Expedia Group Q1 Earnings & Revenues Beat Estimates, Both Increase Y/Y

Expedia Group EXPE reported first-quarter 2026 adjusted earnings of $1.96 per share, up 386% year over year, and surpassed the Zacks Consensus Estimate by 39.01%.Revenues rose 15% from the year-ago quarter to $3.43 billion and beat the consensus mark by 2.47%. Management highlighted that results exceeded the company’s outlook.Expedia Group’s Segment Mix Tilts to B2B StrengthBy segment, B2B remained the primary growth engine. B2B gross bookings grew 22% year over year to $10.75 billion, outpacing B2C gross bookings growth of 10% to $24.78 billion. The differential suggests Expedia Group’s partner-facing business continued to scale faster than its consumer segment.Expedia Group, Inc. Price, Consensus and EPS Surprise Expedia Group, Inc. price-consensus-eps-surprise-chart | Expedia Group, Inc. QuoteThat mix also showed up in revenue performance. B2B revenues rose 25% year over year to $1.18 billion, while B2C revenues increased 8% to $2.12 billion.Within advertising and media, Expedia Group's advertising revenues rose 13% to $197 million, and trivago’s advertising revenues jumped 47% to $125 million, adding a higher-growth layer to the overall revenue profile.EXPE’s Booking Growth Shows Broad-Based DemandTotal gross bookings increased 13% year over year to $35.53 billion, reflecting strength across both lodging and non-lodging categories.Lodging gross bookings climbed 13% to $25.98 billion, while non-lodging gross bookings also improved 13% to $9.55 billion, indicating healthy demand across the platform’s key travel products.Pricing trends were supportive as well. Average daily rate booked rose 7% year over year to $228.10, and booked air tickets increased 6% to 15.7 million, helping round out a quarter that featured gains across multiple demand indicators.Momentum in core travel demand remained intact, with booked room nights increasing 6% year over year to 113.9 million.EXPE’s Q1 Operating DetailsProfitability improved sharply in the quarter. Operating income swung to $251 million from an operating loss of $70 million in the year-ago period, supported by expense leverage and better operating efficiency.On an adjusted basis, EBITDA increased 83% year over year to $542 million, and adjusted EBITDA margin expanded 591 basis points to 15.8%.Direct sales and marketing expenses were $1.86 billion, representing 54.2% of revenues, up 6% year over year. However, B2C direct marketing expenses declined 7% year over year to $1.04 billion and leveraged 75 bps as a percentage of B2C gross bookings to 4.2% from 4.9%.Overhead expenses were $627 million, representing 18.3% of revenues, up 4% year over year, while leveraging 190 bps as a percentage of revenues from 20.2% in the prior-year quarter.Adjusted cost of revenues was $373 million, up 5% year over year, representing 10.9% of revenues, leveraging 98 bps year over year.EXPE’s Balance Sheet & Cash Flow DetailsAs of March 31, 2026, cash and cash equivalents and short-term investments were $5.79 billion, up from $5.73 billion as of Dec. 31, 2025.Long-term debt was unchanged at $4.47 billion as of March 31, 2026, compared with Dec. 31, 2025.Cash generation was another bright spot. Net cash provided by operating activities increased 33% year over year to $3.93 billion, reflecting the company’s improved operating performance and favorable working-capital dynamics typical of the travel marketplace model.Free cash flow climbed 36% year over year to $3.75 billion after $184 million of capital expenditures.Capital returns accelerated. Expedia Group repurchased roughly 3.3 million shares for $700 million in the quarter and announced a new $5 billion share repurchase authorization. The board also declared a quarterly cash dividend of 48 cents per share.EXPE’s Q2 & 2026 GuidanceLooking ahead, EXPE maintained its full-year 2026 framework while providing a solid second-quarter outlook.The company expects gross bookings to be in the range of $32.5-$33.1 billion for the second quarter of 2026, representing growth of 7-9% year over year.Revenues are expected to be in the band of $4.11-$4.19 billion, suggesting growth of 9-11% year over year.Expedia Group expects second-quarter adjusted EBITDA margin expansion of 50-100 bps year over year.For full-year 2026, Expedia Group continues to project gross bookings of $127-$129 billion, implying growth of 6-8% year over year. Revenues are still expected in the range of $15.6-$16.0 billion, indicating growth of 6-9% year over year.Expedia Group expects adjusted EBITDA margin to expand 100-125 bps year over year for the year 2026.EXPE’s Zacks Rank & Stocks to ConsiderExpedia Group currently carries a Zacks Rank #3 (Hold).American Public Education APEI, Fox FOX and Hasbro HAS are some better-ranked stocks that investors can consider in the broader Consumer Discretionary sector.American Public Education sports a Zacks Rank #1 (Strong Buy) at present, while Fox and Hasbro carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.American Public Education is slated to announce first-quarter 2026 results on May 11. 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