EXPE 10-K & 10-Q changes, risk factors and insider trading
Expedia Group, Inc. · Nasdaq · Transportation Services · CIK 1324424 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Our use of AI technologies in our products, services and operations present significant risks that could materially harm our business, reputation and financial performance.”
New heading “Our alternative accommodations business is subject to significant and evolving regulatory and legal risks, which could have a material adverse effect on our operations and financial results.”
Removed heading “Our alternative accommodations business is subject to regulatory and legal risks, which could have a material adverse effect on our operations and financial results.”
Largest changes
“We also have been subject, and we will likely be subject in the future, to inquiries or legal proceedings from time to time from regulatory bodies concerning compliance with economic sanctions, consumer protection, competition, tax, payments and travel industry-specific laws and regulations. For example, in 2020, the Australian Competition and Consumer Commission held that aspects of the way that our trivago subsidiary had offered accommodation on its Australian website breached Australian Consumer Law. …”see in full comparison
“Likewise, the SEC, Department of Justice (“DOJ”) and Office of Foreign Assets Controls (“OFAC”), as well as foreign regulatory authorities, have continued to increase the enforcement of economic sanctions and trade regulations, anti-money laundering, and anti-corruption laws, across industries. As regulations continue to evolve and regulatory oversight continues to increase, we cannot guarantee that our programs and policies will be deemed compliant by all applicable regulatory authorities. …”see in full comparison
“We also have been subject, and we will likely be subject in the future, to inquiries or legal proceedings from time to time from regulatory bodies concerning compliance with economic sanctions, consumer protection, competition, tax, payments and travel industry-specific laws and regulations, including but not limited to investigations and legal proceedings relating to the travel industry and, in particular, parity provisions in contracts between hotels and online travel companies, including Expedia Group, and the presentation of information to consumers, as described in Part I. Item 3. …”see in full comparison
“If one or more of these counterparties were to liquidate, declare bankruptcy or otherwise fail to perform their obligations due to liquidity events or other unforeseen events, we may be exposed to significant financial losses. Specifically, a default by a financial institution counterparty could result in the loss of deposited cash, the inability to settle outstanding hedging contracts, or the inability to replace such hedging instruments on favorable terms. …”see in full comparison
“We are exposed to the risk that various counterparties, including financial entities, will fail to perform. This creates risk in a number of areas, including with respect to our bank deposits and investments, foreign exchange risk management, insurance coverages, letters of credit, and for certain of our transactions, the receipt and holding of traveler payments and subsequent remittance of a portion of those payments to travel suppliers. …”see in full comparison
“We are currently, or have been in the past, involved in various legal proceedings and disputes involving taxes, personal injury, contract, alleged infringement of third-party intellectual property rights, privacy, antitrust, consumer protection, labor and employment matters, securities laws, and other claims, including, but not limited to, the legal proceedings described in Part I. Item 3. Legal Proceedings. …”see in full comparison
Full comparison: every changed paragraph (80)
The market for the services we offer is intensely competitive and constantly evolving. We currently, or may in the future, compete globally with a wide variety of providers of travel-related services including:
Some of our competitors have significant advantages such as greater financial resources or name recognition, more advanced technology systems, more consumers and consumer data, more favorable offerings, including pricing and supply breadth, or may be able to leverage other aspects of their business for competitive advantage. For example, Google has used its search market position to promote its own travel services, potentially disintermediating our platform, and may be able to leverage the data it collects on users to the detriment of us and other OTAs.
The rapid emergence and adoption of generative and agentic AI is likely to further intensify competition for our services from established technology companies and new market entrants who may deploy AI-driven travel search, planning, and booking capabilities more effectively or rapidly than we can. If we are unable to successfully innovate and integrate advanced AI capabilities into our own products, or if consumer behavior shifts toward AI-driven platforms where we lack a significant presence, we may experience a loss of market share, reduced direct-booking rates, and increased marketing expenses as we compete for visibility. Any failure to effectively navigate this "agentic" revolution could have a material adverse effect on our business, financial condition, and results of operations.
Our OTA and alternative accommodation provider competitors are also increasingly expanding the range of travel services they offer, thereby further intensifying the competitive environment. In recent years, Airbnb has expanded into tours, activities, and hotel bookings, and discussed expansion into flight bookings, and Booking.com has expanded its flight booking services. Some competing metasearch websites have also looked to add various forms of direct or assisted booking functionality to their sites in direct competition with certain of our brands and other participants or existing competitors may begin to offer or expand other services to the travel industry that compete with the services we offer to our travelers, our travel industry affiliates and partners, or our corporate clients. In other cases, our competitors and potential competitors offer a variety of online services, many of which are used by consumers more frequently than online travel services or have created "super-apps" where consumers can use such various services without leaving the company's app. A competitor that has established other, more frequent online or app-based interactions with consumers may be able to more easily or cost-effectively acquire customers for its online travel services than we can.
We cannot assure you that we will be able to compete successfully against any current, emerging and future competitors or on platforms that may emerge, or offer differentiated products and services to our travelers. Failure to compete effectively against existing or new competitors could result in loss of market share and reduced margins, which could have a material adverse effect on our business, financial condition, and results of operations.
The market for the services we offer is intensely competitive. We compete with both established and emerging online and traditional providers of travel-related services, including online travel agencies; alternative accommodation providers; wholesalers and tour operators; travel product suppliers (including hotels, airlines and car rental companies); search engines and large online portal websites; travel metasearch services; corporate travel management service providers; mobile platform travel applications; social media websites; eCommerce and group buying websites; B2B businesses and other participants in the travel industry. In addition, technological developments in generative artificial intelligence ("AI") tools may be increasingly used to create competing offerings such as AI powered digital assistants, which may further increase competition.
Online travel agencies and alternative accommodations providers. In particular, we face intense competition from other OTAs and alternative accommodation providers in many regions, such as Booking Holdings (through its Booking.com, Priceline.com and Agoda.com brands), Airbnb, and Trip.com, any of which may have more favorable offerings for travelers or suppliers, including pricing and supply breadth. Airbnb, Booking Holdings and other providers of alternative accommodations provide an alternative to hotel rooms and compete with alternative accommodation properties available through Expedia Group brands, including Vrbo. The continued growth of alternative accommodation providers could affect overall travel patterns generally, and the demand for our services specifically, in facilitating reservations at hotels and alternative accommodations. In addition, our competitors are also increasingly expanding the range of travel services they offer, thereby further intensifying the competitive environment, with Airbnb looking to expand into tours, activities, hotel and flight bookings, and Booking.com expanding its flight booking services.
Travel suppliers. Travel suppliers, such as hotels, airlines and rental car companies, may offer products and services on more favorable terms to consumers who transact directly with them. Many of these competitors have been steadily focusing on increasing online demand on their own websites and mobile applications in lieu of third-party distributors through favorable rates and bonus or loyalty points for direct bookings, surcharges for booking outside of the supplier’s own website or preferred booking technologies, suppliers combining to establish a single search platform and other tactics to drive traffic directly to supplier websites.
Search engines and large online portal websites. We also face intense competition from Google and other search engines. There could be a material adverse impact on our business and financial performance to the extent that Google continues to use its market position to disintermediate online travel agencies through its own offerings or capabilities, refer customers directly to suppliers or other favored partners, increase the cost of traffic directed to our websites, offer the ability to transact on its own website, or promote its own competing products by placing its own offerings at the top of organic search results.
In recent years, search engines have increased their focus on acquiring or launching travel products that provide increasingly comprehensive travel planning content and direct booking capabilities, comparable to OTAs. For example, Google has continued to add features and functionality to its Google Travel, Google Flights, Hotel Ads and alternative accommodations metasearch products. In addition, Google may be able to leverage the data they collect on users to the detriment of us and other OTAs. Search engines may also continue to expand their voice and AI capabilities. To the extent these actions have a negative effect on our search traffic or the cost of acquiring such traffic, our business and financial performance could be adversely affected.
In addition, our brands, or brands in which we hold a significant ownership position, including trivago, compete for advertising revenue with these search engines, as well as with large internet portal sites that offer advertising opportunities for travel-related companies. Competition could result in higher traffic acquisition costs, reduced margins on our advertising services, loss of market share, reduced customer traffic to our websites and reduced advertising by travel companies on our websites.
Travel metasearch websites. Travel metasearch websites, including Kayak.com (a subsidiary of Booking Holdings), trivago (a majority-owned subsidiary of Expedia Group), TripAdvisor, Skyscanner and Qunar (both are subsidiaries of Trip.com), aggregate travel search results for a specific itinerary across supplier, travel agent and other websites. In addition, some metasearch websites have looked to add various forms of direct or assisted booking functionality to their sites in direct competition with certain of our brands. To the extent metasearch websites limit our participation within their search results, or consumers utilize a metasearch website for travel services and bookings instead of ours, our traffic-generating arrangements could be affected in a negative manner, or we may be required to increase our marketing costs to maintain share, either of which could have an adverse effect on our business and results of operations. In addition, as a result of our majority ownership interest in trivago, we also compete more directly with other metasearch engines and content aggregators for advertising revenue. To the extent that trivago’s ability to aggregate travel search results for a specific itinerary across supplier, travel agent and other websites is hampered, whether due to its affiliation with us or otherwise, or if OTA advertisers or suppliers choose to limit their participation in trivago’s metasearch marketplace, trivago’s business and therefore our results of operations could be adversely affected and the value of our investment in trivago could be negatively impacted.
Corporate travel management service providers. By virtue of our minority ownership stake in, and long-term supply agreement with, GBT, we compete indirectly with online and traditional corporate travel providers, as well as vendors of corporate travel and expense management software and services. Our brands also compete to attract unmanaged business travelers.
Mobile and other platform travel applications. The demand for and functionality of smartphones, tablet computers and home assistants continue to grow and improve significantly. If we are unable to offer innovative, user-friendly, feature-rich mobile applications and mobile-responsive websites for our travel services, along with effective marketing and advertising, or if our mobile applications and mobile-responsive websites are not used by consumers, we could lose share to existing competitors or new entrants and our future growth and results of operations could be adversely affected.
Applications and social media websites. Applications and social media websites, including Facebook, Instagram and TikTok, continue to develop search functionality for data included within their websites and mobile applications, which may in the future develop into alternative research and booking resources for travelers, resulting in additional competition.
eCommerce and group buying websites. Traditional consumer eCommerce platforms, including Amazon and Alibaba, and group buying websites have periodically undertaken efforts to expand their local offerings into the travel market. For example, traditional consumer eCommerce and group buying websites may add hotel offers or other travel services to their sites. To the extent our travelers use these websites, these websites may create additional competition and could negatively affect our businesses.
B2B businesses. Our B2B business faces competition from other online travel agencies with B2B offerings as well as other competitors such as independent B2B businesses. If we are unable to deliver competitive supply, products, features and commercial terms to our B2B partners, this may result in slower growth and/or a loss of share.
Other participants in the travel industry. Other participants or existing competitors may begin to offer or expand other services to the travel industry that compete with the services we offer to our travelers, our travel industry affiliates and partners, or our corporate clients. For example, ride-sharing apps increasingly compete with traditional car rental services and are adding other transportation and experience offerings, and travel services continue to proliferate. To the extent any of these services gain market share over time, it may create additional competition and could negatively affect our businesses.
In general, increased competition has resulted in, and may continue to result in, reduced margins, as well as loss of travelers, transactions and brand recognition and we cannot assure you that we will be able to compete successfully against any current, emerging and future competitors or on platforms that may emerge, or offer differentiated products and services to our travelers. Increasing competition from current and emerging competitors, the introduction of new technologies and the continued expansion of existing technologies, such as AI, metasearch and other search engine technologies, may force us to make changes to our business models, which could affect our financial performance and liquidity. Some of our competitors may also have other significant advantages, such as greater financial resources or name recognition, more favorable corporate structures, or a broader global presence, among others.
