The logo of online accommodation booking website Booking.com is pictured at the International Tourism Trade Fair (ITB) in Berlin, Germany, March 9, 2016. REUTERS/Fabrizio Bensch
November 7, 2017
NEW YORK (Reuters) – Online travel services company Priceline Group Inc <PCLN.O> on Monday posted a jump in third-quarter net income to $1.7 billion, including a $941 million goodwill impairment charge, with strong performance from its Booking.com online travel agent website.
But shares of Priceline Group – which owns Priceline.com, Booking.com, KAYAK and other online brands – slid over 5 percent in extended trading, as investors reacted to the softer-than-expected guidance for the fourth quarter.
In the current quarter, Priceline said it expects its profit to be between $13.40 and $14 per diluted share, compared to $13.47 in the year prior, as growth in third-party booking agencies slowed across the industry.
To combat the decline in growth, Priceline upped its operating expenses in the quarter by more than 20 percent, largely from spending increases in performance and brand advertising.
“As we look to the fourth quarter and beyond, we will continue to focus on making the right investments across our brands – in people, systems, and marketing – to continue to grow our business for the long term,” Priceline Chief Executive Glenn Fogel said in a statement.
Earnings per share in the busy third quarter beat analyst expectations at $35.22, compared to a consensus view of $34.25, according to Thomson Reuters I/B/E/S.
“Globally, our accommodation business booked 178 million room nights in the third quarter, up 19 percent over the same period last year. Booking.com showed continued momentum with approximately 1.5 million properties on its platform, up 41 percent over last year,” Fogel said.
(Reporting by Alana Wise; Editing by Chris Reese)