Booking Holdings Inc.

Previous wording

Our global room nights in 2024 increased 9% year-over-year driven primarily by healthy travel demand in Europe and Asia. We saw the booking window expand in 2024 compared to 2023, which benefited year-over-year room night growth. In the first quarter of 2025, global room nights increased 7% year-over-year, driven primarily by increased travel demand in Europe and Asia.

Current wording

Our global room nights in 2024 increased 9% year-over-year driven primarily by healthy travel demand in Europe and Asia. We saw the booking window expand in 2024 compared to 2023, which benefited year-over-year room night growth.

Previous wording

While our first quarter results were strong, we are closely monitoring the uncertain geopolitical and macroeconomic environment and the potential impact it may have on global travel demand. We cannot predict how evolving conditions may affect consumer spending and behavior, travel patterns, our partners, or our ability to conduct our business. At this time, we believe our diversified global portfolio of leading travel brands, flexible platforms, and our strong financial position would help us to navigate a range of economic scenarios. We continue to take a long-term view, staying focused on delivering value to our travelers and partners, maintaining disciplined cost management, and making strategic investments as appropriate.

Current wording

While our second quarter results were strong, we are monitoring the uncertain geopolitical and macroeconomic environment and how it may impact global travel demand. We cannot predict how evolving conditions may affect consumer spending and behavior, travel patterns, our partners, or our ability to conduct our business. We believe our diversified global portfolio of leading travel brands, flexible platforms, and strong financial position would help us to navigate a range of economic scenarios. We continue to take a long-term view, staying focused on delivering value to our travelers and partners, maintaining disciplined cost management, and making strategic investments as appropriate.

Previous wording

The cancellation rate in the first quarter of 2025 was slightly higher than the first quarter of 2024. Because we recognize revenues from bookings when the traveler checks in, our reported revenues are not at risk of being reversed due to cancellations. Increases in cancellation rates can negatively impact our marketing efficiency as a result of incurring performance marketing expenses at the time a booking is made even though that booking could be canceled in the future if it was booked under a flexible cancellation policy.

Current wording

The cancellation rate in the second quarter of 2025 was slightly lower than the second quarter of 2024. Because we recognize revenues from bookings when the traveler checks in, our reported revenues are not at risk of being reversed due to cancellations. Increases in cancellation rates can negatively impact our marketing efficiency as a result of incurring performance marketing expenses at the time a booking is made even though that booking could be canceled in the future.

Previous wording

In the first quarter of 2025, our global average daily rates ("ADRs") on a constant currency basis were approximately 1% higher than the prior year. Our global ADRs were negatively impacted by a higher mix of room nights from Asia, which is a lower ADR region. Excluding the changes in regional mix, our global ADRs on a constant currency basis increased year-over-year by about 2%. The year-over-year increase in our global ADRs on a constant currency basis has resulted in constant currency accommodation gross bookings growing faster than our room nights in the first quarter of 2025. It is difficult to predict what the trend in industry ADRs will be in the future.

Current wording

In the second quarter of 2025, our global average daily rates ("ADRs") on a constant currency basis were approximately 1% lower than the prior year. Our global ADRs were negatively impacted by lower ADRs in the U.S. and Asia. Additionally, our global ADRs were negatively impacted by a higher mix of room nights in Asia, which is a lower ADR region, and a lower mix of room nights in the U.S., which is generally a higher ADR region. Excluding the changes in regional mix, our global ADRs on a constant currency basis were flat year-over-year. The year-over-year decrease in our global ADRs on a constant currency basis has resulted in constant currency accommodation gross bookings growing slower than room nights in the second quarter of 2025.

Previous wording

Our mobile app is an important platform for experiencing the Connected Trip since the app travels with the traveler. The mix of our room nights booked on a mobile app in the first quarter of 2025 was a mid-fifties percentage, up from a low-fifties percentage in the first quarter of 2024. The significant majority of room nights booked on our mobile apps are direct, and we continue to see favorable repeat direct booking behavior from consumers in our mobile apps, which allow us more opportunities to engage directly with consumers. The revenues earned on a transaction on a mobile app may be less than a typical desktop transaction as we see different consumer purchasing patterns across devices. For example, accommodation reservations made on a mobile app typically are for shorter lengths of stay and have lower accommodation ADRs.

Current wording

Our mobile app is an important platform for experiencing the Connected Trip since the app travels with the traveler. The mix of our room nights booked on a mobile app was a mid-fifties percentage over the trailing twelve months ended June 30, 2025, up from a low-fifties percentage over the trailing twelve months ended June 30, 2024. The significant majority of room nights booked on our mobile apps are direct, and we continue to see favorable repeat direct booking behavior from consumers in our mobile apps, which allow us more opportunities to engage directly with them. The revenues earned on a transaction on a mobile app may be less than a typical desktop transaction as we see different consumer purchasing patterns across devices. For example, accommodation reservations made on a mobile app typically are for shorter lengths of stay and have lower accommodation ADRs.

