Booking Holdings Reports $4.76 Billion Revenue in Q1 2025, Net Income Declines

Booking Holdings Inc. reported its financial results for the first quarter of 2025, revealing total revenues of $4.76 billion, a 7.9% increase from $4.42 billion in the same period last year. The company's merchant revenues rose significantly to $2.92 billion, up from $2.39 billion, while agency revenues decreased to $1.56 billion from $1.76 billion. The net income for the quarter was $333 million, a decline from $776 million in the prior year, resulting in a net income per diluted share of $10.07 compared to $22.37 in the first quarter of 2024.

The financial performance reflects a shift in the company's revenue model, with a notable increase in merchant bookings, which accounted for 67% of total gross bookings, up from 59% a year earlier. This transition is attributed to a growing preference for direct transactions through Booking.com, which has expanded its offerings and improved user engagement. The total gross bookings for the quarter reached $46.67 billion, an increase from $43.54 billion in the previous year, driven by a 7% rise in room nights reserved, particularly in Europe and Asia.

Operationally, Booking Holdings has seen an increase in its employee headcount, rising to approximately 24,500 from 24,000 a year ago. The company continues to invest in its marketing efforts, with marketing expenses increasing to $1.78 billion, reflecting a 10% rise year-over-year. This increase is aimed at driving further growth in travel demand, although it has also impacted the company's marketing efficiency due to lower returns on investment in performance marketing.

Looking ahead, Booking Holdings has provided a cautious outlook for the second quarter of 2025, expecting room night growth between 4% and 6%, and revenue growth of 10% to 12% on a reported basis. The company acknowledges the potential impact of geopolitical and macroeconomic uncertainties on consumer behavior and travel demand. Additionally, the ongoing Transformation Program, aimed at improving operational efficiency and agility, is expected to yield annual savings of approximately $400 to $450 million over the next three years, although initial costs related to the program have been recorded in the current quarter.