“A solid year with a strong finish,” is how new Expedia
Group chief financial officer Scott Schenkel characterized the company’s Q4 and
full year 2024 financial report as he spoke to analysts Thursday night having just stepped into the role.
The company reported revenue of $3.1 billion in Q4, up 10%
year over year, driven by a 21% jump in B2B revenue and a 25% increase in advertising
revenue as well as growth at all three of its B2C brands – Expedia, Hotels.com
and Vrbo. Full year revenue was $13.7 billion, up 7% compared to 2023.
CEO Ariane Gorin, who will mark her one-year anniversary in
the position in May, said the company is now focused on using its momentum from
2024 to focus on three priorities for the year ahead.
Subscribe to our newsletter below
“First deliver more value for travelers. Second invest where
we see the greatest opportunity to drive growth in each part of our business. And
third continue driving operating efficiencies and expanding our margins,” she
said.
And the company is leaning in to artificial intelligence to
power each of those efforts. Gorin outlined “three buckets” of strategies related
to AI across the company.
The first is using the technology to make its products
better for B2B partners and for travelers — ensuring they have a “delightful
experience that makes them want to come back” — although she did not provide
any update on Expedia’s AI assistant, Romie, which launched last year.
“The second is looking at changing travel behaviors,” Gorin
said.
“Travelers are going to start to search in different ways. And
so we need to make sure that our brands are showing up in those new places where
people are using gen AI native search. And fortunately we’ve got a very tech sophisticated
marketing team that is making sure we do show up there.”
The third priority, Gorin said, is to identify “native AI
travel startups” that Expedia Group could partner with, for example as a supply
partner.
Vrbo and Hotels.com
Speaking about the financial results, Gorin highlighted
growth at Vrbo and Hotels.com, coming after a period when both had struggled as a result of the transition to the company's new tech platform.
Travelers are going to start to search in different ways. And so we need to make sure that our brands are showing up in those new places where people are using gen AI native search.
Ariane Gorin - CEO
“When I stepped in as CEO last year, we set an ambition to
bring Vrbo and Hotels.com back to growth while extending our strengths in brand
Expedia and advertising … I’m proud with how our teams delivered against this
call to action,” she said.
Gorin said work on Vrbo’s product, marketing and supply —
the company added one million units primarily in urban areas — helped fuel the
growth in 2024, and now the company has “some exciting plans coming in 2025 …
so we’re going to continue leaning in.”
For Hotels.com, Gorin said it was “pretty meaningfully
impacted” by both the tech migration and changes to OneKey, but the company has
“big plans on reinvigorating that brand that we’ll see come to life in 2025.”
Regarding OneKey, Gorin said further rollout beyond the United
States and United Kingdom is paused as the company assesses what it has learned
from how the program has impacted Expedia, Hotels.com and Vrbo. Gorin said is
looking “by brand and by geography” to determine what it needs to do regarding
loyalty and will share more later this year.
Financial results
Gross bookings in Q4 were $24.4 billion, up 13% year over
year, and came in at $111 billion for the full year, up 7%.
Booked room nights grew 12% in Q4 and 9% for the full year,
compared to comparable periods in 2023. Lodging gross bookings grew 12% year
over year in the quarter to $17 billion and within that hotel bookings were up
14%.
B2C revenue was $2 billion and B2B was $1 billion
in Q4, up 6% and 21% respectively year over year. For the full year, B2C
revenue was $9.3 billion, up 2%, and B2B was $4.1 billion, up 21% compared
to 2023.
Adjusted EBITDA was $643 million for Q4 and $2.9 billion for
the full year.
Similar to Q3 2024, Gorin said international demand was
stronger than in the U.S., with booked room nights growing in the high single
digits in the U.S. but the low double digits in Eurpe and high teens in the
rest of the world.
“Our B2B business continues to benefit from this strong
international demand, especially in APAC,” Gorin said.
“And in our consumer business, our global expansion efforts
continue to show solid progress.”
Expedia Group’s direct sales and marketing expenses were
$1.5 billion in Q4, up 13% year over year, and $6.8 billion for the full year,
up 12% compared to 2023.
Correction: The original version of this story incorrectly reported lodging gross bookings in Q4 in millions instead of billions.