Summary of Earnings Call Transcript Companies and Industries Involved - **Meta** - **Google** - **Amazon** - **Uber** - **Expedia** - **Doordash** - **OTA (Online Travel Agency) Industry** Key Points and Arguments Meta - **Q2 Performance**: Meta's revenue increased by 22% year-over-year to $47.5 billion, with net profit rising by 36% to $18.3 billion. Advertising revenue also grew by 22% [2][11]. - **Advertising Metrics**: Ad impressions and prices increased by 11% and 9% respectively. User engagement on Facebook and Instagram improved, with video content engagement rising over 20% [12][11]. - **Capital Expenditure**: Meta raised its full-year capital expenditure guidance to $66 billion to $72 billion, with expectations for 2026 to reach $100 billion, leading to increased depreciation costs [14][6]. - **Risks**: The company faces rising costs due to management fees and increased capital expenditures, which may lead to significant depreciation costs in 2026 [41]. Google - **Q2 Performance**: Google reported Q2 revenue of $94.3 billion, a 14% increase year-over-year, with net profit of $28.2 billion, up 19%. Cloud revenue grew by 32% to $13.6 billion [7][2]. - **AI Developments**: Google made significant advancements in AI, with over 2 billion monthly active users in search and 450 million for Gemini. AI tools improved ad conversion rates by over 14% [9][5]. - **Capital Expenditure**: Google’s capital expenditure for Q2 was $22.2 billion, exceeding expectations by 23%, with a full-year plan raised to $85 billion [10][11]. - **Regional Performance**: In the Americas, ad revenue grew by 12%, while the Asia-Pacific region saw an 18% increase [8]. Amazon - **Q2 Performance**: Amazon's revenue growth was 13%, driven by retail operations, with online store sales up 11% and advertising revenue up 22.9% [18][19]. - **AWS Performance**: AWS revenue grew by 17.5%, but profit margins declined due to increased costs [20][21]. - **Valuation**: Amazon's target price is set at $240, indicating about 10% upside potential [24]. Uber - **Q2 Performance**: Uber's GMV increased by 17% to $46.8 billion, with adjusted EBITDA growing by 35% to $2.1 billion [35][36]. - **User Growth**: Uber One membership grew by 60% to 36 million, contributing significantly to platform transactions [36]. - **Future Outlook**: The company announced a $20 billion share buyback plan and expects continued growth in GMV [36][37]. Doordash - **Q2 Performance**: Doordash's GMV grew by 23%, with total orders up 20% and revenue increasing by 25% [25][30]. - **International Growth**: The international business showed strong growth, with user engagement metrics reaching new highs [28]. - **Advertising Revenue**: Doordash's advertising revenue increased, and the company acquired Symbiosis to enhance ad targeting [29][30]. OTA Industry - **Q2 Performance**: Major OTA companies like Booking, Airbnb, and Expedia reported strong earnings, with Booking benefiting from cost-cutting measures [38][40]. - **Future Outlook**: The industry is expected to see growth in emerging markets and vertical categories, although profit pressures may arise in the short term [39][40]. Other Important but Possibly Overlooked Content - **AI Impact**: AI is enhancing operational efficiency across companies, but the long-term effects on profitability due to increased depreciation costs remain a concern [16][17]. - **Market Sentiment**: Despite strong earnings, there are concerns about rising costs and the sustainability of growth in the face of macroeconomic challenges [6][41]. - **Valuation Comparisons**: Google and Meta's valuations are considered reasonable compared to historical data, with Google trading at about 20 times GAAP PE and Meta at 25-27 times [43][44].

Group 1 - Wedbush raised the target price for Expedia from $175 to $220 while maintaining a "neutral" rating [1]

Expedia Group exceeded earnings, revenue, and gross bookings forecasts on a big boost from international sales. https://t.co/TfNpmAE1Gr ...

