Expedia Sees Drop in Q4 Earnings; Misses Estimates (EXPE)

Expedia Sees Drop in Q4 Earnings; Misses Estimates (EXPE)


Travel services company, Expedia Inc(EXPE) reported a drop in Q4 profits due to legal fees, missing analysts estimates on Wednesday.

The Bellevue, WA based company reported fourth quarter net income of $6.7 million, or 5 cents per share, down -90% from 70.3 million, or 51 cents per share last year. Excluding special items, net income was $88.9 million, or 63 cents per share, missing analysts estimate of 65 cents per share

Revenue for the quarter was $974.9 million, up 24% from $787.13 million last year. Analysts expected to see $930.7 million. The company saw an upside in both international and domestic sales, with international revenue growing by 35% and domestic sales increasing by 15%.

Although sales were up during the quarter, the company’s earnings suffered due to legal fees related to a Hawaii tax court litigation.

On the upside, Expedia saw a 19% increase in gross bookings, which included a 33% growth in the number of hotel rooms booked, and a 12% increase in the sale of airline tickets. Although the average room rate fell by -3%, airfare prices increased by 2%

The company saw an increase in expenses during the quarter, with marketing costs rising 25% and technology expenses increasing 31%. Administrative costs also grew by 12% during the quarter.

Expedia shares were up $1.21, or 1.79% during premarket trading Wednesday. The stock has increased 97% in the last year.

The Bottom Line
Shares of Expedia Inc(EXPE) have a 0.77% yield, based on Tuesday’s closing price of $67.50.

Expedia Inc(EXPE) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.

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