Leisure travel has been rising lately. Royal Caribbean (NYSE: RCL) just posted second-quarter earnings that doubled from $55.7 million to $122.2 million amid higher ticket and occupancy rates and strong bookings for future cruises. Industry leader Carnival (NYSE: CCL) reported similar trends as it logged record earnings of its own.
Likewise, business and group travel is also on the mend. Last week, Hilton (NYSE: HLT) credited that class with improvements in both occupancy and pricing that lifted revenues per available room (RevPAR) by 8.3%. Other hotel chains such as Marriott International (NYSE: MAR) shared similar upbeat news. Just to continue with the whole cruise, hotel, and rental car theme, I'll note that Dollar Thrifty's (NYSE: DTG) 35% jump in vehicle rental days has recently driven (pun intended) revenues to new record highs.
As expected, the companies that direct travelers to their rooms, berths, flights, and vehicles have been direct recipients of all this. Yesterday, Priceline.com (Nasdaq: PCLN) released solid second-quarter numbers, though a few metrics indicated that recent red-hot growth may be cooling. Today, Orbitz (Nasdaq: ORBZ) followed with an equally impressive show of strength.
Each of Orbitz's three business segments posted strong top-line growth, lifting overall revenues 30% to $75.6 million. Air revenues rose 12% to $44.2 million. Other travel revenues, excluding air, nearly doubled to $22 million. Hotel and rental car revenues increased 52% and 50% respectively, while sales of vacation packages tripled. The third division -- prosaically named other revenues -- jumped 23% to $9.3 million, thanks to advertising growth.
At the midway point of the year, Orbitz's gross margins have expanded from 66% to 73%, lifting gross profits 48% to $106.1 million. Net income has swung from a $5.4 million ($0.16) loss to a $12.2 million ($0.28) gain. Gross bookings of $2.1 billion mark a 29% improvement over last year's pace.
Orbitz's second-quarter bookings grew 21%, healthy in absolute terms, but still trailing Priceline's 58% growth, and industry leader InterActiveCorp's (Nasdaq: IACI) 31%. In July, management lowered full-year guidance, foreshadowing a possible slowdown that has Interactive shareholders concerned today. Still, with a redesigned, user-friendly website -- which is crucial in an industry that has little distinguishing characteristics among peers -- Orbitz is worth clicking on, if for nothing else than to check the price.
Fool contributor Nathan Slaughter periodically checks online travel sites in search of a $100 or less Dallas-Las Vegas flight but hasn't found one yet. He owns none of the companies mentioned.
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