Financial Performance - Expedia's total bookings increased by 5% year-over-year [1] - Expedia's adjusted EBITDA increased by 16% year-over-year [1] Market Trends & Dynamics - The travel market in the US is experiencing softness, particularly among budget travelers [1][5] - Inbound travel to the US is facing pressure with shorter booking windows and higher cancellation rates [2] - Expedia's B2B bookings grew by 17%, outpacing the market and marking 16 consecutive quarters of double-digit growth [3] - Expedia anticipates trends to moderate in Q4 due to tough comparisons against the previous year [3] - Luxury travel remains strong, unaffected by economic concerns [8] Company Strategy & Innovation - Expedia is leveraging AI across its strategic priorities, including customer value, growth opportunities, margin expansion, and operational efficiencies [4] Competitive Landscape - Viator, Expedia's experiences platform, is driving significant growth [4] - Cruise lines (Norwegian, Carnival, Royal Caribbean) are reporting strong forward bookings, indicating value perception [6] - Las Vegas market shows mixed performance, with Caesars facing challenges (low room rates, concert cancellations) while Wynn reports record profitability [7]

Core Insights - Expedia Group (EXPE) reported second-quarter 2025 adjusted earnings of $4.24 per share, exceeding the Zacks Consensus Estimate by 2.42% and reflecting a year-over-year increase of 20.8% [1] - Revenues reached $3.79 billion, a 6.4% year-over-year rise, also surpassing the Zacks Consensus Estimate by 1.94% [1] - B2B revenues grew by 15% year over year to $1.21 billion, while B2C revenues increased by 2% to $2.48 billion [1] Gross Bookings - Total gross bookings amounted to $30.4 billion, marking a 5% year-over-year increase [2] - B2C gross bookings rose by 1%, while B2B gross bookings surged by 17%, achieving the 16th consecutive quarter of double-digit growth [2] - Lodging gross bookings increased by 6% year over year to $22.07 billion, with hotel bookings climbing by 8% [2] Operating Performance - Adjusted EBITDA for the quarter was $908 million, up 15.5% year over year, with an adjusted EBITDA margin of 24%, expanding by 190 basis points [3] - Direct sales and marketing expenses were $1.92 billion, representing 50.7% of revenues, an increase of 7.1% year over year [3] - Overhead expenses totaled $637 million, accounting for 16.8% of revenues, up 5.1% year over year [3] Profitability Metrics - Adjusted EBIT increased by 22.7% year over year to $583 million, with an adjusted EBIT margin improving by 200 basis points to 15.4% [4] Balance Sheet Overview - As of June 30, 2025, cash and cash equivalents and short-term investments were $6.7 billion, up from $6.1 billion as of March 31, 2025 [5] - Long-term debt stood at $4.466 billion, slightly up from $4.465 billion as of March 31, 2025 [5] - The gross leverage ratio was maintained at 2x, aligning with the target to uphold an investment-grade rating [5] Cash Flow - Net cash provided by operating activities was $1.12 billion for the quarter, with free cash flow amounting to $921 million [6] Future Guidance - For Q3 2025, EXPE expects gross bookings growth in the range of 5-7% and revenue growth between 4-6% [7] - The company anticipates adjusted EBITDA margins to increase by 50-100 basis points year over year for Q3 [9] - For the full year 2025, EXPE projects gross bookings and revenue growth in the 3-5% range, with adjusted EBITDA margin expansion of more than 100 basis points year over year [9]

Group 1 - Proactive provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The news team covers medium and small-cap markets, as well as blue-chip companies, commodities, and broader investment stories [3] - Proactive focuses on sectors such as biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Group 2 - Proactive is committed to adopting technology to enhance workflows and content production [4] - The company utilizes automation and software tools, including generative AI, while ensuring all content is edited and authored by humans [5]

Core Insights - Expedia's stock surged over 18% in after-hours trading, reaching $221.49 [1] - The company reported a 6% year-over-year revenue increase to $3.79 billion, exceeding analyst expectations of $3.71 billion [1] - Adjusted earnings per share were $4.24, also surpassing the forecast of $4.09 [1] Revenue and Booking Performance - Total bookings grew by 5%, amounting to $30.41 billion, which was above the anticipated $29.81 billion [1] - The company raised its full-year revenue guidance, now expecting a growth of 3% to 5%, up from the previous forecast of 2% to 4% [1] - Market expectations for revenue growth were at 3.6% [1] Future Outlook - Total bookings are projected to increase by 3% to 5% for the year [1]

Core Insights - Expedia is rapidly integrating artificial intelligence (AI) across its operations, enhancing personalized travel recommendations, customer service, and operational efficiency [2][3][5] - The company reported a significant increase in gross bookings in its B2B segment, with a 17% rise to $8.8 billion, driven by growth in Asia and Europe [6][11] - Despite mixed performance in the U.S. market, Expedia's international revenue grew by 13%, indicating strong momentum in regions like Japan, Brazil, and Northern Europe [6][9] AI Integration - CEO Ariane Gorin emphasized that AI is utilized in every function of the company, with all employees having AI-related goals [3][4] - AI-powered customer service has led to record high net promoter scores and cost reductions [3] - The company is exploring agentic AI to automate inventory management and improve customer issue resolution [4][5] Financial Performance - For Q2, Expedia reported a net income of $330 million, or $2.48 per share, down from $386 million, or $2.80 per share, year-over-year [10] - Revenue increased to $3.79 billion from $3.56 billion a year ago, surpassing analyst expectations [10][11] - Adjusted EBITDA rose 16% to $908 million, reflecting improved operational performance [10] Market Trends - The company noted a cautious approach to discretionary spending among lower-end consumers, while higher-end consumers remain resilient [7] - There was a noted weakness in foreign travel to the U.S., shorter booking windows, and higher cancellation rates [7][9] - Expedia's flagship brands, including Hotels.com and Vrbo, are seeing improvements and new feature introductions post-platform migrations [8][9] Future Outlook - Expedia raised its revenue growth outlook for the year to 3% to 5%, up from a previous estimate of 2% to 4% [11] - The company plans to roll out additional B2B APIs to enhance travel booking capabilities for businesses [5][11] - Traffic from generative AI searches is small but growing rapidly, converting into bookings at higher rates than other traffic sources [5]

