The paragraph is from a conference call for Booking Holdings' First Quarter 2025 financial report. It opens with a reminder that forward-looking statements made during the call are subject to risks and uncertainties, potentially leading to different outcomes than expected. The company does not commit to updating these statements publicly. The call introduces CEO Glenn Fogel and CFO Ewout Steenbergen, who begin by sharing positive results for the quarter, highlighting growth in room nights and gross bookings thanks to geographical diversification, which allows them to adapt to travelers' changing destination preferences.

The paragraph highlights the company's strong financial performance in the first quarter, with revenue and adjusted EBITDA exceeding expectations, and a significant growth in adjusted earnings per share. The company achieved over 300 million room nights in a single quarter for the first time and reported stable global leisure travel demand despite geopolitical and macroeconomic uncertainties. Emphasis is placed on the company's strategic priorities, including incorporating AI technology. The company expresses confidence in its ability to navigate potential challenges due to its global diversification, liquidity, and historical execution record. Further details on performance and outlook will be provided by Ewout.

The paragraph emphasizes the long-term confidence in the travel industry's outlook, highlighting the importance of travel to consumers and the desire to explore the world post-pandemic. The business aims to focus on strategic initiatives such as expanding Alternative Accommodations, enhancing the Genius program, advancing the Connected Trip concept, and innovating AI capabilities. The company is committed to supporting accommodation partners, particularly small independents, by generating travel demand and developing supportive products and features. In economic uncertainty, their value proposition includes sharing booking data and leveraging AI, like GenAI at Booking.com for optimized customer interaction and an AI Partner Assistant for onboarding, enhancing partnership value.

The paragraph discusses Booking.com's increased focus on supporting small and independent businesses by providing access to data and AI tools, leading to more accommodation listings on their platform, which reached 31 million by the end of Q1. The growth, particularly in alternative accommodations, contributed to a 12% rise in room night growth. The company emphasizes improving the booking experience for travelers, resulting in growth in new and repeat travelers, with a noticeable shift towards direct bookings over paid marketing channels. The Genius loyalty program extends benefits to travelers by offering discounted prices and broadening its scope to include other travel services beyond accommodations.

The paragraph discusses Booking.com's efforts to enhance the traveler experience by leveraging AI technology and expanding travel services. Over 30% of active travelers are advancing to higher Genius tiers with increased direct booking rates and frequencies. AI features like Smart Filters, Property Q&A, and Review Summaries improve search and booking processes. AI is integral to the company's Connected Trip vision, which aims to streamline travel planning and provide better value for travelers and suppliers. The Connected Trip initiative has seen a 35% year-over-year growth and focuses on expanding beyond accommodations, with flights showing 45% growth and attractions seeing 92% growth.

The paragraph discusses the company's efforts to enhance its travel offerings by integrating AI technologies. Currently, they are focusing on improving in-destination experiences, as well as dining options through a new partnership between OpenTable and Uber. The company is developing AI-powered solutions to create personalized and seamless travel experiences, including the launch of KAYAK.ai as a test lab for AI-driven features. Collaborations with major Generative AI organizations like OpenAI, Microsoft, and Amazon further demonstrate their commitment to innovation and leadership in the AI space. The ultimate goal is to improve search efficiency, increase conversion rates, and reduce customer support needs.

The paragraph discusses the integration and positive impact of Generative AI in travel services, expressing confidence in long-term growth despite geopolitical and macroeconomic uncertainties. The CFO, Ewout Steenbergen, reviews the first-quarter results, highlighting room night growth slightly above expectations, with Europe and Asia experiencing high single-digit growth, and the Rest of World seeing low double-digit growth. The U.S. saw low single-digit growth, with a noted moderation in inbound travel trends, particularly from Canada and Europe. Financial details and presentations will be available on the Booking Holdings investor relations website after the earnings call.

