10-QPeriod: Q2 FY2021

Expedia Group, Inc. Quarterly Report for Q2 Ended Jun 30, 2021

Filed August 6, 2021For Securities:EXPE

Summary

Expedia Group, Inc. (EXPE) reported its second quarter 2021 financial results, indicating a significant recovery in revenue and booking activity compared to the pandemic-impacted second quarter of 2020. Total revenue surged by 273% year-over-year to $2.1 billion, driven by a substantial rebound in its Retail segment, which saw a 357% increase in revenue to $1.7 billion. This growth was fueled by a 667% increase in gross bookings, highlighting a strong recovery in leisure travel demand. Despite the revenue surge, the company still reported an operating loss of $132 million for the quarter, an improvement from the $849 million operating loss in the prior year period. Net loss attributable to common stockholders narrowed to $301 million from $753 million in Q2 2020. The company's liquidity remains strong, with $5.5 billion in cash and cash equivalents and short-term investments as of June 30, 2021. Expedia also made progress in its debt management by issuing new convertible senior notes and senior unsecured notes, while also redeeming higher-cost debt.

Financial Highlights

49 data points
Beta

Revenue

$2.11B

Net Income

-$172.00M

-8.1% Net Margin

EPS (Diluted)

$-2.02

Total Assets

$24.18B

Cash & Equivalents

$5.46B

Free Cash Flow

$2.33B

Financial Statements
Beta
Revenue$2.11B
Operating Income-$132.00M
Interest Expense$83.00M
Net Income-$172.00M
EPS (Basic)$-2.02
EPS (Diluted)$-2.02
Shares Outstanding (Basic)149.09M
Shares Outstanding (Diluted)149.09M

Key Highlights

  • 1Revenue more than quadrupled year-over-year, reaching $2.11 billion in Q2 2021, driven by a strong rebound in travel demand.
  • 2Gross bookings saw a dramatic increase of 667% year-over-year, reaching $20.8 billion, signaling a significant recovery in customer activity.
  • 3The Retail segment, the largest revenue contributor, experienced a 357% surge in revenue, indicating a strong recovery in its core online travel agency operations.
  • 4Operating loss improved substantially to $132 million from $849 million in the prior year, demonstrating operational leverage as revenue recovered.
  • 5The company maintained a robust liquidity position with $5.5 billion in cash, cash equivalents, and short-term investments as of June 30, 2021.
  • 6Expedia completed the issuance of $1 billion in 0% Convertible Senior Notes due 2026 and $1 billion in 2.95% Senior Notes due 2031, strengthening its balance sheet and extending debt maturities.
  • 7The company reported a net loss attributable to common stockholders of $301 million, an improvement from $753 million in the prior year period.

Frequently Asked Questions

Expedia Group's total revenue significantly increased by 273% to $2.11 billion for the three months ended June 30, 2021, compared to $566 million for the same period in 2020. This substantial growth was primarily driven by the recovery in leisure travel and a strong rebound in the company's Retail segment.

Expedia Group maintained a strong liquidity position as of June 30, 2021, with $5.5 billion in cash and cash equivalents and short-term investments. The company also has access to substantial credit facilities that were largely untapped during the period. Their ability to generate positive cash flow from operations, as seen in the six months ended June 30, 2021 ($4.7 billion), indicates a healthy financial footing.

During the first half of 2021, Expedia Group took proactive steps to manage its debt. This included the issuance of $1 billion in 0% Convertible Senior Notes due 2026 and $1 billion in 2.95% Senior Notes due 2031. They also used proceeds from these issuances to redeem higher-cost debt, specifically the 7.0% senior notes due 2025 and tender for a portion of the 6.25% senior notes due 2025, leading to a $280 million loss on debt extinguishment but improving their interest expense profile.

While the company has seen a significant recovery in revenue and bookings, it still reported an operating loss and net loss in Q2 2021. Management indicates that the full duration and impact of COVID-19 remain uncertain, making it difficult to predict the exact shape and timing of a sustained recovery. However, cost-saving initiatives and the recovery in travel demand provide a positive outlook for improving profitability as travel volumes normalize.