分组1 - Expedia reported quarterly earnings of $4.24 per share, exceeding the Zacks Consensus Estimate of $4.14 per share, and up from $3.51 per share a year ago, representing an earnings surprise of +2.42% [1] - The company posted revenues of $3.79 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.94%, compared to $3.56 billion in the same quarter last year [2] - Over the last four quarters, Expedia has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [2] 分组2 - The stock has underperformed the market, losing about 0.6% since the beginning of the year, while the S&P 500 has gained 7.9% [3] - The current consensus EPS estimate for the coming quarter is $7.11 on revenues of $4.22 billion, and for the current fiscal year, it is $14.65 on revenues of $14.17 billion [7] - The Zacks Industry Rank indicates that the Internet - Commerce sector is currently in the bottom 34% of over 250 Zacks industries, which may impact stock performance [8]

Part I. Financial Information [Item 1. Consolidated Financial Statements](index=3&type=section&id=Item%201%20Consolidated%20Financial%20Statements) Expedia Group's unaudited consolidated financial statements and detailed notes for specified periods are presented [Consolidated Statements of Operations](index=3&type=section&id=Consolidated%20Statements%20of%20Operations) This statement details Expedia Group's revenue, operating income, net income, and earnings per share for specified periods | Metric (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $3,786 | $3,558 | $6,774 | $6,447 | | Operating income | $485 | $451 | $415 | $341 | | Net income | $322 | $375 | $125 | $239 | | Net income attributable to Expedia Group, Inc. | $330 | $386 | $130 | $251 | | Basic EPS | $2.61 | $2.92 | $1.02 | $1.88 | | Diluted EPS | $2.48 | $2.80 | $0.96 | $1.79 | - Revenue increased by **6.4%** for the three months ended June 30, 2025, and by **5.1%** for the six months ended June 30, 2025, compared to the same periods in 2024[8](index=8&type=chunk) - Net income attributable to Expedia Group, Inc. decreased by **14.5%** for the three months ended June 30, 2025, and by **48.2%** for the six months ended June 30, 2025, compared to the same periods in 2024[8](index=8&type=chunk) [Consolidated Statements of Comprehensive Income (Loss)](index=4&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This statement presents net income and other comprehensive income components, including currency translation adjustments | Metric (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $322 | $375 | $125 | $239 | | Currency translation adjustments, net of tax | $40 | $(2) | $55 | $(17) | | Comprehensive income | $362 | $373 | $180 | $222 | | Comprehensive income attributable to Expedia Group, Inc. | $363 | $385 | $175 | $237 | - Currency translation adjustments significantly impacted comprehensive income, shifting from a net loss of **$2 million** in Q2 2024 to a gain of **$40 million** in Q2 2025, and from a loss of **$17 million** YTD 2024 to a gain of **$55 million** YTD 2025[10](index=10&type=chunk) [Consolidated Balance Sheets](index=5&type=section&id=Consolidated%20Balance%20Sheets) This statement provides a snapshot of Expedia Group's financial position, detailing assets, liabilities, and equity | Metric (in millions) | June 30, 2025 | December 31, 2024 | | :------------------- | :------------ | :---------------- | | **ASSETS** | | | | Total current assets | $14,733 | $9,815 | | Total assets | $26,976 | $22,388 | | **LIABILITIES AND STOCKHOLDERS' EQUITY** | | | | Total current liabilities | $19,614 | $13,611 | | Total liabilities | $24,890 | $19,578 | | Total stockholders' equity | $2,086 | $2,799 | - Total assets increased by **$4,588 million (20.5%)** from December 31, 2024, to June 30, 2025, primarily driven by a significant increase in cash and cash equivalents and deferred merchant bookings[14](index=14&type=chunk) - Total current liabilities increased by **$6,003 million (44.1%)** over the same period, largely due to a substantial rise in deferred merchant bookings[14](index=14&type=chunk) [Consolidated Statements of Stockholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Stockholders%20Equity) This statement tracks changes in stockholders' equity, including net income, dividends, and share repurchases | Metric (in millions) | Three months ended June 30, 2025 | Six months ended June 30, 2025 | | :------------------- | :------------------------------- | :----------------------------- | | Net income (loss) | $330 | $130 | | Other comprehensive income, net of taxes | $33 | $45 | | Payment of dividends to stockholders | $(51) | $(102) | | Common stock repurchases | $(627) | $(957) | | Stock-based compensation expense | $132 | $248 | - Total stockholders' equity decreased from **$2,799 million** as of December 31, 2024, to **$2,086 million** as of June 30, 2025, primarily due to common stock repurchases and dividend payments, partially offset by net income and stock-based compensation[18](index=18&type=chunk) - The company reinstated quarterly common stock dividends in Q1 2025, with two payments of **$0.40 per share** totaling **$102 million** for the six months ended