Expedia Earnings: Here’s Why the Stock is Falling Now

Expedia Inc. (NASDAQ:EXPE) delivered a profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 23.55%.

Expedia Inc. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share decreased 28.09% to $0.64 in the quarter versus EPS of $0.89 in the year-earlier quarter.

Revenue: Rose 15.87% to $1.21 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Expedia Inc. reported adjusted EPS income of $0.64 per share. By that measure, the company missed the mean analyst estimate of $0.79. It missed the average revenue estimate of $1.26 billion.

Quoting Management: “We knew we were facing second quarter headwinds and those which we expected, as well as some we didn’t, materialized. Despite this, we remain confident about our long-term strategy. We see continued return on our core brands’ technology investments, broader adoption of Expedia Traveler Preference Program, momentum in our recent acquisitions and emerging markets as well as exciting traction in one of travel’s fastest growth channels – mobile,” said Dara Khosrowshahi, Expedia, Inc. President and Chief Executive Officer.

Key Stats (on next page)…

Revenue increased 19.03% from $1.01 billion in the previous quarter. EPS increased 156% from $0.25 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $1.49 to a profit $1.45. For the current year, the average estimate has moved down from a profit of $3.44 to a profit of $3.32 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)