Priceline.com has reported a better-than-expected second quarter, with its international businesses booking.com and agoda.com showing operational and financial growth.
Priceline eyes growth after positive second quarter
Priceline.com has reported a better-than-expected second quarter, with its international businesses booking.com and agoda.com showing operational and financial growth.
In the second quarter, gross bookings from all markets apart from the US was 67% ahead in local currency, coming in at $2.3 billion (£1.4 billion).
Revenue from international markets came in at $322.6 million (£203 million), a 63.3% increase versus a year ago.
The total number of room nights booked across all Priceline’s businesses in the April-June quarter was 22.8 million, nearly 50% ahead of the second quarter 2009.
Chief executive Jeffery Boyd told analysts that on the Q2 earnings call that booking.com was becoming a global business, with its Asia and North America offering opportunities set to expand.
“New markets for booking.com include the Middle East and Eastern Europe,” he said, “and it’s early days in South America where we see good potential there over time.
“But North America is also to a degree a new market for booking.com and represents an opportunity. We have been working on initiatives mainly around driving European customers to US hotels while building out booking.com’s US inventory.”
Booking.com is also a key part of Priceline’s plans for APAC. Agoda is the main brand for that region, but with booking.com also growing, Priceline has “two independent efforts in that market and they are both well-positioned”.
Boyd was also asked to talk about Travel Jigsaw, the Manchester-based car rental broker which Priceline acquired for an undisclosed sum this May.
The business contributed $43.9 million of gross bookings in the second quarter.
“We will work with it like we did with booking.com, but the plan is to offer a fair degree of operational independence,” he said.
Areas such as business processes, intellectual property and knowledge would be shared “and over time we will look for opportunities to advertise its product on other web sites around the world.
“But that is not the principal driver of the transaction – Travel Jigsaw will build upon and expand its international franchise in rental cars and build its own brand and direct customer flows, but we’ll take advantage of any business that we can move back and forth.”
When asked about Google and ITA, Boyd followed the OTA line of taking Google at its word, in terms of what the search giant has publicly said about wanting to improve the user experience for customers while delivering better leads for advertisers.
“If that’s how it shakes out then it could be a win for Google and a win for the OTAs,” he said.
Wall Street responded positively to the results, which were released after the market closed on Tuesday. Its share jumped by more than 20%, hitting ten-year highs.
