Booking Holdings profit rises 17% as gross bookings climb

Booking Holdings (BKNG) said on Nov. 3 that third-quarter adjusted earnings per share rose 17% to $4.66, above the $4.59 consensus estimate, as gross bookings grew 10%. Adjusted revenue of $9.79 billion was in line with the $9.74 billion consensus estimate.

Shares fell 1.1% in after-hours trading as of 5:05 p.m. ET, from a regular-session close of $154.63.

Here's how the company did:

• Adjusted EPS: $4.66 vs. $3.98 a year earlier, against the $4.59 consensus estimate
• GAAP EPS: $3.61 vs. $3.38 a year earlier
• Adjusted revenue: $9.79 billion vs. $9.01 billion a year earlier
• Total revenues: $8.89 billion vs. $9.01 billion a year earlier
• Adjusted EBITDA: $4.61 billion vs. $4.23 billion a year earlier

The company said total revenues fell 1% to $8.89 billion. That figure reflects a $900 million reduction tied to an FTC matter, which it excluded from adjusted revenue.

The company also accrued a $100 million loss related to the same FTC matter. It excluded that charge from its adjusted results.

Gross bookings rose 10% to $54.5 billion, or about 11% on a constant currency basis. Room nights grew 7% to 345 million.

Guidance for the fourth quarter and full year

The company expects fourth-quarter room nights to grow 1% to 3%, and gross bookings to rise 2% to 4%. Adjusted revenue is expected to grow 0% to 2%, and adjusted EBITDA is expected to be about flat.

For the full year, the company expects gross bookings, adjusted revenue and adjusted EBITDA to grow in the high single digits. Foreign currency movements are expected to weigh on fourth-quarter adjusted revenue growth by about 2 percentage points.

The company said global travel demand moderated somewhat toward the end of the third quarter. It cited disruptions to travel to and from the Middle East and localized unrest in certain European cities in October. Its guidance assumes those effects persist through the end of the year.

Management comment

CEO Glenn Fogel said, "resilient travel demand and disciplined execution by our teams drove double-digit gross bookings growth, margin expansion, and 17% adjusted earnings per share growth." He also said geopolitical and macroeconomic uncertainty may affect near-term travel trends.

Costs and capital returns

Total operating expenses decreased 1% to $5.48 billion. Adjusted fixed operating expenses grew 6%, and the company said personnel costs were slightly lower.

The board declared a quarterly dividend of 42 cents per share, payable Dec. 31 to stockholders of record on Dec. 11. The company repurchased $2.1 billion of its common stock in the quarter and had $12.4 billion remaining under its buyback authorization as of Sept. 30.

Booking Holdings operates Booking.com, Priceline, Agoda, KAYAK and OpenTable in over 220 countries and territories.