0001324424false00013244242024-08-082024-08-08

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): August 8, 2024
EXPEDIA GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 001-37429 20-2705720
(State or other jurisdiction
of incorporation)		 (Commission
File Number)		 (I.R.S. Employer
Identification No.)
1111 Expedia Group Way W.
Seattle, Washington 98119
(Address of principal executive offices) (Zip code)
(206) 481-7200
Registrant’s telephone number, including area code
Not Applicable
(Former name or former address if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol(s)
Name of each exchange on which registered
Common stock, $0.0001 par value
EXPE
Nasdaq Stock Market LLC
(Nasdaq Global Select Market)
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02.    Results of Operations and Financial Condition.
On August 8, 2024, Expedia Group, Inc. (“Expedia Group”) issued an earnings release and will hold a conference call regarding its financial results for the quarter ended June 30, 2024. A copy of the earnings release is furnished as Exhibit 99.1 hereto.
Expedia Group is making reference to non-GAAP financial measures in both the earnings release and the conference call. A reconciliation of these non-GAAP financial measures to the nearest comparable GAAP financial measures is contained in the attached Exhibit 99.1 earnings release.
Pursuant to General Instruction B.2. to Form 8-K, the information set forth in this Item 2.02 and in the accompanying Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
Item 9.01.    Financial Statements and Exhibits.
(d) Exhibits
Exhibit
Number
  Description
  
104Cover Page Interactive Data File, formatted in Inline XBRL




SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
EXPEDIA GROUP, INC.
By:/s/ Julie Whalen
Julie Whalen
Chief Financial Officer
Dated: August 8, 2024



expediagroup3.jpg
Expedia Group Reports Second Quarter 2024 Results
Posts double-digit room night growth
Drove 3 points of sequential acceleration in gross bookings growth to 6%
SEATTLE, WA – August 8, 2024 – Expedia Group, Inc. (NASDAQ: EXPE) announced financial results today for the second quarter ended June 30, 2024.

“Our second quarter results came in at the high end of our expectations, with gross bookings and revenue growing 6%. We're pleased with our momentum and the sequential improvement in our consumer brands. However, in July, we have seen a more challenging macro environment and a softening in travel demand. We are therefore adjusting our expectations for the rest of the year,” said Ariane Gorin, CEO of Expedia Group.

Second Quarter Highlights
•Total gross bookings were $28.8 billion, an increase of 6% compared to 2023.
•Lodging gross bookings were $20.7 billion, an increase of 8% compared to 2023. Hotel bookings were up 11% compared to 2023.
•Room nights growth accelerated to +10% with Brand Expedia at nearly 20% growth. Total room nights grew at the fastest rate since the first quarter of 2023.
•Revenue at $3.6 billion grew 6% compared to 2023. B2B revenue was $1.0 billion, an increase of 22% compared to 2023.
•Net income was $386 million and adjusted net income was $469 million. Adjusted EBITDA was $786 million, an increase of 5% with 15 basis points of margin contraction compared to 2023. Adjusted EBIT was $475 million, an increase of 8% with 21 bps of margin expansion compared to 2023.
•Repurchased approximately 9.2 million shares for $1.2 billion year-to-date.


Financial Summary & Operating Metrics (In millions except per share amounts)
Expedia Group, Inc.
MetricQ2 2024Q2 2023Δ Y/Y
Booked room nights98.989.710%
Gross bookings$28,837$27,3216%
Revenue$3,558$3,3586%
Operating income$451$4432%
Net income attributable to Expedia Group, Inc.$386$385—%
Diluted earnings per share$2.80$2.5410%
Adjusted EBITDA*$786$7475%
Adjusted EBIT*$475$4428%
Adjusted net income (loss)*$469$42810%
Adjusted EPS*$3.51$2.8921%
Net cash provided by operating activities$1,501$1,14631%
Free cash flow*$1,307$92342%
* A reconciliation of non-GAAP financial measures to the most comparable GAAP measures is provided at the end of this release.




Page 1 of 15


Conference Call
Expedia Group, Inc. will webcast a conference call to discuss second quarter 2024 financial results and certain forward-looking information on Thursday, August 8, 2024 at 1:30 p.m. Pacific Time (PT). The webcast will be open to the public and available via ir.expediagroup.com. Expedia Group expects to maintain access to the webcast on the IR website for approximately twelve months subsequent to the initial broadcast.

About Expedia Group
Expedia Group, Inc. brands power travel for everyone, everywhere through our global platform. Driven by the core belief that travel is a force for good, we help people experience the world in new ways and build lasting connections. We provide industry-leading technology solutions to fuel partner growth and success, while facilitating memorable experiences for travelers.

