Q4 2023 Booking Holdings Inc Earnings Call

Operator: Welcome to Booking Holdings' fourth quarter and full year 2023 conference call. Booking Holdings would like to remind everyone that this call may contain forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guaranteed to perform and are subject to certain risks, uncertainties, and assumptions that are difficult to predict. Therefore, actual results may differ materially from those expressed, implied, or forecasted in any such forward-looking statement.

Welcome to booking Holdings' fourth quarter and full year 2023 conference call.

Booking holdings would like to remind everyone that this call may contain forward looking statements, which are made pursuant to the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.

These forward looking statements are not guarantees of future performance and are subject to certain risks uncertainties and assumptions that are difficult to predict.

Therefore actual results may differ materially from those expressed implied or forecasted in any such forward looking statements.

Operator: Expressions of future goals or expectations and similar expressions reflecting something other than historical facts are intended to identify forward-looking statements. For a list of factors that could cause Booking Holdings' actual results to differ materially from those described in the forward-looking statements, please refer to the Safe Harbor Statement at the end of each earnings press release, as well as Booking Holdings' most recent filings with the Securities and Exchange Commission. Unless required by law, Booking Holdings undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. A copy of the Booking Holdings earnings press release together with an accompanying financial and statistical supplement is available in the For Investors section of the Booking Holdings website at www.bookingholdings.com. And now, I'd like to introduce the Booking Holdings speakers for this afternoon, Glenn Fogel and David Goulden. Please go ahead, gentlemen.

Expressions of future goals or expectations, and similar expressions, reflecting something other than historical fact are intended to identify forward looking statements for.

For a list of factors that could cause booking holdings' actual results to differ materially from those described in the forward looking statements. Please refer to the safe Harbor statement at the end of booking Holdings' earnings press release as well as booking Holdings'. Most recent filings with the Securities and Exchange Commission.

Unless required by law booking holdings undertakes no obligation to update publicly any forward looking statements, whether as a result of new information future events or otherwise.

A copy of booking Holdings' earnings press release, together with an accompanying financial and statistical supplement is available in the foreign investors section of booking Holdings' website at Www Dot booking holdings Dot com.

And now I'd like to introduce booking Holdings' speakers for this afternoon, Glenn Fogel and David Goldman Please.

Speaker Change: Please go ahead gentlemen.

Glenn D. Fogel: Thank you and welcome to Booking Holdings' fourth quarter conference call. I'm joined this afternoon by our CFO, David Goulden. I am pleased to report a solid finish to 2023, as fourth quarter room nights slightly exceeded our expectations and grew by a bit more than 9% year over year, or 11% if one excludes Israel from both periods. When compared to 2019, our roommates grew 21% versus our expectations of 20%. We delivered record fourth-quarter revenue of $4.8 billion and Record Adjusted EBITDA of $1.5 billion, which were both ahead of our expectations. Finally, non-GAAP earnings per share in the quarter grew 29% year-over-year, helped by the reduction in our share count versus last year.

Glenn D. Fogel: Thank you and welcome to booking Holdings' fourth quarter conference call.

David Goldman: Joining us afternoon by our CFO David Gordon.

David Goldman: I am pleased to report a solid finish to 2023.

David Goldman: Quarter room nights slightly exceeding our expectations and grew a bit more than 90% year over year or 11%, if one excludes Israel from both periods.

David Goldman: When compared to 2019, our room nights.

David Goldman: 21% versus your expectations of 20%.

David Gordon: We delivered record fourth quarter revenue of $4 $8 billion.

David Gordon: Adjusted EBITDA of $1 5 billion, which were both ahead of our expectations.

David Gordon: Finally, non-GAAP earnings per share in the quarter grew 29% year over year.

David Gordon: The reduction in our share count versus last year.

Glenn D. Fogel: At the start of 2024, we continue to see resilience in global leisure travel demand. As we look to the year ahead, we see strong growth on the books for travel that's scheduled to take place in 2024, which gives early indications of potentially another record summer travel season. As we've noted previously, a high percentage of these bookings are cancelable, and what is on the books today for the summer period represents a small percentage of the total number of bookings that we expect to ultimately receive.

David Gordon: At the start of 2024, we continue to see resilience in global leisure travel demand.

David Gordon: As we look to the right we see strong growth on the books, who travel that's scheduled to take place in 2024, which gives early indications are potentially another record summer travel season.

David Gordon: As we've noted previously a high percentage of these bookings are comfortable.

David Gordon: On the books today for the summer period represents a small percentage of the total bookings that we expect to ultimately receive Dave.

Glenn D. Fogel: David will provide further details on our fourth quarter results and on our thoughts about the first quarter and for the year 2024. Looking back at the full year of 2023, I am proud of our efforts to drive more benefits to our travelers and supply partners while also delivering record-setting industry-leading financial results. We reached a significant milestone last year with our customers booking an all-time high of over 1 billion units on our platforms, which was an increase of 17% versus 2022. Gross bookings of $151 billion increased 24% versus 2022.

David Gordon: David will provide further details on our fourth quarter results and all of our thoughts about the first quarter and full year 2024.

David: Looking back at the full year of 2023, I am proud of our efforts to drive more benefits to our travelers and supplier partners, while also delivering record setting industry, leading financial results.

David: We reached a significant milestone last year with our customers booking an all time high of over 1 million room nights on our platforms.

David: Each was an increase of 17% versus 2022.

David: Gross bookings.

David: <unk> hundred $51 million increased 24% versus 2022.

Glenn D. Fogel: In 2023, we reached a new revenue record of over $21 billion, which was 25% higher than 2022. We achieved this strong top-line result while improving our profitability with a record adjusted EBITDA of $7.1 billion, an increase of 34% versus 2022, and our adjusted EBITDA margin expanded by over two percentage points year-over-year. Our non-GAAP earnings per share of about $152 increased 52% year-over-year and was 48% higher than our prior full-year all-time high back in 2019.

David: In 2023.

David: Reached a new revenue record over $21 billion, which was 25% higher than 2022.

David: We achieved this strong topline results, while improving our profitability with record adjusted EBITDA of $7 1 billion.

David: Increase of 34% versus 2022, and our adjusted EBITDA margin expanded by over two percentage points year over year.

Our non-GAAP earnings per share of about $152 increased 52% year over year and was 48% higher than our prior full year all time high back in 2019.

Glenn D. Fogel: Across all of our key metrics, in 2023, we will be a meaningfully larger and faster growing business than we were in 2019. Our ambition going forward in a normalized growth environment for the travel industry is to continue to grow our gross bookings, revenue, and earnings per share faster than we did in 2019. We are confident we will achieve these objectives because we've invested in building a stronger business and better product offerings for our travelers and partners than we had back then. We can see this in many areas.

David: Of course, all of our key metrics in 2023, we were a meaningfully larger and faster growing business than we were in 2019.

David: Alright ambition going forward in a normalized growth environment for the travel industry is to continue to grow our gross bookings revenue and earnings per share faster than we did in 2019.

David: We are confident we will achieve these objectives, because we have invested in building a stronger business and better product offerings for our travelers and partners that we had back then.

David: We can see this in many areas.

Glenn D. Fogel: But I will highlight a few examples of where we as strengths are offering relative to 2019. We now have a scaled-up merchant platform at Booking.com, which processed about half of Booking.com's gross bookings in 2023. Our merchant offering brings many benefits to our travelers and partners, as well as new strategic benefits to us, including the ability to merchandise.

David: I will highlight a few examples where we have strengths that are offering relative to 2019.

David: We now have a scaled up merchant platform at <unk> Dot com, which process both sales booking dot coms gross bookings in 2023.

David: Our merchant offering brings many benefits to our travelers and partners as well as new strategic benefits to us, including the ability to merchandise.

Glenn D. Fogel: On flights, we have continued to scale up our offering at Booking.com since launching in 2019, with total company air tickets booked in 2023 up more than 400% over that timeframe, primarily driven by Booking.com. We see this vertical bringing new customers to our platform while delivering a more complete offering to our existing customers, making travel planning and booking easier for them and creating opportunities to provide more value to, and Alternative Accommodations. We continue to increase the mix of our alternative accommodation room nights, which reached 33% of Booking.com's room nights in 2023, as we improve our product offering and increase our supply choices with further opportunities ahead, particularly in the U.S. Early. We are pleased that, for Booking.com, we have created the foundations necessary to offer insurance, attractions, and ground transportation options, and expect these offerings to add value to our Connected Trip vision.

David: On slide <unk>, we have continued to scale, our offering a booking dotcom since launching in 2019 with total company air tickets booked in 2023 more than 400% over that timeframe, primarily driven by bulk <unk> dot com.

David: We see this vertical bringing new customers to our platform, while delivering a more complete offering to our existing customers, making travel planning and booking easier for them and creating opportunities to provide more value to them.

David: On alternative accommodations, we continued to increase the mix of our alternative accommodation room nights, which reached 33% of booking dot coms room nights in 2023, as we improve our product offering and increase our supply choices with further opportunities ahead, particularly in the U S.

David: While early we are pleased that for booking dot com, we have created the foundation necessary to offer insurance attractions and ground transportation options and expect these offerings to add value to our connected trip vision.

Glenn D. Fogel: On marketing, we've improved our abilities in using performance marketing channels even more effectively and are now better focused on our brand spending and loyalty. We've expanded and enhanced our Dean's Loyalty Program at Booking.com to deliver more benefits to more of our traveler customers, with more of our property and rental car partners participating. NLF, We are continuing to strengthen the direct relationship with our travelers as our mobile app room lights and tone direct room lights continue to increase in our network.

David: On marketing, we can improve our abilities in using performance marketing channel channels, even more effectively and are now better focused on our brand spending.

David: On loyalty, we've expanded and enhanced our <unk> loyalty program booking dot com to deliver more benefits to more of our traveler customers with more of a property in rental car partners participating.

David: And lastly, we are continuing to strengthen the direct relationship with our travelers as our mobile App room nights and total direct room nights continue to increase in our mix.

Glenn D. Fogel: We remain confident in our long-term outlook for the travel industry, which we believe will grow faster than GDP growth across our core markets. With that foundation of industry growth and the improvements we've made to strengthen our offerings, we are positive about our future and believe we are well positioned to deliver attractive growth across our key metrics in the coming year. With our long-term positive outlook, solid financial performance, and strong balance sheet, we returned over $10 billion to shareholders during 2023 by repurchasing our shares. Returning capital to shareholders will remain a high priority for the company going forward.

David: We remain confident in our long term outlook for the travel industry, which we believe will grow faster than GDP growth across our core markets.

David: With that foundation of industry growth and the improvements we've made to strengthen our offerings. We are positive about our future and believe we are well positioned to deliver attractive growth across our key metrics in the coming years.

David: We are long term positive outlook solid financial performance and strong balance sheet, we returned over $10 billion to shareholders during 2023 by repurchasing our shares.

David: Returning capital to shareholders will remain a high priority for the company going forward.