Previous wording

As part of our strategy to provide more payment options to consumers and travel service providers, increase the number and variety of our accommodations, and enable our long-term Connected Trip strategy, Booking.com increasingly processes transactions on a merchant basis, where it facilitates payments from travelers for the services provided. This allows Booking.com to process transactions for travel service providers and to increase its ability to offer secure and flexible transaction terms to consumers, such as the form, currency, and timing of payment. The mix of our total gross bookings generated on a merchant basis was 67% in the first quarter of 2025, an increase from 59% in the first quarter of 2024. We believe that expanding these types of service offerings will benefit consumers and travel service providers, as well as our gross bookings, room night, and earnings growth rates. However, this results in additional expenses for personnel, payment processing, chargebacks (including those related to fraud), and other expenses related to these transactions, which are recorded in "Personnel" expenses and "Sales and other expenses" in our Unaudited Consolidated Statements of Operations, as well as associated incremental revenues (e.g., payment card rebates), which are recorded in "Merchant revenues." To the extent more of our business is generated on a merchant basis, we incur a greater level of these merchant-related expenses, which negatively impacts our operating margins despite increases in associated incremental revenues. Over the trailing twelve months ended March 31, 2025, the incremental revenues from facilitating payments were greater than the associated incremental variable expenses.

Current wording

As part of our strategy to provide more payment options to consumers and travel service providers, increase the number and variety of our accommodations, and enable our long-term Connected Trip strategy, Booking.com increasingly processes transactions on a merchant basis, where it facilitates payments from travelers for the services provided. This allows Booking.com to process transactions for travel service providers and to increase its ability to offer secure and flexible transaction terms to consumers, such as the form, currency, and timing of payment. The mix of our total gross bookings generated on a merchant basis was 69% in the second quarter of 2025, an increase from 62% in the second quarter of 2024. We believe that expanding these types of service offerings will benefit consumers and travel service providers, as well as our gross bookings, room night, and earnings growth rates. However, this results in additional expenses for personnel, payment processing, chargebacks (including those related to fraud), and other expenses related to these transactions, which are recorded in "Personnel" expenses and "Sales and other expenses" in our Unaudited Consolidated Statements of Operations, as well as associated incremental revenues (e.g., payment card rebates), which are recorded in "Merchant revenues." To the extent more of our business is generated on a merchant basis, we incur a greater level of these merchant-related expenses, which negatively impacts our operating margins despite increases in associated incremental revenues. Over the trailing twelve months ended June 30, 2025, the incremental revenues from facilitating payments were greater than the associated incremental variable expenses.

Previous wording

We have established widely-used and recognized brands through marketing and promotional campaigns. Our total marketing expenses, which are comprised of performance and brand marketing expenses that are substantially variable in nature, were $1.8 billion in the first quarter of 2025, up 10% versus the first quarter of 2024 as a result of the year-over-year growth in travel demand in the quarter and our efforts to invest in marketing. Our performance marketing expenses, which represent a substantial majority of our marketing expenses, are primarily related to the use of online search engines (primarily Google), affiliate marketing, meta-search, and social media channels to generate traffic to our platforms. Our brand marketing expenses are primarily related to costs associated with producing and airing digital branding and television advertising.

Current wording

We have established widely-used and recognized brands through marketing and promotional campaigns. Our total marketing expenses, which are comprised of performance and brand marketing expenses that are substantially variable in nature, were $2.1 billion in the second quarter of 2025, up 10% versus the second quarter of 2024 as a result of the year-over-year growth in travel demand in the quarter and our efforts to invest in marketing. Our performance marketing expenses, which represent a substantial majority of our marketing expenses, are primarily related to the use of online search engines (primarily Google), affiliate marketing, meta search, and social media channels to generate bookings through our platforms. Our brand marketing expenses are primarily related to costs associated with producing and airing digital branding and television advertising.

Previous wording

Marketing efficiency, expressed as marketing expenses as a percentage of gross bookings, and performance marketing returns on investment ("ROIs") are impacted by a number of factors that are in some cases outside of our control. Such factors include ADRs, costs per click, cancellation rates, foreign currency exchange rates, search engine bidding algorithms, channel mix, our ability to convert paid traffic to booking customers, and the timing and effectiveness of our brand marketing and social media marketing campaigns. In recent years, we observed periods of stable or increasing ROIs. Although it is difficult to predict how ROIs will change in the future, ROIs could be negatively impacted by increased levels of competition and other factors. When evaluating our performance marketing spend, we typically consider several factors for each channel, such as the customer experience on the advertising platform, the incremental traffic we receive, and anticipated repeat rates. Marketing efficiency can also be impacted by the extent to which consumers come directly to our platforms for bookings. The mix of our total room nights booked by consumers coming directly to our platforms was a mid-fifties percentage over the trailing twelve months ended March 31, 2025 and was higher if we exclude the room nights booked through affiliate programs (i.e., business-to-business). The mix of total room nights booked by consumers coming directly to our platforms increased year-over-year, which benefited our marketing efficiency in the first quarter of 2025 versus the first quarter of 2024. See Part I, Item 1A, Risk Factors - "We face risks relating to our marketing efforts" and "We are dependent on travel service providers, restaurants, search platforms, and other third parties" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

Marketing efficiency, expressed as marketing expenses as a percentage of gross bookings, and performance marketing returns on investment ("ROIs") are impacted by a number of factors that are in some cases outside of our control. Such factors include ADRs, costs per click, cancellation rates, foreign currency exchange rates, search engine bidding algorithms, channel mix, our ability to convert paid traffic to booking customers, and the timing and effectiveness of our brand marketing and social media marketing campaigns. In recent years, ROIs have generally been stable. However, ROIs could be negatively impacted by increased levels of competition and other factors. When evaluating our performance marketing spend, we typically consider several factors for each channel, such as the customer experience on the advertising platform, the incremental bookings we receive, and anticipated repeat rates. Marketing efficiency is also impacted by the extent to which consumers book directly with us. The mix of our total room nights booked by consumers coming directly to our platforms was a mid-fifties percentage over the trailing twelve months ended June 30, 2025 and was higher if we exclude the room nights booked through affiliate programs (i.e., business-to-business). The mix of total room nights booked by consumers coming directly to our platforms increased year-over-year, which benefited our marketing efficiency in the second quarter of 2025 versus the second quarter of 2024.

