Summary
Expedia Group, Inc. reported solid revenue growth for the nine months ended September 30, 2016, with total revenue reaching $6.68 billion, a 34% increase year-over-year. This growth was significantly driven by strategic acquisitions, including Orbitz and HomeAway, which contributed substantially to revenue and gross bookings. The company's net income attributable to Expedia, Inc. for the nine months was $202.39 million, a notable decrease from $777.00 million in the prior year. This reduction is largely attributable to a significant gain on the sale of eLong in the prior year and increased operating expenses, including higher selling and marketing costs and amortization of intangible assets related to recent acquisitions. Despite the decrease in net income, the company's operating income for the nine months was $314.5 million, though down from $384.1 million in the prior year. Expedia maintains a strong liquidity position with $1.9 billion in cash and cash equivalents and a largely untapped $1.5 billion revolving credit facility. The company continued its return of capital to shareholders through share repurchases and dividend payments. Investors should note the ongoing legal proceedings related to occupancy taxes and the company's active management of these risks, including establishing reserves.
Financial Highlights
51 data points| Revenue | $2.58B |
| Cost of Revenue | $416.91M |
| Gross Profit | $2.16B |
| Operating Income | $386.15M |
| Interest Expense | $43.37M |
| Net Income | $279.33M |
| EPS (Basic) | $1.86 |
| EPS (Diluted) | $1.81 |
| Shares Outstanding (Basic) | 150.24M |
| Shares Outstanding (Diluted) | 154.24M |
Key Highlights
- 1Total revenue for the first nine months of 2016 increased by 34% to $6.68 billion, driven by acquisitions and organic growth in Core OTA and trivago.
- 2Net income attributable to Expedia, Inc. decreased significantly to $202.39 million for the nine months ended September 30, 2016, down from $777.00 million in the prior year, largely due to a large gain from the sale of eLong in the prior year.
- 3Operating income for the nine months decreased to $314.5 million from $384.1 million, impacted by increased operating expenses and the prior year's gain from the sale of eLong.
- 4The company completed the acquisition of Orbitz in September 2015 and HomeAway in December 2015, contributing significantly to revenue and gross bookings in 2016.
- 5Cash and cash equivalents stood at $1.84 billion as of September 30, 2016, indicating a strong liquidity position.
- 6Selling and marketing expenses increased by 31% for the nine months, driven by direct and indirect costs, including marketing expenses and increased headcount from acquisitions.
- 7Amortization of intangible assets increased by 202% to $251.3 million for the nine months, primarily due to recent acquisitions like Orbitz and HomeAway.