Booking Holdings, the parent company of popular online travel booking platforms like Booking.com and Kayak, reported better-than-expected earnings for the fourth quarter of 2019. The company reported a non-GAAP EPS of $11.60, which beat estimates by $0.86. The company’s revenue for the quarter was $3.3 billion, which was in line with analysts’ estimates.
Despite the strong earnings, Booking Holdings’ stock fell slightly in after-hours trading following the release of the report. The company cited a weakening travel environment due to a variety of factors, including the coronavirus outbreak, the Australian bushfires, and geopolitical tensions.
“Weakening travel demand due to the coronavirus outbreak resulted in a material impact on our first-quarter 2020 outlook,” Glenn Fogel, Booking Holdings’ CEO, said in a statement. “We are closely monitoring this situation and remain committed to taking necessary actions to navigate this challenging environment.”
In addition to the travel market headwinds, Booking Holdings also faces increasing competition from other online travel booking platforms like Expedia and Airbnb. The company is looking to differentiate itself by investing in new technology and expanding its offerings beyond traditional hotel and flight bookings. The company recently launched a new platform called CityBook, which provides travelers with customized recommendations for experiences like restaurants and local attractions.
Despite the challenges facing the travel industry, Booking Holdings is well-positioned to weather the storm. The company has a strong balance sheet, with over $14 billion in cash and short-term investments. The company is also highly profitable, with an operating margin of around 40%.
In the long-term, Booking Holdings’ success will depend on its ability to continue innovating and staying ahead of the competition. The company has a proven track record of adapting to changing market conditions, and its continued investment in new technologies and offerings should help it maintain its position as a leader in the online travel industry.