Booking Holdings Adjusted EPS Climbs 17% To $4.66, But Fourth-Quarter Room Nights Seen Up Just 1% To 3%
The online travel company cites Middle East disruptions and pricier airfares as it guides to slower fourth-quarter bookings growth.
Booking Holdings, the parent of Booking.com, Priceline and Agoda, said in an 8-K filed Tuesday that third-quarter adjusted earnings per share rose 17% to $4.66, while it guided fourth-quarter room-night growth down to 1% to 3%. Reported revenue fell 1% to $8.9 billion after a $900 million reduction tied to a Federal Trade Commission matter.
Strong quarter, FTC charge
Adjusted earnings per share reached $4.66, up 17%. Earnings per share under standard accounting were $3.61, up 7%.
Adjusted revenue, which excludes the FTC item, rose 9% to $9.8 billion. The company also accrued a $100 million loss on the FTC matter, which is excluded from its adjusted measures. Net income slipped 1% to $2.7 billion, while adjusted net income rose 8% to $3.5 billion.
Gross bookings, the total value of travel booked, grew 10% to $54.5 billion, or about 11% at constant currency. Room nights rose 7% to 345 million, and adjusted EBITDA climbed 9% to $4.6 billion with the margin flat at 47.0%.
Cash generation lagged: operating cash flow for the quarter fell 21% to $1.1 billion, and free cash flow fell 22% to $1.1 billion. For the first nine months, both rose 2%.
Middle East weighs on the outlook
Booking said global demand moderated toward the end of the third quarter on softer international travel, while domestic travel stayed resilient. In October, disruptions to travel to and from the Middle East, elevated airfares and localized unrest in some European cities also hit demand.
For the fourth quarter, it guided to gross bookings growth of 2% to 4% and adjusted revenue growth of 0% to 2%. Adjusted EBITDA is expected to be about flat. The outlook assumes the direct and indirect effects of the conflict last through year-end.
For 2026, it expects gross bookings and adjusted revenue growth in the high single digits, and adjusted EPS growth in the low to mid-teens.
CEO Glenn Fogel said geopolitical and macroeconomic uncertainty "may affect near-term travel trends."
Buybacks and the dividend
Booking, which runs Booking.com, Priceline, Agoda, KAYAK and OpenTable, repurchased $2.1 billion of stock in the quarter, leaving $12.4 billion of authorization as of September 30.
The board declared a dividend of $0.42 per share, payable December 31 to holders of record December 11. Prepared remarks will be posted to its investor relations site after the earnings call.
Marketing spending ran 4.8% of gross bookings, against 4.7% a year earlier, as the company heads into a quarter it expects to be its slowest of the year for room nights.