Previous wording

Booking.com had approximately 4.1 million total properties on its website at March 31, 2025, representing an increase from approximately 3.5 million total properties at March 31, 2024. At March 31, 2025, the total properties on Booking.com's website consisted of approximately 3.6 million alternative accommodation properties (including homes, apartments, and other unique places to stay) and approximately 500,000 hotels, motels, and resorts.

Current wording

Booking.com had approximately 4.3 million total properties on its website at June 30, 2025, representing an increase from approximately 3.8 million total properties at June 30, 2024. At June 30, 2025, the total properties on Booking.com's website consisted of approximately 3.8 million alternative accommodation properties (including homes, apartments, and other unique places to stay) and approximately 500,000 hotels, motels, and resorts.

Previous wording

The mix of Booking.com's room nights booked for alternative accommodation properties in the first quarter of 2025 was approximately 37%, up versus approximately 36% in the first quarter of 2024. We have observed a longer-term trend of an increasing mix of room nights booked for alternative accommodation properties as consumer demand for these types of properties has grown, and as we have increased the number and variety of these properties on Booking.com. We may experience lower profit margins due to additional costs, such as increased customer service or certain partner related costs, related to offering alternative accommodations. As our alternative accommodation business has grown, these different characteristics have negatively impacted our profit margins and this trend may continue.

Current wording

The mix of Booking.com's room nights booked for alternative accommodation properties in the second quarter of 2025 was approximately 37%, up versus approximately 36% in the second quarter of 2024. We have observed a longer-term trend of an increasing mix of room nights booked for alternative accommodation properties as consumer demand for these types of properties has grown, and as we have increased the number and variety of these properties on Booking.com. We may experience lower profit margins due to additional costs, such as increased customer service or certain partner related costs, related to offering alternative accommodations. As our alternative accommodation business grows, these different characteristics may negatively impact our profit margins.

Previous wording

In November 2024, we announced our intention to implement certain organizational changes, including modernizing processes and systems, initiating an expected workforce reduction, optimizing procurement, and seeking real estate savings (the "Transformation Program"). We continue to believe it is important to make these organizational changes in order to drive further expense efficiency, create room for reinvestment in projects and initiatives that will support the growth of our business over the long run, and further improve our organizational agility. Since the announcement of the Transformation Program, we have initiated actions that we expect will result in savings in future quarters and years. As we are in the early stages of this program and we expect the majority of the run rate savings to be achieved after 2025, such savings were not material to our first quarter results. We continue to expect the Transformation Program to ultimately deliver about $400 to $450 million in annual run rate savings over the next three years as compared to our 2024 expense base. We continue to expect that restructuring costs and accelerated investments related to the Transformation Program will be incurred in the next two to three years and are estimated to be, in the aggregate, approximately one times the expected annual run rate savings.

Current wording

Starting in the fourth quarter of 2024, we began the implementation of the previously announced organizational changes that are expected to improve operating expense efficiency, increase organizational agility, free up resources that can be reinvested into further improving our offering to travelers and partners, and better position our business for the long term (the "Transformation Program"). The Transformation Program resulted in approximately $50 million in savings in the first half of 2025. We continue to expect the Transformation Program to ultimately deliver about $400 to $450 million in annual run rate savings over the next three years as compared to our 2024 expense base, with the majority of savings expected to be achieved after 2025. We also continue to expect that restructuring costs and accelerated investments related to the Transformation Program will be incurred in the next two to three years and are estimated to be, in the aggregate, approximately one times the expected annual run rate savings.

Previous wording

Many taxing authorities seek to increase tax revenues and have targeted large multinational technology companies in these efforts. Many jurisdictions, particularly in the EU, have implemented or are considering the adoption of a digital services tax or similar tax that imposes a tax on revenues earned from digital advertisements or the use of online platforms, even when there is no physical presence in the jurisdiction. Rates for these taxes range from 1.5% to 10% of revenues deemed generated in the jurisdiction. We record the applicable digital services taxes in "Sales and other expenses" in the Unaudited Consolidated Statements of Operations. For more information, see Part I, Item 1A, Risk Factors - "We may have exposure to additional tax liabilities" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

Many taxing authorities seek to increase tax revenues and have targeted large multinational technology companies. Many jurisdictions, particularly in the EU, have implemented or are considering the adoption of a digital services tax or similar tax that imposes a tax on revenues earned from digital advertisements or the use of online platforms, even when there is no physical presence in the jurisdiction. Rates for these taxes range from 1.5% to 10% of revenues deemed generated in the jurisdiction. We record the applicable digital services taxes in "Sales and other expenses" in the Unaudited Consolidated Statements of Operations. In July 2025, the One Big Beautiful Bill Act (the "BBB Act") made changes to certain international, foreign tax credit, and domestic tax provisions in the United States. We are continuing to evaluate the impact of the BBB Act and it could have a negative impact on our results of operations and cash flows. See Part I, Item 1A, Risk Factors - "We may have exposure to additional tax liabilities" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Previous wording

Increased regulatory focus on large technology companies could result in increased compliance costs or otherwise adversely affect our business. For example, the European Commission designated the Company as a gatekeeper under the Digital Markets Act in 2024 and Booking.com as a "Very Large Online Platform" under the Digital Services Act in 2023. As a result of these designations, we are subject to additional rules and regulations that may not be applicable to our competitors. For more information, see Part I, Item 1A, Risk Factors - "Our business is subject to various competition, consumer protection, and online commerce laws and regulations around the world, and as the size of our business grows, scrutiny of our business by legislators and regulators in these areas may intensify" in our Annual Report on Form 10-K for the year ended December 31, 2024 and Note 13 to our Unaudited Consolidated Financial Statements.