Expedia Group’s three flagship consumer brands includes: Expedia®, Hotels.com®, and Vrbo®. One Key™ is our comprehensive loyalty program that unifies Expedia, Hotels.com and Vrbo into one simple, flexible travel rewards experience. To enroll in One Key, download Expedia, Hotels.com and Vrbo mobile apps for free on iOS and Android devices. One Key is currently available in the U.S.

© 2024 Expedia, Inc., an Expedia Group company. All rights reserved. Trademarks and logos are the property of their respective owners. CST: 2029030-50

Contacts
Investor Relations                    Communications
ir@expediagroup.com                    press@expediagroup.com


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Expedia Group, Inc.
Trended Metrics
(All figures in millions)

The metrics below are intended to supplement the financial statements in this release and in our filings with the SEC, and do not include adjustments for one-time items, acquisitions, foreign exchange or other adjustments. The definition or methodology of any of our supplemental metrics are subject to change, and such changes could be material. We may also discontinue certain supplemental metrics as our business evolves over time. In the event of any discrepancy between any supplemental metric and our historical financial statements, you should rely on the information included in the financial statements filed with or furnished to the SEC.

202220232024Full Year
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q220222023
Units sold
Booked room nights77.082.581.670.894.589.789.377.4101.298.9312.0350.9
Booked air tickets13.113.512.211.114.013.612.811.414.214.549.951.9
Gross bookings by business model
Agency$11,346$12,773$10,904$9,469$13,425$12,370$10,927$9,439$13,301$12,578$44,492$46,161
Merchant13,06613,36613,08311,04215,97614,95114,75812,23316,86316,25950,55757,918
Total$24,412$26,139$23,987$20,511$29,401$27,321$25,685$21,672$30,164$28,837$95,049$104,079
Lodging gross bookings$17,756$17,867$17,099$14,117$21,055$19,167$18,513$15,253$21,903$20,749$66,839$73,987
Revenue by segment
B2C$1,740$2,420$2,707$1,874$1,921$2,415$2,819$1,958$1,986$2,432$8,741$9,113
B2B4326507886766688619958648331,0492,5463,388
trivago (third-party revenue)77111124687682115657077380338
Total$2,249$3,181$3,619$2,618$2,665$3,358$3,929$2,887$2,889$3,558$11,667$12,839
Revenue by product
Lodging$1,610$2,400$2,881$2,014$2,029$2,698$3,233$2,304$2,228$2,862$8,905$10,264
Air74951009311311110086115111362410
Advertising and media - EG(1)
891029810899119125140145152397483
Advertising and media - trivago(1)
77111124687682115657077380338
Other(2)
3994734163353483483562923313561,6231,344
Total$2,249$3,181$3,619$2,618$2,665$3,358$3,929$2,887$2,889$3,558$11,667$12,839
Revenue by geography
U.S. points of sale$1,656$2,208$2,358$1,717$1,748$2,172$2,440$1,787$1,793$2,246$7,939$8,147
Non-U.S. points of sale5939731,2619019171,1861,4891,1001,0961,3123,7284,692
Total$2,249$3,181$3,619$2,618$2,665$3,358$3,929$2,887$2,889$3,558$11,667$12,839
Adjusted EBITDA by segment(3)
B2C$188$582$943$411$148$653$1,056$468$215$654$2,124$2,325
B2B80156221142133206266193172263599798
Other(4)
(95)(90)(85)(104)(96)(112)(106)(129)(132)(131)(374)(443)
Total$173$648$1,079$449$185$747$1,216$532$255$786$2,349$2,680
Net income (loss) attributable to Expedia Group, Inc.(5)
$(122)$(185)$482$177$(145)$385$425$132$(135)$386$352$797
(1) Our advertising and media business consists of Expedia Group ("EG") Media Solutions, which is responsible for generating advertising revenue on our global online travel brands, and third-party revenue for trivago, a leading hotel metasearch site.
(2) Other revenue primarily includes insurance, car rental, destination services and cruise revenue.
(3) See the section below titled "Tabular Reconciliations for Non-GAAP Measures — Adjusted EBITDA by segment" for additional details.
(4) Other is comprised of trivago, corporate and intercompany eliminations.
(5) Expedia Group does not calculate or report net income (loss) by segment.

Notes:
•All trivago revenue is classified as Non-U.S. point of sale.
•Some numbers may not add due to rounding. All percentages throughout this release are calculated on precise, unrounded numbers.