Glenn D. Fogel: And today, we are taking another important step in that journey by announcing that our Board of Directors has declared a quarterly dividend to complement our existing share repurchase program. David will provide further thoughts on our approach to capital returns in his remarks. In addition to our strong financial results in 2023, we made meaningful progress against our key strategic priorities, which include advancing our Connected Trip vision, further integrating AI technology into our office, supporting our supply partners and growing alternative accommodation, and building more direct relationships with our traveler customers. Let me discuss the progress we have made in each of these areas. On the Connected Trip, we continue to take steps towards our long-term vision to make planning, booking, and experiencing travel easier, more personal, and more enjoyable, while delivering better value to our travelers and supplier partners. We believe this is important because we know the current travel experience is much more complicated, fragmented, and frustrating for travelers than it should be.

David: We are taking another important step in that journey by announcing that our board of directors has declared a quarterly dividend to complement our existing share repurchase program.

David: David will provide further thoughts on our approach to capital returns in his remarks.

David: In addition to our strong financial results in 2023, we made meaningful progress against our key strategic priorities which include it.

David: Advancing our connected trip vision.

David: Further integrating AI technology into our offerings.

David: Supporting our supply partners and growing alternative accommodations.

David: And building more direct relationships with our traveler customers.

Speaker Change: Let me address the progress we have made in each of these areas.

Speaker Change: On the connected trip, we continued to take steps towards our long term vision to make planning booking and experiencing travel easier more personal and more enjoyable, while delivering better value for our travelers and supplier partners.

Speaker Change: We believe this is important because we know the current travel experience is much more complicated fragmented and frustrating to travelers and it should be.

Glenn D. Fogel: The Connected Trip vision aims to greatly improve that experience for consumers, which we believe will drive further differentiation of our offerings and lead to improved loyalty, increased direct bookings, higher frequency, and a greater share of total travel spend on our platform over time. This is good, not only for our travelers but also for our partner suppliers, who will be able to utilize different elements of the Connected Trip to obtain additional business in an efficient, lower cost way. As we continue to make progress in developing the Connected Trip, you will see incremental improvements and enhancements to our platform that move us closer to this long-term vision. This approach allows us to realize benefits while we are building towards that future state. In fact, some of the key improvements to our platform over the last two years that I spoke about earlier were driven by our work on the Connected Trip. For example, Platform at Bookie.com is a foundational base to the Connected Trip.

Speaker Change: The connected trip vision aimed to greatly improve that experience for consumers, which we believe will drive further differentiation of our offerings and lead to improved loyalty increased direct bookings higher frequency and a greater share of total travel spend on our platform overtime.

Speaker Change: This is good not only for our travelers, but also for our partner suppliers, who we utilize different elements of the connected trip to obtain additional business in efficient lower cost way.

Speaker Change: As we continue to make progress in developing the connected trip you will see incremental improvements and enhancements to our platform that moves us closer to this long term vision.

Speaker Change: This approach allows us to realize benefit while we are building towards that future state in fact, some of the key improvements to our platform over the last few years that I spoke about earlier were driven by our work on the connected trip for example.

Our merchant platform.

Booking dot com is a foundational piece to.

Speaker Change: So the connected trip and it helps deliver a more seamless and frictionless booking experience for our travelers.

Glenn D. Fogel: And it helps deliver a more seamless and frictionless booking experience for our travelers. Plus, it enables us to smartly merchandise a variety of partner and self-supply offers when appropriate. Another example would be the development of flights at Booking.com, with flights being one of the most important elements of travel outside of accommodation.

Speaker Change: It enables us to smart merchandise of Hawaii, a partner and self supply offers when appropriate.

Speaker Change: Another example would be the development of flights at booking com with flights being one of the most important elements of travel outside of accommodations through 2023 air tickets booked on our platforms increased.

Glenn D. Fogel: In 2023, air tickets booked on our platforms increased 58% year-over-year, driven primarily by the growth of Booking.com's flight business. We continue to see a healthy number of new customers to Booking.com through the flight vertical and are encouraged by the way that these customers book other services on our platform. Outside of flights and accommodations, we made solid progress in expanding the breadth of our attraction supply that is available to our travelers. While we do not expect attractions to be a major financial contributor on their own, we see benefits from a strong attraction offering given the potential bundling opportunities, as well as the ability to increase traveler engagement with the app while travelers are in the destination. Overall, we believe we have made great progress in building towards our Connected Trip vision, and we are starting to see early signs of the benefits. We continue to see a growing percentage of transactions which we count as connected trips, though these are still a small percentage of our total transactions today.

Speaker Change: The 8% year over year, driven primarily by the growth of booking dot com site offering.

We continue to see a healthy number of new customers to <unk> dot com through the flight vertical and are encouraged by the rate that these customers book other services on our platform.

Speaker Change: Outside of flights and accommodations, we made solid progress in expanding the breadth of our attractions supply.

Speaker Change: Available to our travelers.

Speaker Change: While we don't expect.

Speaker Change: We do not expect attractions to be a major financial contributor on its own we see benefits from a strong attraction offering given the potential bundling opportunities as long as the ability to increase traveler engagement with the app what travelers are in destination.

Speaker Change: Overall, we believe we have made great progress in building towards our connected trip vision and we are starting to see early signs of the benefits. We continue to see a growing percentage of transactions, which we count as connected trips. Though these are still a small percentage of our total transactions today.

Glenn D. Fogel: Importantly, we see these types of customers returning to us more frequently, and we plan to experiment with expanding our Genius program to include all travel verticals in 2024, which we expect will drive more valued travelers across the different elements of the Connected Trip. We plan to continue to build out our Connected Trip vision, which we believe will result in increased traveler and supplier engagement with our platform. In order to achieve the easier and more personalized experience of the Connected Trip, we have always envisioned AI technology playing a central role.

Speaker Change: Fortunately, we see these types of customers returning to us more frequently and we plan to experiment with expanding our genius program to include all travel verticals in 2024, which we expect will drive more value to travelers across the different elements of the connected trip.

Speaker Change: We plan to continue to build out our connector vision, which we believe will result in increased travel and supplier engagement with our platform.

Speaker Change: In order to achieve the easier and more personalized experience of the connected trip, we have always envision AI technology play a central role.

Glenn D. Fogel: Over the last few quarters, I have discussed the hard work our team has been doing to integrate generative AI into our offerings in innovative ways, including Booking.com's AI Trip Planner and Priceline's generative AI Travel Assistant named Penny. After launching Booking.com's AI Trip Planner in the US last summer, we expanded the rollout to the UK market in the fourth quarter. At this early stage, the team remains focused on learning more about how customers want to interact with the tool and what types of questions they will ask.

Speaker Change: Over the last few quarters I have discussed the hard work our teams have been duly integrate generative AI into our offerings innovative ways, including booking dot coms AI trip planner and price slides generative AI travel assistant named Penny.

Speaker Change: After launching <unk> dot com AI, playing out in the U S last summer, we expanded the rollout to the U K market in the fourth quarter.

Speaker Change: At this early stage the team remains focused on learning more about customers.

Speaker Change: To interact with the tool and what types of questions. They will ask.

Glenn D. Fogel: We see the AI trip planner is getting better at answering customers' inquiries, and we are excited to start testing other verticals outside of accommodation. At Priceline, last week, they announced their Reacher product release, which included several enhancements to Penny following six months of real-world interaction with users that resulted in valuable learnings for the Priceline team. BriteFlight's AI travel assistant product can now help travelers beyond just the hotel category, as it now covers flights, car rentals, and vacation packages. While Payne was initially launched at the end of the booking funnel on the checkout page, it is now available on the Priceline homepage, where it can help with travel planning, booking, and modifying a trip after it's been booked.

Speaker Change: We see the AI trip planner is getting better entering customers' inquiries and we are excited to start testing other verticals outside of accommodations.

Speaker Change: At Priceline last week, they announced they are weaker product release, which included several enhancements to penny following six months of real world interaction with users that resulted in valuable learnings from the Priceline team.

Speaker Change: <unk> AI travel assistant product can now help travelers beyond just the hotel category as it now covers flight car rentals and vacation packages.

Speaker Change: <unk> was initially launched at the end of the booking funnel on the checkout page. It is now available on our Priceline homepage, where it can help with travel planning booking and modifying a trip after it's been locked.

Glenn D. Fogel: This is a clear example of how our teams iterate and enhance our AI-powered products as we learn more through user interaction. We continue to see encouraging signs that Priceline's penny product helps lower customer service contact rates across travel verticals and, we believe, improves the customer experience. Beyond improving customer service contact rates, we believe that, over time, we can leverage generative AI technology to help make our customer service agents more efficient across our entire organization. Outside of customer service, we continue to explore areas where we believe we can use generative AI tools to increase productivity. We have early indications that using generative AI enhances the productivity of our software developers, and we are encouraged by the results so far.

Speaker Change: This is a clear example of how our teams iterate and enhance our AI powered products as we learn more through user interactions.

Speaker Change: We continue to see encouraging signs there.

Speaker Change: <unk> products helps lower customer service contact rates across travel verticals, and we believe improves the customer experience.

Improving customer service contact rates, we believe that overtime, we can leverage <unk> AI technology to help make our customer service agents more efficient across our entire organization.

Speaker Change: Outside of customer service, we continue to explore areas, where we believe we can use generative AI tools to increase productivity.

Speaker Change: Early indications that using generative AI enhances the productivity of our software developers and are encouraged by the results so far.

Glenn D. Fogel: We look forward to experimenting with these and other ways Gen AI tools might make our business more efficient in the future. Turning to our supply partners, we strive to be a trusted and valuable partner for all accommodation types on our platform, and we look to add value for our partners by delivering incremental bookings and developing products and features to help support their business. The majority of our partners are small independent businesses.

Speaker Change: We look forward to experiment experimenting with these and other ways Gen AI tools might make our business more efficient in the future.

Speaker Change: Turning to our supply partners, we strive to be a trusted and valuable partner for all accommodation types on our platform and we look to add value for our partners by delivering incremental bookings and developing products and features to help support their businesses.

Speaker Change: The majority of our partners are small independent businesses and we are pleased to see many are reporting significantly improved business performance over the last year.

Glenn D. Fogel: And we are pleased to see many are reporting significantly improved business performance over the last year. We believe that helping our smaller partners thrive contributes to the long-term diversity and sustainability of our sector. One area in which we work with many small independent businesses is through our alternative accommodation offering at Booking.com.

Speaker Change: We believe that helping our smaller partners thrive contributes to the long term diversity and sustainability of our sector.

Speaker Change: One area in which we work with many small independent businesses is through our alternative accommodation offering at book and Dot Com.