Current wording

Increased regulatory focus on large technology companies could result in increased compliance costs or otherwise adversely affect our business. For example, the European Commission designated the Company as a gatekeeper under the Digital Markets Act in 2024 and Booking.com as a "Very Large Online Platform" under the Digital Services Act in 2023. As a result of these designations, we are subject to additional rules and regulations that may not be applicable to our competitors. See Part I, Item 1A, Risk Factors - "Our business is subject to various competition, consumer protection, and online commerce laws and regulations around the world, and as the size of our business grows, scrutiny of our business by legislators and regulators in these areas may intensify" in our Annual Report on Form 10-K for the year ended December 31, 2024 and Note 13 to our Unaudited Consolidated Financial Statements.

Previous wording

Our businesses outside of the U.S. represent a substantial majority of our financial results, but because we report our results in U.S. Dollars, we face exposure to movements in foreign currency exchange rates as the financial results and the financial condition of our businesses outside of the U.S. are translated from local currency (principally Euros and British Pounds Sterling) into U.S. Dollars. See Note 14 to our Unaudited Consolidated Financial Statements for information related to revenues by geographic area. As a result of movements in foreign currency exchange rates, both the absolute amounts of and percentage changes in our foreign-currency-denominated net assets, gross bookings, revenues, operating expenses, and net income as expressed in U.S. Dollars are affected. Our total revenues increased by approximately 8% in the first quarter of 2025 as compared to the first quarter of 2024, but without the impact of changes in foreign currency exchange rates our total revenues increased year-over-year on a constant currency basis by approximately 10%. Since our expenses are generally denominated in foreign currencies on a basis similar to our revenues, our operating margins have not been significantly impacted by currency fluctuations.

Current wording

Our businesses outside of the U.S. represent a substantial majority of our financial results, but because we report our results in U.S. Dollars, we face exposure to movements in foreign currency exchange rates (principally related to Euros and British Pounds Sterling). See Note 14 to our Unaudited Consolidated Financial Statements for information related to revenues by geographic area. As a result of these movements, the absolute amounts of and percentage changes in our foreign-currency-denominated net assets, gross bookings, revenues, operating expenses, and net income as expressed in U.S. Dollars are affected. Our total revenues increased by approximately 16% in the second quarter of 2025 as compared to the second quarter of 2024, but without the impact of changes in foreign currency exchange rates our total revenues increased year-over-year on a constant currency basis by approximately 12%. Since our expenses are generally denominated in foreign currencies on a basis similar to our revenues, our operating margins have not been significantly impacted by currency fluctuations.

Previous wording

We generally enter into derivative instruments to minimize the impact of foreign currency exchange rate fluctuations, such as foreign currency exchange derivative contracts to hedge our exposure to the impact of movements in foreign currency exchange rates on our transactional balances denominated in currencies other than the functional currency. See Note 6 to our Unaudited Consolidated Financial Statements for additional information. We designate certain portions of the aggregate principal value of our Euro-denominated debt as a hedge of the foreign currency exposure of the net investment in certain Euro functional currency subsidiaries. Foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument for accounting purposes are recognized in "Other income (expense), net" in the Unaudited Consolidated Statements of Operations (see Notes 9 and 15 to our Unaudited Consolidated Financial Statements). Such foreign currency transaction gains or losses are dependent on the amount of net assets of the Euro functional currency subsidiaries, the amount of the Euro-denominated debt that is designated as a hedge, and fluctuations in foreign currency exchange rates. For more information, see Part I, Item 1A, Risk Factors - "We are exposed to fluctuations in foreign currency exchange rates" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Current wording

We generally enter into derivative instruments to minimize the impact of foreign currency exchange rate fluctuations. In addition, we designate certain portions of the aggregate principal value of our Euro-denominated debt as a hedge of the foreign currency exposure of the net investment in certain Euro functional currency subsidiaries. Foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument for accounting purposes are recognized in "Other income (expense), net" in the Unaudited Consolidated Statements of Operations. Such foreign currency transaction gains or losses are dependent on the amount of net assets of the Euro functional currency subsidiaries, the amount of the Euro-denominated debt that is designated as a hedge, and fluctuations in foreign currency exchange rates. See Notes 6, 9, and 15 to our Unaudited Consolidated Financial Statements and Part I, Item 1A, Risk Factors - "We are exposed to fluctuations in foreign currency exchange rates" in our Annual Report on Form 10-K for the year ended December 31, 2024.