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EXPEDIA GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except share and per share data)
(Unaudited)
 Three months ended
June 30,		Six months ended
June 30,
 2024202320242023
Revenue$3,558 $3,358 $6,447 $6,023 
Costs and expenses:
Cost of revenue (exclusive of depreciation and amortization shown separately below) (1)
362 407 720 821 
Selling and marketing - direct1,793 1,579 3,443 3,066 
Selling and marketing - indirect (1)
197 191 383 378 
Technology and content (1)
331 344 672 661 
General and administrative (1)
180 194 366 378 
Depreciation and amortization 205 199 415 391 
Legal reserves, occupancy tax and other21 1 41 6 
Restructuring and related reorganization charges (1)
18 — 66 — 
Operating income451 443 341 322 
Other income (expense):
Interest income67 63 118 106 
Interest expense(61)(61)(123)(122)
Other, net31 19 (3)97 
Total other income (expense), net37 21 (8)81 
Income before income taxes488 464 333 403 
Provision for income taxes(113)(77)(94)(156)
Net income375 387 239 247 
Net (income) loss attributable to non-controlling interests11 (2)12 (7)
Net income attributable to Expedia Group, Inc.$386 $385 $251 $240 
Earnings per share attributable to Expedia Group, Inc. available to common stockholders:
Basic$2.92 $2.62 $1.88 $1.60 
Diluted2.80 2.54 1.79 1.55 
Shares used in computing earnings per share (000's):
Basic131,948 147,168 133,724 149,808 
Diluted137,832 151,844 140,131 154,425 
(1) Includes stock-based compensation as follows:
Cost of revenue$4 $4 $6 $7 
Selling and marketing23 20 42 40 
Technology and content40 36 80 70 
General and administrative39 46 82 92 
Restructuring and related reorganization charges8 — 8 — 

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EXPEDIA GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(In millions, except number of shares which are reflected in thousands and par value)
June 30,
2024		December 31, 2023June 30,
2023
(Unaudited)(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents$6,242 $4,225 $6,274 
Restricted cash and cash equivalents2,120 1,436 2,484 
Short-term investments31 28 27 
Accounts receivable, net of allowance of $57, $46 and $51
4,127 2,786 2,903 
Income taxes receivable71 47 70 
Prepaid expenses and other current assets924 708 1,055 
Total current assets13,515 9,230 12,813 
Property and equipment, net2,381 2,359 2,318 
Operating lease right-of-use assets332 357 348 
Long-term investments and other assets1,283 1,238 1,202 
Deferred income taxes544 586 665 
Intangible assets, net991 1,023 1,180 
Goodwill6,847 6,849 7,150 
TOTAL ASSETS$25,893 $21,642 $25,676 
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable, merchant$2,206 $2,041 $1,775 
Accounts payable, other1,361 1,077 1,066 
Deferred merchant bookings12,083 7,723 11,523 
Deferred revenue176 164 185 
Income taxes payable32 26 61 
Accrued expenses and other current liabilities857 752 819 
Current maturities of long-term debt1,041 — — 
Total current liabilities17,756 11,783 15,429 
Long-term debt, excluding current maturities5,218 6,253 6,247 
Deferred income taxes31 33 35 
Operating lease liabilities292 314 302 
Other long-term liabilities470 473 447 
Commitments and contingencies
Stockholders’ equity:
Common stock: $.0001 par value; Authorized shares: 1,600,000— — — 
Shares issued: 284,861, 282,149 and 280,006; Shares outstanding: 125,281, 131,522 and 138,885
Class B common stock: $.0001 par value; Authorized shares: 400,000— — — 
Shares issued: 12,800; Shares outstanding: 5,523
Additional paid-in capital15,697 15,398 15,072 
Treasury stock - Common stock and Class B, at cost; Shares 166,857, 157,903 and 148,398(14,204)(13,023)(11,937)
Retained earnings (deficit)(381)(632)(1,169)
Accumulated other comprehensive income (loss)(223)(209)(207)
Total Expedia Group, Inc. stockholders’ equity889 1,534 1,759 
Non-redeemable non-controlling interests1,237 1,252 1,457 
Total stockholders’ equity2,126 2,786 3,216 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$25,893 $21,642 $25,676 
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EXPEDIA GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
 Six months ended
June 30,
 20242023
Operating activities:
Net income$239 $247 
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation of property and equipment, including internal-use software and website development385 361 
Amortization of intangible assets30 30 
Amortization of stock-based compensation218 209 
Deferred income taxes39 (17)
Foreign exchange (gain) loss on cash, restricted cash and short-term investments, net44 (3)
Realized (gain) loss on foreign currency forwards, net55 (26)
Gain on minority equity investments, net(47)(54)
Other, net38 28 
Changes in operating assets and liabilities:
Accounts receivable(1,361)(846)
Prepaid expenses and other assets(180)(147)
Accounts payable, merchant165 66 
Accounts payable, other, accrued expenses and other liabilities403 175 
Tax payable/receivable, net(8)(91)
Deferred merchant bookings4,360 4,371 
Net cash provided by operating activities4,380 4,303 
Investing activities:
Capital expenditures, including internal-use software and website development(371)(456)
Purchases of investments(69)— 
Sales and maturities of investments43 22 
Other, net(52)46 
Net cash used in investing activities(449)(388)
Financing activities:
Purchases of treasury stock(1,172)(1,062)
Proceeds from exercise of equity awards and employee stock purchase plan48 40 
Other, net(25)4 
Net cash used in financing activities(1,149)(1,018)
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents(81)10 
Net increase in cash, cash equivalents and restricted cash and cash equivalents2,701 2,907 
Cash, cash equivalents and restricted cash and cash equivalents at beginning of period5,661 5,851 
Cash, cash equivalents and restricted cash and cash equivalents at end of period$8,362 $8,758 
Supplemental cash flow information
Cash paid for interest$116 $115 
Income tax payments, net57 193 
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Notes & Definitions:

