TLDR

  • Expedia announced fourth-quarter revenue of $3.55 billion, an 11% increase from the previous year, surpassing analyst projections of $3.42 billion. Adjusted earnings per share reached $3.78, exceeding the expected $3.35.
  • The B2B segment fueled expansion, with gross bookings soaring 24% to $8.7 billion. This division now comprises 38% of overall revenue, compared to 33% in the prior year.
  • Following declines throughout 2024, Hotels.com and Vrbo resumed growth in the fourth quarter. Booked room nights grew by 9%.
  • During the fourth quarter, Expedia bought back $255 million worth of stock and increased its quarterly dividend by 20% to $0.48 per share.
  • The company’s 2026 full-year forecast projects gross bookings to increase 6-8% and revenue to grow 6-9%, with EBITDA margins anticipated to widen by 100-125 basis points.

Expedia delivered fourth-quarter results that exceeded Wall Street forecasts. Revenue rose 11% to $3.55 billion, surpassing the analyst consensus of $3.42 billion.

Expedia’s B2B division stood out as the top performer. Gross bookings in this segment jumped 24% to $8.7 billion, far outpacing the 5% growth in consumer bookings.

Chief Executive Ariane Gorin noted that corporate travel clients, airlines, and financial institutions are increasingly relying on Expedia for technology solutions and inventory. In a Thursday interview, Gorin stated, “B2B has been the fastest growing. So it will be a bigger part of the company.”

This segment now makes up 38% of total revenue, compared to 33% in the year-ago period. B2B revenue also climbed 24% to $1.3 billion.

EXPE Stock Card

Adjusted earnings per share totaled $3.78, topping the consensus estimate of $3.35. Net income dropped to $205 million, or $1.60 per share, down from $299 million, or $2.20 per share, in the prior year.

Consumer Brands Return to Growth

After declining throughout 2024, Hotels.com and Vrbo resumed growth in the fourth quarter. Total booked room nights increased 9% for the period. Gross bookings grew 11% to $27 billion.

Expedia’s consumer-facing B2C division recorded a 5% increase in gross bookings to $18.3 billion. B2C revenue rose 4% to $2.2 billion. B2C EBITDA margins hit 31.5%, an improvement of approximately six percentage points from the previous year.

Advertising revenue surged 19% in the fourth quarter. The company finished the year with a record number of active advertising partners. Expedia introduced video ads in search results and added video advertisements to its homepage in 2025.

Chief Financial Officer Scott Schenkel noted that foreign exchange contributed just over one percentage point to bookings growth. Geopolitical tensions in Asia dampened expansion in the rest-of-world segment for several quarters.

AI and Product Improvements

Expedia’s websites and mobile applications now operate 30% faster than they did a year ago. The firm enhanced its checkout system and introduced additional payment methods. AI-driven recommendation engines at Brand Expedia produced what Gorin described as the “best fourth quarter attach rates ever.”

The company is testing AI capabilities across various platforms. It was one of the first to debut as an application within [platform]. Travelers can make bookings directly through the chatbot.

The number of lodging properties grew by more than 10% compared to 2024. AI solutions accelerated property onboarding by 70%. Partner-funded promotions accounted for over 30% of bookings in Q4, an increase of more than 10 percentage points from Q3.

Property participation in the Black Friday sale rose by nearly 70% compared to prior years. Expedia broadened its Vrbo Care program and improved customer service functions, reaching record-high levels of traveler self-service.

Capital Return and Share Buybacks

In the fourth quarter, Expedia bought back $255 million worth of stock, repurchasing 1.1 million shares. Since 2022, the firm has repurchased over 45 million shares, cutting its share count by 22% after accounting for dilution.

The board of directors increased the quarterly dividend by 20% to $0.48 per share. Free cash flow for 2025 reached $3.1 billion. The company closed the quarter with $5.7 billion in unrestricted cash and short-term investments.

Adjusted EBITDA hit $848 million in Q4, yielding a 24% margin. B2B EBITDA margins were 24%, a decline of approximately one percentage point due to investments in future growth.

Cost of revenue increased 3% to $342 million but decreased as a share of revenue. B2C direct sales and marketing spending fell 5% compared to the prior year. Overhead costs stayed essentially unchanged at $640 million.

2026 Outlook

Expedia anticipates first-quarter 2026 gross bookings to grow 10-12% and revenue to increase 11-13%. Based on current exchange rates, foreign currency should boost bookings growth by approximately three percentage points and revenue growth by four percentage points.

First-quarter EBITDA margins are projected to rise by three to four percentage points. For the full year 2026, management forecasted gross bookings growth of 6-8% and revenue growth of 6-9%, which includes one to two percentage points of foreign exchange benefits.

Full-year EBITDA margins are expected to widen by 100 to 125 basis points. Schenkel indicated that margin expansion will slow as the company moves past the benefits of 2025 workforce reductions while making targeted investments for growth.