Previous wording

The estimation of the recoverable values of asset groups and the fair values of our reporting units reflect numerous assumptions that are subject to various risks and uncertainties, including key assumptions regarding each reporting unit's expected growth rates and operating margin and with respect to matters outside of our control, such as discount rates and market comparables. Generally, changes in the assumptions used for comparable company multiples would result in directionally similar changes in the fair value and changes in the assumptions used for discount rates would result in directionally opposite changes in the fair value. The estimation of fair value requires significant judgments and estimates and actual results could be materially different than the judgments and estimates used. Future events and changing market conditions may lead us to re-evaluate the assumptions used to estimate the fair values of our reporting units. Such changes may include travel service providers reducing or withdrawing from our services, such as those offered by KAYAK, generative AI better enabling or offering alternatives for travel service providers to reach consumers or competitors affecting our ability to market to and reach customers in a cost-efficient way.

Current wording

The estimation of the recoverable values of asset groups and the fair values of our reporting units reflect numerous assumptions that are subject to various risks and uncertainties, including key assumptions regarding each reporting unit's expected growth rates and operating margin and with respect to matters outside of our control, such as discount rates and market comparables. Generally, changes in the assumptions used for comparable company multiples would result in directionally similar changes in the fair value and changes in the assumptions used for discount rates would result in directionally opposite changes in the fair value. The estimation of fair value requires significant judgments and estimates and actual results could be materially different than the judgments and estimates used. Future events and changing market conditions may lead us to re-evaluate the assumptions used to estimate the fair values of our reporting units. Such changes may include travel service providers reducing or withdrawing from our services, such as those offered by KAYAK, generative AI better enabling or offering alternatives for travel service providers to reach consumers, or competitors affecting our ability to market to and reach consumers in a cost-efficient way.

Previous wording

Three Months Ended March 31, 2025 compared to the Three Months Ended March 31, 2024

Current wording

Three and Six Months Ended June 30, 2025 compared to the Three and Six Months Ended June 30, 2024

Previous wording

Room nights reserved through our services increased year-over-year for the three months ended March 31, 2025 driven primarily by increased travel demand in Europe and Asia. Rental car days reserved through our services increased year-over-year for the three months ended March 31, 2025 driven primarily by growth in rental car days reserved on Booking.com and Priceline. Airline tickets reserved through our services increased year-over-year for the three months ended March 31, 2025 driven primarily by the expansion of flight offerings at Booking.com and Agoda.

Current wording

Room nights reserved through our services increased year-over-year for the three and six months ended June 30, 2025 driven primarily by increased travel demand in Europe and Asia. Rental car days reserved through our services increased year-over-year for the three and six months ended June 30, 2025 driven primarily by growth in rental car days reserved on Booking.com and Priceline. Airline tickets reserved through our services increased year-over-year for the three and six months ended June 30, 2025 driven primarily by the expansion of flight offerings at Booking.com and Agoda.

Previous wording

Merchant gross bookings increased year-over-year and agency gross bookings decreased year-over-year for the three months ended March 31, 2025 due primarily to the ongoing shift from agency bookings to merchant bookings at Booking.com. The year-over-year increase in merchant gross bookings during the three months ended March 31, 2025 was also due to strong growth in gross bookings from merchant accommodation reservation services at Agoda and merchant flight reservation services at Booking.com and Agoda.

Current wording

Merchant gross bookings increased year-over-year and agency gross bookings decreased year-over-year for the three and six months ended June 30, 2025 due primarily to the ongoing shift from agency to merchant bookings at Booking.com. The year-over-year increase in merchant gross bookings during the three and six months ended June 30, 2025 was also due to growth in gross bookings from accommodation reservation services at Agoda and flight reservation services at Booking.com and Agoda.

Previous wording

The year-over-year increase in total gross bookings for the three months ended March 31, 2025 was due primarily to the increase in room nights, as well as the positive impact from year-over-year growth in flight gross bookings and an increase in constant currency accommodation ADRs of approximately 1%, partially offset by a negative impact of foreign exchange rate fluctuations.

Current wording

The year-over-year increase in total gross bookings for the three months ended June 30, 2025 was due primarily to the increase in room nights, a positive impact of foreign exchange rate fluctuations, as well as the positive impact from growth in flight gross bookings, partially offset by a decrease in constant currency accommodation ADRs of approximately 1%.

Previous wording

Flight gross bookings increased 30% year-over-year for the three months ended March 31, 2025, due to airline ticket growth, partially offset by lower average airline ticket prices. Rental car gross bookings increased 5% year-over-year for the three months ended March 31, 2025, due primarily to rental car days growth, partially offset by lower average daily car rental prices.

Current wording

Flight gross bookings increased 33% and 31% year-over-year for the three and six months ended June 30, 2025, due to airline ticket growth, partially offset by lower average airline ticket prices. Rental car gross bookings increased 13% and 9% year-over-year for the three and six months ended June 30, 2025, due primarily to rental car days growth.

Previous wording

Merchant revenues increased year-over-year while agency revenues decreased year-over-year for the three months ended March 31, 2025 due primarily to the ongoing shift from agency revenues to merchant revenues at Booking.com. Advertising and other revenues increased year-over-year for the three months ended March 31, 2025 due to growth at OpenTable and growth in advertising revenues at Booking.com and Agoda. The year-over-year growth in total revenues was negatively impacted from the shift in the timing of the Easter holiday relative to last year.

Current wording

Merchant revenues increased year-over-year while agency revenues decreased year-over-year for the three and six months ended June 30, 2025 due primarily to the ongoing shift from agency to merchant revenues at Booking.com. Advertising and other revenues increased year-over-year for the three and six months ended June 30, 2025 due to growth at OpenTable and growth in advertising revenues at Booking.com and Agoda. The year-over-year growth in total revenues in the second quarter of 2025 was positively impacted from the shift in the timing of the Easter holiday relative to last year.

