets Act, may increase compliance costs and affect business operations[196]. - The company had a remaining transition tax liability of $692 million as of June 30, 2023, due to the U.S. Tax Cuts and Jobs Act[245]. - The effective tax rates for the three and six months ended June 30, 2023, were lower compared to the same periods in 2022, primarily due to a lower valuation allowance related to unrealized losses on equity securities[264]. - The company has commitments and contingencies that are detailed in the financial statements[269]. Future Outlook - The company expects room nights to grow at a low double digits percentage for Q3 2023 compared to Q3 2022, with gross bookings growth projected to be about seven percentage points higher than room nights growth[198]. - Deferred merchant bookings amounted to $6.0 billion as of June 30, 2023, primarily consisting of cash payments received from travelers in advance of performance obligations[266]. - A hypothetical 100 basis point decrease in interest rates would increase the estimated fair value of other debt by approximately $630 million as of June 30, 2023[274]. - The company anticipates that the fair value of convertible senior notes will be more sensitive to equity market price volatility than to changes in interest rates[274]. - The convertible senior notes due in May 2025 are currently classified as "Short-term debt" on the balance sheet as of June 30, 2023[267]. - The company has no obligation to update forward-looking statements unless required by law, emphasizing the importance of reviewing SEC filings for updated information[273].

Booking Holdings Inc. (NASDAQ:BKNG) Q1 2023 Earnings Conference Call May 4, 2023 4:30 PM ET Company Participants Glenn Fogel - Chief Executive Officer David Goulden - Chief Financial Officer Conference Call Participants Justin Post - Bank of America Mark Mahaney - Evercore Lloyd Walmsley - UBS Brian Nowak - Morgan Stanley Doug Anmuth - JPMorgan Kevin Kopelman - TD Cowen Lee Horowitz - Deutsche Bank John Colantuoni - Jefferies Zachary Morrissey - Wolfe Research Stephen Ju - Credit Suisse James Lee - Mizuho R ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 1-36691 Booking Holdings Inc. (Exact name of registrant as specified in its charter) Delaware 06-1528493 (State or other jurisdiction of inco ...

Financial Data and Key Metrics Changes - The company reported fourth quarter revenue of approximately $4 billion and adjusted EBITDA of $1.2 billion, both exceeding previous expectations [3] - Full year revenue reached over $17 billion, which was 13% higher than 2019 and up about 24% on a constant currency basis [13] - Free cash flow for the full year was nearly $6.2 billion, a 38% increase compared to 2019 [14] - Adjusted EBITDA for the fourth quarter was over $1.2 billion, which was 3% below 2019 but would have been around 16% above 2019 on a constant currency basis [83] Business Line Data and Key Metrics Changes - Room nights for the full year were 6% higher than 2019, with gross bookings 26% higher [13] - Alternative accommodation room nights grew about 56% versus 2021 and represented about 30% of total room nights [7] - The mobile app accounted for about 45% of total room nights booked in 2022, a 13 percentage point increase from 2019 [8] Market Data and Key Metrics Changes - U.S. room night growth was nearly 30% and gross bookings growth was about 60% in 2022 compared to 2019 [100] - Room night growth in the fourth quarter was 10%, up from 8% in the third quarter, with significant contributions from Asia and the U.S. [11] - International mix of total room nights in Q4 was about 48%, higher than Q3 but still below Q4 2019 levels [11] Company Strategy and Development Direction - The company is focused on expanding payments at Booking.com, enhancing connected trip capabilities, and strengthening its position in the U.S. market [5] - The long-term vision includes making travel booking easier and more enjoyable while linking relevant travel components for a seamless experience [76] - The company aims to increase its direct booking mix through initiatives like enhancing the Genius loyalty program and improving the mobile app experience [78] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth of travel and the company's positioning, despite recognizing potential volatility in top-line trends [19][41] - The company anticipates low-teens gross booking growth for the year, with expectations of continued pressure on constant currency ADRs [21][41] - Management highlighted the importance of adapting to technological changes and leveraging AI to enhance customer service [22][43] Other Important Information - The company repurchased over $6.5 billion of its shares in 2022, reducing the year-end share count by 8% compared to 2021 [14] - The CFO plans to retire in early 2024 but will assist with the transition for up to two more years [9] Q&A Session All Questions and Answers Question: What is the outlook for room night growth and ADRs? - Management expects room night growth to be slightly lower than low teens gross booking growth, with some support from FX and flights [21] Question: How is the company positioned for changes in technology and AI? - Management is confident in adapting to technological changes and believes their capabilities are competitive in utilizing new AI tools [22] Question: What are the expectations regarding the recovery of the Chinese travel market? - Management acknowledges the potential in the Chinese market but cautions that recovery may take time, with outbound travel still limited [24] Question: Is there another region where the company sees potential for market share gains similar to the U.S.? - Management does not identify another specific region but emphasizes ongoing efforts to gain market share globally [25]

