Booking Holdings beats Q2 estimates, EPS up 15% on record buyback

Booking Holdings reported second-quarter adjusted earnings of $2.54 a share, up 15 percent and beating the $2.44 consensus, as resilient domestic travel offset Middle East conflict headwinds.

"We exceeded the high end of our guidance across all of our key financial metrics while continuing to invest in the strategic priorities that we believe will drive long-term value," Chief Executive Officer Glenn Fogel said.

Revenue rose 8 percent to $7.35 billion, topping the $7.20 billion estimate by about 2 percent. Room nights grew 5 percent, above the high end of guidance, while gross bookings climbed 9 percent (8 percent constant currency) and adjusted EBITDA reached about $2.6 billion, up 9 percent with margin expanding nearly 40 basis points. Constant-currency average daily rates rose about 2 percent, led by Europe and the U.S.

Shares climbed 5.8 percent after hours to $205.60 from a $194.27 close. The company returned a record $4.1 billion to shareholders in the quarter, including $3.7 billion in buybacks, part of $7.4 billion repurchased in the first half at an average price near $173. Free cash flow totaled $3.6 billion, with cash and investments at $17.7 billion.

Metric	Actual	Consensus	Beat/Miss
Revenue	$7.35B	$7.20B	+2.1%
Adjusted EPS	$2.54	$2.44	+4.1%
Room nights	+5%	~4%	+1pp

Management raised its transformation program savings target to about $650 million from $550 million, with the incremental $100 million expected mostly in 2027 from procurement. Connected Trip transactions, where travelers book more than one vertical for the same trip, grew at a low-double-digit rate and now represent a low-double-digit share of Booking.com's total transactions. Merchant gross bookings reached 73 percent of the total, up four percentage points.

For the third quarter, Booking expects room nights to grow 3 percent to 5 percent and gross bookings, revenue, and adjusted EBITDA each to rise 4 percent to 6 percent, assuming indirect Middle East impacts persist. Full-year guidance calls for high-single-digit growth in gross bookings, revenue, and adjusted EBITDA, with adjusted EPS up low to mid-teens. Chief Financial Officer Ewout Steenbergen said AI investments are already delivering a positive return, with customer service cost per booking declining at a double-digit rate.

The beat and raised savings target signal management expects operating leverage to keep expanding even as geopolitical uncertainty weighs on long-haul travel. Investors will watch the third-quarter call for signs that flight capacity and pricing normalize, and for traction from the AI-powered discovery tools and B2B consolidation under Agoda CEO Omri Morgenshtern.

This article is for informational purposes only and does not constitute investment advice.