Booked Room Nights: Represents booked hotel room nights and property nights for our B2C reportable segment and booked hotel room nights for our B2B reportable segment. Booked hotel room nights include both merchant and agency hotel room nights. Property nights are related to our alternative accommodation business.

Booked Air Tickets: Includes both merchant and agency air bookings.

Gross Bookings: Generally represent the total retail value of transactions booked, recorded at the time of booking reflecting the total price due for travel by travelers, including taxes, fees and other charges, adjusted for cancellations and refunds.

Lodging Metrics: Reported on a booked basis except for revenue, which is on a stayed basis. Lodging consists of both merchant and agency model hotel and alternative accommodations.

B2C: The B2C segment provides a full range of travel and advertising services to our worldwide customers through a variety of consumer brands including: Expedia, Hotels.com, Vrbo, Orbitz, Travelocity, Wotif Group, ebookers, Hotwire.com, and CarRentals.com.

B2B: The B2B segment fuels a wide range of travel and non-travel companies including airlines, offline travel agents, online retailers, corporate travel management and financial institutions, who leverage our leading travel technology and tap into our diverse supply to augment their offerings and market Expedia Group rates and availabilities to their travelers.

trivago: The trivago segment generates advertising revenue primarily from sending referrals to online travel companies and travel service providers from its localized hotel metasearch websites.

Corporate: Includes unallocated corporate expenses.


























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Non-GAAP Measures
Expedia Group reports Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted EBIT, Adjusted EBIT Margin, Leverage Ratio, Adjusted Net Income (Loss), Adjusted EPS, Free Cash Flow and Adjusted Expenses (non-GAAP cost of revenue, non-GAAP selling and marketing, non-GAAP technology and content and non-GAAP general and administrative), all of which are supplemental measures to GAAP and are defined by the SEC as non-GAAP financial measures. These measures are among the primary metrics by which management evaluates the performance of the business and on which internal budgets are based. Management believes that investors should have access to the same set of tools that management uses to analyze our results. These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP. Adjusted EBITDA, Adjusted Net Income (Loss) and Adjusted EPS have certain limitations in that they do not take into account the impact of certain expenses to our consolidated statements of operations. We endeavor to compensate for the limitation of the non-GAAP measures presented by also providing the most directly comparable GAAP measures and descriptions of the reconciling items and adjustments to derive the non-GAAP measures. Adjusted EBITDA, Adjusted EBIT, Adjusted Net Income (Loss) and Adjusted EPS also exclude certain items related to transactional tax matters, which may ultimately be settled in cash. We urge investors to review the detailed disclosure regarding these matters in the Management Discussion and Analysis and Legal Proceedings sections, as well as the notes to the financial statements, included in the Company's annual and quarterly reports filed with the Securities and Exchange Commission. The non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.

Adjusted EBITDA is defined as net income (loss) attributable to Expedia Group adjusted for:
(1) net income (loss) attributable to non-controlling interests;
(2) provision for income taxes;
(3) total other expenses, net;
(4) stock-based compensation expense, including compensation expense related to certain subsidiary equity plans;
(5) acquisition-related impacts, including
(i) amortization of intangible assets and goodwill and intangible asset impairment,
(ii) gains (losses) recognized on changes in the value of contingent consideration arrangements; and
(iii) upfront consideration paid to settle employee compensation plans of the acquiree;
(6) certain other items, including restructuring;
(7) items included in legal reserves, occupancy tax and other, which includes reserves for potential settlement of issues related to transactional taxes (e.g. hotel and excise taxes), related to court decisions and final settlements, and charges incurred, if any, for monies that may be required to be paid in advance of litigation in certain transactional tax proceedings;
(8) that portion of gains (losses) on revenue hedging activities that are included in other, net that relate to revenue recognized in the period; and
(9) depreciation.
The above items are excluded from our Adjusted EBITDA measure because these items are non-cash in nature, or because the amount and timing of these items is unpredictable, not driven by core operating results and renders comparisons with prior periods and competitors less meaningful. We believe Adjusted EBITDA is a useful measure for analysts and investors to evaluate our future on-going performance as this measure allows a more meaningful comparison of our performance and projected cash earnings with our historical results from prior periods and to the results of our competitors. Moreover, our management uses this measure internally to evaluate the performance of our business as a whole and our individual business segments. In addition, we believe that by excluding certain items, such as stock-based compensation and acquisition-related impacts, Adjusted EBITDA corresponds more closely to the cash operating income generated from our business and allows investors to gain an understanding of the factors and trends affecting the ongoing cash earnings capabilities of our business, from which capital investments are made and debt is serviced.

