Expedia Group stock tumbled Friday after the company reported mixed first quarter results and lowered its sales outlook, citing "weaker than expected" U.S. travel demand.
The results prompted a downgrade from one Wall Street analyst and pushed Expedia down 7% to close at 156.66 on the stock market today.
The Seattle-based Expedia said in a news release Thursday that Q1 adjusted earnings increased 90% to 40 cents per share for its March quarter, ahead of expectations of 35 cents per share. Revenue increased 3% to $2.99 billion. That missed expectations of $3.01 billion, according to FactSet.
The total booking value across Expedia platforms – which include Hotels.com, Vrbo and Expedia.com – grew 4% to $31.45 billion. Analysts were looking for $31.76 billion, according to FactSet.
"We posted first quarter bookings and revenue within our guidance range despite weaker than expected demand in the US, drove bottom-line meaningfully above our guidance, and made significant progress against our strategic priorities," Expedia Group Chief Executive Ariane Gorin said in a news release. "Looking ahead, we are committed to continuing to deliver margin expansion while growing our top-line."
Expedia Stock Downgraded
On a call with analysts late Thursday, Expedia Chief Financial Officer Scott Schenkel said the weakness in the U.S. market weighed on total bookings for the quarter.
"Demand in the U.S. was softer than expected, which was a headwind given two-thirds of our business comes from the U.S. point of sale," Schenkel said. "We also noticed softness in demand for inbound travel into the U.S., which was down 7%. As part of that, inbound bookings from Canada fell nearly 30%."
Expedia lowered its 2025 full-year guidance for gross bookings and revenue growth outlook. The company expects growth for both metrics to fall between 2% and 4%, compared to a previous 4% and 6%.
Booking Holdings and Airbnb called out similar trends in the U.S. during their recent Q1 earnings calls. But both those companies – particularly Booking Holdings, with its Europe focus – have larger international operations to lean on.
Analysts with Piper Sandler downgraded Expedia to a negative under-weight call following the report.
"The commentary around U.S. inbound travel and the B2C (business-to-consumer) business was discouraging and suggests a tough slog from here," Piper Sandler analyst Thomas Champion wrote. "It could also get incrementally worse."
Expedia Down 16% In 2025
Expedia stock closed Friday trading down 16% this year compared with a 3.8% decline for the S&P 500.
But shares are ahead 40% from 12 months ago, easily outperforming the S& P 500.
Coming into the report, Expedia stock had an IBD Composite Rating of 94 out of a best-possible 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.