The paragraph discusses trends and strategic initiatives in a travel business. Despite varied performance in different regions, such as improved travel between Canada and Mexico and decreased length of stay in the U.S., the company achieved stable growth globally. They observed that higher star hotels in the U.S. are faring better than lower star ones, a trend not seen in Europe. The company is making progress in its strategic goals, including expanding alternative accommodations, increasing direct and mobile app bookings, and growing its Genius loyalty program. Alternative accommodations grew by 12% in the first quarter, and the direct B2C and mobile app booking mixes both increased. Most mobile app bookings are made directly, highlighting their effort to enhance direct consumer relationships and loyalty.

The paragraph discusses the performance of Booking.com's Genius loyalty program and overall business growth. In the higher Genius tiers, room nights booked have increased to the mid-50% range over the past year, with higher direct booking rates from these travelers. In the first quarter, over 16 million airline tickets were sold, marking a 45% year-over-year increase, and attractions bookings rose by 92%. Gross bookings increased by 7% year-over-year, or 10% on a constant currency basis, partly due to growth in flight bookings and higher average daily rates (ADRs) in Asia. Revenue rose by 8% to $4.8 billion, exceeding guidance due to strong payment revenues and favorable changes in foreign exchange.

In the first quarter, constant currency revenue growth was 15% after adjusting for Easter and leap year impacts. Marketing expenses grew by 10% year-over-year, constituting 3.8% of gross bookings, and were slightly higher than the previous year. Social media channel spending provided attractive ROI, while traditional marketing channels saw improved performance, increasing booker volumes at comparable ROIs. Sales and other expenses as a percentage of gross bookings fell to 1.5%, due to efficiencies despite a higher merchant mix. Adjusted fixed operating expenses dropped by 3% year-over-year, aided by reductions in transaction tax and pension accruals, and personnel expenses were below expectations. Adjusted EBITDA increased by 21% year-over-year to approximately $1.1 billion, surpassing guidance, while adjusted EPS rose by 22% to $24.81, impacted by a 5% lower share count and higher interest expenses.

In the first quarter, the company reported a GAAP net income of $333 million, impacted by various financial adjustments and partially offset by a pension fund accrual reduction. Excluding these items, the adjusted results reflect minimal initial savings from the Transformation Program, which is projected to eventually save $300 million annually. Transformation costs for the quarter were $32 million, with total expected costs between $400 million and $450 million. The company ended the first quarter with $16.1 billion in cash and investments, a decrease from the previous quarter due to capital returns, debt paydown, and additional share repurchases, despite generating $3.2 billion in free cash flow. Looking forward, stable travel demand trends are expected to continue into the second quarter.

The article discusses how geopolitical and macroeconomic uncertainties could impact trends in travel and consumer behavior. For the second quarter, they anticipate a 4-6% growth in room nights and a 10-12% increase in gross bookings and revenue, partly benefitting from a calendar shift of Easter. Forex changes are expected to positively impact growth rates by 4 percentage points, and adjusted EBITDA is projected to rise by 16% at the high end. For the full year 2025, they foresee stable trends but acknowledge potential impacts from uncertainties, thus broadening their growth expectations to mid to high single digits for bookings and revenue, and low to mid-teens for adjusted EPS.

The paragraph discusses a company's financial outlook and strategic initiatives. It anticipates growth in adjusted EBITDA and margins, highlighting the impact of favorable foreign exchange rates. The company plans to reinvest $170 million in 2025 and expects efficient expense management. It underscores confidence in navigating the current economic environment due to its low capital intensity, global diversification, and strong financial profile. The company credits its team's efforts in building better offerings for travelers and partners, positioning it well for the long-term. The paragraph concludes with an invitation for questions, with the first question directed to Glenn and Ewout regarding AI in the travel sector.