Adjusted EBIT is defined as net income (loss) attributable to Expedia Group adjusted for:
(1) net income (loss) attributable to non-controlling interests;
(2) provision for income taxes;
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(3) total other expenses, net;
(4) acquisition-related impacts, including
(i) gains (losses) recognized on changes in the value of contingent consideration arrangements; and
(ii) upfront consideration paid to settle employee compensation plans of the acquiree;
(5) certain other items, including restructuring;
(6) items included in legal reserves, occupancy tax and other, which includes reserves for potential settlement of issues related to transactional taxes (e.g. hotel and excise taxes), related to court decisions and final settlements, and charges incurred, if any, for monies that may be required to be paid in advance of litigation in certain transactional tax proceedings; and
(7) that portion of gains (losses) on revenue hedging activities that are included in other, net that relate to revenue recognized in the period.
The above items are excluded from our Adjusted EBIT measure because the amount and timing of these items is unpredictable, not driven by core operating results and renders comparisons with prior periods and competitors less meaningful. We believe Adjusted EBIT is a useful measure for analysts and investors to evaluate our future on-going performance as this measure allows a more comprehensive comparison of our performance with our historical results from prior periods and to the results of our competitors. Moreover, our management uses this measure internally to evaluate the performance of our business as a whole and it allows investors to gain an understanding of the factors and trends affecting profitability, including the ongoing costs to operating our business, which we believe are inclusive of non-cash items such as stock-based compensation.

Trailing Twelve Month Financial Information
Expedia Group includes certain unaudited financial information for the trailing twelve months ("TTM") ended June 30, 2024, which is calculated as the six months ended June 30, 2024 plus the year ended December 31, 2023 less the six months ended June 30, 2023. This presentation is not in accordance with GAAP. However, we believe that this presentation provides useful information to investors regarding its recent financial performance, and it views this presentation of the four most recently completed fiscal quarters as a key measurement period for investors to assess its historical results.

Adjusted Net Income (Loss) generally captures all items on the statements of operations that occur in normal course operations and have been, or ultimately will be, settled in cash and is defined as net income (loss) attributable to Expedia Group plus the following items, net of tax(a):
(1) stock-based compensation expense, including compensation expense related to equity plans of certain subsidiaries and equity-method investments;
(2) acquisition-related impacts, including;
(i) amortization of intangible assets, including as part of equity-method investments, and goodwill and intangible asset impairment;
(ii) gains (losses) recognized on changes in the value of contingent consideration arrangements;
(iii) upfront consideration paid to settle employee compensation plans of the acquiree; and
(iv) gains (losses) recognized on non-controlling investment basis adjustments when we acquire or lose controlling interests;
(3) currency gains or losses on U.S. dollar denominated cash;
(4) the changes in fair value of equity investments;
(5) certain other items, including restructuring charges;
(6) items included in legal reserves, occupancy tax and other, which includes reserves for potential settlement of issues related to transactional taxes (e.g., hotel occupancy and excise taxes), related court decisions and final settlements, and charges incurred, if any, for monies that may be required to be paid in advance of litigation in certain transactional tax proceedings, including as part of equity method investments;
(7) discontinued operations;
(8) the non-controlling interest impact of the aforementioned adjustment items; and
(9) unrealized gains (losses) on revenue hedging activities that are included in other, net.
Adjusted Net Income (Loss) includes preferred share dividends. We believe Adjusted Net Income (Loss) is useful to investors because it represents Expedia Group's combined results, taking into account depreciation, which management believes is an ongoing cost of doing business, but excluding the impact of certain expenses and items not directly tied to the core operations of our businesses.
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(a) Effective January 1, 2023, we changed our methodology for the computation of the effective tax rate used in the calculation of adjusted net income to a long-term projected tax rate as we believe this tax rate provides better consistency across reporting periods and produces results that are reflective of Expedia Group’s long-term effective tax rate. This projected effective tax rate is a total tax rate, and eliminates the effects of non-recurring and period- specific income tax items which can vary in size and frequency. We apply this tax rate to pretax income, as adjusted commensurate with our Adjusted Net Income definition. Based on our long-term projections, in 2023 and 2024 we are applying a 21.5% effective tax rate to compute Adjusted Net Income.

