US: Travel firm Expedia Group has announced its 2020 Q3 results, which it has claimed are better than expected, but still down over 50 per cent from 2019.
Its short-term rentals arm Vrbo, however, has outperformed much of the market, as it saw growth in both total bookings and total revenue from 2019.
CEO Peter Kern and CFO Eric Hart addressed analysts on a call yesterday, where they expressed optimism towards stabilising travel trends and improving company cost structures. While the company’s total bookings and profitability figures were still low, it managed to improve on its performance earlier in the year.
Hart said: “Taking into account the impact COVID is having on travel, our financial performance was better than we expected – with over $300 million in adjusted EBITDA and reaching essentially cash flow neutral in September for the first time since February.”
The company’s second-quarter bookings fell by 90 per cent according to its earnings reports, with an 82 per cent drop in total revenues to follow. Bloomberg News reported that these were the lowest revenues reported by the company in over a decade.
Performance for the group’s short term rentals sector was strong, however, with rentals platform Vrbo seeing bookings and revenues improve on 2019 figures. Expedia noted a similar result for Vrbo in Q2 and has been taking steps to improve its margins by working in payments and fee changes.
Kern said: “We definitely think that we did not plan the Vrbo rebranding as strongly as we wanted to. There is opportunity now given that so many people are using it and the use case is so attractive right now … that we intend to and are already pushing into a much more aggressive plot to broadly push the brand.”
Expedia underwent a full reorganisation of their short-term rental branding, retiring the HomeAway brand and folding its sectors into the Vrbo brand. The brand recently launched in many European markets, including the UK, where it entered the market this October.
It has also heavily cut costs, including cutting marketing budgets by 68 per cent, which may lead to around $500 million in costs savings. Additional layoffs are also a possibility, as the company’s travel partners group announced possible staff cuts.