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Analyzing Expedia’s Key Revenue Metric Trends in Q1

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Room night growth

The lodging business unit is still a major revenue growth driver for Expedia (EXPE). Accounting for 66% of the total revenues, the segment reported 7% YoY (year-over-year) growth in its first-quarter revenues due to a 9% increase in room nights. The increase was partially offset by a 2% fall in the revenues per room night due to the unfavorable foreign currency exchange rate.

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During the first quarter, Expedia added 10,000 net new properties to its core lodging platform, which brought the total property count to 640,000—excluding the VRBO (Vacation Rentals by Owner) segment. Including the VRBO segment’s 460,000 property listings, Expedia’s total properties available on its core lodging platform exceeded 1.1 million.

Other revenue metrics

Expedia’s air travel business accounted for 10% of the total first-quarter revenues. The segment’s first-quarter revenues grew 3% YoY mainly due to 11% growth in the ticket volume. The YoY increase was partially offset by a 7% fall in the revenue per ticket due to a shift in the product mix, an unfavorable exchange rate, and reclassification of specific partner fees to other revenues.

Expedia’s advertising and media segment accounted for 10% of its total first-quarter revenues. The segment’s revenues fell 6% due to a decline in Trivago’s (TRVG) subsidiary revenues. Trivago recorded a 26% YoY decline in its first-quarter revenues.

The Other segment’s revenues remained flat YoY and contributed 14% to Expedia’s first-quarter revenues.

Expedia will likely continue to benefit from the continuous shift in travel bookings through online and mobile devices. The company’s sustained focus on enhancing its product portfolio, marketing initiatives, and mobile-centric product designs will likely drive the user base.

The Amplify Online Retail ETF (IBUY) has invested 3.1% of its funds in Expedia. IBUY has also invested 3.1% of its funds in TripAdvisor (TRIP). The Invesco QQQ Trust (QQQ) has invested in Ctrip.com International (CTRP) and Booking Holdings (BKNG).

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