Expedia quarterly profit misses as costs jump

Reuters News
Posted: Feb 08, 2018 4:51 PM

(Reuters) - U.S. online travel services company Expedia Inc missed analysts' quarterly profit estimate on higher marketing expenses, sending its shares tumbling 15 percent in after-hours trading on Thursday.

The company, whose brands include Expedia.com, Hotels.com, Hotwire, said selling and marketing costs jumped 16 percent to $1.12 billion in the fourth quarter.

"We are now operating with a clear focus on our highest priority markets, making concentrated investments across the platform ...," Chief Executive Mark Okerstrom said in a statement.

This is the first full quarter under Okerstrom, who succeeded Dara Khosrowshahi after he left to take the top job at car-ride provider Uber Technologies Inc [UBER.UL].

Expedia's HomeAway vacation rental business, a rival to Airbnb, reported a 16 percent jump in revenue to $193 million in the fourth quarter, compared with analysts' average estimate of $225.4 million, according to Thomson Reuters I/B/E/S.

On an adjusted basis, Expedia earned 84 cents per share in the quarter, falling well short of analysts' average estimate of $1.15, according to Thomson Reuters I/B/E/S.

Bellevue, Washington-based Expedia said gross bookings rose 13.6 percent to $19.8 billion.

Net income attributable to Expedia declined to $55.2 million, or 35 cents per share, from $79.5 million, or 51 cents per share, a year earlier. (http://bit.ly/2EcS9rE)

The company's revenue rose to $2.32 billion in the three months ended Dec. 31, from $2.09 billion.

Trivago GmbH, majority owned by Expedia, reported a bigger-than-expected fourth-quarter loss on Wednesday as the hotel search platform spent more on sales and marketing.

(Reporting by Sanjana Shivdas in Bengaluru; Editing by Sriraj Kalluvila)