Glenn D. Fogel: This is an area in which we have continued to strengthen our business by increasing supply and raising product awareness among travelers. All true accommodation room nights grew 19% year-over-year in the fourth quarter and 24% for the full year, which was faster than our traditional hotel category. We saw meaningfully higher growth in our U.S. alternative accommodation remit, though this is all a relatively small bit. Globally, alternative accommodations represented about 33% of Booking.com's total nights in 2023, which was three percentage points higher than in 2022. Our strong growth in alternative accommodation room nights is benefiting from having more listings available on our platform for travelers to choose from. We are seeing continued momentum in annual alternative accommodation supply both globally and in the US, with global listings reaching about 7.4 million by the end of 2023, which is about 12% higher than 6.6 million last year.

Speaker Change: This is an area, which we have continued to strengthen our business by increasing supply and raising product awareness among travelers.

Speaker Change: Accommodation room nights grew 19% year over year in the fourth quarter and 24% for the full year, which was faster than our traditional hotel category.

Speaker Change: We saw meaningfully higher growth in our U S alternative accommodation room nights, though this is all a relatively small base.

Speaker Change: Globally alternative accommodations represented about 33% of booking dot coms two room nights in 2023, which was three percentage points higher than in 2022.

Speaker Change: Our strong alternative accommodation room nights growth is benefiting from having more listings available on our platform where travelers to choose from we are seeing continued momentum in adding alternative combination supply both globally and in the U S with global listings, reaching about seven 4 million by the <unk>.

Speaker Change: And the 2023, which is about 12% higher than the $6 6 million last year.

Glenn D. Fogel: We're focused on continuing to build on this progress by further improving the product for our supply partners and travelers, particularly in the U.S. Boratrop. We remain focused on building a better experience that leads to increasing loyalty, frequency, spend, and direct relationships over time. I'm encouraged that in 2023 at Booking.com, we had strong growth in our base of repeat customers, demonstrating strong retention, while we're also pleased with the increase in the number of new users to our platform versus 2022. We're also strengthening the direct relationship with our travelers as our mix of customers booking directly on our platforms continued to increase year-over-year in the fourth quarter and when measured for the full year. We see a very high level of direct bookings in the mobile app, which is an important platform because it allows us more opportunities to engage directly with travel. Our mix of room nights through our mobile apps increased year-over-year by about 5 percentage points for the full year to 49 percent. Booking.com remained the number one downloaded travel app in the world in 2023. In Asia, Booking.com and Agoda are among the top five travel apps.

Speaker Change: We're focused on continuing to build on this progress by further improving the product for our supplier partners and travelers, particularly in the U S.

Speaker Change: For our travelers.

Speaker Change: We remain focused on building a better experience that leads to increasing loyalty frequency spend and direct relationships overtime.

Now let me encouraged that in 2023 at booking Dot Com, we had strong growth in our base.

Speaker Change: Bookers demonstrating strong retention, while we're also pleased with the increase in the number of new users to our platform versus 2022.

Speaker Change: We're also strengthening the direct relationship with our travelers as our mix of customers booking directly on our platforms continue to increase year over year in the fourth quarter and when measured for the full year.

Speaker Change: We see a very high level of direct bookings and the mobile App, which is an important platform because it allows us more opportunities to engage directly with travelers.

Speaker Change: Our mix of room nights booked through our mobile apps increased year over year by about five percentage points for the full year to 49%.

Speaker Change: <unk> Dot com remained the number one downloaded travel app in the world in 2023.

In Asia booking dot com and Angola are top five travel apps and in the U S booking dot com Priceline and open table are all in the top 10 travel apps.

Glenn D. Fogel: And in the U.S., Booking.com, Priceline, and OpenTable are all in the top 10 travel apps. We will continue our efforts to enhance the app experience to build on the recent success we have seen here. Finally, I want to briefly address a regulatory matter that's impacting the financial results we're reporting today. The Spanish Competition Authority has issued a draft decision alleging an infringement by Booking.com of Spanish competition law, and they intend to issue a fine of $530 million. We could not disagree more with this draft decision and the arbitrarily large fine that they have proposed, which is completely disproportionate to the alleged conduct.

Speaker Change: We'll continue our efforts to enhance the app experience to build on our recent success we are seeing here.

Speaker Change: Finally, I want to briefly address our regulatory matter that's impacting the financial results we are reporting today.

Speaker Change: Competition Authority has issued a draft decision.

Speaker Change: <unk> infringement by booking dot com of Spanish competition law and that intends to issue a fine of $530 million.

Speaker Change: Okay.

We could not disagree more with this draft decision and arbitrarily large find that they have proposed which is completely disproportionate to the alleged conduct.

Glenn D. Fogel: If the draft decision were to become final, we plan to appeal. The success of our business is built on a mutually beneficial and balanced partnership with our millions of hotels and other accommodation partners around the world. We provide exceptional choice, value, and service for travelers, and we provide a marketplace for hotels and other partners that allows them to attract travelers from around the world at lower costs than many other marketing channels. We have a clear track record of cooperating with many competition and consumer authorities to find amicable and workable solutions to their concerns, including working with the European Commission on Digital Markets. As we have previously disclosed, we plan to file our notification for designation under the DMA soon, and we believe the main concerns raised by the Spanish Authority overlap with the DMA.

Speaker Change: The draft decision were to become final we plan to appeal.

Speaker Change: The success of our business is built on a mutually beneficial imbalanced partnership with our millions of hotels and other accommodation partners around the world.

Speaker Change: We provide exceptional choice value and service for travelers and we provide a marketplace for hotels and other partners that allows them to attract travelers from around the world at lower cost than many other marketing channels. We have a clear track record are cooperating with many competition.

Speaker Change: And consumer authorities to find amicable and workable solutions to their construction, including working with the European Commission on the digital markets Act as we have previously disclosed we plan to file our notification for designation under the DNA soon and we believe the main concerns raised by the Spanish authority.

Glenn D. Fogel: We will continue to work closely with these regulatory bodies to maintain consistent rules, and, most importantly, we will continue to ensure that we are offering the best possible platform to our partners and our customers. In conclusion, I am encouraged by the strong fourth-quarter results and the continued resilience of leisure travel demand. Our teams continue to execute well against our key strategic priorities, which helps position our business well for the long term. We continue our work to deliver a better offering experience for our supply partners and our travelers. We are confident in the long-term growth of travel and in the opportunities ahead for our company. I will now turn the call over to our CFO, David Goulden. Thank you, Glenn, and good afternoon.

Speaker Change: With the DNA, we will continue to work closely with these regulatory bodies to maintain consistent rules and most importantly, we will continue to ensure we are offering the best possible platform to our partners and our customers.

Speaker Change: In conclusion I am.

Speaker Change: Encouraged by the strong fourth quarter results and the continued resilience of leisure travel demand our teams continue to execute well against our key strategic priorities, which helps position our business well for the long term, we continue our work to deliver a better offering and experience for our supplier partners and our travelers.

David I. Goulden: I will review our results for the fourth quarter and provide some color on the trends we've seen so far in the first quarter and, of course, in 2024. All growth rates are on a year-on-year basis unless otherwise indicated. We will be making some references to the comparable periods in 2019 where we think these are helpful. Information regarding reconciliation of non-GAAP results to GAAP results can be found in our earnings release. We will post our prepared remarks on the Booking Holdings Investor Relations website after the conclusion of the earnings call. One housekeeping item before discussing our results. We have reclassified digital services taxes into sales and other expenses and out of G&A expenses due to the highly variable nature of DSTs, which are tied to the revenue earned in the countries where DSTs are inactive.

Speaker Change: We are confident in the long term growth of travel.

Speaker Change: And then the opportunities ahead for our company I will now turn the call over to our CFO David Gordon.

David Gordon: Thank you Glenn and good afternoon.

David Gordon: I will review our results for the fourth quarter and provide some color on the trends we've seen so far in the first quarter and of course on 2024.

David Gordon: All growth rates are on a year on year basis, unless otherwise indicated we will be making some references to the comparable periods in 2019, where we think these are helpful. Information regarding reconciliation of non-GAAP results to GAAP results can be found in our earnings release, we will post our prepared remarks to the booking holdings Investor Relations web.

David I. Goulden: We have provided a table with two years of updated quarterly financials in our earnings press release that reflects this change in P&L geography, and all my comments on this call will also reflect the change. Now, on to our fourth quarter results. Our room nights in the fourth quarter grew 9% year-over-year and 21% versus 2019, which is slightly better than our expectations of about 9% and 20%. Excluding Israel, Q4 room nights were up 11% versus 2022 and 22% versus 2019. Looking at our year-over-year room nights by region in the fourth quarter, Asia was up mid-teens, Europe was up low double digits, the rest of the world was up low single digits, and the U.S. was flat. All regions include bookings from October.

David Gordon: After the conclusion of this earnings call.

David Gordon: One housekeeping item before discussing our results we have reclassified digital service taxes into sales and other expenses out of G&A expense Judy.

David Gordon: Due to the highly variable nature of Dst's, which are tied to the revenue earned in the countries, where DST enacted we have provided a table with two years of updated quarterly financials in our earnings press release that reflects this change in P&L geography, and all of my comments on this call will also reflect this change.

David Gordon: Now onto our fourth quarter results.

David Gordon: Room nights in the fourth quarter grew 9% year over year.

David Gordon: 1% versus 2019, which is slightly better than our expectations of about 9% and 20%.

David I. Goulden: The average booking window of Booking.com expanded in Q4 versus the same period in both 2022 and 2019, but it was a bit less expanded than it was in the third quarter. In Q4, the mobile app mix of about 53% was about 5 percentage points higher than the fourth quarter of 2022. We continue to see an increasing mix of our total room nights coming to us through the Direct Channel. The Direct Channel increased as a percentage of our room nights in the fourth quarter relative to the fourth quarter of 2022. The international mix of our room nights in Q4 was 50%, up from about 48% in the fourth quarter of 2022 and reaching about the same level as the pre-pandemic Q4 mix. Our cancellation rates in the fourth quarter were slightly higher than in the fourth quarter of 2022, which was affected by the war in the Middle East. As we expected, the higher overall cancellation rate would be in October, normalized by the end of the quarter.

David Gordon: Excluding Israel Q4 room nights were up 11% versus 2022 and 22% versus 2019.

David Gordon: On a year over year.

David Gordon: Room nights by region in the fourth quarter Asia was up mid teens Europe was up low double digits and rest of world was up low single digits on the U S was flat.

David Gordon: All regions improved from October.

David Gordon: The average booking window, a booking dot com expanded in Q4 versus the same period in both 2022 and 2019, but was a bit less expanded than it was in the third quarter.

David Gordon: In Q4 mobile <unk> of about 53% was about five percentage points higher than the fourth quarter of 2022.

David Gordon: We continue to see an increasing mix of our total room nights coming to us through that.

David Gordon: Rx channel the direct channel increased as a percentage of our room nights in the fourth quarter relative to the fourth quarter of 2020.

The international mix of our room nights in Q4 was 50% up from about 48% in the fourth quarter of 2022 and.

David Gordon: On reaching about the same level as the pre pandemic Q4 mix.