Previous wording

Total revenues as a percentage of gross bookings increased year-over-year for the three months ended March 31, 2025 due to an increase in revenues related to facilitating payments, partially offset by an increase in the mix of flight gross bookings, which have lower revenues as a percentage of gross bookings, and a negative impact from differences in the timing of booking versus travel. The negative impact from differences in timing of booking versus travel was driven by the shift in the timing of the Easter holiday relative to last year.

Current wording

Total revenues as a percentage of gross bookings increased year-over-year for the three and six months ended June 30, 2025 due to a positive impact from differences in the timing of booking versus travel and an increase in revenues related to facilitating payments, partially offset by an increase in the mix of flight gross bookings, which have lower revenues as a percentage of gross bookings. The positive impact from differences in the timing of booking versus travel in the second quarter of 2025 was driven by the shift in the timing of the Easter holiday relative to last year. The positive impact from differences in the timing of booking versus travel in the first half of 2025 was driven by the strong growth in gross bookings in the fourth quarter of 2024. A portion of these fourth quarter gross bookings were related to travel in the first half of 2025, which is when the associated revenues were recognized.

Previous wording

Our marketing expenses, which are substantially variable in nature, increased year-over-year for the three months ended March 31, 2025, to help drive additional gross bookings and revenues. Marketing expenses as a percentage of total gross bookings in the three months ended March 31, 2025 were higher than in the three months ended March 31, 2024 due to lower performance marketing ROIs, which was driven by changes in paid traffic mix, and increased spend in social media channels. This was partially offset by an increase in the share of room nights booked by consumers coming directly to our platforms as well as lower brand marketing expenses.

Current wording

Our marketing expenses, which are substantially variable in nature, increased year-over-year for the three and six months ended June 30, 2025, to help drive additional gross bookings and revenues. Marketing expenses as a percentage of total gross bookings in the three months ended June 30, 2025 were lower than in the three months ended June 30, 2024 due to lower brand marketing expenses and an increase in the share of room nights booked by consumers coming directly to our platforms, partially offset by increased spend in social media channels.

Previous wording

Sales and other expenses, which are substantially variable in nature, increased year-over-year for the three months ended March 31, 2025 due primarily to an increase in merchant transaction costs of $27 million. Merchant transactions increased year-over-year for the three months ended March 31, 2025 due primarily to the ongoing shift from agency to merchant transactions at Booking.com. Sales and other expenses as a percentage of total revenues decreased year-over-year in the three months ended March 31, 2025 due to lower provisions for expected credit losses as well as efficiencies in third-party customer service costs, partially offset by the impact of increased merchant transactions, which grew faster than total revenue.

Current wording

Sales and other expenses, which are substantially variable in nature, increased year-over-year for the three and six months ended June 30, 2025 due primarily to an increase in merchant transaction costs of $109 million and $136 million, respectively. Merchant transactions increased year-over-year for the three and six months ended June 30, 2025 due primarily to the ongoing shift from agency to merchant transactions at Booking.com. Sales and other expenses as a percentage of total revenues decreased year-over-year for the three and six months ended June 30, 2025 due to lower digital services taxes and other similar taxes, efficiencies in third party customer service costs, as well as lower provisions for expected credit losses, partially offset by the impact of increased merchant transactions, which grew faster than total revenue.

Previous wording

Personnel expenses decreased year-over-year for the three months ended March 31, 2025 primarily due to a $170 million reduction during the three months ended March 31, 2025 in the accrual related to the Netherlands pension fund matter. Salary expenses increased year-over-year for the three months ended March 31, 2025 due to a 2% increase in employee headcount to 24,500 employees, from approximately 24,000 as of March 31, 2024.

Current wording

Personnel expenses increased year-over-year for the three months ended June 30, 2025 primarily due to an increase in salary expenses, as well as increases in bonus expense accruals. Personnel expenses decreased year-over-year for the six months ended June 30, 2025 primarily due to a $170 million reduction during the three months ended March 31, 2025 in the accrual related to the Netherlands pension fund matter, partially offset by an increase in salary expenses. Salary expenses increased year-over-year for the three and six months ended June 30, 2025 due to changes in currency exchange rates, as well as a 3% increase in employee headcount to 24,800 employees, from approximately 24,150 as of June 30, 2024.

Previous wording

Information technology expenses increased year-over-year for the three months ended March 31, 2025 due to an increase in expenses related to cloud computing costs and outsourced data center costs, as well as software license and system maintenance fees.

Current wording

Information technology expenses increased year-over-year for the three and six months ended June 30, 2025 due primarily to an increase in expenses related to cloud computing costs.

Previous wording

Depreciation and amortization expenses increased year-over-year for the three months ended March 31, 2025 due primarily to increased depreciation of computer equipment, as well as amortization expense related to internally-developed and purchased software.

Current wording

Depreciation and amortization expenses increased year-over-year for the three and six months ended June 30, 2025 due primarily to increased depreciation of computer equipment, as well as amortization expense related to internally-developed software.

Previous wording

See "Trends" above for additional information on the Transformation Program. For the three months ended March 31, 2025, program related costs, which primarily consist of professional fees, are recorded in "Transformation costs" in the Unaudited Consolidated Statement of Operations. See Note 17 to our Unaudited Consolidated Financial Statements.

