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    EXPE
    Earnings call· Dec 2025(Q4 FY25)

    Expedia Group Q4 FY25 earnings call EXPE

    Feb 12, 2026 Source

    Executive summary

    Expedia Group Q4 FY25 — Accelerated Bookings & Revenue Growth, Expanded Margins

    Expedia Group delivered strong Q4 FY25 results, accelerating bookings and revenue growth while significantly expanding margins, driven by B2B and advertising strength and improved B2C marketing efficiency. The company is focused on leveraging AI for product innovation and operational efficiencies, positioning for continued profitable growth despite ongoing macro uncertainties.

    Highlights

    5

    • Bookings and revenue grew 11%, exceeding expectations.

    • Adjusted EBITDA margin expanded by nearly 4 points to 24%.

    • B2B gross bookings grew 24% and advertising revenue grew 19%.

    • Loyalty members grew mid-single digits, with faster growth in Silver tiers and above.

    • All 3 core brands (Vrbo, Hotels.com, Brand Expedia) delivered year-over-year bookings growth.

    Concerns

    3

    • Growth in rest of world slowed due to geopolitical issues in Asia.

    • B2B EBITDA margins were down approximately 1 point due to investments for future growth.

    • Ongoing macro uncertainty necessitates a cautious view for full-year 2026 guidance.

    Guidance & targets

    7
    CategoryTargetConfidence
    Gross bookings growth
    10% to 12%
    high materiality
    High
    Revenue growth
    11% to 13%
    high materiality
    High
    EBITDA margin expansion
    up 3 to 4 points
    high materiality
    High
    Gross bookings growth
    6% and 8%
    high materiality
    Medium
    Revenue growth
    6% to 9%
    high materiality
    Medium
    EBITDA margin expansion
    100 to 125 basis points
    high materiality
    Medium
    Capital expenditure
    roughly in line with '25
    medium materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    B2C
    Bookings growth exceeded revenue growth primarily due to book-to-stay timing. Margins up approximately 6 points from last year, driven by significant marketing leverage, disciplined overhead management, and growth in high-margin advertising revenues.
    Gross bookings: $18.3 billionGross bookings growth: 5%Direct sales and marketing expense growth: -5%Direct sales and marketing expense as % of B2C gross bookings: leveraged 0.5 point
    		$2.2 billion4%—31.5%
    B2B
    Continued double-digit growth across all regions, with Rapid API as the largest contributor. Margins down due to prioritization of investments to support future growth.
    Gross bookings: $8.7 billionGross bookings growth: 24%EBITDA margin change: down approximately 1 point
    		$1.3 billion24%—24%

    Operational metrics

    16
    Booked room nights growth
    9%YoY
    Q4 FY25

    Driven by continued strength in the U.S. and sequential acceleration in EMEA. Growth in rest of world slowed as geopolitical issues in Asia weighed on growth.

    Loyalty members growth
    mid-single digitsYoY
    Q4 FY25
    Lodging property count growth
    more than 10%YoY
    Q4 FY25

    Compared to 2024.

    Partner-funded promotions as % of bookings
    over 30%up more than 10 points from Q3
    Q4 FY25
    Black Friday participating properties
    Nearly 70% morethan ever before
    Q4 FY25
    Site and app speed improvement
    30% fasterthan a year ago
    Q4 FY25
    Property onboarding speed improvement
    70% fasterthan it was before
    Q4 FY25
    Adjusted EBITDA
    $848 million
    Q4 FY25

    Driven by revenue growth, expense leverage and cost out, particularly within B2C direct sales and marketing.

    Adjusted EPS
    $3.78grew 58%
    Q4 FY25

    Outpacing EBITDA growth due to share repurchases and a lower tax rate.

    Unrestricted cash and short-term investments
    $5.7 billion
    Q4 FY25
    Share repurchases
    $255 million
    Q4 FY25
    Cumulative share count reduction
    22%
    since 2022

    Net of dilution.

    Quarterly dividend increase
    20%YoY
    Q1 FY26
    Cost of revenue growth
    3%YoY
    Q4 FY25

    Driven by continued efficiencies in payments and customer service.

    Total direct sales and marketing expenses growth
    10%YoY
    Q4 FY25

    Offset by growth in B2B expense, which reflects partner commissions.

