01—Abstract
Summary
Summary of the 10-K/A filed May 2, 2011. Cited figures are marked; the original filing is the authoritative source.
Expedia Group, Inc. (EXPE) filed its amended 10-K for the year ended December 31, 2010, on May 2, 2011.
This amendment primarily updated Part III and Part IV of the filing, with no changes to Part I or Part II. A key aspect highlighted is Expedia's status as a "controlled company" under NASDAQ rules, due to Barry Diller, in conjunction with Liberty Media, controlling approximately 61%a of the combined voting power of the company's capital stock. This control exempts Expedia from certain NASDAQ governance requirements, such as having a majority of independent directors.
The filing also details executive compensation, including base salaries, cash bonuses, and equity awards (primarily stock options) for the year 2010. Notably, executive bonuses for 2010 were significantly lower than in 2009, reflecting performance considerations.
The report outlines stock ownership guidelines for executives and directors, aiming to align their interests with stockholders. Additionally, it provides details on fees paid to its independent registered public accounting firm, Ernst & Young LLP.
02—Key points
Key Highlights
- Expedia operates as a "controlled company" due to Barry Diller and Liberty Media collectively holding approximately 61% of the voting power, exempting it from certain NASDAQ governance rules.
- The filing details the executive compensation structure for 2010, comprising base salary, cash bonuses, and equity awards (stock options).
- Cash bonuses awarded to named executive officers in 2010 were significantly lower than in 2009.
- The company has implemented stock ownership guidelines for executives and directors to align their interests with those of shareholders.
- The Board of Directors has independent directors, and the Audit Committee has members designated as "audit committee financial experts."
- Ernst & Young LLP served as the independent registered public accounting firm, with fees totaling $6.28 million for 2010.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2010, Expedia Group, Inc. kept $0.14.
- Revenue$3.03B100.0%
- Cost of revenue−$685.5M22.6%
- Gross profit$2.35B77.4%
- Operating costs−$1.85B60.9%
- Operating income$500.8M16.5%
- Interest, other & tax−$79.3M2.6%
- Net income$421.5M13.9%
Where FY2010 revenue went
$3.03B- Operating costs: $1.85B, 61% of revenue
- Cost of revenue: $685.5M, 23% of revenue
- Net income: $421.5M, 14% of revenue
- Interest, other & tax: $79.3M, 2.6% of revenue
Kept 14% as net income
Full revenue history →04—Financials
Financial Highlights
Figures from 10-K/AFY2010filed May 2, 2011Financial Statements
FY2010 against FY2009
| Line item | FY2010FY2009 | Change |
|---|---|---|
| Revenue | $3.03B$2.74B | +10.6% |
| Cost of Revenue | $685.49M$602.68M | +13.7% |
| Gross Profit | $2.35B$2.14B | +9.7% |
| Operating Income | $500.79M$397.74M | +25.9% |
| Interest Expense | $66.43M$49.45M | +34.3% |
| Net Income | $421.50M$299.53M | +40.7% |
| EPS (Basic) | $2.98$2.08 | +43.3% |
| EPS (Diluted) | $2.93$2.05 | +42.9% |
| Shares Outstanding (Basic) | 141.23M144.11M | −2.0% |
| Shares Outstanding (Diluted) | 144.01M146.07M | −1.4% |
05—Questions
Frequently Asked Questions
What does it mean for Expedia to be a "controlled company"?
Expedia is considered a "controlled company" because Barry Diller and Liberty Media, together, hold over 50% of the voting power of the company's stock. This status allows Expedia to be exempt from certain NASDAQ listing rules that typically require a majority of independent directors on the board and independent members on certain committees.
How was executive compensation structured in 2010?
In 2010, Expedia's executive compensation primarily consisted of base salary, cash bonuses, and equity awards, predominantly in the form of stock options. The Compensation Committees reviewed these elements annually, considering company and individual performance, management recommendations, and competitive market data.
What is the significance of the relationship between Expedia, Barry Diller, and Liberty Media?
Barry Diller, along with Liberty Media, effectively controls Expedia through stock ownership and voting agreements. This control influences board composition and governance due to Expedia's "controlled company" status. There are also cost-sharing and aircraft usage agreements between Expedia and IAC (where Diller also holds a significant role) and other arrangements with Liberty Media.
What were the key changes in executive bonuses for 2010 compared to 2009?
Cash bonuses awarded to named executive officers for 2010 were significantly lower than those awarded in 2009. The company's 2010 financial performance, compared to 2009, was a key factor in this reduction, alongside individual executive performance and contributions.
06—Continue