(Reuters) – Online travel agency Booking Holdings Inc beat estimates for first-quarter earnings on Wednesday and said global travel trends pointed to a busy summer season, especially in Europe, sending its shares up about 7% in extended trade.
The Norwalk Connecticut-based company’s gross travel bookings saw a near two-fold rise to $27.3 billion in the quarter from a year earlier, while room nights – a measure of occupancy at any property – more than doubled.
“Despite an uncertain macroeconomic environment, we have seen continued strengthening of global travel trends so far in the second quarter of 2022, and we are preparing for a busy summer travel season ahead,” Chief Executive Officer Glenn Fogel said in a statement.
However, Bernstein analyst Richard Clarke said although summer demand was strong, a rise in marketing expenses could be a drag as the company’s forecast for earnings before interest, taxes, depreciation, and amortization was below consensus.
Pandemic-weary travelers are shrugging off an inflation-induced hit to their wallets from rising air fares and hotel tariffs to visit their favorite tourist spots, driving demand for leisure travel globally.
Vacation rental firm Airbnb Inc on Tuesday forecast second-quarter revenue above estimates, as it expects strong summer travel demand.
Major U.S. airlines including American Airlines Group, United Airlines and Alaska Air Group Inc said their revenue in the current quarter would surpass pre-pandemic levels on travel boost.
Booking’s chief financial officer, David Goulden, said on a post-earnings call that April room nights, a hotel industry metric for calculating occupancy, increased about 10% from the same period in 2019, driven primarily by demand in Europe.
“International demand, driven mainly by travel plans in Europe, accounted for most of the improvements in room nights in April versus Q1,” he added.
Excluding items, Booking’s profit came in at $3.90 per share, compared with analysts’ estimates of 90 cents per share, according to Refinitiv data. Revenue of $2.69 billion beat estimates of $2.54 billion.
(Reporting by Nilanjana Basu and Aishwarya Nair in Bengaluru; Editing by Shailesh Kuber and Anil D’Silva)