Though room night revenues are poised to benefit from improvements in the direct channel, economic uncertainties in the foreign markets and stiff completion can have a negative impact on performance. Also, higher costs, mainly advertising and marketing expenses, and unfavorable currency rates might weigh on the bottom line during the quarter.
While the Brexit-related uncertainties in Europe and the impact of the trade war on businesses remain a challenge for the company, it will be offset by the stable demand for international travel. Earlier, the management had forecast mid-single-digits growth in both room night booking and gross bookings for the second quarter, globally.
Related: Booking Holdings Inc. Q1 2019 Earnings Call Transcript
Booking Holdings had a weak start to the year, marked my unimpressive performance in the first three months. Earnings dipped 7% to $11.17 per share in the first quarter as revenue dropped 3% to $2.84 billion, reflecting lower sales at the agency segment, the company’s main growth driver.
Rival travel company Expedia (EXPE) last month reported a double-digit increase in second-quarter earnings, aided by strong booking growth that pushed up revenues by 9%. Meanwhile, TripAdvisor (TRIP) will be publishing results for its most recent quarter on Thursday before the opening bell.
For the shares of Booking Holdings, it has been a rollercoaster ride for more than a year, losing about 5% during that period. Since the beginning of the year, the stock has gained around 4%.