The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Expedia beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded and GAAP earnings per share dropped significantly.
Margins dropped across the board.
Expedia recorded revenue of $1.20 billion. The 20 analysts polled by S&P Capital IQ hoped for revenue of $1.17 billion on the same basis. GAAP reported sales were 5.1% higher than the prior-year quarter's $1.14 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.32. The 23 earnings estimates compiled by S&P Capital IQ predicted $1.26 per share. GAAP EPS of $1.21 for Q3 were 19% lower than the prior-year quarter's $1.50 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 79.7%, 190 basis points worse than the prior-year quarter. Operating margin was 19.1%, 670 basis points worse than the prior-year quarter. Net margin was 14.3%, 410 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $905.0 million. On the bottom line, the average EPS estimate is $0.61.
Next year's average estimate for revenue is $3.93 billion. The average EPS estimate is $3.00.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 345 members out of 440 rating the stock outperform, and 95 members rating it underperform. Among 142 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 122 give Expedia a green thumbs-up, and 20 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Expedia is hold, with an average price target of $52.71.
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