Expedia, Inc. (NASDAQ: EXPE) will report its third quarter results on Oct. 30, 2013 via an earnings release and accompanying webcast. The earnings release will post after market close and the webcast will begin at 1:30 PM Pacific Daylight Time / 4:30 PM Eastern Daylight Time.
Expedia is the largest online travel company in the world, with an extensive brand portfolio that includes some of the world's leading online travel brands, including Expedia.com, Hotels.com, and Hotwire.
Wall Street expects Expedia to post earnings of to earn $1.35 a share, according to analysts polled by Thomson Reuters. The consensus estimate implies 2.3 percent growth from $1.32 cents it earned last year.
Expedia's earnings have topped Street view twice in the past four quarters. The consensus estimate has decreased by 2 cents in the past 90 days. In the past one month, one analyst has cut their view.
Quarterly revenue is expected to increase 14.6 percent to $1.37 billion from $1.20 billion in the same quarter last year.
The key metrics would be gross bookings and average room rates. The company could see more growth in international versus domestic. For the second quarter, gross bookings increased 13 percent. Average daily room rates and average airfares were essentially flat year-over-year. Domestic bookings increased 7 percent while international bookings rose 23 percent.
"We expect Expedia to produce gross bookings of $10.2b (13% YoY growth), driven by international bookings growth of 24% and domestic bookings growth of just 5%," UBS analyst Eric Sheridan said in a client note.
Increased online and offline marketing spend, investment behind trivago and eLong, and an ongoing mix shift to lower margin regions would key drivers of growth. There might be incremental technology-related spend being directed toward the Expedia Traveler Preference Program (ETP) as new hotels come onto the platform.
According to comScore, total online travel spend was up 8.5 percent in the seco! nd quarter 2013 versus tracking up about 11 percent in the third quarter 2013, based on monthly average growth rates for the first two months of the quarter.
From July to August, worldwide comScore desktop data for Expedia showed a 27 percent rise in unique visitors, 2.8 percent increase in total minutes, and a 15.1 percent decrease in total page views
As for Expedia's mobile platform, comScore US mobile data suggests a 47.6 percent increase in unique mobile visitors (iPhone and Android) and a 48.4 percent rise in total mobile minutes.
"We expect hotel bookings to grow 17% (driven by 17% room night growth) and airline bookings to grow 6% (on 1% ticket growth)," Sheridan noted.
Investors will look at how the Trivago investment is contributing to the bottom line as the management has indicated that Trivago to contribute positively to EBITDA in the back half of the year.
In August, Expedia announced an agreement with Travelocity. With Booking.com making a marketing-led push into the US market, potential share losses in Expedia's core domestic market have been a key concern for investors. This deal should help Expedia in addressing these concerns and investors would be hoping for additional color on this topic.
The Street will focus on updates over ETP program and its traction internationally and any incremental observations related to TripAdvisor's meta-display transition / competitive behavior within the bidding platform.
Bellevue, Washington-based Expedia's second-quarter profit dropped to $71.5 million or $0.51 per share from $105.2 million or 76 cents a share last year. Excluding items, adjusted profit for the quarter dropped to 64 cents a share, missing the consensus earnings estimate of 79 cents.
Second-quarter revenues quarter rose 16 percent to $1.21 billion. Analysts polled by Thomson Reuters had a consensus revenue estimate of $1.26 billion for the quarter.
Expedia has demonstrated mixed performance after its last two third quarter earnings an! nouncemen! ts, increasing 15 percent and decreasing 6 percent, respectively. The stock, which trades 14 times its 2014 consensus earnings estimate, has unperformed the market by 35 percent on a year-to-date basis.
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