10-KPeriod: FY2022

Booking Holdings Inc. Annual Report, Year Ended Dec 31, 2022

Filed February 23, 2023For Securities:BKNG

Summary

Booking Holdings Inc. (BKNG) demonstrated a robust recovery in 2022, surpassing pre-pandemic room night levels and achieving 6% growth in room nights compared to 2019. Total revenues surged by 56% year-over-year to $17.1 billion, driven by a significant increase in both agency and merchant bookings, reflecting a rebound in global travel demand post-COVID-19. The company's strategic focus on enhancing its platforms, expanding its payments capabilities, and improving loyalty programs like Booking.com's Genius program appears to be paying off. Despite facing headwinds from geopolitical events, inflation, and travel disruptions, Booking Holdings successfully navigated these challenges. The company's diversified brand portfolio, including Booking.com, Priceline, Agoda, Rentalcars.com, KAYAK, and OpenTable, positions it well within the online travel sector. Investors should note the significant increase in marketing expenses ($6.0 billion) and the company's continued investment in technology and expanding services, such as flights and activities, as key drivers for future growth. While the company has strong liquidity, it also faces ongoing risks related to competition, regulatory changes, and currency fluctuations, which are important considerations for investors.

Financial Highlights

52 data points
Beta

Revenue

$17.09B

Net Income

$3.06B

17.9% Net Margin

EPS (Diluted)

$3.05

Total Assets

$25.36B

Cash & Equivalents

$12.25B

Free Cash Flow

$6.19B

Financial Statements
Beta
Revenue$17.09B
Operating Expenses$11.99B
Operating Income$5.10B
Interest Expense$391.00M
Net Income$3.06B
EPS (Basic)$3.07
EPS (Diluted)$3.05
Shares Outstanding (Basic)996.80M
Shares Outstanding (Diluted)1.00B

Key Highlights

  • 1Global room nights in 2022 exceeded 2019 levels by 6%, indicating a strong recovery in travel demand.
  • 2Total revenues grew 56% year-over-year to $17.1 billion, driven by substantial increases in both agency and merchant bookings.
  • 3Marketing expenses increased significantly to $6.0 billion, reflecting investment in demand recovery and brand awareness.
  • 4Booking.com's mobile app remains a key driver, being the most downloaded online travel agency app globally and in the U.S.
  • 5The company continues to expand its offerings beyond accommodation, notably growing its flight and tours & activities segments.
  • 6Despite foreign currency headwinds, constant currency revenue growth was even stronger at 71% year-over-year.
  • 7Booking Holdings maintained strong liquidity with $15.2 billion in cash, cash equivalents, and investments as of December 31, 2022.

Frequently Asked Questions

For the first quarter of 2023, Booking Holdings expects year-over-year room night growth to exceed 30% and gross bookings growth to be approximately four percentage points higher. Revenues as a percentage of gross bookings and operating profit are also expected to be higher than in Q1 2022. For the full year 2023, the company anticipates low teens percentage growth in gross bookings, with revenues as a percentage of gross bookings and operating profit being higher than both 2019 and 2022 levels.

The strengthening of the U.S. Dollar against major currencies like the Euro and British Pound Sterling negatively impacted reported revenues and gross bookings in 2022. While total revenues increased 56% year-over-year, on a constant currency basis, revenue growth was approximately 71%, indicating the significant effect of currency fluctuations.

Key risks include intense competition from both online travel agencies and large tech companies, potential adverse changes in market conditions, regulatory scrutiny and evolving laws (especially in data privacy and online commerce), cybersecurity threats, dependence on travel service providers, and currency exchange rate volatility. The company also faces risks related to attracting and retaining skilled talent and the potential impact of global economic conditions.

Booking Holdings is actively expanding beyond its core accommodation booking services. In 2022, it significantly grew its flight offerings, expanding into over 50 countries, and also expanded its tours and activities segment into over 1,200 cities. The company is also focused on developing a 'Connected Trip' strategy to offer a more seamless and tailored consumer experience across multiple travel elements.