Booking Holdings sees upward trend in Q1 and focuses on buildout of connected trip

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Booking Holdings CEO Glenn Fogel said he is encouraged by booking trends in the first quarter of this year, primarily in the U.S. and also in the U.K. and Israel -- countries where vaccine distribution is boosting travel demand.

The U.S. was the company's strongest performing market in Q1 and for the full quarter had positive room night growth versus 2019 (cited for comparison by CFO David Goulden since Q1 2020 was impacted by the pandemic).

In a call with analysts to discuss the results, Fogel said these trends support the company's view that vaccine distribution is "a key to unlocking pent-up travel demand." 

In the first quarter of this year, gross travel bookings -- the value of bookings for rooms, car rentals and air tickets -- were $11.9 billion, a decrease of 4% from the same period in 2020.

Total revenue for Q1 was $1.1 billion, a 50% decrease year-over-year.

Adjusted EBITDA for the first quarter was a loss of $195 million, compared with adjusted EBITDA of $290 million in Q1 2020.

Room nights booked in the first quarter decreased 20% year-over-year, while air ticket bookings increased 62%. Fogel said Q1 brought the highest number of air tickets ever booked in a single quarter for the company and continuing to build the flight product on Booking.com is a priority for the future as part of the long-term connected trip strategy.

"This year we'll be focused on enabling travelers to book the major elements of their trip in one place on Booking.com. This means we are working to build up our non-accommodation products like flights, ground transportation and attractions by increasing supply as well as exposing more of our customers to these products," he said. 

Booking.com's flight offering is now full native in the app and live in 18 countries, which collectively represented more than half of the brand's room nights booked in 2019. 

"We hope in the long run that this connected trip, which is ... all the things people do when they are traveling [will] create something that makes them want to always use our app more than anything else. So when they think of travel they come back to us," Fogel said. Currently more than two-thirds of the company's bookings come through mobile devices, the majority of which are done in the app.

Along with flights, the company will continue to work to engage with travelers in destination by growing Booking.com's supply of attractions and experiences -- current partners include Viator and Musement -- and to continue to build its integrated payment platform. 

Fogel said Booking.com will continue to invest in efforts to strengthen its brand, citing the recent "Back to Travel" promotion in the U.S. as an example of the marketing methods it will use in the future. A similar promotion launched Tuesday in the U.K., giving travelers a 10% post-stay credit.

"It's an example of things we haven't done in past that we will do in the future," he said. 

"We're trying to be more creative going forward, coming up with different ways to bring those customers to us, show them what a great product we have, great service we have and make sure they come back to us in the future."

Booking Holdings marketing expenses were $461 million in the first quarter of 2021, compared to $851 million in the same period of 2020.

Source: PhocusWire

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