David I. Goulden: For our alternative accommodations at Booking.com, our Q4 room night growth was 19% year-over-year, and the global mix of alternative accommodation room nights was about 32%, which was up versus about 29% in the fourth quarter of 2022. Q4 gross bookings increased 16% year-over-year, or about 15% on a constant currency basis, which was ahead of our expectations. The 16% increase in gross bookings was 7 percentage points higher than the 9% room-night growth due to about 4% higher accommodation constant currency ADRs plus over 1 percentage point of positive impact from each of FX movements and flight bookings. Our year-over-year ADR growth was negatively impacted by regional mix due to higher mixing of room nights from Asia. Excluding regional mix, constant currency ADRs were up about 5 percentage points year-over-

David Gordon: Our cancellation rate in the fourth quarter was slightly higher than Q4 2022 impacted by the war in the Middle East as we expected the higher overall cancellations in October normalized by the end of the quarter.

David Gordon: So for our alternative accommodations are broken Dot com, our Q4 room night growth was 19% year over year on the global mix old surgically remove lines was about 32%, which was up versus about 29% in the fourth quarter of 2022.

David Gordon: Q4, gross bookings increased 16% year over year or about 15% on a constant currency basis, which was ahead of our expectations. The 16% increase in gross bookings was seven percentage points higher than the 9% room night growth due to about 4% higher correlation.

David Gordon: Currency.

David I. Goulden: Despite higher ADRs in the fourth quarter, we have not seen a change in the mix of hotel-style rating levels being bought or changes in the length of stay that could indicate that consumers are trading down. We continue to watch the dynamics closely. Airline tickets booked in the fourth quarter were up about 46% year-over-year, driven by the continued growth of Booking.com's flight offerings.

David Gordon: Plus over one percentage points of positive impact from each of FX movements on flight bookings.

David Gordon: Our year over year ADR growth was negatively impacted by regional mix due to a higher mix of room nights from Asia, excluding regional mix constant currency ADR.

David Gordon: About five percentage points year over year.

David Gordon: Despite higher ADR in.

David Gordon: In the fourth quarter, we have not seen a change in the mix of hotel star rating levels.

David I. Goulden: Revenue for the fourth quarter exceeded our expectations, increasing 18% year over year or about 17% on a constant currency basis. Revenue as a percentage of gross bookings was 15.1%, which was about in line with our expectations. Marketing expense, which is a highly variable expense line, increased 9% year over year. However, marketing expense as a percentage of gross bookings was about 30 basis points lower than Q4 2022 due to higher ROIs in our paid channels and a higher mix of direct business. The Affordance Marketing ROI increase year-over-year helps with our ongoing efforts to improve the efficiency of our marketing spend. Marketing and merchandising combined as a percentage of gross bookings in Q4 was about 15 basis points lower than last year, which is better than our expectation due to lower merchandising expense, higher direct mix, and better performance marketing ROI.

David Gordon: Changes in the length of stay that could indicate that consumers are trading down we continue to watch.

David Gordon: Closely.

David Gordon: Airline tickets booked in the fourth quarter were up about 46% year over year, driven by the continued growth of booking com's flight offering.

David Gordon: Revenue for the fourth quarter exceeded our expectations, increasing 18% year over year or about 17% on a constant currency basis.

David Gordon: Revenue as a percentage of gross bookings was 15, 1%, which was about in line with our expectation.

David Gordon: Marketing expense, which is a highly variable expense line increased 9%.

David Gordon: Marketing expense as a percentage of gross bookings was about 30 basis points lower than Q4, 2022 due to higher rois in our pay channels and a higher mix of direct business.

David Gordon: Performance marketing Rois increase year over year helped by our ongoing efforts to improve the efficiency of our marketing spend.

David I. Goulden: Q4 sales and other expenses as a percentage of gross bookings were up about 20 basis points compared with last year and also about 20 basis points above our expectation normalized for the DST reclassification due in large part to higher accounts receivable provisions related to our decision to delay some collections during the partner payment issue we discussed last quarter. We do not expect this to be an ongoing issue. Our more fixed expenses, in aggregate, were up 21% year-over-year, which was below our expectation, primarily due to lower personnel and IT expenses, as well as due to the DST reclassification.

David Gordon: Marketing merchandising combined as a percentage of gross bookings in Q4 was about 15 basis points lower than last year, which was better than our expectation due to lower merchandise do you expense.

David Gordon: It makes them better performance marketing Rois.

David Gordon: Q4 sales to our expenses.

David Gordon: Gross bookings were up about 20 basis points compared with last year and also about 20 basis points above our expectation normalized for the DST reclassification due in large part to higher accounts receivable provisions related to our decision to delays in collections during the pause.

David I. Goulden: 21% is calculated using our non-GAAP expenses in both Q4 2023 and Q4 2022. And Justin Iveda, with almost $1.5 billion, was ahead of our expectations and was up 18% year-over-year and would have been up about 22% on a constant currency basis. Separately, Q4 Adjusted EBITDA was negatively impacted by a $37 million loss recorded in other income related to the devaluation of the Argentinian peso, which was not factored into our prior guidance.

Not a payment issue we discussed last quarter, we do not expect this to be an ongoing issue.

A more fixed expenses in aggregate were up 21% year over year, which was below our expectation primarily due to lower personnel expense as well as due to the DSG reclassification.

David Gordon: 21% is calculated using our non-GAAP expenses in both Q4, 2023 and Q4 2022.

David I. Goulden: This reduced Q4 Adjusted EBITDA margins by almost 1%. Non-gap net income of $1.1 billion resulted in non-gap earnings per share of $32 a share, which is up 29% year-over-year. Our average share count in the fourth quarter was 9% below Q4 2022. On non-GAAP results... Excluding $276 million of expense in personnel related to a ruling in the Netherlands pension fund matter and $530 million of expense in G&A related to a draft decision by the Spanish Competition Authority, I'd like to provide some perspective on each of these. As Glenn mentioned, we strongly disagree with the draft decision and the totally unprecedented fine proposed by the Spanish Competition Authority, which we plan to appeal if it becomes final. The appeal process could take a few years.

Adjusted EBITDA of almost $1 $5 billion was ahead of our expectation and was up 18% year over year and would it be up about 2% on a constant currency basis.

David Gordon: Separately Q4, adjusted EBITDA was negatively impacted by a $37 million loss recorded in other income related to the devaluation of the Argentinean peso, which was not factored into our prior guidance. This reduced Q4, adjusted EBITDA margin by almost 1%.

David Gordon: non-GAAP net income of $1 $1 billion, resulting in non-GAAP earnings per share of $32, a share which was up 29% year over year, our average share count in the fourth quarter was 9% below Q4 2022.

David I. Goulden: During any appeal process, we would expect to implement some changes to our business practices in Spain, but we do not currently anticipate that these would have a significant impact on our business. Turning to the Dutch pension case, in January, the Court of Appeal in The Hague ruled that most Booking.com employees in the Netherlands should be enrolled in a travel industry-wide pension fund.

David Gordon: Our non-GAAP results exclude $236 million of expense and personnel related to a ruling in the Netherlands pension from NASA and $530 million of expense in G&A related to a draft decision by Spanish competition authority I'd like to provide some perspective on each of these.

David Gordon: As Glenn mentioned, we strongly disagree with the draft decision on the totally unprecedented find propose bioscience competition authority, which we plan to appeal it becomes final.

David I. Goulden: The liability we recorded in our Q4 results is for prior periods related to this pension. We're working through how we align this travel industry-wide plan with the existing pension plan we offer to our employees in the Netherlands. We expect there will be some increase in our pension plan costs at levels going forward, but we do not expect these to be material. On a gap basis, we had net income of $222 million in the quarter.

David Gordon: <unk> process could take a few years during the appeal process, we would expect to influence some changes to our business practices in Spain. We do not currently anticipate these will have a significant impact on our business.

David Gordon: Turning to the Dutch pension case in January the court of appeal.

David I. Goulden: When looking at the full year, we're pleased to report that our 2023 RUBY, our 2023 room nights grew 17% year-over-year, and our growth bookings grew 24% and about 25% on a constant currency basis. Our full year revenue was over $21 million, which was up 25% year over year and up similarly on a constant currency basis. Full-year revenue as a percentage of gross bookings was 14.2% in 2023, which is up slightly versus 14.1% in 2022. For the full year, there was more than half a percentage point of positive impact on timing, as well as a benefit to take rates from increased revenues associated with payments. But this was most offset by an increased mix of flights, an increase in Asian traffic as the region recovered, and by our increased investments in merchandise.

David I. Goulden: Our underlying accommodation take rates continue to be in line with 2019 levels. For the full year, our marketing plus merchandising at Booking.com as a percentage of gross bookings was 5.6%, down from 5.9% in 2022, driven by marketing efficiencies and direct mix. The 5.6% in 2023 is still up from 5.5% in 2019 and is leaning into a recovered travel market more than offsets the benefits of gains due to increased direct mix. For the full year, the direct channel as a percentage of our room nights continued to increase in mix. When we exclude our B2B or business to business business, our direct mix was in the low 60% range for the year.

David Gordon: Hi, Angela gross bookings was 14.2% in 2023, which is up slightly versus 41% and 2022.

David Gordon: A full yeah does more than half a percentage point, a positive impact on timing as well as a benefit to take race from increased revenues associated with payments, but this was most offset by an increase it makes it flights and increase in Asia mix as really recovered and <unk> increased investments and merchandise.

David Gordon: Underlying a combination take right from changed me in line with 2019 levels.

David Gordon: For the full year Ah marketing calls merchandise you can book, an dot com as a percentage of gross bookings was 5.6% down from 5.9% in 2022, driven by market efficiencies and diet mix.

David I. Goulden: Our full year just for EBITDA was more than $7 million and was up 34% year-over-year and up about 37% on a constant currency basis. The adjusted EBITDA margin was 33%, which was a couple of percentage points higher than our adjusted EBITDA margin in 2022 and in line with our expectations at the start of the year. Our four-year non-gap earnings per share were about $152 per share, which is up 52% year-over-year and up about 58% on a constant currency basis. Now on to our cash and liquidity position. Our Q4 ending cash investment balance of $13.1 billion was down versus our Q3 ending balance of $14.3 billion due to the $2.4 billion in share repurchases we completed in the quarter, partially offset by the $1.3 billion of free cash flow we generated in the fourth quarter. For the full year, we generated $7 billion in free cash flow.

David Gordon: 5.6% in 2023 is still up from 5.5% in 2019, leading into a recovered travel market <unk> offset the benefits of games due to increased direct mix.

David Gordon: So the full yeah, the giant channel.

David Gordon: The percentage of art room nights, some change increase in mix, when we exclude b b or business to business business alternate mix was in the low 60 per cent range for the year.

David Gordon: Full you adjusted EBITDA was $7 million I was up 34% yoga, yeah up about 37% on a constant currency basis.

David Gordon: Adjusted EBITDA margin was 33 per cent, which was a couple of percentage points higher just EBITDA margin in 2022 and in line with our expectations at the start of the year.

