Euro am Sonntag: Travel portals: A great desire for lightness | News

Tim Schfer, Euro on Sunday

DThe desire for a vacation returns with a vengeance. Hotels are filling up after a pandemic, flights are full, prices are rising. Travel portals especially benefit from the return on demand as their fixed costs are very manageable. Internet companies do not typically maintain any investment facilities such as real estate or ships. The business model of companies such as Expedia, Booking Holdings, Airbnb is usually easily scalable.

The world leader in this field is The group in Norwalk, Connecticut, feels very clearly the present spirit of optimism. “I am delighted to record a record $ 27 billion in gross bookings in the first quarter, the highest quarterly result in our history,” said CEO Glenn Fogel, enjoying a doubling of sales and a higher-than-expected profit. “Despite the uncertain macroeconomic environment, so far in the second quarter of 2022 we have seen a further strengthening in global travel trends. We are preparing for a very active summer tourist season, ”said Fogel. The recovery continued in April, said CFO David Goulden, business is booming, especially in Europe.

Booking is a giant that acquires its customers in over 220 countries with six brands. In addition to booking, there are Priceline, Agoda, Kayak comparison engine, as well as car rental companies like and restaurant booking services like Open Table. There are many internal links that sites are pushing each other around. This creates economies of scale in the network where users end up not realizing that the six brands belong to the holding company.

Clever customer capture

The American group Expedia has created just such a network of reports from 200 websites. Sites like, Travelocity, Traveldoo and are owned by an empire. Expedia also has a majority stake in the Dsseldorf Trivago hotel search platform since 2012. Thanks to skilfully woven networks to hold customers, ISPs are increasingly replacing traditional travel agencies. The trend continues, consumers prefer to obtain information on the Internet. In a 2015 study, Expedia found that Americans visit an average of 140 travel sites 45 days before booking, and use an average of nearly 23 hours of digital media six weeks before booking. Bookings are then often made on these information pages.

Artificial Intelligence and Machine Learning help customers find exactly what suits their needs. Expedia has created an open world technology platform open to partners of all sizes. Included is an e-commerce bundle that includes items such as payments, calls, and services. Whether they are airlines, travel agents or Tiktok influencers – everyone can compile offers there.

Three key elements

Expedia chief Peter Kern predicts “a strong recovery in vacation travel this summer.” From January to March, Americans recorded an 81 percent increase in sales, but at the same time recorded a net loss of $ 122 million – almost 500 million less than a year earlier. The opening quarter is seasonally weak, but Kern posted a profit of $ 276 million in the fourth quarter.

“We are also excited about the return of city, business and international travel, the three key elements of a full travel return,” says Kern. At the same time, however, he stipulates that inflation may weigh on consumers’ plans. Nevertheless, Expedia is launching new products this year and entering new markets.

The management board used the crisis to simplify the structure of the company. The subsidiaries he had little confidence in turned into money. In May 2020, Kern completed the sale of However, many analysts criticized the fact that a year earlier he had only bought a site for fitness fans and pulled the plug so quickly.

But recovery is still bumpy. The quarterly gross bookings have been disappointing recently, and the booked accommodation has fallen short of expectations. According to the latest data, the share price fell by 14 percent. Credit Suisse lowered its target price from $ 231 to $ 225. In the meantime, however, the price has fallen significantly below the target average of $ 213. Therefore, the latest reviews are again much more positive.

The Airbnb accommodation broker is also taking advantage of the growing demand for travel. The Americans did not come to the Nasdaq until December 2020. Then the business collapsed by 80 percent. Founder Brian Chesky made redundancies, hired departments, and cut advertising budgets. Since then, the platform has recovered quickly. Last year, sales increased by 70 percent. Reservations are also increasing now. Between January and March, there were already over 102 million nights. However, there is a downside: during the Corona period, many employees retired to the home office and used Airbnb to work in pleasant places. This demand is decreasing again.

Lucrative accommodation

Like Airbnb, travel portals generate most of their income by arranging overnight stays. On Expedia, it was 72 percent. sales. Car and travel insurance are also profitable businesses, but flight brokerage is less profitable. Thus, as hotel prices rise, so do the agent’s commissions. A pent-up demand for travel and leisure can therefore provide a boom in portals.

Continuous innovation speaks for the industry giants Booking and Expedia. Giants tempt customers with information such as virtual cards or attractively presented ratings. Expedia also introduced a “smart shopping” feature that makes it easier for travelers to compare different offers. In 2023, the company wants to start the universal loyalty program “One Key”. Travelers can earn bonus points on all brands in the group, including airfare, hotel, vacation rental, car or cruise.

The desire to relax can fuel it even more. Portal prices have already rebounded from the peak of the pandemic. Analysts predict the potential for catching up in the next four to five years.


Until 2018, the world’s largest travel portal operated under the name The success story is characterized by acquisitions, the Dutch website was added in 2005 for $ 135 million. The Kayak comparison in 2012 for $ 1.8 billion. In the first quarter, a new record was recorded in gross bookings, sales increased by 136%. up to $ 2.7 billion. Adjusted earnings per share hit $ 3.90, analysts expected only 90 cents. Strong balance sheet, good cash flow. Our favorite.

The group that was once established as part of the software giant Microsoft has not recovered as quickly as the leader of the Booking market. Internet mogul Barry Diller sits on the board of directors, nearly 900,000 hotels and more than 500 airlines are bookable in addition to vacation homes, cruises, insurance and car rentals. Analysts expect sales to increase by 37 and 16 percent in 2022 and 2023, respectively. Profits should grow more dynamically.

The digital group only arrived on the Nasdaq during the pandemic, and then suffered a fundamental failure. While it still posted a $ 19 million loss in the first quarter, it was much smaller than it had been in early 2021. Profit shift is visible, especially as free cash flow hit a record high of $ 1.2 billion this quarter. Analysts expect earnings in 2022. Expensive.

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