EXPE — Expedia Group, Inc.

Summary of Expedia Group Q4 2025 Earnings Call

1. Key Financial Results and Metrics:

• Gross Bookings: $27 billion, up 11% year-over-year.
• Revenue: $3.5 billion, also up 11%.
• Booked Room Nights: Increased by 9%, with high single-digit growth in the U.S. and low double-digit growth in EMEA.
• Adjusted EBITDA: $848 million, with a margin of 24%, reflecting nearly 4 points of margin expansion.
• Adjusted EPS: $3.78, a 58% increase year-over-year.
• Cash Position: Ended the quarter with $5.7 billion in unrestricted cash and short-term investments.
• Free Cash Flow: $3.1 billion for the year, with $255 million used for share repurchases.

2. Strategic Updates and Business Highlights:

• Growth in Consumer Brands: Vrbo and Hotels.com returned to growth, with Brand Expedia sustaining its performance. Overall Consumer Brands bookings rose 5%, with double-digit growth outside the U.S.
• B2B and Advertising Performance: B2B bookings grew by 24%, and advertising revenue increased by 19%. The company added new partners and expanded its travel agency platform.
• AI Integration: Ongoing investments in AI to enhance personalization, improve traveler experiences, and streamline operations. The company is leveraging AI for better product recommendations and customer service.
• Supply Expansion: Lodging property count grew by over 10% compared to 2024, with increased participation in promotional events.

3. Forward Guidance and Outlook:

• Q1 2026 Guidance: Gross bookings growth expected between 10% to 12%, with revenue growth of 11% to 13%. EBITDA margins anticipated to expand by 3 to 4 points.
• Full Year 2026 Guidance: Gross bookings growth projected at 6% to 8% and revenue growth at 6% to 9%, with foreign exchange tailwinds contributing to the growth rates.
• Long-term Margin Expansion: Expected to expand by 100 to 125 basis points, though at a more moderate pace compared to 2025.

4. Bad News, Challenges, or Points of Concern:

• Geopolitical Issues: Slower growth in the rest of the world, particularly in Asia, due to geopolitical tensions.
• B2B Margin Pressure: B2B EBITDA margins decreased by approximately 1 point, with ongoing investments expected to weigh on near-term margins.
• Market Competition: The competitive landscape remains challenging, with ongoing pressures from direct hotel bookings and evolving AI technologies impacting customer engagement.

5. Notable Q&A Insights:

• Product Development and AI: The company is focused on enhancing the travel planning process through improved marketing and product features, including natural language processing capabilities.
• B2C Growth Acceleration: While there is potential for B2C growth, the company is cautious about maintaining ad spend efficiency while aiming for higher growth rates.
• Tiqets Acquisition: Positioned primarily for B2B but expected to enhance B2C offerings as well, indicating a strategy to broaden experiences offered to customers.
• Supply Growth Dynamics: Supply growth is benefiting both B2C and B2B segments, with a strong emphasis on maintaining competitive pricing and inventory.

Overall, Expedia Group reported strong financial results for Q4 2025, driven by effective execution of its strategic initiatives, particularly in AI and B2B growth. However, the company faces challenges from geopolitical factors and competitive pressures in the travel industry.