David Gordon: <unk> sure was about $152 shirt, which is up 52 per cent, yeah, I'm about 58% on a constant currency basis.

David I. Goulden: We repurchased over $10 billion worth of shares in 2023, taking our remaining repurchase authorization down to $14 billion and reducing our year-end share count by 9% versus 2022 and by 16% versus 2021, which is just before we restarted our share repurchase program. As we think about our capital structure and allocation framework going forward, we remain focused on appropriately investing in our business and growing returns for our shareholders while maintaining a strong investment grade credit rating. Given our confidence in our early power, strong pre-cash flow profile, and our ability to consistently return capital to shareholders, we are announcing today that our Board of Directors has declared a quarterly dividend of $8.75 per share to complement our existing share repurchase program. The dividend is payable on March 28, 2024 to shareholders on record on March 8, 2024.

David Gordon: Now onto our cash and liquidity position Q.

David Gordon: Q for ending cash in the best balance is $13.1 billion was down this al Q3, any balance of $14.3 billion June so the $2.4 billion in share repurchases will be completed in a quota.

David Gordon: Offset by the $1.3 billion, a free cash flow Jerry in the fourth quarter for the full year majority $7 billion in free cash flow.

David Gordon: We read purchase over $10 billion buying shares in 2023, taking already many refreshes authorization down to $40 billion in reducing all your <unk> account by 9% versus 2022 and by 16% versus 2021, which is just before we reached out.

David Gordon: Share repurchase program.

David Gordon: Let me think about all capital structure, an application framework going forward, we remain focused on a <unk> investing in our business and grocery chains, Russia holders, while maintaining a strong investment grade credit ratings.

David I. Goulden: We believe the introduction of a dividend will allow us to enhance our capital return program and further expand our base of investment. In terms of the composition of capital returns, we expect share repurchases will represent the vast majority of our total capital return to shareholders going forward. We continue to expect to complete the 24 billion share repurchase authorization we announced in early 2023, within four years of when we started, which would be before the end of 2026. We reiterate our previously stated gross leverage target of 2x, and our goal is to move to a 1x net leverage over time. The initiation of a dividend does not change our thinking around these targets. Now on to our thoughts for the first quarter of 2024. All growth rates are on a year-on-year basis.

David Gordon: Giving them confidence.

David Gordon: Strong free cash flow profile on our ability to consistently Chen carpetshells, we're announcing today the board of directors declared a quarterly dividend $8.75 per share to complements our existing share repurchase program.

David Gordon: Dividend is payable March 28th 2024 to shareholders of record on March 8th 2024.

David Gordon: We believe the introduction of a dividend will allow us to enhance an <unk> program.

David Gordon: Expand our base of investors.

David Gordon: Instead of the composition of capital returns, we expect of share repurchases will represent the vast majority of our total capital returns shells going forward. We continue to expect to complete the 24 billion share repurchase authorization, we announced early 2023 within four years, where we started which would be before the.

David I. Goulden: Given that we're now beyond the COVID period, when granular short-term information was helpful in assessing the path of the recovery, we're returning to our historical guidance approach with outcome ranges for the full quarter ahead and less detail on monthly trends and individual P&L line items. Based on the solid total demands we've seen so far in the first quarter, we expect Q1 room temperature growth to be between 4% and 6%. We expect the ongoing war in the Middle East to have a negative 1% impact on Q1 room night growth. But we're also comparing with a strong start to the year in 2023 when we start to see an expansion of the booking window. January room 9 growth was above the high end of that range. As we move through the quarter, February bank growth will benefit from an extra day, and March bank growth will be hurt by Easter being in March.

David Gordon: And a 2026.

David Gordon: We we we we reiterate our previously stated gross Larry started to X and they'll go move to a <unk> net leverage over time, the initiation of a dividend does not change our thinking around these targets.

David Gordon: Now onto our thoughts for the first quarter of 2024.

David Gordon: All growth rates are on a year on that basis.

David Gordon: Given that we know beyond the Covid period, when granular short survey information was helpful in assessing the passenger recovery.

David Gordon: Trying to I struggled guidance approach with outcome range for the full quote ahead and less detail a monthly trends in individual P&L line items.

David Gordon: Based on a solid <unk> so far in the first quarter, we expect <unk> to be between four and 6%.

David I. Goulden: We expect these to roughly offset each other. We expect Q1 gross bookings growth to be between 5% and 7%, about 1% point faster than room bank growth due to slightly higher accommodation, constant currency ADRs, and faster growth from flights, partially offset by about 1% point of exit from FX pressure. We expect Q1 revenue growth to be between 11% and 13% faster than Q1 2020. Bookings growth during the Easter shift, which we expect to benefit Q1 revenue by about 3%. We expect a similar negative impact on revenue growth in Q2. We expect Q1 adjusted EBITDA to be between $680 million and $720 million, which at the midpoint would be 19% year-on-year growth and about a 1% increase in EBITDA margin.

David Gordon: We expect the ongoing war in the Middle East have a 91% impact on cue on through my growth. We're also comparing with a strong start you a 2023, when we start to see an expansion of the booking window.

David Gordon: Jeremy room nine growth was above the high end of that range as we move through the quota February by Roku benefit from an extra day Ah monitoring I broke will be fit by Easter being in March we expect me to roughly offset each.

David Gordon: We expect coupon gross bookings wrote to be between five and seven per cent about one percentage point pass through my growth due to slightly higher combination constant currency <unk> and faster growth from flights, partially offset by about one percentage point of exit of ethics pressure.

David Gordon: We expect Q I'm revenue grocery be between 11, and 13% faster than Q1.

David Gordon: Bookings growth June parts of eastern ship, which we expect to benefit Q on revenue by about three percentage points, we expect <unk> impact on revenue growth. Thank you too.

David I. Goulden: We expect EBITDA margin to benefit from market expenses growing slower than revenue and growing similar to gross bookings, which we expect will more than offset our fixed OPEX growth, growing slightly faster below revenue. As we turn our thoughts to the full year ahead, I want to first address our longer-term ambitions for growth in our business. As we've discussed previously, in more normalized... market environments, we believe we'll be able to achieve these levels of growth given the investments we've made to build a stronger business and a better offering for our travelers and partners versus what we had five years ago. At recent FX rates, we expect changes in FX will negatively impact our reported growth rates by a little more than 1 percentage point.

David Gordon: We expect she wanted to just an EBITDA to be between $680 million and $720 million, which is a bitcoin will be 19% year on year growth on about a one percentage 0.0 about a one percentage point increase in EBITDA margin we.

David Gordon: We expect EBITDA margin to banking for monkey expensive growing slower than revenue and growing similar to gross bookies, which we expect will move all set or fixed opex growth.

David Gordon: Growing slightly faster than revenue.

David Gordon: Of course, the full your head I want to first address a longer term ambitious for growth in our business as we have discussed previously and a more normal life.

David I. Goulden: With that framework and with FX in mind, we expect to grow our full-year 2024 growth bookings slightly faster than 7%, including the assumption that the war in the Middle East will negatively impact our full-year 2024 growth rates by 1%. We expect, brand new for the year, to grow at a similar rate to our gross bookings growth. We expect our more fixed expenses in 2024 to grow in the low to mid-teens.

David Gordon: Login environment with Amy to achieve constant currency growth rates for gross bookings revenue in English at the higher than what we achieved in 2019. This would mean growing above 8% for each of the top line metrics.

David Gordon: 15%.

David Gordon: Sure.

David Gordon: We believe you'll be able to achieve these levels of growth given the vessels rebate to build a stronger business and a better offering travelers I'm partners, let's see what we have five years ago.

David I. Goulden: We're planning to leverage these more fixed expenses in 2025. We expect 2024 adjusted EBITDA will grow slightly faster than revenue, largely due to expectations for an increased direct mix. We expect that Justin's EBITDA margins will expand year-over-year by a bit less than a percentage point. Lastly, we expect ETS growth to be above 14%. In closing, we're pleased with our Q4 results, our Q1 outlook, and our expectation in 2024 for us to grow faster than in 2019 across growth bookings, revenue, adjusted EBITDA, and EPS with expanding EBITDA margins year over year. We expect 2024 to be another strong year for us. We'll now move to Q&A. Sarah, will you please open the line? Press 1 on your telephone keypad.

David Gordon: Recent F X rays, we expect changes in ethics will negatively impact reported growth rates by a little more than one percentage points.

David Gordon: Without a framework with ethics in mind, we expect to grow a full year 2024, gross bookings slightly faster than 7%, including the assumption that the war in the middle East negatively impacts awful yeah, 20th of April growth rates by 1% we.

David Gordon: We expect.

David Gordon: <unk>, a similar right to our growth problems growth we.

David Gordon: We expect almost all fixed expenses and 20 points for to grow in the low to mid teens, we applying for leverage from these more fixed expenses in 2025 weeks.

David Gordon: We expect 2024, adjusted EBITDA will grow slightly faster revenue logging juice expectations for an inquiry stomach next we expect adjusted EBITDA margin lifespan, <unk> by a bit less than a percentage point.

Operator: If you have queued up and want to withdraw your question, simply press star 1 again. We ask that you please limit yourself to one question. Your first question comes from the line of Justin Post with Bank of America Merrill Lynch. Your line is open. Great. Thanks for taking my questions. One for David, and I guess this might be your last call.

David Gordon: Lastly, we expect E b S stroke to be above 14 per cent.

David Gordon: In closing, we pleased with our queue for results are cute outlook expectation in 2024 trust grow faster.

David Gordon: Then 2019 across gross bookings revenue adjusted EBITDA and E. P. S with expanding EBITDA margins you over yet we expect 2024 <unk> strong you of course will now move to Q&A. Sarah will you. Please open the lines.

David I. Goulden: I'd love to hear about where you are on the CFO transition. But the guidance, is January going above the 4 to 6% for room nights? I thought January might have tougher comps.

David I. Goulden: So maybe talk a little bit about the shape of the quarter. And then maybe the bigger picture for Glenn. I just was wondering, you have so much data as the share leader in room nights. How do you think the AI transition could play out for booking? And do you think you have some advantages versus search engines or your peers?

Sarah: Thank you.

Sarah: Please press one on your telephone keypad.

Sarah: Q that they want to withdraw your question simply pressed Taiwan again, yeah. Thank.

Sarah: Thank you please let me yourself.

Sarah: Your first question.

Sarah: <unk>.

Sarah: <unk> <unk> <unk>.

Speaker Change: Great. Thanks for taking my questions, one for David and and I guess, maybe it might be your last call I'd love to hear about your.

Glenn D. Fogel: How are you thinking about that? Thank you. Yeah, Justin, thank you. Let me take the first one and hand it over to Glenn for the second one.

Speaker Change: She felt transition, but the guidance is January and going above the 4% to 6% for room nights at that January might have tougher comps. So maybe talk a little bit about the shape of a quota and then may be bigger picture for for Glenn.

