Booking Holdings (BKNG) Q3 Earnings Beat, Revenues Rise Y/Y

·4 min read

Booking Holdings Inc. BKNG reported non-GAAP earnings of $37.70 per share in third-quarter 2021, beating the Zacks Consensus Estimate by 19.5%. Further, the figure jumped from $12.27 reported in the year-ago quarter. Also, it compares favorably with the loss of $2.55 per share in the previous quarter.

Revenues of $4.68 billion surpassed the Zacks Consensus Estimate of $4.16 billion. The top line improved 77% year over year on a reported basis and 76% on a constant-currency basis. Further, the figure grew 116.5% sequentially.

Substantial improvement in its booking trends was a tailwind. The company experienced solid momentum in Europe in the reported quarter.

Booking Holdings witnessed growth of 44% in rental car on a year-over-year basis. The company also experienced 154.8% year-over-year growth in the airline tickets unit in the reported quarter.

Booked room night number, which was 183 million in the third quarter, surged 43.9% from the prior-year quarter.

The company witnessed strong growth across its agency, merchant, and advertising and other businesses in the reported quarter.

Although the pandemic persisted as a headwind, Booking Holdings witnessed improvement in travel demand in many parts of the world, owing to the removal of travel restrictions and the ongoing vaccination drives.

Booking Holdings Inc. Price, Consensus and EPS Surprise

Booking Holdings Inc. Price, Consensus and EPS Surprise
Booking Holdings Inc. Price, Consensus and EPS Surprise

Booking Holdings Inc. price-consensus-eps-surprise-chart | Booking Holdings Inc. Quote

Top Line in Detail

The company generates the bulk of revenues from international markets, wherein the agency model is more popular. This is reflected in the merchant/agency split of revenues, which was 34.7/61.3% in the third quarter (the previous quarter’s split was 30.6/61.5%).

Merchant revenues were $1.62 billion, up 93.8% year over year. Agency revenues were $2.87 billion, up 66.4% on a year-over-year basis.

Advertising & Other revenues were $187 million (4% of total revenues), increasing 133.8% from the year-ago quarter. These are non-inter-company revenues from Kayak and OpenTable.


Booking Holdings’ overall gross bookings totaled $23.7 billion, which increased 77% on a reported and 75% on a constant currency basis from the year-ago quarter.

Total gross bookings surpassed the Zacks Consensus Estimate of $22.1 billion.

Merchant bookings were $8.8 billion, up 128.2% from the prior-year quarter.

Agency bookings were $14.9 billion, rising 56.2% from the prior-year quarter.

Operating Results

Adjusted EBITDA in the third quarter was $2.1 billion, up 111% on a year-over-year basis.

Per management, operating expenses were $2.7 billion, up 14.4% on a year-over-year basis. As a percentage of revenues, the figure contracted to 56.9% from 88.1% in the year-ago quarter.

Notably, the company generated an operating income of $2.02 million, which jumped from $315 million in the year-ago period. The operating margin was 43.1%, up from 11.9% in the prior-year quarter.

Balance Sheet

As of Sep 30, 2021, cash and cash equivalents were $11.6 billion, up from $11.2 billion as of Jun 30, 2021.

Short-term investments amounted to $522 million in the reported quarter compared with $501 million in the previous quarter.

At the end of the third quarter, Booking Holdings had $9.89 billion of long-term debt compared with $9.99 billion at the end of the second quarter.

Zacks Rank & Stocks to Consider

Currently, Booking Holdings carries a Zacks Rank #3 (Hold).

AutoNation, Inc. AN, Revolve Group, Inc. RVLV and Costco Wholesale COST are some better-ranked companies in the broader Retail-Wholesale sector. While AutoNation sports a Zacks Rank #1 (Strong Buy) at present, Revolve and Costco carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term earnings growth rates for AutoNation, Revolve and Costco are pegged at 19.08%, 20.71% and 8.56%, respectively.

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