Adjusted EPS is defined as Adjusted Net Income (Loss) divided by adjusted weighted average shares outstanding, which, when applicable, include dilution from our convertible debt instruments per the treasury stock method for Adjusted EPS. The treasury stock method assumes we would elect to settle the principal amount of the debt for cash and the conversion premium for shares. If the conversion prices for such instruments exceed our average stock price for the period, the instruments generally would have no impact to adjusted weighted average shares outstanding. This differs from the GAAP method for dilution from our convertible debt instruments, which include them on an if-converted method. We believe Adjusted EPS is useful to investors because it represents, on a per share basis, Expedia Group's consolidated results, taking into account depreciation, which we believe is an ongoing cost of doing business, as well as other items which are not allocated to the operating businesses such as interest expense, taxes, foreign exchange gains or losses, and minority interest, but excluding the effects of certain expenses not directly tied to the core operations of our businesses. Adjusted Net Income (Loss) and Adjusted EPS have similar limitations as Adjusted EBITDA. In addition, Adjusted Net Income (Loss) does not include all items that affect our net income (loss) and net income (loss) per share for the period. Therefore, we think it is important to evaluate these measures along with our consolidated statements of operations.

Free Cash Flow is defined as net cash flow provided by operating activities less capital expenditures. Management believes Free Cash Flow is useful to investors because it represents the operating cash flow that our operating businesses generate, less capital expenditures but before taking into account other cash movements that are not directly tied to the core operations of our businesses, such as financing activities, foreign exchange or certain investing activities. Free Cash Flow has certain limitations in that it does not represent the total increase or decrease in the cash balance for the period, nor does it represent the residual cash flow for discretionary expenditures. Therefore, it is important to evaluate Free Cash Flow along with the consolidated statements of cash flows.

Adjusted Expenses (cost of revenue, direct and indirect selling and marketing, technology and content and general and administrative expenses) exclude stock-based compensation related to expenses for stock options, restricted stock units and other equity compensation under applicable stock-based compensation accounting standards. Expedia Group excludes stock-based compensation from these measures primarily because they are non-cash expenses that we do not believe are necessarily reflective of our ongoing cash operating expenses and cash operating income. Moreover, because of varying available valuation methodologies, subjective assumptions and the variety of award types that companies can use when adopting applicable stock-based compensation accounting standards, management believes that providing non-GAAP financial measures that exclude stock-based compensation allows investors to make meaningful comparisons between our recurring core business operating results and those of other companies, as well as providing management with an important tool for financial operational decision making and for evaluating our own recurring core business operating results over different periods of time. There are certain limitations in using financial measures that do not take into account stock-based compensation, including the fact that stock-based compensation is a recurring expense and a valued part of employees' compensation. Therefore, it is important to evaluate both our GAAP and non-GAAP measures. See the Notes to the Consolidated Statements of Operations for stock-based compensation by line item.

Expedia Group, Inc. (excluding trivago) In order to provide increased transparency on the transaction-based component of the business, Expedia Group is reporting results both in total and excluding trivago.


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Tabular Reconciliations for Non-GAAP Measures
Adjusted EBITDA (Adjusted Earnings Before Interest, Taxes, Depreciation & Amortization) by Segment(1)
 Three months ended June 30, 2024
 B2CB2BtrivagoCorporate &
Eliminations		Total
 (In millions)
Operating income (loss)$533 $236 $(6)$(312)$451 
Realized gain (loss) on revenue hedges(8)(7)— — (15)
Restructuring and related reorganization charges, excluding stock-based compensation— — — 10 10 
Legal reserves, occupancy tax and other— — — 21 21 
Stock-based compensation— — — 114 114 
Amortization of intangible assets— — — 15 15 
Depreciation129 34 1 26 190 
Adjusted EBITDA(1)
$654 $263 $(5)$(126)$786 
 Three months ended June 30, 2023
 B2CB2BtrivagoCorporate &
Eliminations		Total
 (In millions)
Operating income$529 $175 $12 $(273)$443 
Realized gain (loss) on revenue hedges(6)4 — — (2)
Legal reserves, occupancy tax and other— — — 1 1 
Stock-based compensation— — — 106 106 
Amortization of intangible assets— — — 15 15 
Depreciation130 27 1 26 184 
Adjusted EBITDA(1)
$653 $206 $13 $(125)$747 
(1) Adjusted EBITDA for our B2C and B2B segments includes allocations of certain expenses, primarily cost of revenue and facilities, the total costs of our global travel supply organizations, the majority of platform and marketplace technology costs, and the realized foreign currency gains or losses related to the forward contracts hedging a component of our net merchant lodging revenue. We base the allocations primarily on transaction volumes and other usage metrics. We do not allocate certain shared expenses such as accounting, human resources, certain information technology and legal to our reportable segments. We include these expenses in Corporate and Eliminations. Our allocation methodology is periodically evaluated and may change.