Debt and Financing - The company's outstanding aggregate principal amount of debt was $12.5 billion at December 31, 2022, compared to $11.1 billion at December 31, 2021[190] - The company issued senior notes for an aggregate principal amount of 3.5 billion Euros in November 2022, with interest rates ranging from 4.0% to 4.75% and maturity dates from November 2026 to November 2034[212] - The company's convertible senior notes are more sensitive to equity market price volatility than changes in interest rates, with their fair value likely increasing as the market price of the company's shares increases[190] Share Repurchases - The company repurchased shares of its common stock for an aggregate cost of $6.7 billion during the year ended December 31, 2022, and had a remaining authorized amount of $3.9 billion for stock repurchases at December 31, 2022[213] Cash and Investments - The company's cash, cash equivalents, and short-term and long-term investments totaled $15.2 billion at December 31, 2022, with approximately $9.3 billion held by international subsidiaries[210] Expenses - Marketing expenses increased significantly in 2022 compared to 2021 due to the recovery in travel demand, but marketing expenses as a percentage of total gross bookings decreased slightly[196] - Personnel expenses, excluding stock-based compensation, increased 6% in 2022 compared to 2021, driven by a $139 million increase in salary expense and a $66 million increase in bonus expense accruals[198] Tax and Valuation - The company's effective tax rate was higher in 2022 compared to 2021, primarily due to lower benefits from the Netherlands Innovation Box Tax and higher valuation allowances against deferred tax assets[177] Obligations - The company had lease obligations of $867 million and non-cancellable purchase obligations of $378 million at December 31, 2022, with $143 million payable within the next twelve months[214] Foreign Currency and Derivatives - The company's foreign currency transaction gains for the year ended December 31, 2022 included $46 million related to Euro-denominated debt and accrued interest, offset by $52 million in losses on derivative contracts[205] - The company uses derivative financial instruments to mitigate potential future market exposure but does not engage in speculative trading or leveraged derivatives[220] Operating Activities and Working Capital - Net cash provided by operating activities for 2021 was $2.8 billion, driven by net income of $1.2 billion, $1.4 billion from non-cash adjustments, and a $269 million favorable net change in working capital[217] - Accounts receivable increased by $1.0 billion in 2021, primarily due to higher business volumes[217] - Deferred merchant bookings and other current liabilities increased by $1.5 billion in 2021, reflecting growth in business volumes[217] - Non-cash items included net losses on equity securities, deferred income tax benefits, depreciation and amortization, stock-based compensation, and operating lease amortization[217] Market Risk Assessment - The company evaluates market risk by assessing near-term and long-term fluctuations in interest rates and foreign currency exchange rates[220]

Booking Holdings Inc (NASDAQ:BKNG) Q3 2022 Results Conference Call November 2, 2022 4:30 PM ET Company Participants Glenn Fogel - CEO David Goulden - CFO Conference Call Participants Lloyd Walmsley - UBS Brian Nowak - Morgan Stanley Kevin Kopelman - Cowen Mark Mahaney - Evercore Justin Post - Bank of America Merrill Lynch Doug Anmuth - JPMorgan Eric Sheridan - Goldman Sachs Naved Kahn - Truist Securities Lee Horowitz - Deutsche Bank Mario Lu - Barclays Stephen Ju - Credit Suisse Operator Welcome to Booking ...