Our business and financial performance are affected by the overall health of the worldwide travel industry. Most recently, the COVID-19 pandemic and efforts to contain it severely restricted the level of economic activity around the world, had an unprecedented negative impact on the global travel industry, and materially impacted our business, financial performance and liquidity position, as well as those of many of the partners on which our business relies. Factors beyond our control that have in the past and could in the future materially and adversely affect the travel industry and demand in general and our business in particular include:
Because these events or concerns, and the full impact of their effects, are largely unpredictable, they can dramatically and suddenly affect travel behavior by consumers. Any associated decrease in demand, depending on its scope and duration, together with any future issues affecting travel safety, could significantly and adversely affect our business, working capital and financial performance over the short and long-term. For example, during 2024, Hurricanes Helene and Milton negatively impacted our financial results for the third and fourth fiscal quarters, respectively.
Recent examples of such events include the COVID-19 pandemic and efforts to contain it, which severely restricted the level of economic activity around the world, had an unprecedented negative impact on the global travel industry, and materially impacted our business, financial performance and liquidity position, as well as those of many of the partners on which our business relies. In addition, during 2024, Hurricanes Helene and Milton negatively impacted our financial results for the third and fourth fiscal quarters, respectively.
As of December 31, 2024, we have outstanding long-term indebtedness, excluding current maturities, with a face value of $6.3 billion and we have an essentially untapped revolving credit facility of $2.5 billion. Risks relating to our indebtedness include:
We rely heavily on internet search engines, such as Google, through the purchase of travel-related keywords and through organic search, to generate a significant portion of the traffic to our websites and the websites of our affiliates.affiliates from internet search engines, such as Google, through the purchase of travel-related keywords and organic search. Search engines frequently update and change the logicalgorithms that determines thedetermine placement and display of resultsresults. ofThese achanges user’scan search,adversely such thataffect the placementranking, visibility, or cost of links to our websites and those of our affiliates can be negatively affected.websites. In addition, awe significantreceive amount ofmeaningful traffic is directed to our websites and those of our affiliates through participation in pay-per-click and display advertising campaigns on search engines, including Google, and travel metasearch websites, includingsuch as Kayak, TripAdvisor and trivago. Pricing and operating dynamics for these traffic sources can change rapidly, both technically and competitively. Moreover, a searchSearch or metasearch engineengines could, for competitive or other purposes, alter itstheir search algorithms or display of results which could cause a website to placerank lower in search query results or inhibit participation in the search query results. InFor particular,example, Google has in the past, and may continue to in the future, change its algorithms or results in a manner that negatively affects the search engine ranking, both paid and unpaid, of our websites, the websites of our affiliates and those of our third-party distribution partners, which could adversely impactsimpact our business and financial performance. Google has also increasingly added its own travel search functionality and content at the expense of traditional paid listings and organic search results, which may continue to reduce the amount of traffic to our websites or those of our affiliates. If Google or other search or metasearch companies continue to pursue these or similar strategies, which is out of our control, or we do not successfully manage our paid and unpaid search strategies, we could face a significant decrease in traffic to our websites and/or increased costs related to replacing unpaid traffic with paid traffic.
Certain search providers, such as Google, have increasingly added their own travel search functionality and content at the expense of traditional paid listings and organic search results, which may continue to reduce the amount of traffic to our websites or those of our affiliates. If Google or other search or metasearch companies continue to pursue these or similar strategies, which are out of our control, or we do not successfully manage our paid and unpaid search strategies, we could face a significant decrease in traffic to our websites and/or increased costs related to replacing unpaid traffic with paid traffic. In addition, the emergence of AI search platforms and changing consumer behavior adversely affect search traffic and margins.
We are subject to payments-related fraud risks.
In addition, we mayhave bebeen subject to fraudulent impersonation and supplier schemes. ForFraudulent example,impersonation whenschemes onboardinginvolve suppliersexternal actors impersonating our business and customer support operations. This activity occurs outside of our systems, for example driven by search results that surface fake phone numbers and links, making detection and mitigation challenging. With respect to ourfraudulent websites,supplier schemes, we may fail to identify falsified or stolen supplier credentials, which may result in fraudulent bookingsbookings, payments or unauthorized access to personal or confidential information of users of our websites and mobile applications. AImpersonation and fraudulent supplier schemeschemes could alsotherefore result in negative publicity, damage to our reputation, and could cause users of our websites and mobile applications to lose confidence in the quality of our services.
The rapid evolution and increased adoption of AI technologiestechnologies, including agentic booking capabilities that may lack strong consent controls, may significantly increase theour riskfraud ofrisks, fraudulent bookings and fraudulent supplier scheme risks. Any of these eventswhich could have a significant negative effect on the value of our brands,brands which could haveand an adverse impact on our financial performance.
In addition, as a result of our migration of key portions of our platform functionality to Amazon Web Services (“AWS”), we now depend on the availability of AWS’s services and any incident affecting AWS’s infrastructure and availability, which have occurred a number of times in the recent past, could adversely affect the availability of our platform and our ability to serve our customers, which could in turn damage our reputation with current and potential customers, expose us to liability, result in substantial costs for remediation, cause us to lose customers, or otherwise harm our business, financial condition, or results of operations. We may also incur significant costs for using alternative hosting sources or taking other actions in preparation for, or in reaction to, events that compromise the AWS services we use.
We operate in a number of jurisdictions outside of the United States and intend to continue to expand our international presence. Laws and business practices that favor local competitorscompetitors, disfavor foreign competitors, or prohibit or limit foreign ownership of certain businesses or our failure to adapt our practices, systems, processes and business models effectively to the traveler and supplier preferencespreferences, (as well as the regulatory and tax landscapes)landscapes, of each country into which we expand, could slow our growth or prevent our ability to compete effectively in certain markets. For example, to compete in certain international markets we have in the past, and may in the future, adopt locally-preferred payment methods, which has increased our costs and instances of fraud. Certain international markets in which we operate have lower margins than more mature markets, which could have a negative impact on our overall margins if the proportion of our overall revenue from these markets grow over time. Additionally, some countries have enacted or are considering enacting various regulations, such as data localizationlocalization, laws,tax and tourism laws that make competition by foreign companies costly or operationally difficult in those markets.
In addition to the risks outlined elsewhere in this section, ourOur international operations are also subject to a number of other risks, including:
We have acquired, invested in, divested or entered into significant commercial arrangements with a number of businesses in the past, and our future success may depend, in part, on such transactions, any of which could be material to our financial condition and results of operations. Certain financial and operationalKey risks related to such transactions that may have a material impact on our business areinclude:
Moreover, we often rely heavily on the representations and warranties and related indemnities provided to us by the sellers of acquired private companies, including as they relate to creation, ownership and rights in intellectual property and compliance with laws and contractual requirements. Our failure to address these risks or other problems encountered in connection with past or future acquisitionsacquisitions, divestitures and investments could cause us to fail to realize the anticipated benefits of such acquisitionsacquisitions, divestitures or investments, incur unanticipated liabilities and harm our business generally.
Our performance is largely dependent on the talents and efforts of our employees. Our future success depends on our continuing ability to identify, hire, develop, motivate and retain highly skilled personnel for all areas of our organization.
Our performance is largely dependent on the talents and efforts of our employees. Our future success depends on our continuing ability to identify, hire, develop, motivate and retain highly skilled personnel for all areas of our organization. Competition for well-qualified employees is intense in almost all categories, including for software engineers, developers, product management personnel, development personnel, and other technology professionals, and in all geographies. The competition for talent is also exacerbated by an increased willingness of certain companies to offer flexible and remote working policies, which expands the pool of candidates from which our competitors may attract talent. If we do not succeed in attracting and retaining well-qualified employees, our business, our ability to execute and innovate, our competitive position, and results of operations would be adversely affected. The current labor market is highly competitivecompetitive, and particularly so in high-demand specialties such as AI and machine learning disciplines, and our personnel expenses to attract and retain key talent may increase further, which may adversely affect our results of operations.
We are exposed to the risk that various counterparties, including financial entities, will fail to perform. This creates risk in a number of areas, including with respect to our significant bank deposits and investments, foreign exchange risk management, insurance coverages, letters of credit, and for certain of our transactions, the receipt and holding of traveler payments and subsequent remittance of a portion of those payments to travel suppliers. Additional information regarding our cash, cash equivalents and investments is included below in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Financial Position, Liquidity and Capital Resources, and additional information about our foreign exchange risk management is included below in Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
If one or more of these counterparties were to liquidate, declare bankruptcy or otherwise fail to perform their obligations due to liquidity events or other unforeseen events, we may be exposed to significant financial losses. Specifically, a default by a financial institution counterparty could result in the loss of deposited cash, the inability to settle outstanding hedging contracts, or the inability to replace such hedging instruments on favorable terms. In addition, we face significant credit risk and potential payment delays with respect to non-financial contract counterparties including our B2B and Vrbo partners, which may be exacerbated by economic downturns. The realization of any of these risks could have an adverse impact on our business and financial performance.
We are exposed to the risk that various counterparties, including financial entities, will fail to perform. This creates risk in a number of areas, including with respect to our bank deposits and investments, foreign exchange risk management, insurance coverages, letters of credit, and for certain of our transactions, the receipt and holding of traveler payments and subsequent remittance of a portion of those payments to travel suppliers. As it relates to deposits, as of December 31, 2024, we held cash in bank depository accounts of approximately $3.8 billion and money market funds and term deposits of approximately $192 million. Additionally, majority-owned subsidiaries held cash of approximately $68 million and held term deposits of approximately $84 million. As it relates to investments, as of December 31, 2024, we held U.S. treasury securities, U.S. agency securities, corporate debt securities, term deposits, commercial paper, foreign debt instruments, and asset-backed securities, all investment grade, in short-term and long-term investments totaling $502 million. As it relates to foreign exchange, as of December 31, 2024, we were party to forward contracts with a notional value of approximately $3.9 billion, the fair value of which was a net liability of approximately $2 million. We employ forward contracts to hedge a portion of our exposure to foreign currency exchange rate fluctuations. At the end of the deposit term or upon the maturity of the forward contracts, the counterparties are obligated, or potentially obligated in the case of forward contracts, to return our funds or pay us net settlement values. If any of these counterparties were to liquidate, declare bankruptcy or otherwise cease operations, it may not be able to satisfy its obligations under these term deposits or forward contracts, our ability to recover losses or to access or recover our assets held may be limited by the counterparty’s liquidity or the applicable laws governing the insolvency or bankruptcy proceeding, and the receipt and remittance of payments via such counterparties would be severely limited or cease. In addition, we face significant credit risk and potential payment delays with respect to non-financial contract counterparties including our B2B and Vrbo partners, which may be exacerbated by economic downturns. The realization of any of these risks could have an adverse impact on our business and financial performance.
Our alternative accommodations business is subject to regulatory and legal risks, which could have a material adverse effect on our operations and financial results.
Our alternative accommodations business has been, and continues to be, subject to risks relating to regulatory developments that affect the alternative accommodation industry and the ability of companies like us to list those alternative accommodations online. For example, certain domestic and foreign jurisdictions have adopted or are considering statutes or ordinances that (i) prohibit or limit the ability of property owners and managers to rent certain properties for fewer than thirty consecutive days, (ii) place onerous obligations on property owners wishing to offer their properties, (iii) regulate platforms’ ability to list alternative accommodations, including prohibiting the listing of unlicensed properties, or (iv) limit the number of alternative accommodations permitted in a particular area, which may be more likely in areas experiencing housing shortages, in response to perceived safety concerns, or as a result of natural disasters such as wildfires. Other factors that may limit homeowners’ ability to rent their properties include condominium and neighborhood association rules that prohibit or restrict short-term rentals and challenges obtaining insurance and liability for personal injury.
