Booking Holdings 2025 Q2 Earnings Net Income Declines 41%

Booking Holdings (BKNG), ranking 66th by market capitalization, reported its fiscal 2025 Q2 earnings on July 29th, 2025. The company exceeded revenue expectations, reporting a 16% increase to $6.8 billion, surpassing analyst estimates of $6.59 billion. However, the earnings per share (EPS) and net income faced significant declines, with EPS dropping 38.7% to $27.54 and net income decreasing by 41.2% to $895 million. The guidance for the third quarter was in line with expectations, projecting revenue growth between 7% and 9%, and adjusted EBITDA between $3.9 billion and $4 billion.

Revenue

The total revenue for Booking Holdings rose by 16% to $6.80 billion in 2025 Q2, compared to $5.86 billion in the previous year. Within its business segments, merchant revenues contributed $4.46 billion, agency revenues added $2.04 billion, and advertising and other revenues accounted for $297 million.

Earnings/Net Income

Booking Holdings' EPS dropped 38.7% to $27.54 in 2025 Q2, compared to $44.94 in 2024 Q2, while net income decreased by 41.2% to $895 million. The decline in EPS indicates a challenging quarter for the company.

Price Action

Post-Earnings Price Action Review

The strategy of buying BKNG when its earnings beat expectations and selling after 30 days resulted in a 51.84% return, which significantly underperformed the benchmark return of 83.60%. This strategy had a maximum drawdown of 0.00%, a Sharpe ratio of 0.44, and a compound annual growth rate (CAGR) of 8.80%. Although it effectively avoided drawdowns, the low CAGR, combined with high volatility, suggests a conservative approach that did not fully capitalize on the stock's potential for long-term growth. This underperformance highlights the challenges faced in leveraging earnings surprises to drive significant investment returns, suggesting the need for a more aggressive strategy to better capture the stock's growth opportunities.

CEO Commentary

Booking Holdings' President and CEO, Glenn D. Fogel, expressed optimism about the company's strong performance, highlighting solid growth in room nights, gross bookings, and revenue, all exceeding expectations. He noted, "Our top line trends saw solid improvement," driven by robust demand across regions, especially Europe and Asia. Fogel emphasized key strategic initiatives such as expanding alternative accommodations and enhancing the Genius loyalty program, stating, "We continue to extend our Genius program beyond accommodations into other travel verticals." He underscored the importance of technology and AI in delivering value, asserting a commitment to innovation amid geopolitical and macroeconomic uncertainties, reflecting a positive leadership outlook.

Guidance

For the third quarter, Booking Holdings expects room night growth between 3.5% and 5.5%, with gross bookings anticipated to increase by 8% to 10%. The company projects revenue growth of 7% to 9%, along with adjusted EBITDA between $3.9 billion and $4 billion, representing year-over-year growth. For the full year, the company increased guidance, projecting low double-digit growth in gross bookings and revenue, with adjusted EBITDA expected to rise in the mid-teens. Adjusted EPS is projected to increase by high teens, reflecting confidence in ongoing demand trends and strategic initiatives.

Additional News

In recent weeks, Booking Holdings has focused on strategic partnerships and technological advancements. On July 22, 2025, OpenTable and KAYAK released their inaugural list of the Top 100 Hotel Restaurants in America, highlighting a shift in travel and dining trends. On July 16, 2025, KAYAK for Business announced a strategic partnership with HQ to integrate global ground transportation services into its corporate travel platform, enhancing its service offering. Additionally, OpenTable launched a generative AI-powered assistant, "Concierge," on July 15, 2025, to provide instant restaurant insights, marking a significant expansion of its AI initiatives. These developments underscore Booking Holdings' commitment to enhancing its customer experience and expanding its service capabilities.