June 30, 2025[18](index=18&type=chunk)[59](index=59&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This statement summarizes cash inflows and outflows from operating, investing, and financing activities | Cash Flow Activity (in millions) | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $4,073 | $4,380 | | Net cash used in investing activities | $(220) | $(449) | | Net cash used in financing activities | $(1,180) | $(1,149) | | Effect of exchange rate changes on cash | $208 | $(81) | | Net increase in cash, cash equivalents and restricted cash | $2,881 | $2,701 | | Cash, cash equivalents and restricted cash at end of period | $8,455 | $8,362 | - Net cash provided by operating activities decreased by **$307 million** for the six months ended June 30, 2025, compared to the prior year, primarily due to lower working capital benefits[20](index=20&type=chunk)[172](index=172&type=chunk) - Net cash used in investing activities decreased by **$229 million**, driven by sources of cash from currency forward contract gains in 2025 compared to losses in 2024[20](index=20&type=chunk)[173](index=173&type=chunk) [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the consolidated financial statements [Note 1 – Basis of Presentation](index=9&type=section&id=Note%201%20%E2%80%93%20Basis%20of%20Presentation) This note outlines the basis for financial statement preparation, including GAAP adherence, estimates, and business seasonality - Expedia Group's business experiences seasonal fluctuations, with leisure travel bookings generally highest in the first three quarters. Revenue typically lags bookings by several weeks for hotels and several months for alternative accommodations[26](index=26&type=chunk) - On a consolidated basis, revenue and income are typically lowest in the first quarter and highest in the third quarter[26](index=26&type=chunk) [Note 2 – Summary of Significant Accounting Policies](index=9&type=section&id=Note%202%20%E2%80%93%20Summary%20of%20Significant%20Accounting%20Policies) This note details recent accounting policy updates, including new FASB guidance and revenue recognition principles - New FASB guidance on income tax disclosure is effective for annual periods beginning after December 15, 2024, requiring specific categories in rate reconciliation and additional information for significant reconciling items[27](index=27&type=chunk)[28](index=28&type=chunk) - New FASB guidance expanding disclosure requirements for certain income statement expenses is effective for fiscal years beginning after December 15, 2026[29](index=29&type=chunk) | Revenue Recognition Item (in millions) | June 30, 2025 | December 31, 2024 | Recognized in H1 2025 | | :----------------------------------- | :------------ | :---------------- | :-------------------- | | Prepaid merchant bookings | $481 | $319 | N/A | | Deferred merchant bookings | $12,300 | $7,600 | $5,700 | | Deferred loyalty rewards | $1,100 | $937 | $431 | | Deferred revenue | $167 | $164 | $104 | [Note 3 – Fair Value Measurements](index=11&type=section&id=Note%203%20%E2%80%93%20Fair%20Value%20Measurements) This note details financial assets and liabilities measured at fair value, including derivatives and investments | Financial Assets Measured at Fair Value (in millions) | June 30, 2025 | December 31, 2024 | | :-------------------------------------------------- | :------------ | :---------------- | | Total assets measured at fair value on a recurring basis | $1,651 | $1,700 | | Total liabilities measured at fair value on a recurring basis | $15 | $2 | - As of June 30, 2025, the company held **$5.6 billion** in outstanding foreign currency forward contracts to hedge liability exposures, resulting in a net forward asset of **$38 million**[44](index=44&type=chunk) - During the six months ended June 30, 2025, the company recognized approximately **$(223) million** in losses from fair value changes of its equity investment in Global Business Travel Group, Inc., and a **$2 million** gain from the sale of Despegar.com, Corp[46](index=46&type=chunk)[47](index=47&type=chunk) [Note 4 – Debt](index=13&type=section&id=Note%204%20%E2%80%93%20Debt) This note details Expedia Group's outstanding debt, including notes, redemptions, issuances, and credit facility status | Debt Type (in millions) | June 30, 2025 | December 31, 2024 | | :---------------------- | :------------ | :---------------- | | 6.25% senior notes due 2025 | $— | $1,043 | | 5.0% senior notes due 2026 | $750 | $749 | | 0% convertible senior notes due 2026 | $998 | $996 | | 5.4% senior notes due 2035 | $985 | $— | | Total debt | $6,213 | $6,266 | | Long-term debt, excluding current maturities | $4,466 | $5,223 | - In February 2025, Expedia Group early redeemed approximately **$1 billion** of 6.25% senior unsecured notes due May 2025[51](index=51&type=chunk) - In February 2025, the company issued **$1 billion** of 5.4% registered senior unsecured notes due February 2035, with net proceeds of approximately **$985 million**[53](index=53&type=chunk) - Expedia Group maintains a **$2.5 billion** revolving credit facility, with no outstanding borrowings as of June 30, 2025, and was in compliance with all covenants[57](index=57&type=chunk)[58](index=58&type=chunk) [Note 5 – Stockholders' Equity](index=14&type=section&id=Note%205%20%E2%80%93%20Stockholders%20Equity) This note details common stock dividends, share repurchases, and accumulated other comprehensive income | Dividend Declaration | Per Share | Total Amount (in millions) | Payment Date | | :------------------- | :-------- | :------------------------- | :----------- | | February 4, 2025 | $0.40 | $51 | March 27, 2025 | | May 7, 2025 | $0.40 | $51 | June 18, 2025 | - During the six months ended June 30, 2025, Expedia Group repurchased **5.6 million shares** for **$957 million** under its 2023 Share Repurchase Program, with **$2.3 billion** remaining authorized[61](index=61&type=chunk) - Accumulated Other Comprehensive Income (Loss) primarily consists of foreign currency