Current wording

See "Trends" above for additional information on the Transformation Program. For the three and six months ended June 30, 2025, Program related costs, which primarily consist of professional fees and employee termination benefits, are recorded in "Transformation costs" in the Unaudited Consolidated Statements of Operations. See Note 17 to our Unaudited Consolidated Financial Statements.

Previous wording

Interest expense increased year-over-year for the three months ended March 31, 2025 primarily due to the amortization of debt discount related to the convertible senior notes due in May 2025 (the "May 2025 Notes") (see Note 9 to our Unaudited Consolidated Financial Statements) and the issuance of senior notes in 2024.

Current wording

Interest expense increased year-over-year for the three and six months ended June 30, 2025 primarily due to the amortization of debt discount related to the convertible senior notes (see Note 9 to our Unaudited Consolidated Financial Statements) and the issuance of senior notes in November 2024. Interest and dividend income decreased year-over-year for the three and six months ended June 30, 2025 primarily due to lower interest rates, partially offset by higher money market fund investment balances.

Previous wording

Our primary source of funds for operations is the cash flow that we generate from operations. We use our cash for a variety of needs, including ongoing investments in our business, share repurchases, dividends, repayment of debt, and capital expenditures. Our continued access to sources of liquidity depends on multiple factors. See Part I, Item 1A, Risk Factors - "Our liquidity, credit ratings, and ongoing access to capital could be materially and negatively affected by global financial conditions and events" in our Annual Report on Form 10-K for the year ended December 31, 2024. Our financial results and prospects are almost entirely dependent on facilitating the sale of travel-related services. Marketing expenses, personnel expenses, and sales and other expenses are the most significant operating expenses for our business. See our Unaudited Consolidated Statements of Operations and "Trends" and "Results of Operations" above for additional information on marketing expenses, personnel expenses, and sales and other expenses. We believe that our existing cash balances, liquid resources, and access to capital markets will be sufficient to fund our operating activities and other obligations in the short term and into the foreseeable future.

Current wording

Our primary source of funds for operations is the cash flow that we generate from operations. We use our cash for a variety of needs, including ongoing investments in our business, share repurchases, dividends, repayment of debt, and capital expenditures. Our continued access to sources of liquidity depends on multiple factors. See Part I, Item 1A, Risk Factors - "Our liquidity, credit ratings, and ongoing access to capital could be materially and negatively affected by global financial conditions and events" in our Annual Report on Form 10-K for the year ended December 31, 2024. Our financial results and prospects are almost entirely dependent on facilitating the sale of travel-related services. Marketing expenses, sales and other expenses, and personnel expenses are our most significant operating expenses. See our Unaudited Consolidated Statements of Operations and "Trends" and "Results of Operations" above for additional information. We believe that our existing cash balances, liquid resources, and access to capital markets will be sufficient to fund our operating activities and other obligations in the short term and into the foreseeable future.

Previous wording

At March 31, 2025, we had $16.1 billion in cash, cash equivalents, and investments, of which approximately $11.3 billion is held by our international subsidiaries. Cash, cash equivalents, and long-term investments held by our international subsidiaries are denominated primarily in Euros, U.S. Dollars, and British Pounds Sterling. Our investment policy seeks to preserve capital and maintain sufficient liquidity to meet operational and other needs of the business. See Notes 5 and 6 to our Unaudited Consolidated Financial Statements.

Current wording

At June 30, 2025, we had $18.2 billion in cash, cash equivalents, and investments, of which approximately $13.7 billion is held by our international subsidiaries. Cash, cash equivalents, and long-term investments held by our international subsidiaries are denominated primarily in Euros, U.S. Dollars, and British Pounds Sterling. Our investment policy seeks to preserve capital and maintain sufficient liquidity to meet operational and other needs of the business. See Notes 5 and 6 to our Unaudited Consolidated Financial Statements.

Previous wording

Deferred merchant bookings of $6.9 billion at March 31, 2025 includes cash payments received from travelers in advance of us completing our performance obligations and are comprised principally of amounts estimated to be payable to travel service providers as well as our estimated future revenue for our commission or margin and fees. The amounts are mostly subject to refunds for cancellations.

Current wording

Deferred merchant bookings of $9.1 billion at June 30, 2025 includes cash payments received from travelers in advance of us completing our performance obligations and are comprised principally of amounts estimated to be payable to travel service providers as well as our estimated future revenue for our commission or margin and fees. The amounts are mostly subject to refunds for cancellations.

Previous wording

Our outstanding senior notes at March 31, 2025 had cumulative interest to maturity (based on coupon interest rates) of $4.5 billion, with $573 million payable within the next twelve months.

Current wording

Our outstanding senior notes at June 30, 2025 had cumulative interest to maturity (based on coupon interest rates) of $5.8 billion, with $690 million payable within the next twelve months.

Previous wording

In the first quarter of 2025, our Board of Directors (the "Board") authorized a program to repurchase up to $20 billion of our common stock. At March 31, 2025, we had a total remaining authorization of $25.9 billion related to share repurchase programs authorized by the Board.

Current wording

In the first quarter of 2025, our Board of Directors (the "Board") authorized a program to repurchase up to $20 billion of our common stock. At June 30, 2025, we had a total remaining authorization of $24.6 billion related to share repurchase programs authorized by the Board.

