EXPE — Expedia Group, Inc.

Summary of Expedia Group Q1 2026 Earnings Call

1. Key Financial Results and Metrics

• Gross Bookings: $35.5 billion, up 13% year-over-year.
• Revenue: $3.4 billion, a 15% increase, with foreign exchange contributing approximately 3 points.
• Adjusted EBITDA: $542 million, with a margin of 15.8%, marking the highest Q1 EBITDA margin in 15 years and a nearly 6-point expansion.
• Adjusted EPS: $1.96, reflecting a fourfold increase.
• Cash Position: $5.8 billion in unrestricted cash and short-term investments; $1.75 billion of short-term debt retired during the quarter.

2. Strategic Updates and Business Highlights

• Bookings Growth: Consumer gross bookings grew 10%, with B2B bookings up 22%.
• AI Integration: AI is being leveraged to enhance personalization, improve supply onboarding, and optimize marketing efforts. AI-driven channels are identified as a growth opportunity.
• Partnerships: An exclusive partnership with Uber was announced, aimed at enhancing the B2B segment by providing hotels through the Uber app.
• Vacation Rentals: Achieved an annualized run rate of $1 billion in vacation rentals on Expedia.
• Marketing Efficiency: Significant leverage in marketing with a 7% reduction in consumer marketing spend while achieving growth.

3. Forward Guidance and Outlook

• Q2 Expectations: Gross bookings growth projected at 7% to 9%, revenue growth at 9% to 11%, with EBITDA margins expected to increase by 50 to 100 basis points.
• Full Year Guidance: Reiterated expectations for gross bookings growth of 6% to 8% and revenue growth of 6% to 9%. Anticipated EBITDA margin expansion of 100 to 125 basis points for the full year.

4. Bad News, Challenges, or Points of Concern

• Geopolitical Headwinds: The conflict in the Middle East and travel advisories in Mexico led to increased cancellations and impacted bookings, particularly in March.
• Competitive Pressures: Some B2B partners reduced promotional activity, affecting growth rates.
• Market Volatility: Ongoing geopolitical and macroeconomic uncertainties could impact future performance, prompting a cautious outlook.

5. Notable Q&A Insights

• April Trends: Cancellations normalized in early April, and bookings improved, but lingering impacts from geopolitical tensions were acknowledged.
• U.S. Market Performance: Domestic bookings grew in the mid-teens, with Vrbo showing strong performance, though some competitive pressures were noted.
• Marketing Strategy: The company is balancing brand and performance marketing spend, with a focus on improving returns and understanding consumer behavior.
• AI Traffic Capture: Early efforts in AI-driven channels are being explored to convert new users into repeat customers, with ongoing experiments planned.
• B2B Dynamics: The B2B segment remains strong, but the impact of macro factors was noted, with a focus on expanding partnerships to drive growth.

Overall, Expedia reported a strong Q1 performance, leveraging strategic initiatives and AI while navigating geopolitical challenges and competitive pressures. The company remains optimistic about future growth but is cautious due to external uncertainties.