Booking Holdings Q1 Review: Strong Results Underscore Resilience in Global Travel Demand

Booking Holdings (NASDAQ: BKNG) delivered a robust first-quarter earnings report that beat consensus on both the top and bottom lines, reinforcing the strength of global travel demand despite pockets of macro uncertainty. The company reported adjusted EPS of $24.81, crushing the Street’s $17.25 estimate, and revenue of $4.76 billion, exceeding expectations by nearly 4%. The report underscores consumers' sustained willingness to spend on travel, particularly outside the U.S., even as cost sensitivity grows among lower-income domestic travelers. Booking’s geographic diversification once again proved to be a key asset, helping it weather regional softness while continuing to grow room nights, alternative accommodations, and attractions bookings.

Booking continues to see stable global travel demand, with CEO Glenn Fogel highlighting the durability of consumer intent despite a complex macro environment. Room night bookings rose over 7% year over year to 319 million—the first time the platform has surpassed 300 million nights in a single quarter—while alternative accommodation bookings climbed 12%, reflecting travelers’ appetite for flexibility and value. Airline ticket sales and attraction ticket bookings also surged, up 45% and 92% respectively, pointing to expanding consumer preferences across travel verticals. However, within the U.S., management noted a softening trend in inbound travel and early signs of price sensitivity, particularly among cost-conscious segments.

Key Metrics: Outperformance with a Few Mixed Pockets

• Revenue: $4.76 billion, up 8% year-over-year, beating estimates of $4.6 billion.
• EPS: $24.81 adjusted, a 22% increase from $20.39 last year and a 43% beat vs. consensus.
• Gross Bookings: $46.7 billion, up 7% YoY and about 10% on a constant currency basis.
• Room Nights Booked: 319 million, slightly above consensus of 317.9 million, up over 7% YoY.
• Adjusted EBITDA: $1.1 billion, up 21% YoY.
• Free Cash Flow: $3.2 billion.
• Airline Tickets Sold: 16 million, up 45% YoY.
• Attraction Tickets Booked: +92% YoY.

By segment, merchant revenue rose a solid 22.2% to $2.92 billion, outperforming expectations, while agency revenue slipped 11.3% to $1.56 billion, slightly missing estimates. Advertising and other revenue grew 6.1% to $280 million, broadly in line with forecasts. The strong performance in merchant bookings signals continued momentum in mobile and direct bookings—areas where Booking’s investments in AI and personalization are paying off.

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Guidance: FX Tailwinds but Conservative Constant Currency Outlook

Booking guided Q2 gross bookings to grow between 10% to 12%, ahead of the Street’s 7% estimate. Room nights are forecast to grow 4% to 6%, in line to slightly below expectations. Revenue is expected to rise 10% to 12% in Q2, well above the 8.3% consensus, while EBITDA guidance of $2.15 billion to $2.2 billion came in just below analyst expectations of $2.24 billion. Importantly, FX is now expected to be a +2 point tailwind for the year, reversing from a previously expected -3 point headwind, largely due to currency shifts in Europe. Excluding FX, however, full-year revenue guidance was lowered slightly at the midpoint, a move that contributed to the muted investor reaction.

Stock Performance: Mixed Signals as Guidance Tempers Enthusiasm

Despite the headline beats, BKNG shares fell more than 3% in after-hours trading, settling near $4,741. Analysts attributed the decline to a combination of modest room night bookings—barely above consensus—and lowered constant currency guidance. Investors were likely expecting a more convincing upside in volume trends, especially given Booking’s historic pattern of outperformance. Prior to earnings, the stock had gained slightly on the year, outperforming both the S&P 500 and more U.S.-centric peers like Expedia, which is down 14% YTD.

Jefferies analyst John Colantuoni noted that while room night bookings met expectations, they lacked the upside surprise investors have come to expect from Booking. Still, Citizens raised its price target to $5,700 from $5,600, citing the company’s geographic resilience and long-term margin levers.

Consumer Trends and Strategic Outlook

CFO Ewout Steenbergen flagged some subtle shifts in traveler behavior—especially in the U.S.—including shorter lengths of stay and growing demand for lower-cost options. Nevertheless, Booking's globally diversified business and strong cash position ($16.1 billion in cash and investments) give it the flexibility to press advantages in weaker markets. The company also highlighted a more aggressive push into performance marketing channels and increased ad spend in traditional media, supported by strong ROI metrics.

AI integration remains a strategic priority, with Booking testing new agentic tools like Priceline’s “Penny” to drive a more personalized travel experience. Management emphasized that while the full monetization impact is still in the distance, early results are encouraging, especially in boosting direct bookings through the Genius loyalty program.

Conclusion

Booking Holdings enters the heart of 2025 in a position of relative strength, leveraging its global reach to offset regional softness and maintaining solid growth across room nights, flights, and attractions. While near-term guidance struck a conservative tone on a constant currency basis, the company’s strong financial performance, disciplined marketing approach, and long-term vision around the “connected trip” strategy suggest it is well positioned to capitalize on ongoing travel demand. Investors may be reacting to the absence of a blockbuster upside, but the durability of the model remains intact.