(Feb. 9): Expedia warned Thursday that revenue in 2024 would moderate as airline ticket prices drop, and said CEO Peter Kern is stepping down and will be succeeded by an insider.
The company’s shares, which have gained more than 60% since November, fell more than 12% in extended trading and trailed those of peers Booking Holdings and Airbnb after Expedia sounded some concern about the moderation of and reservations.
Air travel revenue has come under pressure from a drop in average ticket prices, Chief Financial Officer Julie Whalen said in a post-earnings call.
The grounding of Boeing’s 737 Max 9 fleet – after a panel flew off one of its planes last month – was also weighing on bookings, he added.
“The discussion of some softness of the air and the moderation of travel demand is probably also contributing to the action after hours, as the fact that the shares are very much in the press,” said the Morningstar analyst Dan Wasiolek.
The moderation in travel demand was not surprising after a strong recovery, which was echoed by hotel chain Hilton on its earnings call this week, analysts said.
The company expects gross bookings growth in the first quarter to be in the low to mid-single digits and revenue growth to be in the mid-single digits.
“At a macro level, we expect travel demand to remain relatively healthy, but we expect global growth rates to slow,” Kern said on the call.
The outgoing CEO, who led the company for four years, will continue to serve as Expedia’s vice president and board member, working closely with his successor, Ariane Gorin, to ensure a smooth transition, the company said.
Gorin, who has been with the travel company for more than a decade, was most recently president of Expedia for Business, where he led the global supply chain partner group, the advertising business and the B2B partner network.
She will receive an annual base salary of US$1.25 million (RM5.9 million) and a one-off transfer payment of US$100,000.
Gorin, who was also an executive at Microsoft between 2003 and 2013, will take the helm of the online travel company on May 13.
The company also beat estimates for fourth-quarter profit and sales, driven by steady demand for travel in the United States.
Its gross bookings, which grew 6% from a year earlier, were affected by the Middle East crisis at the beginning of the quarter.
It earned $1.72 per share on an adjusted basis, ahead of analysts’ estimates of $1.68 per share, according to LSEG data.
Fourth-quarter sales rose 10% to $2.89 billion, beating previous estimates of $2.88 billion.
Your article helped me a lot, is there any more related content? Thanks!