The paragraph discusses the implications of AI developments in the travel industry, emphasizing the role of large AI players like OpenAI and collaborations with companies like Microsoft. Glenn Fogel notes that both broad and niche AI systems have their place, with larger systems providing extensive capabilities and personalized systems, like the one they are developing, leveraging specific resources and data for tailored experiences. He underscores the potential of both approaches in enhancing travel booking processes, noting that some users may naturally gravitate toward larger AI providers.

The paragraph discusses the company's efforts to improve direct engagement with consumers and enhance the travel experience by creating a seamless, frictionless, and connected trip. Despite knowing that some people still use search engines like Google, the company has seen an increase in direct interactions, now in the mid-60% range. Ewout Steenbergen reports that global travel demand remains stable despite economic conditions, although there are shifts in travel patterns, with Europeans and Canadians changing preferred destinations. The company remains indifferent to these shifts as expenditure per traveler remains consistent.

The paragraph discusses the company's global business diversification, with over 50% of its business in Europe, about 25% in Asia, and a smaller portion in the U.S. Despite a slight weakness in the U.S., global trends are positive, with stable lengths of stay and expanding booking windows, except in the U.S. Bookings for future months, including summer, show a healthy year-over-year increase. The company aims to add value for supply partners, helping them fill seats and rooms, which strengthens partnerships. Mark Mahaney asks about the company's strategy for attractions and agentic tools on their sites.

In the paragraph, Glenn Fogel discusses the progress and future plans for Priceline's product development, focusing on the concept of a "connected trip." He highlights recent growth in attractions and outlines the company's long-term vision to enhance the travel experience beyond just hotel bookings, which was their initial offering. This vision includes building capabilities in payments, flights, ground transportation, and attractions. Fogel mentions the challenges of prioritizing these developments and balancing resources, emphasizing that while some features are still in beta, significant progress has been made, with notable growth in flights and attractions.

The paragraph discusses the development and growth of a new initiative at Booking.com called "marketplace," which integrates technology, data, machine learning, and generative AI to enhance travel experiences. It emphasizes the project's potential to offer valuable travel suggestions and deals, effectively functioning like a travel agent in one's pocket. The text also highlights recent advancements, such as AI tools like Penny at Priceline and the AI Trip Planner at Booking, in addition to KAYAK.ai, all designed to simplify travel planning. The paragraph acknowledges that while these technologies are still in the early stages, they hold significant promise for improving travel experiences.

In the article paragraph, the speaker reflects on the gradual improvement of new technology, comparing it to the early days of their company in 2000. They express optimism about collaboration with major players to enhance this technology, although acknowledging it will take time to perfect. The speaker cannot provide a precise timeline for when it will be perfected. Following this, Eric Sheridan from Goldman Sachs asks two questions: whether the company is altering its focus or growth investments due to shifts in travel behavior and industry competition, and for more details on successful experiments in traditional marketing channels mentioned in the prepared remarks. Ewout Steenbergen then responds to address both questions.

The company is maintaining its long-term investment strategy without making immediate changes, despite global developments. They're continuing their transformation program and investments in areas like attractions, advertising, GenAI, fintech, alternative accommodations, flights, and direct channels. Although the business environment is stable and they're not anticipating shifts, they are open to adjusting investments if future uncertainties present advantageous opportunities. In performance marketing, they planned for higher spending this quarter and remain focused on optimizing expenditures through experimentation to improve efficiency, even when encountering lower yet positive ROI opportunities.

The paragraph discusses the company's economic performance and its resilience during potential downturns. Although the average ROI is slightly decreasing due to changes in traffic mix, the overall performance is improving, and the company is gaining market share. Eric Sheridan and Glenn Fogel emphasize the company's historical ability to navigate challenging situations by leveraging opportunities to gain share. The speaker acknowledges some concerns about the future but remains optimistic about the company's track record. Brian Nowak from Morgan Stanley asks about the rationale behind the widened annual guidance range, seeking clarity on whether it is a cautious approach or if there are specific business insights influencing this decision.

