01—Abstract
Summary
Summary of the 10-Q filed May 4, 2022. Cited figures are marked; the original filing is the authoritative source.
Booking Holdings Inc. reported a net loss of $700 milliona for the first quarter of 2022, a significant increase from the $55 million net loss in the same period of 2021.
This widening loss was primarily driven by substantial unrealized losses on equity investments, totaling $987 millionb, compared to a gain of $36 million in the prior year. Despite the net loss, total revenues surged by 136.3% year-over-year to $2.7 billion, reflecting a strong rebound in travel demand as pandemic-related restrictions eased. The company saw a robust recovery in key operational metrics, with room nights booked increasing by 99.7% and gross bookings more than doubling to $27.3 billion.
This growth was bolstered by significant increases in both agency and merchant revenues, with merchant gross bookings growing at a faster pace due to expansion at Booking.com. While marketing expenses rose considerably to support the demand recovery, they remained below pre-pandemic levels. The company also highlighted increased ADRs (Average Daily Rates) and expressed optimism for an operating profit in the second quarter of 2022, despite ongoing uncertainties from geopolitical events and the pandemic.
02—Key points
Key Highlights
- Total revenues increased significantly by 136.3% to $2.7 billion, driven by recovering travel demand.
- Net loss widened to $700 million from $55 million in the prior year, largely due to $987 million in unrealized losses on equity investments.
- Gross bookings more than doubled, increasing by 128.7% to $27.3 billion, indicating a strong recovery in travel volume.
- Room nights booked saw a substantial increase of 99.7%, demonstrating a robust rebound in customer bookings.
- Marketing expenses rose by 148.8% to $1.15 billion, reflecting increased investment to capture the recovering travel market.
- The company expects an operating profit in the second quarter of 2022, signaling a return to profitability despite ongoing market uncertainties.
- Booking Holdings continued its share repurchase program, spending $1.1 billion in the first quarter of 2022.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2022filed May 4, 2022Financial Statements
Q1 FY2022 against Q1 FY2021
| Line item | Q1 FY2022Q1 FY2021 | Change |
|---|---|---|
| Revenue | $2.69B$1.14B | +136.2% |
| Operating Expenses | $2.52B$1.45B | +73.6% |
| Operating Income | $174.00M-$311.00M | +155.9% |
| Interest Expense | $68.00M$98.00M | −30.6% |
| Net Income | -$700.00M-$55.00M | −1172.7% |
| EPS (Basic) | $-0.68$-0.05 | −1176.1% |
| EPS (Diluted) | $-0.68$-0.05 | −1176.1% |
| Shares Outstanding (Basic) | 1.02B1.02B | −0.1% |
| Shares Outstanding (Diluted) | 1.02B1.02B | −0.1% |
05—Questions
Frequently Asked Questions
What was the primary driver of the significant net loss in Q1 2022?
The primary driver of the widened net loss in Q1 2022 was $987 million in unrealized losses on equity investments, notably in Meituan, DiDi Global Inc., and Grab Holdings Limited. This contrasts with a net gain on equity investments in the prior year's quarter.
How did Booking Holdings' revenues and bookings perform compared to the previous year?
Booking Holdings experienced a strong rebound in Q1 2022. Total revenues grew by 136.3% to $2.7 billion, and total gross bookings increased by 128.7% to $27.3 billion, reflecting a significant recovery in travel demand and operational activity.
What is the company's outlook for the second quarter of 2022?
Booking Holdings anticipates an operating profit in the second quarter of 2022. They expect gross bookings to be approximately 20 percentage points better than room nights relative to Q2 2019, primarily due to increased Average Daily Rates (ADRs), and anticipate revenues as a percentage of gross bookings to be lower than Q2 2019.
How is the Russia-Ukraine conflict impacting Booking Holdings?
The conflict led to an immediate suspension of booking services in Russia and Belarus, resulting in lost bookings and cancellations. While there was an initial softening of booking trends across Europe, the company noted an improvement after the first week of March 2022. The company is also navigating complex sanctions regimes and potential cybersecurity or geopolitical risks.
06—Continue