translation adjustments[62](index=62&type=chunk) [Note 6 – Earnings Per Share](index=15&type=section&id=Note%206%20%E2%80%93%20Earnings%20Per%20Share) This note presents basic and diluted earnings per share and weighted-average shares outstanding for specified periods | EPS Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :--------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $2.61 | $2.92 | $1.02 | $1.88 | | Diluted EPS | $2.48 | $2.80 | $0.96 | $1.79 | | Shares (000's) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic | 126,453 | 131,948 | 127,541 | 133,724 | | Diluted | 132,809 | 137,832 | 134,296 | 140,131 | [Note 7 – Restructuring and Related Reorganization Charges](index=16&type=section&id=Note%207%20-%20Restructuring%20and%20Related%20Reorganization%20Charges) This note details restructuring actions, primarily headcount reductions, and associated charges for specified periods - Expedia Group recognized **$70 million** in restructuring and related reorganization charges during the six months ended June 30, 2025, an increase from **$66 million** in the same period of 2024[66](index=66&type=chunk) - These charges were predominately related to employee severance and benefit costs, with approximately **$32 million** included in accrued expenses and other current liabilities as of June 30, 2025[66](index=66&type=chunk) - The company expects approximately **$20 million** in additional reorganization charges based on current plans[66](index=66&type=chunk) [Note 8 – Income Taxes](index=16&type=section&id=Note%208%20%E2%80%93%20Income%20Taxes) This note provides effective tax rates, explains changes, and discusses IRS examinations and transfer pricing disputes | Metric | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :----- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Effective tax rate | 23.9% | 23.3% | 39.3% | 28.3% | - The change in effective tax rate for both periods was primarily due to nondeductible mark-to-market charges[68](index=68&type=chunk) - Expedia Group is under examination by the IRS for tax years 2017 to 2020 and is vigorously defending its position against prior IRS adjustments related to transfer pricing for tax years 2011-2013 and 2014-2016, totaling approximately **$675 million** in federal income tax[69](index=69&type=chunk) [Note 9 – Commitments and Contingencies](index=16&type=section&id=Note%209%20%E2%80%93%20Commitments%20and%20Contingencies) This note discusses legal proceedings, contingent matters, taxes, international VAT, and recent tax settlements - Management does not expect current lawsuits to have a material impact on liquidity, results of operations, or financial condition[70](index=70&type=chunk) - Expedia Group has established reserves for potential settlement of hotel occupancy and other taxes, which were not material as of June 30, 2025, and December 31, 2024[71](index=71&type=chunk) - The company reached an agreement with Italian tax authorities, paying **$71 million** for 2016-2022 VAT matters in November 2024, and an additional **$33 million** for 2023-2024 in July 2025[75](index=75&type=chunk) [Note 10 – Segment Information](index=17&type=section&id=Note%2010%20%E2%80%93%20Segment%20Information) This note defines Expedia Group's B2C, B2B, and trivago segments, detailing performance using Adjusted EBITDA - Expedia Group operates through three reportable segments: B2C (consumer brands), B2B (travel technology and supply solutions), and trivago (hotel metasearch)[77](index=77&type=chunk) - Adjusted EBITDA is the primary operating metric used by CODMs to allocate resources and assess segment performance[79](index=79&type=chunk) | Segment Revenue (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | B2C | $2,479 | $2,432 | $4,435 | $4,418 | | B2B | $1,209 | $1,049 | $2,156 | $1,882 | | trivago (Third-party) | $98 | $77 | $183 | $147 | | Total Revenue | $3,786 | $3,558 | $6,774 | $6,447 | | Segment Adjusted EBITDA (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | B2C | $728 | $654 | $945 | $869 | | B2B | $331 | $263 | $547 | $435 | | trivago | $(6) | $(5) | $(11) | $(14) | | Total Adjusted EBITDA | $908 | $786 | $1,204 | $1,041 | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on financial performance, condition, and operational results [Overview and Trends](index=23&type=section&id=Overview%20and%20Trends) This section outlines Expedia Group's mission, industry trends, competitive landscape, and key operating metrics - Expedia Group's mission is to power global travel, leveraging its supply portfolio, platform, and technology across consumer brands and business partners[95](index=95&type=chunk) - Global macroeconomic and geopolitical pressures, including weaker than expected travel demand in the U.S. during Q1 and Q2 2025, are impacting the travel industry[97](index=97&type=chunk) - The online travel market is highly competitive, with challenges from generative AI tools, search engine companies (e.g., Google), metasearch companies, direct bookings by airlines/lodging, and the 'sharing economy' (e.g., Airbnb, Vrbo)[100](index=100&type=chunk) | Lodging Metric | Q2 2025 Growth | 2024 Growth | 2023 Growth | | :------------- | :------------- | :---------- | :---------- | | Room nights booked | 7% | 9% | 12% | | ADRs booked | Flat | -1% | -2% | - Air bookings grew **3%** in Q2 2025 compared to Q2 2024, but continued to lag lodging business growth. Air revenue accounted for **3%** of total worldwide revenue in Q2 2025[110](index=110&type=chunk)[111](index=111&type=chunk) - Total advertising and media revenue accounted for **7%** of total worldwide revenue in Q2 2025, with EG Advertising growing **19%** and trivago Advertising growing **28%** compared to Q2 2024[112](index=112&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) [Business Strategy](index=25&type=section&id=Business%20Strategy) Expedia Group's strategy focuses on leveraging its brand, supply, and platform technology for customer relationships - Expedia Group's strategy focuses on leveraging its