In addition, many of the laws that impose taxes or other obligations on travel and lodging companies were established before the growth of the internet and the alternative accommodation industry, which creates a risk of those laws being interpreted in ways not originally intended that could burden property owners and managers or otherwise harm our business. Governments also are considering additional taxes specific to alternative accommodations that, if implemented, could make the business of operating an alternative accommodation less attractive or prohibitively expensive.
These new and evolving regulatory schemes may decrease listings available on our sites and add significant compliance risks to our business, including the risk of fines for noncompliance, as well as substantial internal costs and the allocation of resources to develop new internal compliance systems and processes. These compliance obligations include gathering information about property owners, verification of registration status of properties and the ongoing provision of information to governments—both domestic and foreign—about short-term rental owners and operators and requirements to withhold and report taxable income to such governments, which may deter property owners from renting their properties on an alternative accommodation platform. We may also remove properties from our websites if alternative accommodation owners or operators do not provide information we require to comply with applicable regulations, or at the request of governments.
These risks could have a material adverse effect on our alternative accommodations business, including impacting our reputation and brand, as well as the results of operations of our alternative accommodations business, which in turn could have a material adverse effect on Expedia Group’s operations and financial results.
Our global operations are subject to complex and changing laws and regulations. Our business and financial performance could be adversely affected by changes in or interpretations of existing laws, rules and regulations or the promulgation of new laws, rules and regulations applicable to us and our businesses, including those relating to travel and alternative accommodation licensing and listing requirements, the provision of travel packages, the internet and online commerce, internet advertising and price display, consumer protection, licensing and regulations relating to the offer of travel insurance and related products, anti-corruption, anti-trust and competition (including our contractual provisions regarding pricing and travel suppliers), economic and trade sanctions, tax, banking, machine learning and AI, data security, the provision of payment services and privacy.
There are, and will likely continue to be, an increasing number of laws and regulations pertaining to the internet and online commerce that relate to website display and messaging, including prices, liability for information retrieved from or transmitted over the internet, online editorial and user-generated content, user privacy, behavioral targeting and online advertising, taxation, liability for third-party activities and the quality of products and services, and our contractual relationships with travel suppliers who list on our sites. Recent examples of new website display laws or regulations include, (i) in the United States, the Federal Trade Commission and the states of California and Minnesota introducing, and Congress and other states considering, laws or regulations that require us to include all fees in the prices displayed for accommodations on our websites, and (ii) in Europe, the EU Digital Services Act and Council Directive (known as DAC7) requires us to display a variety of supplier-related information, including local license numbers, tax identification numbers, business registration numbers, or statements regarding compliance with local laws. These and other new laws and regulations maybe costly and time consuming to implement, and significantly impact the profitability or competitiveness of our business.
Likewise, the SEC, Department of Justice (“DOJ”) and Office of Foreign Assets Controls (“OFAC”), as well as foreign regulatory authorities, have continued to increase the enforcement of economic sanctions and trade regulations, anti-money laundering, and anti-corruption laws, across industries. As regulations continue to evolve and regulatory oversight continues to increase, we cannot guarantee that our programs and policies will be deemed compliant by all applicable regulatory authorities. In the event our controls should fail or are found to be out of compliance for other reasons, we could be subject to monetary damages, civil and criminal money penalties, litigation and damage to our reputation and the value of our brands.
We also have been subject, and we will likely be subject in the future, to inquiries or legal proceedings from time to time from regulatory bodies concerning compliance with economic sanctions, consumer protection, competition, tax, payments and travel industry-specific laws and regulations, including but not limited to investigations and legal proceedings relating to the travel industry and, in particular, parity provisions in contracts between hotels and online travel companies, including Expedia Group, and the presentation of information to consumers, as described in Part I. Item 3. Legal Proceedings — Competition and Consumer Matters. The failure of our businesses to comply with these laws and regulations could result in fines and/or proceedings against us by governmental agencies and/or consumers which, if material, could adversely affect our business, financial condition and results of operations.
The application of domestic and international income and non-income tax laws, rules and regulations to our products and services is subject to interpretation by the relevant taxing authorities. The taxing authorities have become more aggressive in their interpretation and enforcement of such laws, rules and regulations, resulting in increased audit activity and audit assessments. As such, potential tax liabilities may exceed our current tax reserves.
Judgment and estimation are required in determining our worldwide tax liabilities. In the ordinary course of our business, there are calculations and transactions for which the ultimate tax determination is uncertain or otherwise subject to interpretation. Taxing authorities may disagree with our tax calculations, including transfer pricing. We believe our tax estimates are reasonable, however the final determination of tax audits may be materially different from our historical tax provisions and accruals in which case we may be subject to additional tax liabilities, including interest and penalties, or may require payment of tax assessments prior to contesting the validity of the assessment, any of which could have a material adverse effect on our cash flows, financial condition and results of operations.
Our future tax liabilities may be adversely affected by legislative and other changes to taxing regimes, as well as changes in our business operating structure and the mix of revenue and earnings in countries with differing tax rates. Due to the pace of legislative changes and the scale of our business activities, any substantial changes in tax policies or legislative initiatives may materially and adversely affect our business, the taxes we are required to pay, our financial position, and results of operations.
Taxing jurisdictions around the world have focused legislative efforts on tax reform, transparency, base erosion, and have enacted or are considering enacting digital services taxes, which could lead to inconsistent and potentially overlapping international tax regimes. The Organization for Economic Cooperation and Development ("OECD") continues to advance proposals relating to its initiative for modernizing international tax rules, with the goal of having the participant countries implement a modernized and aligned international tax framework.
We are currently, or have been in the past, involved in various legal proceedings and disputes involving taxes, personal injury, contract, alleged infringement of third-party intellectual property rights, antitrust, consumer protection, labor and employment matters, securities laws, and other claims, including, but not limited to, the legal proceedings described in Part I, Item 3, Legal Proceedings. These matters may involve claims for substantial amounts of money or for other relief that might necessitate changes to our business or operations. While the Company maintains insurance coverage for certain types of claims, such insurance coverage may be insufficient to cover all losses or all types of claims that may arise and the defense of these actions has been, and will likely continue to be, both time consuming and expensive and the outcomes of these actions cannot be predicted with certainty. Determining reserves for pending litigation is a complex, fact-intensive process that requires significant legal judgment. It is possible that unfavorable outcomes in one or more such proceedings could result in substantial payments that could adversely affect our business, consolidated financial position, results of operations, or cash flows in a particular period.
Our websites and mobile applications rely on content, brands, trademarks, domain names and technology, much of which is proprietary. We establish and protect our intellectual property by relying on a combination of trademark, domain name, copyright, trade secret and patent laws in the U.S. and other jurisdictions, license and confidentiality agreements, and internal policies and procedures. In connection with our license agreements with third parties, we seek to control access to, and the use and distribution of, our proprietary information and intellectual property. Even with these precautions, however, third parties may copy or otherwise obtain and use our intellectual property or confusingly similar trademarks or domain names without our authorization or to develop similar intellectual property independently. Effective trademark, domain name, copyright, patent and trade secret protection may not be available in every jurisdiction in which our services are available and policing unauthorized use of our intellectual property is difficult and expensive. We cannot be sure that the steps we have taken will prevent misappropriation or infringement of intellectual property. Any misappropriation or violation of our rights could have a material adverse effect on our business. Furthermore, we may need to go to court or other tribunals to enforce our intellectual property rights, to protect our trade secrets or to determine the validity and scope of the proprietary rights of others. These proceedings might result in substantial costs and diversion of resources and management attention.
We rely on information technology to operate our businesses and maintain our competitiveness, and ifIf we fail to adequately maintain or improve our information technology systems, or to adapt them to technological developments and industry trends,trends such as the use of AI and machine learning, our business and operations could be adversely affected.
Our future success depends on our ability to adapt our services and infrastructure to meet rapidly evolving consumer preferences and industry standards, while continuing to improve the performance, features and reliability of our service in response to competitive service and product offerings. AI, cloud computing, the continued growth of alternative platforms and mobile computing devices, the emergence of niche competitors who may be better able to utilize existing and new technologies to optimize their products, services or strategies have, and will continue to require, new and costly investments. Transitioning to these new technologies may be disruptive to resources and the services we provide and may increase our reliance on third party service providers. Recent examples include:
Innovations, implementations and system enhancements such as these have been in the past, and may continue to be in the future, more time consuming and expensive than originally anticipated.
WeFor example, beginning in 2020, we undertook in a multi-year effort to migrate products, data storage and processing, key portions of our consumer and affiliate sites, as well as back-office application functionality, to new technology platforms and significantly increase our utilization of public cloud computing services, primarily AWS. Innovations, implementations and system enhancements such as this have been in the past, and may be unablecontinue to successfullybe migratein the future, more time consuming and improveexpensive ourthan technologyoriginally asanticipated planned orand we may not achieve the expected benefits from any such initiatives, and as a result our business, including customer relationships, reputation and operations, could be materially adversely affected.
Our use of AI technologies in our products, services and operations present significant risks that could materially harm our business, reputation and financial performance.
We have incorporated third-party AI technology in certain of our products, services and business operations, and our research, development and deployment of AI technologies for internal productivity and customer or partner-facing initiatives remains ongoing. These efforts will continue to require significant investment and resources and present risks, challenges, and unintended consequences that could affect our and our customers’ adoption and use of this technology. While we aim to develop and deploy AI responsibly and attempt to identify and mitigate ethical and legal issues presented by its use, AI algorithms and training methodologies may be flawed and we may be unsuccessful in identifying or resolving issues before they arise. AI-related issues, deficiencies and/or failures could give rise to legal and/or regulatory action as a result of new applications of existing data protection, privacy, intellectual property, and other laws, including with respect to proposed legislation regulating AI in jurisdictions in which we operate; damage our reputation; or otherwise materially harm our business.
System interruption, security breaches and unplanned outages in our information systemssystems, or those of third-party providers on which we rely, may harm our businesses.
Management's Discussion & Analysis (MD&A)
Removed heading “Occupancy and Other Taxes”
Largest changes
“These broader economic and regulatory uncertainties also extend to the global tax environment in which we operate. Domestic and international taxing authorities have in recent years become increasingly focused on ways to increase tax revenue, including the enactment of new taxes such as digital services taxes, and have become more aggressive in their interpretation and enforcement of existing tax laws, rules and regulations. …”see in full comparison
“Certain jurisdictions may assert that we are required to pay any assessed taxes prior to being allowed to contest or litigate the applicability of the ordinances. This prepayment of contested taxes is referred to as “pay-to-play.” Payment of these amounts is not an admission that we believe we are subject to such taxes and, even when such payments are made, we continue to defend our position vigorously. …”see in full comparison
Goodwill. We assess goodwill for impairment annually as of October 1, or more frequently, if events and circumstances indicate impairment may have occurred.see in full comparisonDuring the third quarter of 2023, as a result of trivago’s recent strategic shift which included intensifying its brand marketing investments with an anticipated decrease in profitability, we concluded that sufficient indicators existed to require us to perform an interim impairment assessment.In the evaluation of goodwill for impairment, wetypicallyperform a qualitative assessment to determine whether the fair value of the goodwill is more likely than not impaired. Periodically, or if our qualitative assessment shows indications of impairment, we perform a quantitative assessment and compare the fair value of the reporting unit to the carrying value and, if applicable, record an impairment charge based on the excess of the reporting unit's carrying amount over its fair value.Periodically, we may choose to perform a qualitative assessment, prior to performing the quantitative analysis, to determine whether the fair value of the goodwill is more likely than not impaired.
