In the first quarter of 2018, Booking Holdings, formerly the Priceline Group, has reported significant financial growth despite a slowing of growth in bookings and room nights.
The company, whose brands include Booking.com, Priceline.com, Kayak, Agoda.com, Rentalcars.com and OpenTable, saw total revenue jump to 2.9 billion, up 25% from Q1 of 2017.
In Q1 2018, gross bookings also hit a record $25 billion, up from $21 billion in the same period in 2017.
Despite the record booking figure, growth year-over-year is slower at 21% between 2017 and 2018; bookings increased by 24% between Q1 2016 and 2017.
Room night growth has also slowed, with 196.8 million in Q1, up 13% year-over-year, yet a long way behind the 27% and 30.5% figures from the first quarters in 2017 and 2016, respectively.
Subscribe to our newsletter below
"We are off to a strong start in 2018 with solid top and bottom line results for the first quarter with our performance marketing optimization efforts driving a second consecutive quarter of operating margin expansion," says Glenn Fogel, Booking Holdings CEO. "Our brands are making good progress deploying investments to position us for continued future growth."
Direct strategy
Speaking during the company's call with financial analysts, Fogel says the increasing direct traffic is a "key strategic priority".
The strategy appears to be paying off, with growth reported driven by brand marketing as part of an effort to increase its "investment and expertise in these areas".
Fogel says: "It’s so important to our strategy in the long run that we don't depend as heavily as we have in the past on third-party sources of customers.
"We believe the right thing for the company in the long run is to create a service that is so good that people when they think about travel, they think about us immediately and come to us directly."
Booking Holdings spent $1.1 billion in performance marketing during the first quarter of 2018, up from $982 million in the same three months in 2017.
Brand marketing also increased from $80.8 million in Q1 2017 to $101.4 million in the first three months of 2018.
Total revenues for Q1 of 2018 under the Current Revenue Standard were approximately 2% lower than total revenues for the 1st quarter of 2018 if reported under the Previous Revenue Standard.