brand, supply, and platform technology to provide greater services and value to travelers, suppliers, and business partners, building longer-lasting direct customer relationships[115](index=115&type=chunk) - The company has unified its technology, product, data engineering, and data science teams to build scalable services and capabilities, completing the migration of core B2C brands onto a unified Brand Expedia technology front-end infrastructure[117](index=117&type=chunk)[118](index=118&type=chunk) - One Key, a unified loyalty program, was launched in the U.S. and U.K., enabling travelers to cross-earn and cross-redeem rewards across Brand Expedia, Hotels.com, and Vrbo[119](index=119&type=chunk) [Seasonality](index=26&type=section&id=Seasonality) This section explains the seasonal nature of travel bookings, with revenue and income typically lowest in Q1 and highest in Q3 - Travel bookings are generally highest in the first three quarters, with revenue lagging bookings by several weeks for hotels and months for alternative accommodations[120](index=120&type=chunk) - Consolidated revenue and income are typically lowest in the first quarter and highest in the third quarter[120](index=120&type=chunk) [Critical Accounting Policies and Estimates](index=26&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section highlights critical accounting estimates requiring significant judgment impacting financial results - Critical accounting estimates require significant judgment and assumptions, where changes could materially impact financial condition or results of operations[122](index=122&type=chunk)[123](index=123&type=chunk) [Segments](index=26&type=section&id=Segments) This section identifies Expedia Group's three reportable segments: B2C, B2B, and trivago - Expedia Group's reportable segments are B2C, B2B, and trivago[125](index=125&type=chunk) [Operating Metrics](index=26&type=section&id=Operating%20Metrics) This section presents key operating metrics, including gross bookings and revenue margin, for specified periods | Metric (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | **Gross Bookings** | | | | | | | | B2C | $21,565 | $21,290 | 1% | $44,180 | $43,687 | 1% | | B2B | $8,844 | $7,547 | 17% | $17,680 | $15,314 | 15% | | Total gross bookings | $30,409 | $28,837 | 5% | $61,860 | $59,001 | 5% | | **Revenue Margin** | | | | | | | | B2C | 11.5% | 11.4% | | 10.0% | 10.1% | | | B2B | 13.7% | 13.9% | | 12.2% | 12.3% | | | Total revenue margin | 12.4% | 12.3% | | 10.9% | 10.9% | | - Gross bookings increased **5%** for both the three and six months ended June 30, 2025, primarily driven by lodging gross bookings in the hotel business, with booked room nights increasing **7%**[128](index=128&type=chunk) [Results of Operations](index=27&type=section&id=Results%20of%20Operations) This section provides a detailed analysis of Expedia Group's revenue and expense performance for the reporting periods [Revenue](index=27&type=section&id=Revenue) Revenue increased, driven by B2B and lodging growth, with strong advertising revenue and decreased air revenue | Revenue by Segment (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | B2C | $2,479 | $2,432 | 2% | $4,435 | $4,418 | 0% | | B2B | $1,209 | $1,049 | 15% | $2,156 | $1,882 | 15% | | trivago (Third-party) | $98 | $77 | 28% | $183 | $147 | 25% | | Total revenue | $3,786 | $3,558 | 6% | $6,774 | $6,447 | 5% | | Revenue by Service Type (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :------------------------------------ | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Lodging | $3,040 | $2,862 | 6% | $5,329 | $5,090 | 5% | | Air | $105 | $111 | (5)% | $212 | $226 | (6)% | | Expedia Group Advertising | $182 | $152 | 19% | $356 | $297 | 20% | | trivago Advertising | $98 | $77 | 28% | $183 | $147 | 25% | | Other | $361 | $356 | 1% | $694 | $687 | 1% | | Total revenue | $3,786 | $3,558 | 6% | $6,774 | $6,447 | 5% | | Revenue by Business Model (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :-------------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Merchant | $2,624 | $2,459 | 7% | $4,670 | $4,423 | 6% | | Agency | $852 | $838 | 2% | $1,504 | $1,516 | (1)% | | Advertising, media and other | $310 | $261 | 19% | $600 | $508 | 18% | | Total revenue | $3,786 | $3,558 | 6% | $6,774 | $6,447 | 5% | [Cost of Revenue](index=28&type=section&id=Cost%20of%20Revenue) Cost of revenue remained consistent for the three and six months ended June 30, 2025, reflecting efficiencies | Cost of Revenue (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :---------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Direct costs | $302 | $284 | 6% | $588 | $564 | 4% | | Personnel and overhead | $75 | $78 | (4)% | $146 | $156 | (6)% | | Total cost of revenue | $377 | $362 | 4% | $734 | $720 | 2% | | % of revenue | 9.9% | 10.2% | | 10.8% | 11.2% | | [Selling and Marketing - Direct and Indirect](index=29&type=section&id=Selling%20and%20Marketing%20-%20Direct%20and%20Indirect) Selling and marketing expenses increased due to higher B2B commissions and increased salaries | Selling and Marketing (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :---------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Selling and marketing - direct | $1,920 | $1,793 | 7% | $3,677 | $3,443 | 7% | | % of revenue | 50.7% | 50.4% | | 54.3% | 53.4% | | | Selling and marketing - indirect | $213 | $197 | 8% | $412 | $383 | 7% | | % of revenue | 5.6% | 5.5% | | 6.1% | 5.9% | | - Direct selling and marketing costs increased due to higher B2B partner commissions supporting revenue growth[140](index=140&type=chunk) - Indirect selling and marketing costs increased primarily due to higher average salaries[140](index=140&type=chunk) [Technology and Content](index=29&type=section&id=Technology%20and%20Content) Technology and content expense decreased due to lower personnel costs and cloud spending optimization initiatives | Technology and Content (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :----------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Personnel