“In addition to the trivago goodwill impairment charge mentioned above, as a result of the assessment during the third quarter of 2023 as well as additional assessment during the third quarter of 2024, we recognized a $15 million and $33 million impairment charges related to trivago's indefinite-lived trade name. During the fourth quarters of 2023 and 2024, we also recognized intangible impairment charges of $114 million for both periods related to indefinite-lived trade names within our B2C segment.”see in full comparison
see in full comparisonIncreasedTheusagemarket opportunity for online travel is broad andfamiliarityhighlywithcompetitive.the internet have continued to drive rapid growth in onlineOnline penetration of travelexpenditures. Online penetrationexpenditures is higher in the U.S. and Western European markets with online penetration rates in some emerging markets, such as Latin America and Eastern European regions, lagging behind those regions. Emerging markets continue to present an attractive growth opportunity for our business, while also attracting many competitors to online travel.TheTechnologicalindustrydevelopmentsisinexpectedgenerative AI tools are increasingly being used toremaincreatehighlycompetingcompetitiveofferings,forsuchtheasforeseeableAIfuture.powered digital planning and assistance, further increasing competition. In addition to the growth of online travel agencies, we have seen continued interest in the online travel industry from search engine companies such as Google, evidenced by continued product enhancements, and prioritizing its own AdWords and metasearch products such as GoogleHotelTravel,AdsGoogle Flights andFlights,Ads, in search results. Competitive entrants such as “metasearch” companies, including Kayak.com (owned by Booking Holdings), trivago (in which Expedia Group owns a majority interest) as well as TripAdvisor, introduced differentiated features, pricing and content compared with the legacy online travel agency companies, as well as various forms of direct or assisted booking tools. Further, airlines and lodging companies are aggressively pursuing direct online distribution of their products and services. In addition, the increasing popularity of the “sharing economy,” accelerated by online penetration, has had a direct impact on the travel and lodging industry. Businesses such as Airbnb, Vrbo and Booking.com have emerged as the leaders, bringing incremental alternative accommodationand vacation rentalinventory to the market. Other competitors have arisen, includingvacationalternativerentalaccommodation property managers, who operate their own booking sites in addition to listing on Airbnb, Vrbo, and Booking.com. Additionally, traditional consumer ecommerce players have expanded their local offerings by adding hotel offers to their websites. Ride sharing app Uber has added transportation and experience offerings to its app via partnerships with other travel providers. Our B2B business has grown significantly but faces competition from other OTAs with B2B offerings, as well as other competitors, such as independent B2B businesses.
“Our effective tax rate for 2024 was broadly in line with the 21% U.S. federal statutory income tax rate. Our effective tax rate for 2023 was higher than the 21% U.S. federal statutory income tax rate due to the non-deductible goodwill impairment and TripAdvisor audit assessment, partially offset by research and experimentation credits. For additional information, see NOTE 10 — Income Taxes in the notes to the consolidated financial statements.”see in full comparison
Full comparison: every changed paragraph (73)
Expedia Group's missionGroup is to powerthe global travel formarketplace everyone,with everywhere.one purpose: to help travelers explore the world, one journey at a time. We believeconnect traveltravelers, ispartners, aand forceadvertisers forthroughout good.our Traveltrusted isbrands, anleading essentialtechnology, humanand experiencerich first-party data, delivering predictive, personalized experiences that strengthens connections, broadens horizons and bridges divides. We help reduceshape the barriers to travel, making it easier, more enjoyable, more attainable and more accessible. We bring the world within reach for customers and partners around the globe. We leverage our supply portfolio, platform and technology capabilities across an extensive portfoliofuture of consumer brands, and provide solutions to our business partners, to empower travelers to efficiently research, plan, book and experience travel. We make available, on a stand-alone and package basis, travel services provided by numerous lodging properties, airlines, car rental companies, activities and experiences providers, cruise lines, alternative accommodations property owners and managers, and other travel product and service companies. We also offer travel and non-travel advertisers access to a potential source of incremental traffic and transactions through our various media and advertising offerings on our websites.websites and apps. For additional information about our portfolio of brands, see the disclosure set forth in Part I,I. Item 1,1. Business, under the caption “Market Opportunity and Business Strategy.”
This section of this Form 10-K generally discusses the years ended December 31, 20242025 and 20232024 items and year over year comparisons between 20242025 and 2023.2024. Discussions of the year ended December 31, 20222023 items and the year over year comparisons between 20232024 and 20222023 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7 of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023.2024, filed on February 7, 2025. All percentages within this section are calculated on actual, unrounded numbers.
The Company continues to operate in an increasingly complex business environment and global macroeconomic and geopolitical pressures, including trade disruptions, currency fluctuations and energy price volatility, contributed to this environment for the travel industry in 2025. We experienced weaker than expected travel demand in the United States in the first half of 2025 and, while conditions improved in the second half of the year, the market remains dynamic. If broader economic and regulatory uncertainties are intensified, travel behaviors may be impacted.
These broader economic and regulatory uncertainties also extend to the global tax environment in which we operate. Domestic and international taxing authorities have in recent years become increasingly focused on ways to increase tax revenue, including the enactment of new taxes such as digital services taxes, and have become more aggressive in their interpretation and enforcement of existing tax laws, rules and regulations. We are in various stages of inquiry or audit with various tax authorities, some of which may require that we prepay any assessed taxes prior to contesting the validity of the assessment (“pay-to-play”) which will be repaid if we prevail in our challenge. However, any significant pay-to-play payment or litigation loss could negatively impact our liquidity.
Other events that could have a negative impact on the travel industry and our businesses in the future are discussed in Part I, Item 1A, Risk Factors - "Declines or disruptions in the travel industry could adversely affect our business and financial performance."
Starting in early 2020, the COVID-19 pandemic, and measures to contain the virus, including government travel restrictions and quarantine orders, had an unprecedented impact on the global travel industry and materially and negatively impacted our business, financial results and financial condition. Travel was severely depressed during 2020, with reduced levels of new bookings. In 2021, we began to see a bookings recovery. In 2022, there was a strong, but uneven, recovery in travel demand with different regions around the world experiencing different rates of recovery. In 2023, the overall reopening of the Asia-Pacific region and general recovery outside of the United States was a factor in the gross bookings year-over-year growth rate for our B2B segment, but any other lingering impacts of the pandemic did not have a significant impact on our businesses, and we expect that to remain the case for future periods.
More recently, inflation and other macroeconomic pressures in the U.S. and the global economy, such as interest rates, and currency fluctuations and energy price volatility, as well as evolving geopolitical conflicts, have contributed to an increasingly complex business environment. Our future operational results may be subject to volatility, particularly in the short-term, due to the impact of the aforementioned trends. Broad, sustained negative economic impacts could put strain on our suppliers, business and service partners, which increases the risk of credit losses and service level or other disruptions.
Additionally, further health-related events, political instability, geopolitical conflicts, acts of terrorism, significant fluctuations in currency values, sustained levels of increased inflation, sovereign debt issues, and natural disasters, are examples of other events that could have a negative impact on the travel industry in the future.
Despite these factors, we have witnessed a healthy but more normalized travel demand environment in 2024, as consumers continue to prioritize spend on travel and experiences over other discretionary spending.
IncreasedThe usagemarket opportunity for online travel is broad and familiarityhighly withcompetitive. the internet have continued to drive rapid growth in onlineOnline penetration of travel expenditures. Online penetrationexpenditures is higher in the U.S. and Western European markets with online penetration rates in some emerging markets, such as Latin America and Eastern European regions, lagging behind those regions. Emerging markets continue to present an attractive growth opportunity for our business, while also attracting many competitors to online travel. TheTechnological industrydevelopments isin expectedgenerative AI tools are increasingly being used to remaincreate highlycompeting competitiveofferings, forsuch theas foreseeableAI future.powered digital planning and assistance, further increasing competition. In addition to the growth of online travel agencies, we have seen continued interest in the online travel industry from search engine companies such as Google, evidenced by continued product enhancements, and prioritizing its own AdWords and metasearch products such as Google HotelTravel, AdsGoogle Flights and GoogleHotel Flights,Ads, in search results. Competitive entrants such as “metasearch” companies, including Kayak.com (owned by Booking Holdings), trivago (in which Expedia Group owns a majority interest) as well as TripAdvisor, introduced differentiated features, pricing and content compared with the legacy online travel agency companies, as well as various forms of direct or assisted booking tools. Further, airlines and lodging companies are aggressively pursuing direct online distribution of their products and services. In addition, the increasing popularity of the “sharing economy,” accelerated by online penetration, has had a direct impact on the travel and lodging industry. Businesses such as Airbnb, Vrbo and Booking.com have emerged as the leaders, bringing incremental alternative accommodation and vacation rental inventory to the market. Other competitors have arisen, including vacationalternative rentalaccommodation property managers, who operate their own booking sites in addition to listing on Airbnb, Vrbo, and Booking.com. Additionally, traditional consumer ecommerce players have expanded their local offerings by adding hotel offers to their websites. Ride sharing app Uber has added transportation and experience offerings to its app via partnerships with other travel providers. Our B2B business has grown significantly but faces competition from other OTAs with B2B offerings, as well as other competitors, such as independent B2B businesses.
Lodging includes both hotel and alternative accommodations. As a percentage of our total worldwide revenue in 2024,2025, lodging accounted for 80%. Room nights booked grew 9%8% in 2024,2025, as compared to a growth of 12%9% in 2023 and 26% in 2022.2024. ADRs for rooms booked for Expedia Group increased 3% in 2022, decreased 2% in 2023 and decreased 1% in 2024.2024 Whileand trendsincreased are normalizing, our lodging business has seen a significant increase1% in ADRs compared to pre-pandemic levels, which were driven by broader industry trends, a mix shift to Vrbo and high ADR geographies.2025.
As of December 31, 2024,2025, our global lodging marketplace hashad overapproximately 3.53.6 million total lodging properties available.available, Ourincluding Vrboapproximately brand has over 2.52.4 million online bookable alternative accommodations listings.through OurVrbo otherand brandsapproximately have over 11.2 million hotels and alternative accommodations.accommodations through our other brands.
Vrbo has transitioned from a listings-based classified advertising model to an online transactional model that optimizes for both travelers and homeowner and property manager partners, with a goal of increasing monetization and driving growth through investments in marketing as well as in product and technology. Vrbo primarily offers a pay-per-booking service model and generates revenue from a traveler service fee for bookings, as well as insurance products.
Expedia Group (“EG”) Advertising is responsible for generating advertising revenue on our global online travel brands through a variety of digital marketing solutions. In 2025, we generated $758 million of advertising and media revenue, a 19% increase from 2024.
We also generate advertising revenue from trivago, a leading hotel metasearch website. In 2023, trivago adapted its marketing strategy and launched a new logo and visual identity, part of a push to rejuvenate its brand, demonstrate the relevance of its offerings and drive long-term growth. During the fourth quarter of 2024, trivago returned to revenue growth, which continued throughout 2025. In 2025, we generated $417 million of third-party revenue from trivago, a 33% increase from 2024.
As a percentage of our total worldwide revenue in 2025, total advertising and media accounted for 8%.
InDuring 2025, air travel demand exhibited a mixed but improving trend. While ticket volumes were positive throughout the year, pricing was pressured by softer consumer demand in the United States and weaker inbound international travel into the United States in early 2024,2025. U.S.By the end of the year, domestic and international travel demand improved, supporting air capacityticket exceeded demand, putting pressure on domestic airfares, but this rationalized by September with domestic fares inflecting back toprice growth. For the full year 2024,2025, U.S. domestic airfarestrips were up approximately 1%2% year-over-year and up approximately 11% compared to 2019 levels, according to Airlines Report Corporation ("ARC") data. Our air bookings grew in 20242025 compared to 20232024 but continued to lag the growth in our lodging business.
Booked air tickets increased 3% in 2025 and 6% in 2024, 4% in 2023 and 8% in 2022.2024. As a percentage of our total worldwide revenue in 2024,2025, air accounted for 3%.
Our advertising and media business is principally driven by revenue generated by trivago, a leading hotel metasearch website, and Expedia Group Media Solutions, which is responsible for generating advertising revenue on our global online travel brands. In 2024, we generated $954 million of advertising and media revenue, a 16% increase from 2023, representing 7% of our total worldwide revenue.
In 2024, we generated $639 million of advertising revenue from Expedia Group Media Solutions, a 32% increase from 2023.
