On the eve of its spinoff, Bellevue-based Expedia yesterday reported a surge in second-quarter profit on strong flight and international...
On the eve of its spinoff, Bellevue-based Expedia yesterday reported a surge in second-quarter profit on strong flight and international bookings.
The company’s income from its core operations grew by 31 percent. Meanwhile, the company’s gross travel bookings — essentially the amount a customer pays for travel before Expedia takes its slice of the pie — rose 26.2 percent to $4.1 billion.
Revenue increased at a slower pace than gross travel bookings, rising 14.0 percent to $555.0 million. (One reason: while the company sold more air tickets, it saw a decline in revenue per ticket.)
|Dollar figures in thousands, except per share.|
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Expedia’s bottom line was helped by its investments: The company more than doubled its net interest income versus a year ago. However, it warned investors to expect less interest income in the future:
After the spinoff, Expedia is expected to have roughly $100 million in cash, about a fourth of its current total. This means it will have less money available for investments.
Parent company InterActiveCorp (IAC) announced plans in December to split its collection of Internet businesses in two and establish a separate, publicly traded travel unit under the Expedia brand name.
Expedia and IAC are expected to begin trading as independent public companies on Tuesday.
Meanwhile, Expedia’s international business continued to outpace its domestic growth, with international gross bookings increasing 73 percent.
Out of every $1 spent at Expedia’s travel companies during the quarter, 22 cents came from international sites. A year ago, it was 16 cents.
Expedia.com — which remains the company’s largest travel unit — has invested hundreds of millions of dollars into building easy-to-use travel-booking sites.
New Expedia Chief Executive Dara Khosrowshahi said his charge is to turn the company from an efficient processor of transactions into an “emotional brand.”
Expedia yesterday said it renewed and expanded its partnership with MSN. Expedia’s leisure brands, including Hotels.com and Hotwire, will provide travel-shopping services on MSN.com and several international MSN sites.
Monica Soto Ouchi: 206-515-5632 or email@example.com