and overhead | $235 | $239 | (1)% | $472 | $489 | (3)% | | Other | $90 | $92 | (3)% | $173 | $183 | (6)% | | Total technology and content | $325 | $331 | (2)% | $645 | $672 | (4)% | | % of revenue | 8.6% | 9.3% | | 9.5% | 10.4% | | [General and Administrative](index=29&type=section&id=General%20and%20Administrative) General and administrative expense increased due to higher personnel and overhead costs and miscellaneous business taxes | General and Administrative (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :--------------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Personnel and overhead | $151 | $144 | 4% | $297 | $292 | 2% | | Professional fees and other | $46 | $36 | 27% | $80 | $74 | 7% | | Total general and administrative | $197 | $180 | 9% | $377 | $366 | 3% | | % of revenue | 5.2% | 5.1% | | 5.6% | 5.7% | | [Depreciation and Amortization](index=30&type=section&id=Depreciation%20and%20Amortization) Depreciation increased from capitalized website development, while amortization decreased | Depreciation and Amortization (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :------------------------------------------ | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Depreciation | $212 | $190 | 12% | $420 | $385 | 9% | | Amortization of intangible assets | $11 | $15 | (32)% | $22 | $30 | (29)% | | Total depreciation and amortization | $223 | $205 | 9% | $442 | $415 | 6% | [Legal Reserves, Occupancy Tax and Other](index=30&type=section&id=Legal%20Reserves%2C%20Occupancy%20Tax%20and%20Other) This expense category decreased significantly in 2025 due to prior year charges for digital service taxes and a donation | Legal Reserves, Occupancy Tax and Other (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :---------------------------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Amount | $2 | $21 | $2 | $41 | | % of revenue | 0.1% | 0.6% | 0% | 0.6% | - The higher charges in the six months ended June 30, 2024, included a **$30 million** charge for Canadian digital service taxes and a **$20 million** donation for public park revitalization in Seattle[147](index=147&type=chunk) [Restructuring and Related Reorganization Charges](index=30&type=section&id=Restructuring%20and%20Related%20Reorganization%20Charges) Restructuring charges increased in H1 2025 due to expanded reorganization actions, primarily employee severance and benefits - Restructuring and related reorganization charges were **$70 million** for the six months ended June 30, 2025, up from **$66 million** in the prior year, due to expanded actions including headcount reductions[148](index=148&type=chunk) [Operating Income](index=30&type=section&id=Operating%20Income) Operating income increased due to revenue growth and lower legal charges, with Adjusted EBITDA growth | Operating Income (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :----------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Operating income | $485 | $451 | 8% | $415 | $341 | 22% | | % of revenue | 12.8% | 12.7% | | 6.1% | 5.3% | | | Adjusted EBITDA by Segment (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :--------------------------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | B2C | $728 | $654 | 12% | $945 | $869 | 9% | | B2B | $331 | $263 | 26% | $547 | $435 | 26% | | trivago | $(6) | $(5) | 30% | $(11) | $(14) | (21)% | | Total Adjusted EBITDA | $908 | $786 | 16% | $1,204 | $1,041 | 16% | [Interest Income and Expense](index=31&type=section&id=Interest%20Income%20and%20Expense) Interest income increased from higher cash balances, while interest expense decreased due to new senior notes | Interest (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :--------------------- | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Interest income | $74 | $67 | 10% | $128 | $118 | 8% | | Interest expense | $(58) | $(61) | (6)% | $(116) | $(123) | (6)% | [Other, Net](index=31&type=section&id=Other%2C%20Net) Other, net shifted from a gain to a loss, primarily due to foreign exchange and minority equity investment changes | Other, Net (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :----------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Foreign exchange rate gains (losses), net | $28 | $(31) | $40 | $(61) | | Gains (losses) on minority equity investments, net | $(102) | $56 | $(258) | $47 | | Other | $(4) | $6 | $(3) | $11 | | Total other, net | $(78) | $31 | $(221) | $(3) | [Provision for Income Taxes](index=32&type=section&id=Provision%20for%20Income%20Taxes) The effective tax rate increased due to mark-to-market charges; OBBBA impacts are under evaluation | Income Tax Metric (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | % Change | Six months ended June 30, 2025 | Six months ended June 30, 2024 | % Change | | :------------------------------ | :------------------------------- | :------------------------------- | :------- | :----------------------------- | :----------------------------- | :------- | | Provision for income taxes | $101 | $113 | (11)% | $81 | $94 | (14)% | | Effective tax rate | 23.9% | 23.3% | | 39.3% | 28.3% | | - The effective tax rate for the six months ended June 30, 2025, increased to **39.3%** from **28.3%** in the prior year, primarily due to nondeductible mark-to-market charges[158](index=158&type=chunk) - The company is evaluating the potential impacts and elections related to the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, which makes permanent key provisions of the Tax Cuts and Jobs Act of 2017 and introduces other tax changes[160](index=160&type=chunk) [Definition and Reconciliation of Adjusted EBITDA](index=32&type=section&id=Definition%20and%20Reconciliation%20of%20Adjusted%20EBITDA) This section defines Adjusted EBITDA as a non-GAAP measure and reconciles it to net income - Adjusted EBITDA is a non-GAAP measure used by management to evaluate business performance and is reconciled to net income attributable to Expedia