In 2024, we generated $315 million of third-party revenue from trivago, a 7% decrease from 2023. Since the onset of COVID-19, online travel agencies, including ourselves, have reduced marketing spend on trivago. In 2023, the company adapted its marketing strategy and launched a new logo and visual identity, part of a push to rejuvenate its brand, demonstrate the relevance of its offerings and drive long-term growth.
We currently offer certain internally administered traveler loyalty programs to our travelers. In July 2023, we began to unify and expand our existing loyalty programs into one global rewards platform called One Key spanning all our main brands. One Key allows members to earn OneKeyCash, the currency of the One Key program, on eligible hotels, alternative accommodations, activities, packagespackages, car rentals, flights and cruises made on theseveral U.S. and U.K. points of salemarkets on Expedia, Hotels.com and Vrbo. Hotels.com Rewards continues to be offered outside of the United States and United Kingdom and offers travelers one free night at any Hotels.com partner property after that traveler stays 10 nights, subject to certain restrictions. The majority of Expedia Rewards alsomembers were migrated to One Key during 2025, but Expedia Rewards continues to be offered outsideon select international points of the United States and United Kingdom and enables participating travelers to earn points on all hotel, flight, package and activities made on various international Brand Expedia websites.sale. As travelers accumulate awards towards free travel products, we defer the relative standalone selling price of earned awards, net of expected breakage, as deferred loyalty rewards within deferred merchant bookings on the consolidated balance sheet. In order to estimate the standalone selling price of the underlying services on which awards can be redeemed for all loyalty programs, we use an adjusted market assessment approach and consider the redemption values expected from the traveler. We then estimate the number of rewards that will not be redeemed based on historical activity in our members' accounts as well as statistical modeling techniques. Revenue is recognized when we have satisfied our performance obligation relating to the awards, that is when the travel service purchased with the loyalty award is satisfied. Both the actual standalone selling price of the underlying services and ultimate redemption rates could differ materially from our estimates due to a number of factors, including fluctuations in reward value, product utilization and divergence from historical member behavior.
Goodwill. We assess goodwill for impairment annually as of October 1, or more frequently, if events and circumstances indicate impairment may have occurred. During the third quarter of 2023, as a result of trivago’s recent strategic shift which included intensifying its brand marketing investments with an anticipated decrease in profitability, we concluded that sufficient indicators existed to require us to perform an interim impairment assessment. In the evaluation of goodwill for impairment, we typicallyperform a qualitative assessment to determine whether the fair value of the goodwill is more likely than not impaired. Periodically, or if our qualitative assessment shows indications of impairment, we perform a quantitative assessment and compare the fair value of the reporting unit to the carrying value and, if applicable, record an impairment charge based on the excess of the reporting unit's carrying amount over its fair value. Periodically, we may choose to perform a qualitative assessment, prior to performing the quantitative analysis, to determine whether the fair value of the goodwill is more likely than not impaired.
In addition to the trivago goodwill impairment charge mentioned above, as a result of the assessment during the third quarter of 2023 as well as additional assessment during the third quarter of 2024, we recognized a $15 million and $33 million impairment charges related to trivago's indefinite-lived trade name. During the fourth quarters of 2023 and 2024, we also recognized intangible impairment charges of $114 million for both periods related to indefinite-lived trade names within our B2C segment.
For additional information on our goodwill and intangible asset impairments recorded in 2024, 20232024 and 2022,2023, see NOTE 3 — Fair Value Measurements in the notes to the consolidated financial statements.
Occupancy and Other Taxes. Some states and localities impose taxes (e.g. transient occupancy, accommodation tax, use tax, sales tax and/or business privilege tax) on the use or occupancy of hotel accommodations or other traveler services. Generally, hotels collect taxes based on the rate paid to the hotel and remit these taxes to the various tax authorities. When a customer books a room through one of our travel services, we collect a tax recovery charge from the customer which we pay to the hotel. We calculate the tax recovery charge by applying the applicable tax rate supplied to us by the hotels to the amount that the hotel has agreed to receive for the rental of the room by the consumer. In most jurisdictions, we do not collect or remit taxes, nor do we pay taxes to the hotel operator, on the portion of the customer payment we retain. Some jurisdictions have questioned our practice in this regard. While the applicable tax provisions vary among the jurisdictions, we generally believe that we are not required to pay such taxes. A limited number of taxing jurisdictions have made similar claims against certain of our companies for tax amounts due on the rental amounts charged by owners of alternative accommodations properties or for taxes on our services. We are an intermediary between a traveler and a party renting an alternative accommodations property and we believe are similarly not liable for such taxes. We are engaged in discussions with tax authorities in various jurisdictions to resolve these issues. Some tax authorities have brought lawsuits or have levied assessments asserting that we are required to collect and remit tax. The ultimate resolution in all jurisdictions cannot be determined at this time. Certain jurisdictions may require us to pay tax assessments, including occupancy and other transactional tax assessments, prior to contesting any such assessments.
Occupancy and Other Taxes
We are currently involved in two lawsuits brought by or against states, cities and counties over issues involving the payment of hotel occupancy and other taxes. We continue to defend these lawsuits vigorously. With respect to the principal claims in these matters, we believe that the statutes and/or ordinances at issue do not apply to us or the services we provide, namely the facilitation of travel planning and reservations, and, therefore, that we do not owe the taxes that are claimed to be owed. We believe that the statutes and ordinances at issue generally impose occupancy and other taxes on entities that own, operate or control hotels (or similar businesses) or furnish or provide hotel rooms or similar accommodations.
For additional information and other recent developments on these and other legal proceedings, see Part I, Item 3, Legal Proceedings.
We have established a reserve for the potential settlement of issues related to hotel occupancy and other tax litigation, consistent with applicable accounting principles and in light of all current facts and circumstances, in the amount of $3 million as of December 31, 2024 and $46 million as of December 31, 2023.
Certain jurisdictions in the United States have enacted legislation seeking to tax online travel company services as part of sales or other taxes for hotel and/or other accommodations and/or car rental. In addition, in certain jurisdictions, we have entered into voluntary collection agreements pursuant to which we have agreed to voluntarily collect and remit taxes to state and/or local taxing jurisdictions.
Pay-to-Play
Certain jurisdictions may assert that we are required to pay any assessed taxes prior to being allowed to contest or litigate the applicability of the ordinances. This prepayment of contested taxes is referred to as “pay-to-play.” Payment of these amounts is not an admission that we believe we are subject to such taxes and, even when such payments are made, we continue to defend our position vigorously. If we prevail in the litigation, for which a pay-to-play payment was made, the jurisdiction collecting the payment will be required to repay such amounts and also may be required to pay interest. However, any significant pay-to-play payment or litigation loss could negatively impact our liquidity.
Other Jurisdictions. We are also in various stages of inquiry or audit with various tax authorities, some of which may impose a pay-to-play requirement to challenge an adverse inquiry or audit result in court.
We have the following reportable segments: B2C, B2B, and trivago. Our B2C segment provides a full range of travel and advertising services to our worldwide customers primarily through aour varietythree offlagship consumerbrands, brandsExpedia, including: Expedia.com, Hotels.com, Vrbo, Orbitz, Travelocity, Wotif Group, ebookers, CheapTickets, Hotwire.comHotels.com and CarRentals.com.Vrbo. Our B2B segment fuels a wide range of travel and non-travel companies including airlines, offline travel agents, online retailers, corporate travel management and financial institutions, who leverage our leading travel technology and tap into our diverse supply to augment their offerings and market Expedia Group rates and availabilities to their travelers. Our trivago segment generates advertising revenue primarily from sending referrals to online travel companies and travel service providers from its hotel metasearch websites.
(1)Includes third-party revenue from trivago as well as our transaction-based websites.
Lodging revenue increased 7% in 20242025 primarily driven by an increase in room nights stayed mostly in our hotel business. Air revenue increaseddecreased 4%5% in 20242025 primarily due to lower revenue per ticket, partially offset by an increase in air tickets sold. EG Advertising and media revenue increased 16%19% in 20242025 due to an increase atacross Expediaour Groupcore Mediaproduct Solutions,offerings, partiallythe offsetaddition of new partners and delivery of new offerings. trivago Advertising revenue increased 33% in 2025 driven by aits declinestrategic focus on brand rebuilding in trivagothe revenue.past two years. All other revenue, which includes car rental, insurance, cruise and activities, remained relatively consistentincreased in 20242025 as compared to 2023.2024 due to higher insurance revenue, partially offset by lower car revenue.
The increase in merchant revenue in 20242025 was primarily due to an increase in merchant hotel revenue. The increase in agencyAgency revenue in 20242025 wasremained primarilyrelatively dueconsistent compared to an increase in agency hotel and air revenue.2024. Advertising, media and other increased 14%20% in 20242025 compared to 20232024 primarily due to anhealthy increasegrowth in Expediaboth MediaEG SolutionsAdvertising advertisingand trivago revenue.
Cost of revenue decreasedremained $130relatively millionconsistent duringin 20242025 compared to 2023,2024, primarilyand duedecreased toas lowera costspercentage fromof revenue during the period as ongoing initiatives continued to drive transactional efficiencies.efficiencies, particularly in payments and customer service.
Selling and marketing - direct increased $739$503 million during 20242025 compared to 20232024 primarily driven by an increase in B2B partner commissions to support strong growth and a ramp in marketing spend at Vrbo and international markets to drive improving growth and global market expansion.growth. Selling and marketing - indirect costs increased during 20242025 compared to 2023,2024, primarily driven by an increase in average salaries and headcount.other personnel costs.
Technology and content expense decreased $44$37 million for 20242025 compared to 20232024 primarily due to lower personnel costs in connection with previously announced cost saving initiatives,initiatives partiallyas offsetwell byas higherinitiatives stock-basedto compensation.optimize cloud spending.
General and administrative expense increaseddecreased $34$40 million in 20242025 compared to 20232024 due to higherlower stock-based compensation of $21$56 million, including the acceleration of stock-compensation expense in the prior year related to the current year departure of our Vice Chairman, aspartially welloffset asby an increase in professionalmiscellaneous fees.items including return to office costs.
Depreciation increased $33$66 million in 20242025 compared to 2023,2024, primarily as a result of increased depreciation related to capitalized website development costs. Amortization of intangible assets remained consistentdecreased in 20242025 compared to 2023.2024 due to the completion of amortization related to certain intangible assets.
Impairment of Goodwill and Intangible Assets
During 2024, we recognized intangible impairment charges of $147 million related to indefinite-lived trade names within our B2C and trivago segments. During 2023, we recognized a goodwill impairment charge of $297 million related to our trivago segment, as well as intangible impairment charges of $129 million related to indefinite-lived trade names within our B2C and trivago segments. During 2022, we recognized intangible impairment charges of $81 million related to an indefinite-lived trade name within our trivago segment. See NOTE 3 — Fair Value Measurements in the notes to the consolidated financial statements for further information.
Legal reserves, occupancy tax and other for the year ended December 31, 2025 primarily included $178 million related to an Italian withholding tax settlement. Legal reserves, occupancy tax and other for the year ended December 31, 2024 primarily included a $107 million charge related to an Italian VAT settlement reserve,settlement, a $30 million charge related to digital service taxes for fiscal years 2022 and 2023 retroactively enacted by Canada in June 2024, and our donation of $20 million as part of a public-private partnership project to revitalize public parks along the Elliot Bay waterfront in Seattle. These charges were partially offset by net reductions to our reserve of $43 million related to hotel occupancy and other taxes due to the favorable resolution of two tax related cases. Legal reserves, occupancy tax and other for the year ended December 31, 2023 primarily included changes to our reserve related to other taxes. Legal reserves, occupancy tax and other for the year ended December 31, 2022 primarily included charges related to certain other legal reserves for trivago.