David I. Goulden: So, yes, as I said in my remarks, just to reiterate, January did grow faster than the high end of the 4% to 6% range that we talked about. It did, however, slightly, maybe in the range of about 1% from the shift of Chinese New Year this year, which we expect will be offset in February. As I said, we would expect, therefore, February and March to have a lower growth rate than January, essentially consistent with our prior guidance of expecting desalvation during the quarter. Thanks, Dave, for that. Justin, AI is obviously an incredibly important subject for everybody in any business right now.

Speaker Change: Wondering you have so much data as the share leader in room nights, how do you think they I transition could could play out for booking and do you think you have some advantages versus search engines or your purse how're you were thinking about that thank you.

Speaker Change: Yeah, just let me take the first one was glad for a second.

Speaker Change: Second one so yes as I said in my remarks of three days right January is <unk>.

Glenn D. Fogel: And I think I talked about it on the last call, and certainly I've been talking about it a lot whenever I speak about how important this is for anybody who is looking to the future to create something that could be transformational. Now, we're very early, as I've said in the past, and I like pointing out the things that we've done so far and some of the early signs we see that this is going to be just fantastic for us. But nobody knows how long it'll take.

Speaker Change: Did grow faster than the <unk>.

Speaker Change: 4% to 6% arrange we talked about uhm it did back that we believe.

Speaker Change: Maybe in the range of about 1% from the shift to try new yeah.

Speaker Change: Which we expect will be all set in February.

Speaker Change:

Speaker Change: As I said, we would expect that for February March to have a little grocery and Jeffrey essentially consistent with all <unk> expecting deceleration during the quarter.

Speaker Change: Thanks to you for that just in a I, obviously incredibly important subject for everybody in any business right now and I think I talked about it the last call and it's only been talking about it a lot whenever I speak about how important this is for anybody who is looking to the future.

Glenn D. Fogel: One of the things I love is us being in a position, because of our financial position, because of the number of people we have, we have the capabilities to look into this, because of the data we have, as you point out, that people can then be able to use it to create models and use it in ways that are complementary to what other people, much bigger than us, are doing in terms of creating large language models, et cetera. I do believe we have an advantage, because of our size and scale and the capabilities of our people, to create something in all parts of the business, whether it be, as I discussed, things that help the traveler, we're talking about several products there, or helping us in the back part of our business, the back office, and making it more efficient, or throughout. I think we do have an advantage.

Speaker Change: Create something that could be transformational.

Speaker Change: Very early as I've said in the past like pointing out the things that we've done so far in some of the early signs we see that this is gonna be just fantastic.

Speaker Change: Nobody knows how long it'll take <unk>.

Speaker Change: One of the things I love is us being in a position because of our financial position because the number of people we had love capabilities to look into this because of the data. We have as you point out that people can then be able to use it to create models.

David I. Goulden: Of course, we'll see over time how well and how quickly we can actually translate that into better numbers in terms of margins, in terms of more people coming to us, people increasing their loyalty, et cetera. But I am very encouraged by what I'm seeing so far, and I certainly believe that we do have the pole position here in the travel industry. And just before we head back to the operator for the next question, I just want to reiterate two other things that I said about the Q1 room night guide. This is, of course, after the impact of about a point of hurt from the Middle East, and of course, we are comping against a very strong start to last year when we saw room nights and the booking window moving from a contracted position to an expanded position in the first quarter, which also created some strong So you have to factor those things into account as well. Great, thank you. And David, if this is your last call, we'll miss you. Thanks for all the work over the years. Thank you, Justin.

Speaker Change: <unk> complementary to other people.

Speaker Change: Are doing in terms of creating large language models et cetera, I do believe we have an advantage because of our size and scale indicate your bill is of our people to create something in all parts of the business whether D. As I discuss things and help the traveller.

Speaker Change: <unk>, we're helping us in the back part of on the back office is more efficient.

Speaker Change: <unk> I think we do have an advantage of course, we'll see you over time, how well and how quickly we can actually translate that into better numbers in terms of margins in terms of more people coming to us people, increasing loyalty et cetera, but I am very encouraged what I'm seeing so far and I certainly believe that we do have the pole position here.

Speaker Change: And the travel industry.

Speaker Change: Yeah, just just before we got back to the to the operator for next question I just want to re iterate two other things I said about check the queue I'm Rebecca got vicious girls after the impact of about one point you've heard from the the the middle East and of course, we all humping against the very strong start to last year when.

Operator: Your next question comes from the line of Kevin Kopelman with TD Cowan. Your line is open. Oh, thanks so much.

David I. Goulden: I wanted to ask about marketing. First, merchandising was only up slightly in the mix, or only up slightly as a percentage of GDP, I should say, in 2023. Do you feel that that's reached a steady state in the mix? Or do you see incremental pushes this year in merchandising? And then on advertising, are you seeing any changes to the bidding environment? Okay, yeah, so, Kevin, so we have now, I think, as you characterized it, we're kind of at scale with our merchandising activities. That's been something we've been ramping up over time at Booking.com, and I think we now kind of deploy it in places where we plan to deploy it.

Speaker Change: We saw rune <unk>.

Speaker Change: Both of them with a moving from a contracted position to an expanded punched in the first quarter, but also created some strong results in Q1 last year. She off the fact that those things into account as well.

Speaker Change: Great. Thank you and David and this is your last call will will Miss you. Thanks for all the work over the years.

Speaker Change: Justin.

Speaker Change: Your next question comes from the line, having koppelman with T V. Colin Your line is open.

Kevin Kopelman: Oh, thanks, so much wanted to ask about marketing.

Kevin Kopelman: First merchandising was only up slightly in the next are only up slightly as a percentage of G. B V. I should say 2023 do you feel that that's reach a steady state in the next or do you see incremental pushes this year and merchandising and then on advertising are you seeing any changes to the <unk>.

Glenn D. Fogel: So it has reached more of a safe stage in the store, with only a slight increase in merchandising in total from last year to this year as a percentage of CTV. So when we kind of look at our model going forward, we do expect that across, you know, marketing, and merchandising, with our continued increase in direct mix, that can be a source of leverage for us. And of course, as I mentioned in my commentary about the full year, that will be the biggest driver of our EBITDA margin expansion this year and will be joined by OPEX next year. And then, relative to the competitive environment, it remains competitive. I mean, these are very competitive markets. There are many players in them.

Kevin Kopelman: <unk> environment.

Speaker Change: Okay, Yeah. So okay.

Speaker Change: So we have now I think.

Speaker Change: You characterize what can scare with almost diving activities Zachary something to read me wrapping up all the time of booking Dot Com I think we now have deployed and places where we plan to deploy so you have reached uhm.

Speaker Change: I'll also stay safe and you saw only a slight increase in boats dodging and total from last year to this year as a message of all C. T V. So when we kind of look at all muddled going forward, we do expect that across mark the merchandising with all confused increasing diet makes that can be a source leveraged <unk>.

David I. Goulden: I think people realize it's not just the OTAs. There are meta players, there are hotel players, there are chains, you name it. A lot of people are bidding in these marketplaces, so it just remains competitive, but we're pleased with how we're doing in a competitive market. And Kevin, just a reference back to Justin's question about AI and data and merchandising, how we do it, et cetera. One of the great things I really see about our position is using data, using all the things we know to merchandise smartly, to do it where we think it's going to give us an advantage, not do it where we're just giving away money. And I really see that as all this AI technology develops further, as we begin to optimize over time with all the different parts of the Connected Trip, we're going to be able to provide value to both the travelers and be able to get our suppliers to help provide merchandising opportunities for us doing it in an intelligent way so it's a win for the traveler, a win for the partner, and us, as the people who are Thanks, Glenn. Your next question comes from the line of Mark Mahaney with Evercore ISI. Your line is open. Okay, thanks. Two questions, please.

Speaker Change: As I mentioned in my country about the the full yeah that will be the biggest driver of all EBITDA margin expansion. This year and we'll be joined by Opex next yet and then relative to the component environment. It stays competitive I mean, these are very comfortable bed markets. Many players.

Speaker Change: And there I think people realize it's not just the <unk>. The amount of players are hotel plays or change. Your your name is a lot of people are bidding. These box places. So I think he just remain competitive but you'll be pleased to how we're doing in a competitive marketplace.

Speaker Change: And Kevin Great. Thank you.

Speaker Change: Okay, I'm, just a reference back to Justin's question about AI and data and merchandising how we do it Sandra one of the great things I really see about art.

Speaker Change: Physician is that using data using all things you know the merchandise smartly.

Kevin Kopelman: Where we think it's kind of give us an advantage to not do or just giving away money and I really see as old as AI technology develops further as we begin to optimize overtime all the different parts of the connected trip.

Speaker Change: Going to be able to provide value to both the travelers and be able to get our suppliers to help.

David I. Goulden: In terms of your guidance for the full year on the margin side, what are you embedding in there in terms of marketing or sales and marketing spend and merchandising spend as a percentage of bookings? Are you assuming a little bit of leverage in there? And I'm sorry if you covered that in your published comments, but if you could answer that, and then secondly, on the buybacks in Q3, I think they were a little bit lower in Q4, I think they were a little bit lower than in Q3. Was that your intention?

Speaker Change: Right merchandising opportunities to hate intelligent way, so it's <unk> the traveller when for the partner and it's the people who are doing all this we will also win.

Speaker Change: Great. Thanks.

Speaker Change: Your next question comes from the line Mark Mahaney with Evercore ISI. Your line is open.

Mark Mahaney: Okay. Thanks, two questions. Please in terms of your guidance for the full year on March inside what are you in bedding in there in terms of marketing or sales and marketing spin and merchandising spend that's a percentage of bookings are you assuming it a little bit of leverage in there and I'm, sorry, if you're covered that.

David I. Goulden: Was there a particular reason why you may have been a little less active in the market in Q4? Thank you very much. All right. Thank you, Mark. We'll take those.

David I. Goulden: So, as I said in the prepared remarks, the biggest driver of leverage we expect this year on the EBITDA margin is going to be from our direct mix increase, which means that we'll have a smaller percentage of the business which is paid, a higher percentage of the mix, and therefore, we'd expect to get some leverage on marketing and merchandising. We expect to continue to be aggressive and still lead in the markets where we are spending money on paid marketing. We don't necessarily—we're not saying anything about our ROI, so we don't want to do that to tip any hand, but we'd expect that it would be the direct mix increase that would be the driver of leverage in marketing and merchandising, and therefore would be the driver of improvement in EBITDA margins. On the buybacks in Q4, I think they're roughly similar in size to Q3.

Speaker Change: In your book published comments, but if you could answer that and then secondly on the buy backs in Q3, I think they were a little I'm in queue for them I think they were a little bit lower than in Q3 was that your intention was there. A particular reason why you may be a little bit may have been a little less active in the marketing Q4. Thank you very much.

Speaker Change: Alright, Thank you Mark and take those so as I said it'd be prepared remarks, the biggest drive at all leverage we.

Speaker Change: This year <unk>, it's gonna be from a dark makes increase which means we will have a small percentage of the business, which is <unk> <unk>.