In the paragraph, Ewout Steenbergen discusses the company's full-year financial guidance, emphasizing the use of constant currency to provide a clearer outlook amid currency fluctuations. He notes that current market conditions are stable, but acknowledges significant uncertainties affecting consumer confidence and spending, particularly in the second half of the year. These uncertainties have led the company to widen its forecast ranges, although the high end remains unchanged from earlier predictions. Steenbergen also addresses the impact on performance marketing ROIs but does not provide detailed information within this paragraph.

The paragraph discusses a company's strategic approach to using social media and traditional performance marketing channels. They began scaling up social media channels in the previous year's second quarter and found them to have positive ROIs, indicating economic benefits for shareholders. There is experimentation in traditional marketing, but details are withheld for competitive reasons. Although some returns on investment might be slightly below average, they still add value. The company plans to continue expanding its direct channels, expecting marketing leverage for the second quarter and full year of 2025. In the Q&A, Lee Horowitz from Deutsche Bank asks about the company's strategy to gain market share in the U.S. if the market stagnates, and notes the increasing direct mix.

The paragraph discusses the strategic growth opportunities in the travel industry, specifically through the development of a "Connected Trip" and leveraging generative AI to potentially increase direct bookings. It highlights the company's success in the alternative accommodations market, noting a consistent growth rate over 16 quarters, outperforming competitors. The speaker, Glenn Fogel, emphasizes seizing investment opportunities for long-term value, particularly when market conditions are challenging, and mentions the company's agility and data-driven approach during difficult times, such as the pandemic.

In the paragraph, the speaker discusses their company's success with a positive EBITDA of almost $900 million, emphasizing their adaptability and willingness to seize opportunities. They acknowledge that, while the direct sales channel is growing, it will never be at 100% due to new customers seeking alternatives, necessitating a diverse approach. The speaker mentions evaluating ROI and acquisition costs across different channels, including potential new opportunities through agentic AI, which could lower customer acquisition costs. They express satisfaction with current strategies and outcomes. The paragraph ends with a transition to another speaker, Kenneth Gawrelski from Wells Fargo, who prepares to ask questions about macroeconomic impacts and the role of online travel agencies (OTAs).

The paragraph discusses potential opportunities and strategies in response to macroeconomic weakness in the U.S. market, particularly in the travel and accommodation sectors. Ewout Steenbergen mentions that some suppliers, such as airlines and hotels, may need assistance in filling seats and rooms, and the company is exploring partnerships to generate additional demand. Additionally, there are opportunities to support owners of alternative accommodations, like villas and apartments, who are experiencing slower bookings. The company may leverage its financial strength to invest in performance marketing channels and increase its market activity, especially as some competitors might face financial challenges.

In the paragraph, it is discussed that there is not a significant economic difference between alternative accommodations and hotels, as evidenced by the company's consistent growth across various metrics, including ADRs and EBITDA margins, despite a faster growth rate in alternative accommodations. The company's EBITDA margins are reportedly higher than those of the largest player in the alternative accommodations market. Additionally, Kenneth Gawrelski acknowledges this performance, and Kevin Kopelman inquires about the engagement of suppliers with the Genius program across different tiers and how it extends beyond traditional accommodations into connected trip verticals. Glenn Fogel affirms the positive impact of the Genius program, noting its benefits for all parties involved.

The paragraph describes how a company successfully generates demand for suppliers, such as hotels and car rentals, by offering targeted pricing strategies and utilizing data and machine learning for optimal pricing without creating channel conflicts. Their "Genius" program levels are highlighted for their effectiveness, and they employ mobile and geography-specific rates to drive incremental customer engagement. The company prides itself on its scientific approach and collaborative partnerships with suppliers, which contribute to its longstanding success.

In the paragraph, Glenn Fogel expresses gratitude to partners, travelers, employees, and stockholders for their support in achieving the company's long-term goals. He then concludes the call, and the operator announces the end of the conference.

This summary was generated with AI and may contain some inaccuracies.