Expedia Group (NASDAQ: EXPE) saw a remarkable 10% increase in its stock price following the release of its second-quarter earnings, surpassing expectations despite a challenging travel market.
The online travel agency reported a 6% revenue growth to $3.6 billion, exceeding the estimated $3.53 billion. Net income also rose by 10% to $386 million, with adjusted earnings per share at $3.51, beating the estimated $3.18 per share.
This positive performance comes in contrast to its competitors, Tripadvisor and Airbnb, who missed revenue estimates and projected a slowdown in U.S. travel trends.
Best Quarter for Room Night Growth in Over a Year
Expedia’s key metrics showed strong results in Q2, with gross bookings up 6% to $28.8 billion and lodging gross bookings increasing by 8% to $20.7 billion. The number of room nights booked surged by 10% to 99 million, marking the fastest growth rate since 2023.
Despite the positive numbers, CEO Ariane Gorin acknowledged the anticipated slowdown in travel demand for the remainder of the year, resulting in an adjustment in the company’s guidance for gross bookings and revenue growth.
Is Expedia Stock a Buy?
With Expedia stock currently trading at $129 per share and a low forward P/E of 10, investors may find it an attractive option. However, considering its historical performance and dependence on travel trends, it may not be the top choice for long-term growth.
While the stock’s recent surge is promising, investors should carefully assess the market conditions and Expedia’s future outlook before making any investment decisions.