Speaker Change: Hi.

Speaker Change: And therefore, we would expect to to get some leverage our mockingbird.

Speaker Change: Would expect to continue to be aggressive and saline into the markets, where we are spending money on paid.

David I. Goulden: At the start of Q4, when the share price was lower, we said if the share price stayed at a lower level, we would buy more in Q4 than we did in Q3. However, the share price moved up during the quarter, and we take the share price into account when thinking about the level of buybacks. Of course, we've taken a long-term view, but in the short term, we do moderate based on how the share price moves, so that's perhaps why we wound up being a little bit less than you may have expected, a little bit less than we perhaps indicated on the last earnings call, but still a big number and still over $10 billion for the year, and, as you see, a significant reduction in our share count over the last Makes a lot of sense. Thank you very much.

Speaker Change: <unk>, we don't necessarily <unk> would also be anything about our our eyes. So we don't do that to tip any hand, but we'd expect that it would be to start mix increase it would be the driver of leverage and mark the merchandising definitely would be the driver of improvement.

Speaker Change: <unk> on buybacks in queue for I think they're roughly seven size 223 at the start of two four share prices Lola We said if the share price stays at a lower level, we would find more in queue for did in Q3 share prices move up through the quota.

Speaker Change: We taped share price into account when thinking about the level of five accident grocery taking a long term here, but in the short term, we do moderate based upon how how share prices move. So that's why I wanted to be a little bit less than you might expect it to be perhaps indicated on the less any school, but still a big numbers still over 10 blindfold, yeah that did you say.

David I. Goulden: Your next question comes from the line of Doug Anmuth with J.P. Morgan. Your line is open. Thanks for taking the question. I just want to follow up on the full-year outlook. It sounds like you're very confident in the business overall. Does the full-year outlook reflect just normalization of trends in 24, the tough comp, and the Middle East impact that you mentioned? Is there anything else to consider here?

Speaker Change: Significant reduction in I'll check out, but once you get it.

Speaker Change: Thank you David makes a lotta sense. Thank you very much.

Speaker Change: Okay. Next question comes down the line and that's with J P. Morgan Your Highness iPhone.

David I. Goulden: Thanks. Yeah, I think there are a couple of things to bear in mind in the four-year outlook. Keep in mind, we talked about our framework. So we said that we would grow faster than 8.815 on a constant currency basis.

Speaker Change: Thanks for taking the question I just wanted to follow up on the full your outlook it sounds like you're very confident.

Speaker Change: Business overall, just does the full your outlook reflects nor.

David I. Goulden: And we're saying we're going to do that even with the impact of the Middle East on slowing our business down. So I think that is a positive outlook. Of course, we've adjusted the numbers to a reported number. So when you include the FX shift, our current rates are roughly 1%. Then the 8.815 becomes a 7.714. But again, it's essentially 8.815 on a constant currency basis.

Speaker Change: Normalization of trends in 24, the tough caught up in the Middle East impacting you mentioned was there anything else to consider here. Thanks.

Speaker Change: Yeah, I think there's a couple of things to bear in mind for your outlook bear in mind, we talked about our framework. So we said that we will grow faster than 815 on a constant currency basis, and we're saying that you're gonna do that even with the impact all the middle East on sewing all business down. So I think that is a positive outlook of closely congested the numbers to.

David I. Goulden: And we expect to do higher than that even with, you know, roughly a point of hurt to the business on the top line and the bottom line from what's happening in the Middle East. So it's consistent with our framework and I believe it is confident of our position in the travel market and our continued ability to gain share in travel. Thank you, David. Your next question comes from the line of Brian Nowak with Morgan Stanley. Your line is open. Thanks for taking my questions, guys. I have two sort of in the U.S.

Speaker Change: Reported number so when you include the F X shift.

Speaker Change: Current rates of roughly 1% than the eight 850 becomes at seven 714, but again, it's essentially eight 815 on a constant currency basis, and we expect that you have not even with roughly appointed to the business on the top of the line on the ball line from what's happening in the belief so it's consistent with our framework.

Speaker Change: I believe is confident of our position of the travel market and I'll come see you <unk> in trouble.

David I. Goulden: The first one, when you talk about the U.S. being flat, does that include alternative accommodations? So is the hotel business in the U.S. actually declining, then? That's the first one. And then just sort of, Glenn, as you look into 2024, what are the investments you have to make in the U.S. both on the hotel side as well as the alternative accommodation side to sort of drive more and more durable, consistent growth from here? Yeah, I'll start with the first one, and then go back to Glenn's second one. So, the U.S. was flat for the quarter, but bear in mind it was down in October.

Speaker Change: Thank you David.

Speaker Change: Your next question comes from the line, Brian <unk> complaint Morgan Stanley. Your line is open.

Brian: [laughter]. Thanks for thanks for taking questions guys I have I have to serve on the the U S. The first one when you're talking about the U S being a flat does that include alternate accommodation. So is the is the hotel business in the U S. Actually declining then that's the the first one and then just sort of Glen and as you look into 2024.

Brian: What are the investments you have to make in the U S. Both on the hotel side as well as the alternative accommodation side to sort of drive more and more durable consistent growth from here [noise].

David I. Goulden: And in October, it was driven very much by the kind of ripple or shock effect of what was happening in the Middle East. So, therefore, it was back into growth mode in November and December in order to come out flat for the quarter. So, I wouldn't read too much into the whole quarter. You have got to kind of look at what happened in October.

Speaker Change: Yeah, I'll start with the first one and the second.

Speaker Change: <unk> U S was <unk> <unk> and it was down in in in October on October It was driven very much by the the Guy Rick will shock effects of of the what was happening in the middle East. So therefore, it was back to back back <unk> and.

David I. Goulden: Yes, that does include alternatives. As Glenn said, alternatives grew very nicely in the U.S., but it's a much more mixed business in the U.S. than it is in other parts of the world. So, again, I wouldn't go too much into kind of assuming that hotels are negative. Yeah, and regarding the question regarding how we are going to do even better in the U.S., you know, we've talked about the numbers that we've shown so far, and I'm very pleased to look back to 2019, see what our share was then, what our numbers were then, and look at them now, which shows really fantastic growth and great work by I think last quarter I gave a shout out to the team then, and I'll do it again because they're doing fantastic work.

Speaker Change: November December yours.

Speaker Change: For the for the quarter, so I won't worry too much into a whole <unk> in October yes that does does include all set that has been set alternative grew very nicely in the U S. But it's amongst a mix of all businesses you asked minutes as in other parts of the world. So again I wouldn't go too much into.

Speaker Change: Assuming that means that hotel Tonight.

Speaker Change: Yep and and regarding the question regarding how are we going to do even better in the U S. You know we've talked about the numbers that we've shown so far I'm very pleased he looked back to 2019 see when our sphere was I want a number is really bad and look at them now.

Speaker Change: Fantastic grown some great work by the team I think last corner I shall give a shout out to the Gmail I'll do it again, because I'm doing fantastic work one of the things is because the underindexed because we are smaller in terms of.

Glenn D. Fogel: One of the things is because we're under-indexed, because we are smaller in terms of our share of the U.S. versus other parts of the world, this is a great opportunity for us, and I've talked about it before. We have to continue to improve our product, particularly in alternative accommodation, and we've been doing that, and that's why we have this large growth rate in U.S. alternative accommodations. Very pleased to see that They don't want us to be providing demand that they think they can always get, and one of the great things about our team is working closely with our hotel partners.

Speaker Change: Care of the U S versus other parts of the World. This is a great opportunity for us and I've talked about you have to continue to improve our product, particularly any alternative a combination that comes with that we've been doing that and that's why we have this large rosemary in the U S will turn the combinations very pleased to see that happening can continue to provide to our hotel partners, what they need and.

Speaker Change: What they want is incremental demand.

Speaker Change: Wanted us to be provided to me and I think I can always get.

Speaker Change: One of the great things about our team is working closely with our hotel partners. You know a lot of the U S is March change and we would melt I think a very good relationship with them to work together to help them do what they need to do to keep their results and us being a provider of those service to them getting what we need which is more bookings I'm pleased with.

Glenn D. Fogel: As you know, a lot of the U.S. is large chains, and we have developed, I think, a very good relationship with them to work together to help them do what they need to do to achieve their results, and us being a provider of those services and getting what we need, which is more bookings. I'm pleased with the results we've achieved so far, and I think we've got a great opportunity to continue to do so for a long time. Thank you both. Your next question comes from the line of James Lee with Mizuho. Your line is open.

Speaker Change: The results we've done so far and I think we got <unk>.

Speaker Change: Great opportunity to continue to do so for a long time.

Speaker Change: [noise]. Thank you both.

Speaker Change: Your next question comes from the line of James Lee with Me <unk>. Your line is open.

David I. Goulden: Great. Thanks for taking my questions. There are two here.

James Lee: Great. Thanks for taking my questions to hear I think Glenn you talk about maybe increasing supply.

Glenn D. Fogel: I think, Glenn, you talk about maybe increasing the supply of home accommodation and alternative accommodation in the U.S. Can you elaborate, maybe talk about that plan a little bit? Help us understand your strategy there. And also, secondly, I think you guys talk about maybe expanding the loyalty program to include all verticals in 2024. It would be great to provide some details there as well.

James Lee: At home accommodation alternative.

James Lee: Turn a tip accommodation in the U S.

James Lee: You elaborate maybe talk about that plan a little bit help us understand your strategy. There and also secondly, I think you guys talk about maybe on the loyalty program to include all go to Kohl's and 2024 would be great to provide some details to you as well thanks.

Glenn D. Fogel: Thanks. Thanks, James, and I didn't quite understand the second one. Let's start with the first one. Maybe you haven't heard the second one.

Speaker Change: Mmm, Thanks, James and I I didn't quite get the second one we start with the first one medium for the second one so it's interesting because in our last call I went into a little bit about what do we need to do to increase that supply of alternative combinations and I talked to move <unk>. It wasn't the first time I've talked about this where are we.

Glenn D. Fogel: So, it's interesting because on our last call, I went into a little bit about what we need to do to increase that supply of alternative accommodations. I talked a little bit, and this isn't, by the way, the first time I've talked about this, where we have, while we are fairly evenly achieved in urban and rural areas and such, I have talked in the past, though, about how we don't have as many of the single But the whole idea is that we want to do things efficiently. We want to do things effectively, which means you go for the things where you can get larger groups of properties listed quicker by going to the big property managers who have lots of them.

Speaker Change: Do you have well we.

Speaker Change: <unk> urban and rural and such I have to talk to the task, though how we don't have as many of the properties that perhaps some of our competitors had mercenary down the road, but the whole idea is we wanted to do things efficiently willing to things effectively which means it goes to the things we didn't get larger groups of properties lifting quicker by going to the big.

Speaker Change: Property managers, who have lots of them.