In February 2024, we committed to restructuring actions to recalibrate resources as most of the Company’s organizational and technological transformation is now completed, which havehas resulted in headcount reductions. During 2025, we made the decision to expand these actions. As a result, we recognized $107 million and $80 million in restructuring and related reorganization charges during 2025 and 2024, which were predominately related to employee severance, stock-based compensation and benefits costs. Based on current plans which are subject to change, we expect approximately $60 million in additional reorganization charges couldwith the majority occurring in the first quarter of 2026. We continue under our previously announced $80 million to $100evaluate millionadditional plancost intoreduction 2025.efforts, These costs could be higher or lowerand should we make additional decisions in future periods thatto impacttake ourfurther actions we may incur additional reorganization efforts.charges.
In 2024,2025, the increase in operating income was primarily due to growth in revenue in excess of operating costs and lower impairment charges in the current periods,period, partially offset by the higher legal reserves, occupancy tax and other charges as well as the restructuring charges discussed above.
Our B2C segment Adjusted EBITDA increased in 20242025 compared to 20232024 as a result of revenue growthgrowth, asincluding wellour ashigh-margin advertising revenue, and cost efficiencies in cost of revenue and lowerrevenue, technology expenses,expenses partiallyas offsetwell by an increase inas direct marketing spend asthrough weongoing reinvested back into Vrbo and our international markets to drive improving growth and market expansion.optimization. Our B2B segment experienced an improvement in Adjusted EBITDA in 20242025 compared to 20232024 primarily as a result of strong revenue growth. Our trivago segment Adjusted EBITDA decreasedincreased in 20242025 compared to 20232024 as a result of revenue declinesgrowth, resultingpartially fromoffset headwinds in its performance marketing channels andby an increase in marketing costs.
Interest income increased in 2025 compared to 2024 a result of higher average cash and investment balances, partially offset by lower rates of return. Interest expense increased in 2025 compared to 2024 primarily due to the amortization of the debt discount related to our Convertible Notes due February 2026 as discussed in NOTE 7 — Debt in the notes to the consolidated financial statements.
Interest income increased in 2024 compared to 2023 as a result of higher rates of return. Interest expense remained consistent in 2024 compared to 2023.
For further information on our gains (losses) on minority equity investments, net, see NOTE 3 — Fair Value Measurements in the notes to the consolidated financial statements. For further information on the loss related to the conversion option on our Convertible Notes, see NOTE 7 — Debt in the notes to the consolidated financial statements.
In 2023, we recognized a $67 million gain, which together with amounts recorded in a prior period, represented the estimate of an indemnification reimbursement due to Expedia Group from TripAdvisor. In 2024, we recognized a $6 million gain related to the same matter. See “Provision for Income Taxes” below for a discussion of a corresponding charges to income tax expense as well as NOTE 10 — Income Taxes in the notes to the consolidated financial statements for further information.
Our effective tax rate for 2024 was broadly in line with the 21% U.S. federal statutory income tax rate. Our effective tax rate for 2023 was higher than the 21% U.S. federal statutory income tax rate due to the non-deductible goodwill impairment and TripAdvisor audit assessment, partially offset by research and experimentation credits. For additional information, see NOTE 10 — Income Taxes in the notes to the consolidated financial statements.
We are subject to taxation in the United States and foreign jurisdictions. Our income tax filings are regularlyroutinely examined by federal, state, and foreign tax authorities. For tax years 2011 to 2013 and 2014 andto 2016, the Internal Revenue Service (“"IRS”") issued final adjustments related to transfer pricing with our foreign subsidiaries. The 2011 to 2013 adjustments would result in federal income tax of approximately $244 million, subject to interest. The 2014 to 2016 adjustments would result in federal income tax of approximately $431 million, subject to interest. We do not agree with these adjustments and will continue to vigorously defend our position through administrative procedures. We are also under examination by the IRS for tax years 2017 to 2020.
In December 2021, the OECD released model rules introducing a 15% global minimum tax rate for large multinational corporations (“Pillar Two”). Certain countries in which we operate have enacted legislation consistent with the OECD model rules effective beginning in 2024. We considered the applicable tax laws in relevant jurisdictions and concluded there is no material effect on our tax provision for the year ended December 31, 2024. The Company will continue to evaluate the potential effect of Pillar Two on future reporting periods.
We report Adjusted EBITDA as a supplemental measure to U.S. generally accepted accounting principles ("GAAP").GAAP. Adjusted EBITDA is among the primary metrics by which management evaluates the performance of the business and on which internal budgets are based. Management believes that investors should have access to the same set of tools that management uses to analyze our results. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP. Adjusted EBITDA has certain limitations in that it does not take into account the impact of certain expenses to our consolidated statements of operations. We endeavor to compensate for the limitation of the non-GAAP measure presented by also providing the most directly comparable GAAP measure and a description of the reconciling items and adjustments to derive the non-GAAP measure. Adjusted EBITDA also excludes certain items related to transactional tax matters, which may ultimately be settled in cash, and we urge investors to review the detailed disclosure regarding these matters included above, in the Legal Proceedings section, as well as the notes to the financial statements. The non-GAAP financial measure used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies.
5.4% Senior Notes Issuance. In February 2025, we issued $1 billion of registered senior unsecured notes that bear interest at 5.40% and are due in February 2035 (the “5.40% Notes”). The 5.40% Notes were issued at a price of 99.316% of par resulting in a discount, which is being amortized over their life. Interest is payable semi-annually in arrears in February and August of each year. We used or expect to use the net proceeds of this offering for general corporate purposes, which may include, but not limited to: (i) repayment, prepayment, redemption or repurchase of outstanding debt, (ii) dividends and stock repurchases, and (iii) funding for working capital, capital expenditures and acquisitions.
Redemption of 6.25% Senior Notes. In February 2025, we early redeemed all of our approximately $1 billion senior unsecured notes that bore interest at 6.25% and were due in May 2025 (the “6.25% Notes”), which resulted in the recognition of an immaterial loss on debt extinguishment from the write-off of debt issuance costs.
Our credit ratings are periodically reviewed by rating agencies. As of December 31, 2024,2025, Moody’s rating was Baa2 with an outlook of “stable,” S&P’s rating was BBB with an outlook of “stable” and Fitch’s rating was BBB-BBB with an outlook of “positive.stable.” In January 2025, Fitch upgraded our credit rating from BBB- to BBB with a “stable” outlook." Changes in our operating results, cash flows, financial position, capital structure, financial policy or capital allocations to share repurchase, dividends, investments and acquisitions could impact the ratings assigned by the various rating agencies. Should our credit ratings be adjusted downward, we may incur higher costs to borrow and/or limited access to capital markets and interest rates on our 6.25% senior notes, 4.625% senior notes as well as our 2.95% senior notes will increase, which could have a material impact on our financial condition and results of operations.
What changed in the latest 10-Q
Risk Factors
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A, “Risk Factors,” in our Annual Report on Form 10-K for the year ended December 31, 2025, which could materially affect our business, financial condition or future results. These are not the only risks facing the Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
Largest changes
In November 2023, the Executive Committee of the Board of Directors, pursuant to a delegation of authority from the Board, authorized an additional program to repurchase up to $5 billion of our common stock (“2023 Share Repurchase Program”).see in full comparisonDuring the three months ended March 31, 2026, we repurchased, through open market transactions, 3.3 million shares under 2023 Share Repurchase Program for a total cost of approximately $700 million, excluding transaction costs and excise tax due under the Inflation Reduction Act of 2022. As of March 31, 2026, $870 million remained authorized for repurchase under the 2023 Share Repurchase Program.In May 2026, the Audit Committee of the Board of Directors, pursuant to a delegation of authority from the Board, authorized a program to repurchase up to an additional $5 billion of our common stock (“2026 Share Repurchase Program”). During the six months ended June 30, 2026, we repurchased, through open market transactions, 4.2 million shares under 2023 Share Repurchase Program for a total cost of approximately $900 million, excluding transaction costs and excise tax due under the Inflation Reduction Act of 2022. As of June 30, 2026, $5.7 billion remained authorized for repurchase under the 2023 and 2026 Share Repurchase Programs. Our 2023 and 2026 Share Repurchase Programs do not have fixed expiration dates and do not obligate the Company to acquire any specific number of shares. Under the programs, shares may be repurchased in the open market or in privately negotiated transactions. The timing, manner, price and amount of any repurchases will be subject to the discretion of the Company and depend on a variety of factors, including the market price of Expedia Group’s common stock, general market and economic conditions, regulatory requirements and other business considerations.
“During 2026, events in the Middle East reduced global air capacity and drove a material increase in prices, which adversely affected our booked air ticket volume, while having a less pronounced impact on total booked value. Our air bookings grew in the second quarter of 2026 compared to the same period in 2025 in line with growth in our lodging business.”see in full comparison
“Subsequent to June 30, 2026, the IRS replaced the prior adjustments and issued new adjustments for tax years 2011 to 2016 that apply a different method of adjusting transfer pricing with our foreign subsidiaries. The IRS also issued adjustments for 2017 and 2018. The adjustments, as proposed, would result in a federal income tax of approximately $287 million to $313 million for tax years 2011 to 2013, approximately $488 million to $531 million for tax years 2014 to 2016, and approximately $213 million to $380 million for tax years 2017 to 2018, subject to interest. …”see in full comparison
“During 2025, air travel demand exhibited a mixed but improving trend. While ticket volumes were positive throughout the year, pricing was pressured by softer consumer demand in the United States and weaker inbound international travel into the United States in early 2025. By the end of the year, domestic and international travel demand improved, supporting air ticket price growth. For the full year 2025, U.S. domestic trips were up approximately 2% year-over-year according to Airlines Report Corporation ("ARC") data. …”see in full comparison
For thesee in full comparisonthreesix months endedMarchJune31,30, 2026, net cash used in financing activities primarily included $1.8 billion of payments related to the redemption of our 5.0% Notes and our 0% Convertible Notes in February 2026 as discussed above as well as$788$1.1millionbillion of cash paid to acquire shares, including the repurchased shares under the authorization discussed below and for treasury stock activity related to the vesting of equity instruments as well as cash dividend payments of$58$116 million, partially offset by proceeds from the issuance of 5.5% senior notes with net proceeds of $986 million. For thethreesix months endedMarchJune31,30, 2025, net cash used in financing activities primarily included the February 2025 redemption of approximately $1 billion of our 6.25% senior notes,$384$1.1millionbillion of cash paid to acquire shares,including the repurchased shares and for treasury stock activity related to the vesting of equity instruments,and cash dividend payments of$51$102 million, partially offset by the February 2025 issuance of 5.4% senior notes with net proceeds of $985million.million as well as $25 million of proceeds from the exercise of options and employee stock purchase plans.
Our B2C segment Adjusted EBITDA increased during the three and six months endedsee in full comparisonMarchJune31,30, 2026, compared to the same periods in 2025 as a result of revenue growth and disciplined cost management, particularly in direct selling andmarketing.marketing in the year-to-date period. Our B2B segment experienced animprovementincrease in Adjusted EBITDA during the three and six months endedMarchJune31,30, 2026, compared to the sameperiodperiods in 2025, primarily as a result of strong revenue growth, partially offset by a prioritization of investments to support future growth. Our trivago segment Adjusted EBITDAlossreturnedincreasedto positive during the three months endedMarchJune31,30, 2026 and its Adjusted EBITDA loss decreased during the six months ended June 30, 2026, compared to the sameperiodperiods in 2025, as a result of revenue growth, partially offset by higher operating costs, including direct selling and marketingexpenses, partially offset by revenue growth.expenses.
Full comparison: every changed paragraph (45)
The Company continues to operate in an increasingly complex business environment and global macroeconomic and geopolitical pressures, including trade disruptions, currency fluctuations and energy price volatility, contributed to this environment for the travel industry. As anFor example, during the first quarter of 2026, events in the Middle East and Mexico hadlate anin adversethe impactfirst onquarter of 2026 negatively affected the travel industry.industry, and that pressure continued into the second quarter, particularly in Europe, where macro headwinds and reduced air capacity weighed on demand. If these pressures are intensified or sustained, travel behaviors may be impacted and any associated decrease in overall demand would negatively impact our business. In addition, our suppliers, business and service partners could also be impacted, thereby increasing our risk of credit losses and service level or other disruptions. Our future operational results may be subject to volatility, particularly in the short-term, due to the impact of the aforementioned trends.
