Expedia: Slow first quarter - Introduces "smart" tools

The American travel booking platform Expedia Group started the year with less momentum than expected. In its financial results for the first quarter of 2025, the Seattle-based company announced increases in bookings and revenue, but at lower levels than initial estimates — a fact attributed, according to CEO Ariane Gorin, to "lower-than-expected demand for travel within the United States and to the United States."

Specifically, total bookings increased by 4% compared to the same quarter last year, while revenue increased by 3%, reaching $2.9 billion. In contrast, the B2B (business-to-business) and advertising divisions showed stronger growth, with an increase of 14% and 20%, respectively.

Strategic Priorities

Despite the uncertain climate prevailing in the global travel market in general, with characteristics such as shorter travel planning periods and subdued demand, Expedia declares its commitment to its core priorities. These, as Gorin emphasized in the earnings conference call, are: Providing greater value to travelers, targeted investments in the most promising markets, and improving efficiency and increasing profit margins.

New opportunity with Southwest and Ryanair

One of Expedia's most encouraging moves this year was the integration of Southwest Airlines flights into its database. This is the first time that Southwest has made its tickets available through an online travel agency (OTA). Gorin said that about a third of users who booked Southwest flights through Expedia are new customers to the platform. At the same time, partner hotels benefit, as they can offer packages that combine flights and accommodation.

Similarly, in Europe, the partnership with Ryanair has brought in new customers - 75% of those who booked Ryanair flights through Expedia had not used the platform before.

Investment in artificial intelligence and social networks

Expedia is also actively investing in artificial intelligence (AI), both to improve its internal operations and to enhance the user experience. As Gorin said, more and more travelers are using generative AI tools to plan trips, and Expedia wants to appear in relevant searches. The company is already working with OpenAI (creator of ChatGPT) and Microsoft (Copilot Actions), to ensure that its services are displayed when consumers are looking for ideas and suggestions.

Another new tool that combines AI and social media is Expedia Trip Matching, which was created in partnership with Instagram. The tool allows users to send Expedia a post or a Reel directly from Instagram. Within minutes, Expedia automatically responds with a suggested itinerary based on the post, along with experience descriptions and links to book directly.

“We understood that people were seeing travel Reels, they wanted to share them, and they were wondering how to create a trip based on them. With one click, we provide ready-made suggestions and the ability to book,” Gorin said.

Hotels and the renewal of Hotels.com

In the hotel segment, room-night bookings increased 6% in the quarter, reaching 107.7 million, while total room revenue reached $2.3 billion (up 3%).

However, Hotels.com’s performance has been disappointing, with the company turning negative. Expedia is trying to revamp the subsidiary with new tools (like hotel price alerts and analytics) and a new visual identity. Part of the revamp is the introduction of Bellboy, a “live” version of the classic bellboy, who has become the new face of Hotels.com on social media.

Gorin was optimistic: “Hotels.com is a brand that travelers love. It was significantly impacted a few years ago when we changed the platform and the rewards program, but we have a strong plan for the next period.”

The forecast for the future

The company’s CFO, Scott Schenkel, said that for the second quarter, it is expected to grow 2%–4% in total bookings and 3%–5% in revenue. These figures will be positively impacted by Easter (which fell in April this year), but negatively impacted by exchange rates and other factors. For the full year, Expedia revised its forecast for bookings and revenue growth to 2%–4%.

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