    Overhead expenses growth
    roughly flatversus last year
    Q4 FY25

    Last year's cost reductions had a meaningful impact on margin in the back half of the year and are expected to favorably impact H1 2026.

    Industry KPIs

    2
    MetricValueDetails
    Gross bookings value room nights$27 billionUSD
    Loyalty program members tier mixmid-single digits%

    Product announcements

    4
    ProductTypeDetails
    Video ads on Expedia's homepagelaunch
    Cancel for Any Reason assurance productlaunch
    VrboCareexpansion
    The one place you go to go places (Brand Expedia campaign)launch

    Deals & partnerships

    3
    Tiqetsacquisition

    Announced intent to acquire Tiqets in December to expand activities offerings, primarily for the B2B segment, but also expected to impact B2C.

    Southwestpartnership

    Added as an airline partner last year, expanding supply.

    Ryanairpartnership

    Added as an airline partner last year, expanding supply.

    Risks & headwinds

    2
    Geopolitical issues in Asiamultiple quarters

    Growth in rest of world slowed

    Ongoing macro uncertaintyQ1 FY26 and Full-year FY26

    lower end of the range reflects a more cautious view for FY26 gross bookings and revenue guidance

    Mitigation: appropriately cautious guidance; maintaining cost discipline while selectively reinvesting in growth initiatives

    Q&A highlights

    7

    How is Expedia capturing more people up the funnel and keeping them there, beyond just being a booking site? And how much more marketing leverage is there in B2C?

    Ariane emphasized starting with personalized marketing to resonate with travelers, then using AI for relevant product context, ideas, and natural language flows for trip planning. Scott noted 50 bps marketing leverage in B2C through discipline, improved targeting, and reallocation, expecting more of the same.

    “It starts with marketing. And we're doing a lot of work to make sure we know travelers, we're targeting them. We're personalizing our marketing to them.”

    asked by Mark Stephen Mahaney · answered by Ariane Gorin

    2 min read6 chapters

    Detailed Narrative

    01

    Strategic Priorities & AI Integration

    Expedia Group is focused on three strategic priorities: delivering value to travelers, investing in growth opportunities, and driving operating efficiencies. AI is a key enabler across all priorities, from personalizing traveler experiences and improving site speed to enhancing ad targeting and streamlining internal operations like inventory onboarding and customer service. The company is aggressively experimenting with AI, including working with major platforms and developing AI experiences in its own products, while optimizing cloud spend.

    02

    B2B and Advertising Momentum

    The B2B segment continued its strong performance with double-digit growth across all regions, driven by Rapid API, increased marketing activities with partners, and new partner additions. The advertising business reaccelerated revenue growth, ending the year with a record number of active partners and expanding new ad formats, including video ads. Investments in these areas are expected to continue driving future growth.

    03

    Consumer Brand Re-alignment and Performance

    After significant work over the past 12-18 months, all three core consumer brands (Expedia, Hotels.com, Vrbo) delivered year-over-year bookings growth. Brand Expedia is positioned as a one-stop shop, Hotels.com as a hotel pure play with a strong loyalty program, and Vrbo as a trusted vacation rental marketplace. Product improvements, such as faster sites, upgraded checkout, and expanded VrboCare, have contributed to this momentum.

    04

    Operational Discipline and Cost Management

    The company achieved significant margin expansion through continued operational discipline, volume leverage, and cost optimization. This included marketing leverage in consumer brands through improved targeting and measurement, reduced inefficient spend, and reallocation of dollars. Organizational structure optimization and internal AI deployment also contributed to efficiencies, with a focus on cost control, including cloud spend.

    05

    Supply Expansion and Partner Engagement

    Expedia continues to broaden its inventory, growing lodging property count by over 10% year-over-year in Q4. Partner-funded promotions accounted for over 30% of bookings, up more than 10 points from Q3, demonstrating strong partner participation. The company also added new airline partners like Southwest and Ryanair, enhancing its value proposition to both travelers and suppliers.

    06

    Capital Allocation and Shareholder Returns

    Expedia ended the quarter with $5.7 billion in unrestricted cash and short-term investments, committed to maintaining an investment-grade rating. The company repurchased 1.1 million shares for $255 million in Q4, reducing share count by 22% since 2022. The quarterly dividend was raised by 20% to $0.48 per share, reflecting a continued commitment to returning capital to shareholders.

    AI-generated summary of the company’s earnings call. Not investment advice.