Lodging includes both hotel and alternative accommodations. As a percentage of our total worldwide revenue in the firstsecond quarter of 2026, lodging accounted for 76%.79%. Room nights booked grew 6% in the firstsecond quarter of 2026, as compared to growth of 8% in 2025 and 9% in 2024. Average Daily Rates (“ADRs”) booked for Expedia Group increased 7%5% in the firstsecond quarter of 2026, increased 1% in 2025 and decreased 1% in 2024.
As of MarchJune 31,30, 2026, our global lodging marketplace had approximately 3.73.9 million total lodging properties available, including approximately 2.52.6 million online bookable alternative accommodations through Vrbo and approximately 1.21.3 million hotels and alternative accommodations through our other brands.
Expedia Group (“EG”) Advertising is responsible for generating advertising revenue on our global online travel brands through a variety of digital marketing solutions. In the firstsecond quarter of 2026, we generated $197$206 million of advertising revenue from EG Advertising, a 13% increase from the same period in 2025.
We also generate advertising revenue from trivago, a leading hotel metasearch website. In the firstsecond quarter of 2026, we generated $125$145 million of third-party revenue from trivago, a 47%48% increase from the same period in 2025.
As a percentage of our total worldwide revenue in the firstsecond quarter of 2026, total advertising and media accounted for 9%.8%.
During 2026, events in the Middle East reduced global air capacity and drove a material increase in prices, which adversely affected our booked air ticket volume, while having a less pronounced impact on total booked value. Our air bookings grew in the second quarter of 2026 compared to the same period in 2025 in line with growth in our lodging business.
During 2025, air travel demand exhibited a mixed but improving trend. While ticket volumes were positive throughout the year, pricing was pressured by softer consumer demand in the United States and weaker inbound international travel into the United States in early 2025. By the end of the year, domestic and international travel demand improved, supporting air ticket price growth. For the full year 2025, U.S. domestic trips were up approximately 2% year-over-year according to Airlines Report Corporation ("ARC") data. Our air bookings grew in 2025 compared to 2024 but continued to lag the growth in our lodging business. Our air bookings grew in the first quarter of 2026 compared to the same period in 2025 in line with growth in our lodging business.
Booked air tickets increaseddecreased 6%5% in the firstsecond quarter of 2026, increased 3% in 2025 and increased 6% in 2024. As a percentage of our total worldwide revenue in the firstsecond quarter of 2026, air accounted for 3%.2%.
Gross bookings increased 13%12% for both the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025. B2C gross bookings growth was driven by sustained momentum in the U.S. B2B gross bookings grew globally with Rapid API the largest contributor to growth. Booked room nights for our lodging business increased 6% for both the three and six months ended MarchJune 31,30, 2026, which was led by growthcontinued instrength theat U.S.B2B.
Revenue margin remained relatively consistent in the three months ended March 31, 2026 compared to the same period in 2025.
Revenue increased 15%14% for both the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, driven by lodging growth in both our B2B and B2C segments.
Lodging revenue increased 14%13% for both the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, primarily driven by higher ADRs stayed and an increase in room nights stayed in our hotel business and higher ADRs stayed.business.
Air revenue was consistentdecreased for the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, asprimarily higher air tickets sold were offsetdriven by lower revenue per ticket.ticket, as well as 5% lower air tickets sold during the three months ended June 30, 2026.
EG Advertising revenue increased 13% for both the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, driven by our sponsored listing business. trivago Advertising revenue increased 47%48% for both the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, driven by its strategic focus on brand rebuilding in recent years.
All other revenue, which includes insurance, car, cruise and activities, increased 16%23% and 20% for the three endedand six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025 primarily due to higher insurance and activities revenue.
The increase in merchant revenue for the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, was primarily due to an increase in merchant lodging revenue. Agency revenue remained relatively consistentincreased for the three and six months ended MarchJune 31,30, 2026, as compared to the same periodperiods in 2025.2025, primarily due to increase in activities and insurance revenue. Advertising, media and other increased for the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, primarily due to healthy growth in both EGtrivago Advertisingrevenue and trivagoEG revenue.Advertising.
Cost of revenue increased $20$26 million and $46 million during the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025, but decreased as a percentage of revenue during the period driven by continued efficiencies in payments and customer service.payments.
Selling and marketing - direct increased $99$199 million and $298 million during the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, primarily driven by an increase in B2B partner commissions to support revenue growth,growth. The increase in the year-to-date period was partially offset by a decrease in marketing spend at B2C, which sawhad significant marketing leverage. Selling and marketing - indirect costs remained relatively consistent during the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025.
Technology and content expense remained relatively consistent during the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025 as higher license and maintenance costs and cloud costs were mostly offset by lower personnel costs in connection with previously announced cost saving initiatives.
General and administrative expense increased during the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, primarily due to higher stock-based compensation. In addition, the current year to date period was also impacted by higher miscellaneous items, including charitable contributions in the current year.contributions.
Depreciation increased $13$5 million and $18 million during the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, primarily as a result of increased capitalized website development costs. Amortization of intangible assets decreasedremained $4 millionconsistent during the three months ended MarchJune 31,30, 2026 and decreased $4 million during the six months ended June 30, 2026, compared to the same periodperiods in 2025.
The net credit in legal reserves, occupancy tax and other for the threesix months ended MarchJune 31,30, 2026 was primarily due to the reversal of Canadian digital service taxes (“DST”). On March 26, 2026, the government of Canada enacted legislation as part of its 2026 federal budget that repealed the Digital Services Tax Act, with retroactive effect to June 20, 2024.
We had previously recognized, during 2024 and 2025, accruals for anticipated Canadian DST liabilities related to certain digital services revenues, based on enacted law at that time and guidance then available from the Canada Revenue Agency. In connection with the repeal, during the threesix months ended MarchJune 31,30, 2026, we reversed $71 million of previously recognized Canadian DST liabilities, covering in-scope periods from January 1, 2022 through December 31, 2025. As of MarchJune 31,30, 2026, the Company no longer has an obligation related to the Canadian DST.
We have continued to recalibrate resources and expand the restructure efforts that began in 2024 due to the significant completion of the Company’s organizational and technological transformation. As a result, we recognized $56$69 million and $26$70 million in restructuring and related reorganization charges during the threesix months ended MarchJune 31,30, 2026 and 2025, which were predominately related to employee severance, stock-based compensation and benefits costs. Based on current plans which are subject to change, we expect approximately $25$35 million in additional reorganization charges. We continue to evaluate additional cost reduction efforts, and should we make additional decisions in future periods to take further actions we may incur additional reorganization charges.
During the three and six months ended MarchJune 31,30, 2026, the increase in operating income from an operating loss in the priorcurrent year periodperiods was primarily due to a growth in revenue in excess of operating costs.
Our B2C segment Adjusted EBITDA increased during the three and six months ended MarchJune 31,30, 2026, compared to the same periods in 2025 as a result of revenue growth and disciplined cost management, particularly in direct selling and marketing.marketing in the year-to-date period. Our B2B segment experienced an improvementincrease in Adjusted EBITDA during the three and six months ended MarchJune 31,30, 2026, compared to the same periodperiods in 2025, primarily as a result of strong revenue growth, partially offset by a prioritization of investments to support future growth. Our trivago segment Adjusted EBITDA lossreturned increasedto positive during the three months ended MarchJune 31,30, 2026 and its Adjusted EBITDA loss decreased during the six months ended June 30, 2026, compared to the same periodperiods in 2025, as a result of revenue growth, partially offset by higher operating costs, including direct selling and marketing expenses, partially offset by revenue growth.expenses.
Interest income decreased slightly for the three months ended June 30, 2026, compared to the same period in 2025. Interest income increased for the six months ended June 30, 2026, compared to the same period in 2025, as a result of higher average cash and investment balances, partially offset by lower rates of return.
Interest incomeexpense increased for the three months ended MarchJune 31,30, 2026, compared to the same period in 2025, as a result of higher average cashsenior andnotes investmentoutstanding balances. Forin the threecurrent year period. The interest expense increase for the six months ended MarchJune 31,30, 2026,2026 comparedwas to the same period in 2025, interest expense increased primarilyalso due to the amortization of the debt discount related to our Convertible Notes that matured in February 2026 as discussed in Note 4 – Debt in the notes to the consolidated financial statements.
For further information on our gains (losses) on minority equity investments, net, see Note 3 – Fair Value Measurements in the notes to the consolidated financial statements. For further information on the gain related to the conversion option on our Convertible Notes, see Note 4 – Debt in the notes to the consolidated financial statements.
For the three months ended MarchJune 31,30, 2026, the effective tax rate was 145.8%,14.8%, compared to 9.2%23.9% for the three months ended MarchJune 31,30, 2025. For the six months ended June 30, 2026, the effective tax rate was 17.9%, compared to 39.3% for the six months ended June 30, 2025. The change in the effective tax rate for both periods was primarily due to the relative effect of nondeductiblenontaxable mark-to-market charges on a lower measure of pretax income (loss).gains.
We are subject to taxation in the United States and foreign jurisdictions. Our income tax filings are routinely examined by federal, state, and foreign tax authorities. ForPrior to June 30, 2026, for tax years 2011 to 2013 and 2014 to 2016, the IRS issued final adjustments related to transfer pricing with our foreign subsidiaries. The 2011 to 2013 adjustmentsand would result in federal income tax of approximately $244 million, subject to interest. Thethe 2014 to 2016 adjustments would result in federal income tax of approximately $244 million and $431 million, respectively, subject to interest. WeThese doaudit notcycles agreehave remained in administrative procedures with these adjustments and will continue to vigorously defend our position through administrative procedures. We are also under examination by the IRS for tax years 2017 to 2020.IRS.
Subsequent to June 30, 2026, the IRS replaced the prior adjustments and issued new adjustments for tax years 2011 to 2016 that apply a different method of adjusting transfer pricing with our foreign subsidiaries. The IRS also issued adjustments for 2017 and 2018. The adjustments, as proposed, would result in a federal income tax of approximately $287 million to $313 million for tax years 2011 to 2013, approximately $488 million to $531 million for tax years 2014 to 2016, and approximately $213 million to $380 million for tax years 2017 to 2018, subject to interest. We do not agree with these adjustments and will continue to vigorously defend our position through administrative procedures. The IRS has indicated that adjustments for this matter are not relevant for tax years 2019 to 2020.
The reconciliation of net lossincome attributable to Expedia Group, Inc. to Adjusted EBITDA is as follows:
Our principal sources of liquidity are typically cash flows generated from operations, cash available under our credit facility as well as our cash and cash equivalents and short-term investment balances, which were $5.8$7.1 billion and $5.7 billion at MarchJune 31,30, 2026 and December 31, 2025. As of MarchJune 31,30, 2026, the total cash and cash equivalents and short-term investments held outside the United States was $401$398 million ($230$220 million in wholly-owned foreign subsidiaries and $171$178 million in majority-owned subsidiaries).
New Revolving Credit Facility. On March 27, 2026, we entered into a new revolving credit facility with aggregate commitments of $2.5 billion, which replaced our previous credit facility with the same commitment level and matures in March 2031. The revolving credit facility was essentially untapped at MarchJune 31,30, 2026.
5.5% Senior Notes Issuance. In April 2026, we issued $1 billion of registered senior unsecured notes, which bear interest at 5.5% and are due in April 2036 (the “5.5% Notes”). The 5.5% Notes were issued at 99.384% of par resulting in a discount, which is being amortized over their life. Interest is payable semi-annually in arrears in April and October of each year, beginning October 15, 2026. We used or expect to use the net proceeds of this offering of approximately $986 million for general corporate purposes, which may include, but not limited to: (i) repayment, prepayment, redemption or repurchase of outstanding debt, (ii) dividends and stock repurchases, and (iii) funding for working capital, capital expenditures and acquisitions.