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Adjusted EBIT (Adjusted Earnings Before Interest & Taxes) and Adjusted EBITDA (Adjusted Earnings Before Interest, Taxes, Depreciation & Amortization)
 
 Three months ended
June 30,		Six months ended
June 30,		Year Ended December 31,TTM
June 30,
 202420232024202320232024
 ($ in millions)
Net income attributable to Expedia Group, Inc.$386 $385 $251 $240 $797 $808 
Net income (loss) attributable to non-controlling interests(11)2 (12)7 (109)(128)
Provision for income taxes113 77 94 156 330 268 
Total other (income) expense, net(37)(21)8 (81)15 104 
Operating income451 443 341 322 1,033 1,052 
Gain (loss) on revenue hedges related to revenue recognized(15)(2)(32)4 (7)(43)
Restructuring and related reorganization charges, including stock-based compensation18 — 66 — — 66 
Legal reserves, occupancy tax and other21 1 41 6 8 43 
Impairment of goodwill— — — — 297 297 
Impairment of intangible assets— — — — 129 129 
Adjusted EBIT475 442 416 332 1,460 1,544 
Stock-based compensation, excluding restructuring and related reorganization charges106 106 210 209 413 414 
Depreciation and amortization205 199 415 391 807 831 
Adjusted EBITDA$786 $747 $1,041 $932 $2,680 $2,789 
Net income margin(1)
10.8 %11.5 %3.9 %4.0 %6.2 %6.1 %
Adjusted EBIT margin(1)
13.3 %13.1 %6.4 %5.5 %11.4 %11.6 %
Adjusted EBITDA margin(1)
22.1 %22.2 %16.1 %15.5 %20.9 %21.0 %
Long-term debt, including current maturities$6,259 
Long-term debt to net income ratio7.7 
Long-term debt, including current maturities$6,259 
Unamortized discounts and debt issuance costs35 
Adjusted debt $6,294 
Leverage ratio(2)
2.3 
(1) Net income, Adjusted EBIT and Adjusted EBITDA margins represent net income (loss) attributable to Expedia Group, Inc., Adjusted EBIT or Adjusted EBITDA divided by revenue.
(2) Leverage ratio represents adjusted debt divided by TTM Adjusted EBITDA.


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Adjusted Net Income (Loss) & Adjusted EPS
 Three months ended
June 30,		Six months ended
June 30,
 2024202320242023
 (In millions, except share and per share data)
Net income attributable to Expedia Group, Inc.$386 $385 $251 $240 
Less: Net (income) loss attributable to non-controlling interests 11 (2)12 (7)
Less: Provision for income taxes(113)(77)(94)(156)
Income before income taxes488 464 333 403 
Amortization of intangible assets15 15 30 30 
Stock-based compensation114 106 218 209 
Legal reserves, occupancy tax and other21 1 41 6 
Restructuring and related reorganization charges, excluding stock-based compensation10 — 58 — 
Unrealized (gain) loss on revenue hedges(2)17 (3)15 
Gain on minority equity investments, net(56)(53)(47)(54)
TripAdvisor tax indemnification adjustment(6)2 (6)(67)
Gain on sale of businesses— (4)(3)(24)
Adjusted income before income taxes584 548 621 518 
GAAP Provision for income taxes(113)(77)(94)(156)
Provision for income taxes for adjustments(13)(40)(40)45 
Total Adjusted provision for income taxes(126)(117)(134)(111)
Total Adjusted income tax rate21.5 %21.5 %21.5 %21.5 %
Non-controlling interests11 (3)11 (9)
Adjusted net income attributable to Expedia Group, Inc.$469 $428 $498 $398 
GAAP diluted earnings per share$2.80 $2.54 $1.79 $1.55 
Amortization of intangible assets0.11 0.10 0.22 0.20 
Stock-based compensation0.85 0.72 1.60 1.39 
Legal reserves, occupancy tax and other0.16 — 0.30 0.04 
Restructuring and related reorganization charges0.08 — 0.43 — 
Unrealized (gain) loss on revenue hedges(0.01)0.11 (0.02)0.11 
Gain on minority equity investments, net(0.42)(0.36)(0.35)(0.36)
TripAdvisor tax indemnification adjustment(0.05)0.02 (0.05)(0.44)
Gain on sale of businesses— (0.03)(0.03)(0.16)
Income tax effects and adjustments(0.09)(0.27)(0.29)0.30 
Non-controlling interest(0.01)(0.01)(0.01)(0.01)
Adjustment to GAAP dilutive securities (1)
0.08 0.07 0.05 0.04 
Adjusted earnings per share(2)
$3.51 $2.89 $3.66 $2.64 
GAAP diluted weighted average shares outstanding (000's)137,832 151,844 140,131 154,425 
Adjustment to dilutive securities (000's)(1)
(3,921)(3,921)(3,921)(3,921)
Adjusted weighted average shares outstanding (000's) (2)
133,910 147,923 136,209 150,504 
Ex-trivago Adjusted Net Income and Adjusted EPS
Adjusted net income attributable to Expedia Group, Inc.$469 $428 $498 $398 
Less: Adjusted net income (loss) attributable to trivago7 7 (1)16 
Adjusted net income excluding trivago$462 $421 $499 $382 
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Adjusted earnings per share$3.51 $2.89 $3.66 $2.64 
Less: Adjusted earnings (loss) per share attributable to trivago0.05 0.05 (0.01)0.11 
Adjusted earnings per share excluding trivago(2)
$3.46 $2.84 $3.67 $2.53 
(1) In periods for which we have Adjusted net income, the GAAP diluted average shares and diluted earnings (loss) per share is presented adjusted for our convertible debt instruments per the treasury stock method.
(2) Share and per share numbers may not add due to rounding.