Glenn D. Fogel: That may be that you're going to end up with more things that are not single-home properties. But then, after we've done that enough, and that's the low-hanging fruit after we've got that accommodation, then we've got to go out and start getting more of the single homes, etc. And I expressed my own disappointment that sometimes when I look for a single property, sometimes I've mentioned on the call about wanting to get something out in the Hamptons and New York for the summer and not seeing enough properties for us.

Speaker Change: That may be that you're gonna end up with more things that are not single <unk> single home properties, but then after we've done that enough and that's the low hanging fruit kind of assume we gotta go out and started getting more of the single homes you. Sir can I Express uhm, Yeah, Oh, my own disappointment that while I look for a single property, sometimes I've mentioned at one point on the call about wanting to get something to help me.

Speaker Change: <unk> in New York for the summer and not seeing enough properties for us.

Glenn D. Fogel: There are lots of opportunities, but I look at this as an opportunity, not as a negative, but thinking, look how well we're doing, even though there's all that other stuff to go out and get. That's the way I feel about it, and I'm pleased about it. I'm pleased with the way the team's going out.

Speaker Change: <unk> look at this opportunity not as a negative thing you'll look how well we're doing even though there's all that other stuff to go out and get that's the way I feel about it and I'm pleased with that I'm pleased the way the team's gonna 12 per cent increase in our listings or 6697, 0.4, alright and like the <unk>.

Glenn D. Fogel: Look, 12% increase in our listings, you know, 6.6 million; now we're over 7.4. I like the fact that we're increasing those numbers, doing it in a nice size, and I also really like the fact that our growth rate of alternative accommodations was significantly higher than some other people in our space. So I was very happy to see that. David, I didn't catch the second part of your, Yeah, of course. The second part of the question is about your loyalty program, Genius. I think Glenn, you had mentioned you wanted to include, you know, all travel verticals into the program this year, and I was wondering if you could provide some details on that. Sure. Okay. So what I said is we're going to experiment, as we always do. We always want to experiment.

Speaker Change: After we increasing those numbers doing a nice sized and also particularly really liked the fact that our growth rate of return on.

Speaker Change: Combinations.

Speaker Change: And if they can't my higher than just the amount of people in our space. So I was very happy to see that.

Speaker Change: Hey, David I didn't catch the second part of this question.

Speaker Change: Yeah.

David: Yeah of course, the acquaintances the second part of the questions about your loyalty program genius I think going yet mention you want to include.

David: Traveled verticals into the program. This year I was wondering can provide some details on that.

David: Sure. Okay. So when I say, we're going to experiment and we always do we always want to experiment, where and if things work, where do we see returned where do we see has this isn't working so well. So what we're gonna do is continuing experiment and we do have for example rental cars well established into our genius program. Obviously are combinations willing to put an experiment with all the different.

Glenn D. Fogel: Where do things work? Where do we see a return for it? Where do we see how this isn't working so well?

Glenn D. Fogel: So what we're going to do is continue to experiment. And we do have, for example, rental cars well-established in our Genius program. Obviously, our combination is well-integrated. We're going to experiment with all of the different verticals and think, is there a way to do it in flights?

David: Nichols anything is there a way to do in flight is there a way to do it and attractions how do we do it in terms of potential new insurance and all sorts of ways Y T. L. R O Y business when people need a wide from the airport to the only child.

Glenn D. Fogel: Is there a way to do it in attractions? How do we do it in terms of potentially even insurance? And all sorts of ways.

Glenn D. Fogel: So there's a ride business when people need a ride from the airport to the hotel, or hotel to the airport, or from their home to the airport. The idea is, again, and this goes back to the first question that Justin asked about AI and about how you use data. And that's kind of one of the key things, is when you have these models, and you can figure out what the best way to provide a benefit is, and that's through our loyalty Genius program. That's doing that in a way that it provides value to the traveler. That's why they choose us. That's why they come back to us. That's why they come to us directly. Maybe they use the app because it's so simple to do it.

David: And the airport or from your home to the airport.

David: He is again and this goes back to the first question I think it was just gonna ask about AI and about how you use data.

David: That's kind of one of the key things is when you have these models and you can figure out what the best way to provide a better Clinton that's to our loyalty genius program, that's doing that in a way that it provides value to the travel that appointment to spot when they come back to us that's why they come to us direct maybe they use the app.

Glenn D. Fogel: At the same time, Genius is primarily being funded by our partners right now because they see value in that. They see value in providing a discount or some other type of benefit that we put into the offering so that the traveler will book that supplier what they want to sell, and doing it together in a scientific way, and doing it in a way that is going to make sure that we're not leaving any value out of the site. We're going to cycle it in a way that's not going to be beneficial to our supplier partners, and we're going to do it smartly.

David: We'll do it at the same time genius is primarily almost right now primarily being funded by our partners cause they see value in S. D. C died and providing a discount or some other type of benefit that we put into the into the offering the traveler will book that supplier.

David: <unk>, what they wanted to sell and do you need to get it in a scientific way and doing it in a way.

David: <unk> that is gonna make sure that we're not leaving by you out.

David: In a way that's not gonna be beneficial to our supplier partners doing it smartly once a thing that I love and that's what I was gonna continue to experiment on that and I think it's worked so well in hotels and I think it's kind of any combination <unk> I think this is gonna work great.

Glenn D. Fogel: That's the thing that I love, and that's why we're going to continue to experiment with that. And I think it's worked so well in hotels, and I think it will work in accommodations, alternative accommodations. I think this is going to work great in all of it, but we'll see after we experiment.

David: But we'll see after we experiment.

Glenn D. Fogel: Great, thank you. Your next question comes from the line of Eric Sheridan with Goldman Sachs. Your line is open. Thanks so much. Maybe following up on that last question from James, you talked earlier about Connected Trip and feeling optimistic about attach rates there, but there is still work to do. When you think about what you're trying to accomplish with Connected Trip longer term, and you think about rising conversion, and reducing friction, what do you put it down to? Is it consumer education? Is it supply?

Speaker Change: Okay, great. Thank you.

Speaker Change: Your next question comes from the line of Eric Sheridan with Goldman Sachs. Your line is open.

Eric Sheridan: Thanks, So much maybe following up on that last question <unk> from James you talked earlier about connected trip good feeling optimistic about attach rates there, but still work to do when do you think about what you're trying to accomplish disconnected trip longer term and do you think about Verizon conversion reduce friction what do you put it down to as a consumer.

Eric Sheridan: Education is it supply how should we do you think about the building blocks behind connected trip to accomplish your longer term goals. Thank you.

Glenn D. Fogel: How should we think about the building blocks behind Connected Trip to accomplish your longer-term goals? Thank you. So the question is really, how do we get from here, the early, early stage showing good signs, but it's still small to scale and really showing the bottom line and top line and loyalty and all those things. I think that's really the question. It is quite tense. Yeah, so look, one of the things that we have to do, and I've said this is a long-term path. And the first thing was, we had to build the verticals to begin with. You know, one of the fun things was to mention that we started Booking.com really right off the ground in 2019. And now when you put all the flight numbers together, you see a 400% increase there. That's including, of course, Priceline had flights before that, where you just see the growth rate of flights right now.

Eric Sheridan: So is the question is how do we get from here early early stage showing good signs, but it's still small to scale and really showing the bottom line and top line and loyalty and all those things I think that is that the question really.

Speaker Change: It is go ahead. Thanks, yeah.

Speaker Change: Yeah. So look one of the things that we have to.

Speaker Change: I just have this is a long term path and the first thing was we have a bill the verticals to begin with one of the fun things supposed to mention that we started booking dot com right.

Speaker Change: <unk> off the ground in 2019 and that all put in all the flight number to get any C 400 per cent increase their that's including of course.

Glenn D. Fogel: Place before that can you just see the growth rate of flights right now great. So we got that political up and we got <unk> and attractions still early but but these things all these things on the car rental was up but yeah, we still do more of that and of course, the wives business and others.

Glenn D. Fogel: Great. So we got that vertical up, and we got insurance up, and the track is still early, but up. But these things, all of these things, the car rental business is up, but yeah, we still do more on that. And, of course, the ride-sharing business and others. All of these things are at different levels of development but still relatively new. And along with that, we have to build all the modeling and all the ways to figure out what's the best way to offer one versus the other and make sure that we're doing it the right way.

Glenn D. Fogel: These things.

Speaker Change: Different levels of development, let's do email.

Glenn D. Fogel: And what would that then we have to build all the model and all the ways to figure out what's the best way to offer one versus the other and make sure that we're doing it the right way and then is working with our partners suppliers to provide us improve out to them. This is worthwhile to death.

Glenn D. Fogel: And then it's working with our partner suppliers to provide us with and prove to them that this is worthwhile for them. All of these things take time. But I do like, as I say, we are seeing those signals. We are seeing the numbers. It is early.

Speaker Change: These things take time, but I do like him to say we are seeing those signals are seen the numbers. It is early.

Glenn D. Fogel: And I'm not going to do that. I'm sure you'd like me to give you some numbers and say, here's where it's going to be tomorrow. Here's the next milestone. I'm not going to do that.

Speaker Change: I'm not gonna do I'm sure you'd like me to give you some numbers and here's where it's gonna be tomorrow, here's what <unk> thinks milestones have been to do that I can say I see we are on the right path.

Glenn D. Fogel: And I can say, I see we are on the right. Great, thank you. And thank you for everything, David. Congratulations on the last call and good luck with everything. Thank you, Eric. That is all the time we have for questions.

Speaker Change: Great. Thank you and thank you for everything David Congrats on on the last call and good luck with everything.

Speaker Change: Thank you.

Speaker Change: That is all the time, we have for questions I will tend to contact Glenn for closing remark.

Glenn D. Fogel: I will turn the call over to Glenn for his closing remarks. Thank you. So I want to thank our partners, our customers, our dedicated employees, our shareholders, and, as mentioned by a couple of people on the call, I have to give out a very special thank you to my very good friend and colleague, David Goulden. As you know, after 24 earnings calls as Booking Holdings CFO, David is retiring from this role and will be working on other areas in the business going forward. We greatly appreciate everything that David has done for this company, and we greatly appreciate everyone else's support as well as we continue to build on the long-term vision of our company. Thank you very much, and good night. This concludes today's call. We thank you for joining us. You may now disconnect your line. Please report as well as we continue to build on the long-term vision of our company.

Speaker Change: Thank you so I want to thank our partners our customers are dedicated employees are shareholders.

Glenn D. Fogel: And as mentioned by a couple of people on the call I have to give out a very special. Thank you to my very good friend and colleague David Go add you know after 24 earnings call. This book your holdings here about.

Glenn D. Fogel: It is retiring from neutral and Louie working on other areas new business going forward. We greatly appreciate everything that David has done for this company and we.

Glenn D. Fogel: Greatly appreciate everyone else is important as well as we continue the bill on the long term vision of our company. Thank you very much and Goodnight.

Speaker Change: This concludes today's call. We thank you for joining you may not disconnect your lines.

Glenn D. Fogel: As well as we continue to build on the long term vision of our company.