Our credit ratings are periodically reviewed by rating agencies. As of MarchJune 31,30, 2026, Moody’s rating was Baa2 with an outlook of “positive,” S&P’s rating was BBB with an outlook of “stable” and Fitch’s rating was BBB with an outlook of “stable.” Changes in our operating results, cash flows, financial position, capital structure, financial policy or capital allocations to share repurchase, dividends, investments and acquisitions could impact the ratings assigned by the various rating agencies. Should our credit ratings be adjusted downward, we may incur higher costs to borrow and/or limited access to capital markets and interest rates on our 4.625% senior notes as well as our 2.95% senior notes will increase, which could have a material impact on our financial condition and results of operations.
As of MarchJune 31,30, 2026, we were in compliance with the covenants and conditions in our revolving credit facility and outstanding debt as detailed in Note 4 – Debt in the notes to the consolidated financial statements.
For the threesix months ended MarchJune 31,30, 2026, net cash provided by operating activities increased compared to the prior year period due to higher working capital benefits driven mostly from an increase in deferred merchant bookings and merchant accounts payable as well as higher operating income after adjusting for impacts of depreciation and amortization.
For the threesix months ended MarchJune 31,30, 2026, net cash used in investing activities was $440$1.2 millionbillion compared to $384$220 million used in the prior year period. The change was primarily due to net sales and maturitiespurchase of investments in the current year compared to net purchasessales and maturities of investments in the prior year, uses of cash for the settlement of currency forward contract losses in the current year compared to sources of cash for gains in the prior year as well as cash used infor acquisitions in the current year.
For the threesix months ended MarchJune 31,30, 2026, net cash used in financing activities primarily included $1.8 billion of payments related to the redemption of our 5.0% Notes and our 0% Convertible Notes in February 2026 as discussed above as well as $788$1.1 millionbillion of cash paid to acquire shares, including the repurchased shares under the authorization discussed below and for treasury stock activity related to the vesting of equity instruments as well as cash dividend payments of $58$116 million, partially offset by proceeds from the issuance of 5.5% senior notes with net proceeds of $986 million. For the threesix months ended MarchJune 31,30, 2025, net cash used in financing activities primarily included the February 2025 redemption of approximately $1 billion of our 6.25% senior notes, $384$1.1 millionbillion of cash paid to acquire shares, including the repurchased shares and for treasury stock activity related to the vesting of equity instruments, and cash dividend payments of $51$102 million, partially offset by the February 2025 issuance of 5.4% senior notes with net proceeds of $985 million.million as well as $25 million of proceeds from the exercise of options and employee stock purchase plans.
In November 2023, the Executive Committee of the Board of Directors, pursuant to a delegation of authority from the Board, authorized an additional program to repurchase up to $5 billion of our common stock (“2023 Share Repurchase Program”). During the three months ended March 31, 2026, we repurchased, through open market transactions, 3.3 million shares under 2023 Share Repurchase Program for a total cost of approximately $700 million, excluding transaction costs and excise tax due under the Inflation Reduction Act of 2022. As of March 31, 2026, $870 million remained authorized for repurchase under the 2023 Share Repurchase Program. In May 2026, the Audit Committee of the Board of Directors, pursuant to a delegation of authority from the Board, authorized a program to repurchase up to an additional $5 billion of our common stock (“2026 Share Repurchase Program”). During the six months ended June 30, 2026, we repurchased, through open market transactions, 4.2 million shares under 2023 Share Repurchase Program for a total cost of approximately $900 million, excluding transaction costs and excise tax due under the Inflation Reduction Act of 2022. As of June 30, 2026, $5.7 billion remained authorized for repurchase under the 2023 and 2026 Share Repurchase Programs. Our 2023 and 2026 Share Repurchase Programs do not have fixed expiration dates and do not obligate the Company to acquire any specific number of shares. Under the programs, shares may be repurchased in the open market or in privately negotiated transactions. The timing, manner, price and amount of any repurchases will be subject to the discretion of the Company and depend on a variety of factors, including the market price of Expedia Group’s common stock, general market and economic conditions, regulatory requirements and other business considerations.
In addition, in MayAugust 2026, the Executive Committee, acting on behalf of the Board of Directors, declared a quarterly cash dividend of $0.48 per share of outstanding common stock payable on JuneSeptember 18,17, 2026 to stockholders of record as of the close of business on MayAugust 28,27, 2026. Future declarations of dividends are subject to final determination by our Board of Directors.
Foreign exchange rate changes resulted in a decrease of our cash and restricted cash balances denominated in foreign currency during the threesix months ended MarchJune 31,30, 2026 of $28$36 million reflecting a net depreciation in foreign currencies relative to the U.S. dollar compared to $61$208 million increase in the prior year period reflecting a net appreciation in foreign currencies relative to the U.S. dollar.
EXPE insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 7 filings (3 insiders, 7 trade dates, 17,592 shares, about $5.2M). Net open-market shares: -17,592 (purchases minus sales); net value about -$5.2M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-24 | Dzielak Robert J |
Open-market sale | 1,004 | $335.00 | $336.3K |
| 2026-08-18 | Soliday Lance A |
Open-market sale | 2,810 | $323.65 | $909.5K |
| 2026-08-17 | Dzielak Robert J |
Open-market sale | 2,000 | $330.50 | $661.0K |
| 2026-08-15 | Gorin Ariane |
Option exercise | 4,097 | — | — |
| 2026-08-15 | Gorin Ariane |
Shares withheld for tax | 6,660 | $332.69 | $2.2M |
| 2026-08-15 | Gorin Ariane |
Option exercise | 1,698 | — | — |
| 2026-08-15 | Gorin Ariane |
Option exercise | 5,156 | — | — |
| 2026-08-15 | Gorin Ariane |
Option exercise | 5,604 | — | — |
| 2026-08-15 | Soliday Lance A |
Option exercise | 252 | — | — |
| 2026-08-15 | Soliday Lance A |
Option exercise | 267 | — | — |
| 2026-08-15 | Soliday Lance A |
Option exercise | 329 | — | — |
| 2026-08-15 | Soliday Lance A |
Option exercise | 366 | — | — |
| 2026-08-15 | Soliday Lance A |
Shares withheld for tax | 481 | $332.69 | $160.0K |
| 2026-08-15 | Diller Barry |
Shares withheld for tax | 4,528 | $332.69 | $1.5M |
| 2026-08-15 | Diller Barry |
Option exercise | 1,170 | — | — |
| 2026-08-15 | Diller Barry |
Option exercise | 3,940 | — | — |
| 2026-08-15 | Diller Barry |
Option exercise | 1,601 | — | — |
| 2026-08-15 | Diller Barry |
Option exercise | 1,473 | — | — |
| 2026-08-15 | Andersen Derek |
Shares withheld for tax | 3,624 | $332.69 | $1.2M |
| 2026-08-15 | Andersen Derek |
Option exercise | 7,223 | — | — |
| 2026-08-15 | Dzielak Robert J |
Option exercise | 1,553 | — | — |
| 2026-08-15 | Dzielak Robert J |
Shares withheld for tax | 2,334 | $332.69 | $776.5K |
| 2026-08-15 | Dzielak Robert J |
Option exercise | 1,546 | — | — |
| 2026-08-15 | Dzielak Robert J |
Option exercise | 1,422 | — | — |
| 2026-08-15 | Dzielak Robert J |
Option exercise | 1,319 | — | — |
| 2026-08-14 | Khosrowshahi Dara |
Gift | 15,000 | — | — |
| 2026-08-13 | Jacobson Craig A |
Open-market sale | 3,133 | $328.52 | $1.0M |
| 2026-08-11 | Dzielak Robert J |
Open-market sale | 3,003 | $315.00 | $945.9K |
| 2026-07-15 | Dzielak Robert J |
Shares withheld for tax | 920 | $266.28 | $245.0K |
| 2026-07-15 | Dzielak Robert J |
Option exercise | 2,304 | — | — |
| 2026-06-05 | Dzielak Robert J |
Open-market sale | 4,702 | $233.00 | $1.1M |
| 2026-06-01 | Wang Alexandr |
Option exercise | 871 | — | — |
| 2026-06-01 | Wang Alexandr |
Option exercise | 499 | — | — |
| 2026-06-01 | Wang Alexandr |
Option exercise | 738 | — | — |
| 2026-06-01 | Von Furstenberg Alexander |
Option exercise | 871 | — | — |
| 2026-06-01 | Von Furstenberg Alexander |
Option exercise | 499 | — | — |
| 2026-06-01 | Von Furstenberg Alexander |
Option exercise | 738 | — | — |
| 2026-06-01 | Menendez-Cambo Patricia |
Option exercise | 738 | — | — |
| 2026-06-01 | Menendez-Cambo Patricia |
Option exercise | 871 | — | — |
| 2026-06-01 | Menendez-Cambo Patricia |
Option exercise | 499 | — | — |
| 2026-06-01 | Khosrowshahi Dara |
Option exercise | 499 | — | — |
| 2026-06-01 | Khosrowshahi Dara |
Option exercise | 738 | — | — |
| 2026-06-01 | Khosrowshahi Dara |
Option exercise | 871 | — | — |
| 2026-06-01 | Jacobson Craig A |
Option exercise | 738 | — | — |
| 2026-06-01 | Jacobson Craig A |
Option exercise | 499 | — | — |
| 2026-06-01 | Jacobson Craig A |
Option exercise | 871 | — | — |
| 2026-06-01 | Dubugras Henrique Vasoncelos |
Option exercise | 499 | — | — |
| 2026-06-01 | Dubugras Henrique Vasoncelos |
Option exercise | 738 | — | — |
| 2026-06-01 | Dubugras Henrique Vasoncelos |
Option exercise | 871 | — | — |
| 2026-06-01 | Clinton Chelsea |
Option exercise | 738 | — | — |
| 2026-06-01 | Clinton Chelsea |
Option exercise | 871 | — | — |
| 2026-06-01 | Clinton Chelsea |
Option exercise | 499 | — | — |
| 2026-06-01 | Banerjee Madhumita Moina |
Option exercise | 738 | — | — |
| 2026-06-01 | Banerjee Madhumita Moina |
Option exercise | 499 | — | — |
| 2026-06-01 | Banerjee Madhumita Moina |
Option exercise | 871 | — | — |
| 2026-06-01 | Anderson Beverly J |
Option exercise | 738 | — | — |
| 2026-06-01 | Anderson Beverly J |
Option exercise | 499 | — | — |
| 2026-06-01 | Anderson Beverly J |
Option exercise | 871 | — | — |
| 2026-05-26 | Soliday Lance A |
Open-market sale | 940 | $221.86 | $208.5K |
| 2026-05-15 | Soliday Lance A |
Option exercise | 267 | — | — |
Well-known investors holding EXPE (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 3,104,499 | $794.4M | 0.28% | Added 22% |
| Gotham Asset Management (Joel Greenblatt) | 2026-06-30 | 421,774 | $107.9M | 0.25% | Added 57% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 384,992 | $98.5M | 0.06% | Added 604% |
| Millennium Management (Israel Englander) | 2026-06-30 | 150,497 | $38.5M | 0.03% | Reduced 11% |
| Two Sigma Investments | 2026-06-30 | 51,756 | $13.2M | 0.01% | Added 51% |
| Bridgewater Associates | 2026-06-30 | 31,596 | $8.1M | 0.03% | Added 2801% |
| D. E. Shaw & Co. | 2026-06-30 | 29,579 | $7.6M | 0.0% | Added 10% |
| Renaissance Technologies | 2026-06-30 | 3,900 | $997.9K | 0.0% | New position |