Expedia cuts outlook, as efforts to get Vrbo back on track go slower than expected

By Bill Peters

Company said it still saw 'some acceleration' in its other travel platforms

Shares of Expedia Group Inc. fell after hours on Thursday, after the travel-booking platform cut its sales outlook for the year, as efforts to recharge vacation-rental site Vrbo progressed more slowly than expected after a tech-related overhaul.

"As we enter the second quarter, we are seeing some acceleration in the rest of our B2C business and expect it to continue throughout the year," Chief Executive Peter Kern said in a statement, referring to Expedia's (EXPE) business-to-customer segment that includes its namesake travel site, Vrbo and Hotels.com

"But given the Vrbo drag and the rate of acceleration in B2C thus far, we are lowering our full-year guidance to a range of mid- to high-single-digit top-line growth with margins relatively in line versus last year," he continued.

Shares fell 7.8% after hours on Thursday.

Expedia over the past year been trying to incorporate Vrbo into its namesake platform. While the company believes that will help demand for Vrbo overall as it competes with Airbnb Inc. (ABNB), it risked attracting fewer travelers amid the changeover. Expedia in November said that changeover was complete.

"Despite this slower-than-expected acceleration, the underpinning of the work we have done on the platform is in place and I have every confidence in the teams to continue to leverage these capabilities to drive even stronger growth," Kern said on Thursday.

During the first quarter, Expedia reported a net loss of $135 million, or 99 cents a share, compared with a loss of $145 million, or 95 cents a share, in the same quarter last year. Adjusted for stock-based compensation, restructuring and other items, Expedia reported a per-share profit of 21 cents.

Sales grew 8% year over year to $2.9 billion.

Analysts polled by FactSet expected Expedia to report an adjusted loss of 14 cents a share, on revenue of $2.8 billion.

-Bill Peters

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05-02-24 1808ET

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