Previous wording

At March 31, 2025, we had, in the aggregate, $1.1 billion of non-cancellable purchase obligations individually greater than $10 million, of which $227 million is payable within the next twelve months. Such purchase obligations relate to agreements to purchase goods and services that are enforceable and legally binding and that specify significant terms, including the quantities to be purchased, price provisions, and the approximate timing of the transaction. At March 31, 2025, we had lease obligations of $737 million, of which $162 million is payable within the next twelve months.

Current wording

At June 30, 2025, we had, in the aggregate, $1.0 billion of non-cancellable purchase obligations individually greater than $10 million, of which $235 million is payable within the next twelve months. Such purchase obligations relate to agreements to purchase goods and services that are enforceable and legally binding and that specify significant terms, including the quantities to be purchased, price provisions, and the approximate timing of the transaction. At June 30, 2025, we had lease obligations of $767 million, of which $145 million is payable within the next twelve months.

Previous wording

At March 31, 2025, we had a remaining transition tax liability of $486 million as a result of the U.S. Tax Cuts and Jobs Act (the "Tax Act"), which included $257 million reported as "Long-term U.S. transition tax liability" and $229 million included in "Accrued expenses and other current liabilities" in the Unaudited Consolidated Balance Sheet. This liability will be paid over the next two years. Due to the 2024 U.S. Tax Court decision in Varian Medical Systems, Inc. vs. Commissioner, a portion of our total transition tax liability may be refunded. In accordance with the Tax Act, generally, future repatriation of our international cash will not be subject to a U.S. federal income tax liability as a dividend, but will be subject to U.S. state income taxes and international withholding taxes, which have been accrued by us.

Current wording

At June 30, 2025, we had a remaining transition tax liability of $257 million as a result of the U.S. Tax Cuts and Jobs Act (the "Tax Act"), which is included in "Accrued expenses and other current liabilities" in the Unaudited Consolidated Balance Sheet. Due to the 2024 U.S. Tax Court decision in Varian Medical Systems, Inc. vs. Commissioner, a portion of our total transition tax liability may be refunded. In accordance with the Tax Act, generally, future repatriation of our international cash will not be subject to a U.S. federal income tax liability as a dividend, but will be subject to U.S. state income taxes and international withholding taxes, which have been accrued by us.

Previous wording

See "Trends" above for information on the Transformation Program that we announced in November 2024 to implement certain organizational changes, including the estimated annual run rate savings and restructuring costs and accelerated investments required for the program.

Current wording

See "Trends" above for information on the Transformation Program, including the estimated annual run rate savings and restructuring costs and accelerated investments required for the program.

Previous wording

Net cash provided by operating activities for the three months ended March 31, 2025 resulted from net income of $333 million, a favorable net impact from adjustments for non-cash and other items of $899 million, and a favorable net change in working capital and other assets and liabilities of $2.1 billion. Non-cash and other items were principally associated with unrealized foreign currency transaction losses related to Euro-denominated debt, adjustments related to the convertible senior notes, depreciation and amortization, deferred income taxes, and stock-based compensation expense. For the three months ended March 31, 2025, deferred merchant bookings and other current liabilities increased by $1.9 billion, primarily due to higher business volumes. Merchant revenues increased while agency revenues decreased year-over year for the three months ended March 31, 2025 due to the ongoing shift from agency revenues to merchant revenues at Booking.com.

Current wording

Net cash provided by operating activities for the six months ended June 30, 2025 resulted from net income of $1.2 billion, a favorable net impact from adjustments for non-cash and other items of $2.2 billion, and a favorable net change in working capital and other assets and liabilities of $3.1 billion. Non-cash and other items were principally associated with unrealized foreign currency transaction losses related to Euro-denominated debt, deferred income taxes, adjustments related to the convertible senior notes, depreciation and amortization, stock-based compensation expense, and provision for expected credit losses and chargebacks. For the six months ended June 30, 2025, deferred merchant bookings and other current liabilities increased by $3.8 billion and accounts receivable increased by $1.1 billion, primarily due to higher business volumes. Merchant revenues increased while agency revenues decreased year-over year for the six months ended June 30, 2025 due to the ongoing shift from agency revenues to merchant revenues at Booking.com.

Previous wording

Net cash provided by operating activities for the three months ended March 31, 2024 resulted from net income of $776 million, a favorable net impact from adjustments for non-cash and other items of $224 million, and a favorable net change in working capital and other assets and liabilities of $1.7 billion. Non-cash and other items were principally associated with unrealized foreign currency transaction gains related to Euro-denominated debt, stock-based compensation expense, depreciation and amortization, provision for expected credit losses and chargebacks, operating lease amortization, and deferred income taxes. For the three months ended March 31, 2024, deferred merchant bookings and other current liabilities increased by $2.1 billion and accounts receivable increased by $185 million, primarily due to increases in business volumes.

Current wording

Net cash provided by operating activities for the six months ended June 30, 2024 resulted from net income of $2.3 billion, a favorable net impact from adjustments for non-cash and other items of $602 million, and a favorable net change in working capital and other assets and liabilities of $2.3 billion. Non-cash and other items were principally associated with stock-based compensation expense, depreciation and amortization, unrealized foreign currency transaction gains related to Euro-denominated debt, provision for expected credit losses and chargebacks, and operating lease amortization. For the six months ended June 30, 2024, deferred merchant bookings and other current liabilities increased by $3.3 billion and accounts receivable increased by $830 million, primarily due to increases in business volumes.