Summary of Booking Holdings Q4 2025 Earnings Call

1Key Financial Results and Metrics

Q4 Performance:

Room nights: 285 million, up 9% YoY.

Gross bookings and revenue: Both increased by 16% YoY.

Adjusted EBITDA: $2.2 billion, up 19% YoY.

Adjusted EPS: $48.80, up 17% YoY.

FX impact: Benefited growth rates by approximately 500 basis points in Q4.

Full Year 2025 Performance:

Room nights: Over 1.2 billion, up 8% YoY.

Gross bookings: Up 12% YoY; Revenue: Up 13% YoY.

Adjusted EBITDA: Over $9.9 billion, up 20% YoY; Adjusted EBITDA margin: 36.9%.

Adjusted EPS: $228, up 22% YoY.

Free cash flow: $9.1 billion, 15% more than 2024.

2Strategic Updates and Business Highlights

Transformation Program: Achieved $550 million in annual run rate savings, exceeding prior guidance.

Connected Trip Vision: Transactions grew in the high 20% range, with flights booked increasing by 37% YoY.

Genius Loyalty Program: Levels 2 and 3 members accounted for over 50% of room nights, emphasizing the program's importance.

AI Integration: Continued investment in generative AI to enhance customer experience and operational efficiency.

Asia Growth: Low double-digit room night growth, with a focus on product improvements and partnerships.

3Forward Guidance and Outlook

2026 Expectations:

Targeting constant currency top-line growth about 100 basis points ahead of the long-term growth algorithm.

Anticipating adjusted EBITDA margin expansion by approximately 50 basis points.

Q1 2026 room night growth expected between 5% and 7%, with gross bookings growth between 14% and 16%.

Continued focus on reinvestment in strategic areas, including generative AI and the Connected Trip.

4Bad News, Challenges, or Points of Concern

Marketing Spend: Increased marketing expenses led to slight deleverage in Q4, raising questions about future spending strategies.

Consumer Behavior: Slightly lower Average Daily Rates (ADRs) and shorter lengths of stay observed, indicating cautious consumer spending.

Alternative Accommodations: Growth in this segment is slowing, with the need for further improvements to drive reacceleration.

5Notable Q&A Insights

Marketing Strategy: Management emphasized a tactical approach to marketing spend, focusing on opportunities with attractive ROI despite some deleverage.

Agentic Capabilities: The rollout of AI tools is expected to enhance customer engagement and conversion rates, although specific timelines were not disclosed.

Genius Program: There is a commitment to further develop the loyalty program, with indications of its growing importance in driving direct bookings.

Competitive Landscape: Management expressed confidence in their ability to maintain a competitive edge against emerging technologies and large language models, citing the complexities of the travel industry. Overall, Booking Holdings demonstrated strong financial performance in 2025, underpinned by strategic initiatives and a focus on innovation, while also acknowledging challenges in marketing efficiency and consumer behavior. The outlook for 2026 remains optimistic, with continued investments planned to support growth.