Free Cash Flow
 Three months ended
June 30,		Six months ended
June 30,
 2024202320242023
 (In millions)
Net cash provided by operating activities$1,501 $1,146 $4,380 $4,303 
Less: Total capital expenditures(194)(223)(371)(456)
Free cash flow$1,307 $923 $4,009 $3,847 

Adjusted Expenses (Cost of revenue, direct and indirect selling and marketing, technology and content and general and administrative expenses)
 Three months ended
June 30,		Six months ended
June 30,
 2024202320242023
 (In millions)
Cost of revenue$362 $407 $720 $821 
Less: stock-based compensation4 4 6 7 
Adjusted cost of revenue$358 $403 $714 $814 
Less: trivago cost of revenue(1)
4 4 8 9 
Adjusted cost of revenue excluding trivago$354 $399 $706 $805 
Selling and marketing - direct$1,793 $1,579 $3,443 $3,066 
Less: trivago selling and marketing - direct(2)
54 42 107 70 
Adjusted selling and marketing excluding trivago - direct$1,739 $1,537 $3,336 $2,996 
Selling and marketing - indirect$197 $191 383 378 
Less: stock-based compensation23 20 42 40 
Adjusted selling and marketing - indirect$174 $171 $341 $338 
Less: trivago selling and marketing - indirect(1)
2 2 5 5 
Adjusted selling and marketing excluding trivago - indirect$172 $169 $336 $333 
Technology and content$331 $344 $672 $661 
Less: stock-based compensation40 36 80 70 
Adjusted technology and content$291 $308 $592 $591 
Less: trivago technology and content(1)
12 12 24 23 
Adjusted technology and content excluding trivago$279 $296 $568 $568 
General and administrative$180 $194 $366 $378 
Less: stock-based compensation39 46 82 92 
Adjusted general and administrative$141 $148 $284 $286 
Less: trivago general and administrative(1)
9 9 17 17 
Adjusted general and administrative excluding trivago$132 $139 $267 $269 
Total adjusted overhead expenses(3)
$606 $627 $1,217 $1,215 
Page 14 of 15

Note: Some numbers may not add due to rounding.
(1) trivago amount presented without stock-based compensation as those are included with the consolidated totals above.
(2) Selling and marketing expense adjusted to add back B2C direct marketing spend on trivago eliminated in consolidation.
(3) Total adjusted overhead expenses is the sum of adjusted expenses for Selling and marketing - indirect, Technology and content, and General and administrative.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. These forward-looking statements are based on assumptions that are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict. The use of words such as “believe,” “estimate,” “expect” and “will,” or the negative of these terms or other similar expressions, among others, generally identify forward-looking statements. However, these words are not the exclusive means of identifying such statements. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements and may include statements relating to future revenues, expenses, margins, profitability, net income (loss), earnings per share and other measures of results of operations and the prospects for future growth of Expedia Group, Inc.’s business. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those described in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of our most recently filed periodic reports on Form 10-K and Form 10-Q, which are available on our investor relations website at ir.expediagroup.com and on the SEC website at www.sec.gov. All information provided in this release is as of August 8, 2024. Undue reliance should not be placed on forward-looking statements in this release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.

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v3.24.2.u1
8-K Cover Page
Aug. 08, 2024
Entity Information [Line Items]  
Document Type 8-K
Document Period End Date Aug. 08, 2024
Entity Registrant Name EXPEDIA GROUP, INC.
Entity Incorporation, State or Country Code DE
Entity File Number 001-37429
Entity Tax Identification Number 20-2705720
Entity Address, Address Line One 1111 Expedia Group Way W.
Entity Address, City or Town Seattle
Entity Address, State or Province WA
Entity Address, Postal Zip Code 98119
City Area Code 206
Local Phone Number 481-7200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common stock, $0.0001 par value
Trading Symbol EXPE
Entity Emerging Growth Company false
Entity Central Index Key 0001324424
Amendment Flag false
Security Exchange Name NASDAQ
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