Group, Inc[161](index=161&type=chunk)[162](index=162&type=chunk) | Reconciliation Item (in millions) | Three months ended June 30, 2025 | Three months ended June 30, 2024 | Six months ended June 30, 2025 | Six months ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income attributable to Expedia Group, Inc. | $330 | $386 | $130 | $251 | | Provision for income taxes | $101 | $113 | $81 | $94 | | Total other (income) expense, net | $62 | $(37) | $209 | $8 | | Operating income | $485 | $451 | $415 | $341 | | Stock-based compensation | $105 | $114 | $203 | $218 | | Depreciation and amortization | $223 | $205 | $442 | $415 | | Adjusted EBITDA | $908 | $786 | $1,204 | $1,041 | [Financial Position, Liquidity and Capital Resources](index=33&type=section&id=Financial%20Position%2C%20Liquidity%20and%20Capital%20Resources) This section discusses Expedia Group's financial position, liquidity, capital resources, debt, and cash flow - Principal sources of liquidity include cash flows from operations, available credit facility, and cash and short-term investments, which totaled **$6.7 billion** at June 30, 2025[166](index=166&type=chunk) - In February 2025, the company issued **$1 billion** of 5.4% senior notes and redeemed approximately **$1 billion** of 6.25% senior notes[167](index=167&type=chunk)[168](index=168&type=chunk) - Credit ratings as of June 30, 2025, were Baa2 (Moody's), BBB (S&P), and BBB (Fitch), all with a 'stable' outlook[169](index=169&type=chunk) - Net cash provided by operating activities decreased for the six months ended June 30, 2025, compared to the prior year, due to lower working capital benefits[172](index=172&type=chunk) - The company repurchased **5.6 million shares** for approximately **$957 million** under its 2023 Share Repurchase Program during the six months ended June 30, 2025[175](index=175&type=chunk) - Quarterly cash dividends of **$0.40 per share** were paid in March and June 2025, totaling **$102 million**[176](index=176&type=chunk) [Summarized Financial Information for Guarantors and the Issuer of Guaranteed Securities](index=35&type=section&id=Summarized%20Financial%20Information%20for%20Guarantors%20and%20the%20Issuer%20of%20Guaranteed%20Securities) This section provides summarized financial information for the obligor group, including assets and liabilities | Obligor Group (in millions) | June 30, 2025 | December 31, 2024 | | :-------------------------- | :------------ | :---------------- | | Current Assets | $12,774 | $7,996 | | Non-Current Assets | $10,363 | $10,495 | | Current Liabilities | $18,509 | $14,129 | | Non-Current Liabilities | $5,022 | $5,744 | | Obligor Group (in millions) | Six Months Ended June 30, 2025 | Year Ended December 31, 2024 | | :-------------------------- | :----------------------------- | :--------------------------- | | Revenue | $5,130 | $10,520 | | Operating income | $242 | $915 | | Net income | $218 | $719 | [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=36&type=section&id=Item%203%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section confirms no material changes in Expedia Group's market risk during the specified periods - No material changes in market risk occurred during the three and six months ended June 30, 2025[183](index=183&type=chunk) [Item 4. Controls and Procedures](index=37&type=section&id=Item%204%20Controls%20and%20Procedures) This section confirms effective disclosure controls and no material changes to internal financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025[184](index=184&type=chunk) - There were no material changes to internal control over financial reporting during the quarter ended June 30, 2025[185](index=185&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=38&type=section&id=Item%201%20Legal%20Proceedings) This section provides updates on specific legal proceedings, including favorable outcomes in the Helms Burton Litigation - In the Helms Burton Litigation, the Eleventh Circuit affirmed the dismissal in Del Valle and dismissed the Trinidad appeal, effectively ending those matters. A jury also returned a verdict in favor of Expedia in the CSL matter[186](index=186&type=chunk) [Item 1A. Risk Factors](index=39&type=section&id=Item%201A%20Risk%20Factors) This section refers to the Annual Report on Form 10-K for risk factors, noting no new material risks in this report - Readers should refer to the Annual Report on Form 10-K for a comprehensive discussion of risk factors, as no new material risks are presented in this report[187](index=187&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=39&type=section&id=Item%202%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section summarizes share repurchase activity under the 2023 Share Repurchase Program for Q2 2025 | Period | Total Number of Shares Purchased (in thousands) | Average Price Paid Per Share | | :--------------- | :-------------------------------------------- | :--------------------------- | | April 1-30, 2025 | 782 | $152.98 | | May 1-31, 2025 | 1,472 | $164.36 | | June 1-30, 2025 | 1,570 | $168.88 | | Total | 3,824 | | - As of June 30, 2025, **$2.276 billion** remained authorized for repurchase under the 2023 Share Repurchase Program[188](index=188&type=chunk) [Item 5. Other Information](index=39&type=section&id=Item%205%20Other%20Information) This section confirms no Rule 10b5-1 trading arrangements by directors or executive officers during Q2 2025 - No Rule 10b5-1 trading arrangements were adopted, modified, or terminated by directors or executive officers during Q2 2025[189](index=189&type=chunk) [Item 6. Exhibits](index=40&type=section&id=Item%206%20Exhibits) This section lists all exhibits filed with the Quarterly Report on Form 10-Q, including certifications and XBRL - Key exhibits include certifications pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, and XBRL formatted financial statements[191](index=191&type=chunk) [Signature](index=41&type=section&id=Signature) This section contains the official signature block for the Quarterly Report on Form 10-Q