Priceline’s Robust Q2 2016 Suggests That The Company’s Growth Story Is Expected To Continue
Priceline continued with its solid growth trend in the Q2 2016, despite having a significant exposure to Europe. While the company witnessed reduced demands in regions like France, Belgium, and Turkey, however, there wasn’t a sharp decline in demand from Europe overall. The company’s international operations’ gross profit increased by 17% Y-o-Y to $2.1 billion, while those of the U.S. operations grew by 8% to $327 million. Booking.com continues to drive growth for the company with around 1 million accommodations on its platform, priceline.com is undergoing a makeover to start 2017 on a fresh note, and Kayak,the biggest growth driver for Priceline’s fastest growing advertising and media segment, continues to deliver above expectation.
All The Important Segments Are Growing Solidly
Priceline’s booking.com again delivered a solid quarter with the list of accommodations on its platform crossing 1 million, reflecting a 30% year-on-year growth. The brand has almost doubled the number of properties on its platform in around 2 years time. Priceline’s hotel booking segment contributes to over 90% of its revenues and is expected to do so in the future as well.
Priceline’s metasearch engine, Kayak’s, growth was once again above expectations and the brand launched new products and feature upgrades such as planning and travel tools, Kayak’s Facebook Messenger service, etc. Currently Priceline’s advertising and media revenue is growing at a CAGR of 60% over the three-year period ending 2016, while its overall revenue is growing at a CAGR of 16%. Kayak and OpenTable are the main drivers of this growth.
Turnaround Plan For Priceline.com In Progress
Priceline.com is making progress with its repositioning plans including strengthening the management team and upgrading products and services in order to make a fresh start in 2017. The brand is also in search for a new CEO after its erstwhile CEO Paul Hennessey resigned in June.
Have more questions on Priceline? See the links below.
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- Priceline’s Q2 2016 Earnings Preview
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