Booking (NASDAQ:BKNG) Reports Strong Q1, Stock Soars

Kayode Omotosho /
2022/05/04 4:14 pm EDT

Online travel agency Booking Holdings (NASDAQ:BKNG) reported Q1 FY2022 results topping analyst expectations, with revenue up 136% year on year to $2.69 billion. Booking made a GAAP loss of $700 million, down on its loss of $55 million, in the same quarter last year.

Is now the time to buy Booking? Access our full analysis of the earnings results here, it's free.

Booking (BKNG) Q1 FY2022 Highlights:

  • Revenue: $2.69 billion vs analyst estimates of $2.52 billion (6.61% beat)
  • EPS (non-GAAP): $3.90 vs analyst estimates of $1.18 (231% beat)
  • Free cash flow of $1.58 billion, up from $178 million in previous quarter
  • Room Nights Booked: 198 million, up 99 million year on year

Formerly known as The Priceline Group, Booking Holdings (NASDAQ: BKNG) is the world’s largest online travel agency.

 Because of the enormous number of flights, hotels, and accommodations available, travel is a natural fit for marketplaces that aggregate suppliers, simplifying the shopping process for consumers.

Sales Growth

Booking's revenue growth over the last three years has been strong, averaging 29.1% annually. Booking's revenue took a hit when the pandemic first hit, but it has since rebounded strongly, as you can see below.

Booking Total Revenue

This quarter, Booking beat analyst estimates and reported a very impressive 136% year on year revenue growth.

Ahead of the earnings results the analysts covering the company were estimating sales to grow 40.9% over the next twelve months.

There are others doing even better than Booking. Founded by ex-Google engineers, a small company making software for banks has been growing revenue 90% year on year and is already up more than 150% since the IPO last December. You can find it on our platform for free.

Usage Growth

As an online travel company, Booking generates revenue growth by a combination of increasing the number of stays (or experiences) booked, as well as the level of commission charged on those bookings.

Over the last two years the number of Booking's nights booked, a key usage metric for the company, grew 103% annually to 198 million users. This is among the fastest growth of any consumer internet company, indicating that users are again excited about the offering.

Booking Room Nights Booked

In Q1 the company added 99 million nights booked, translating to a 100% growth year on year.

Key Takeaways from Booking's Q1 Results

Sporting a market capitalization of $85.8 billion, more than $10.5 billion in cash and with positive free cash flow over the last twelve months, we're confident that Booking has the resources it needs to pursue a high growth business strategy.

We were impressed by the exceptional revenue growth Booking delivered this quarter. And we were also glad to see the user growth. Zooming out, we think this was a fantastic quarter that should have shareholders cheering. The company is up 7.5% on the results and currently trades at $2,265 per share.

Booking may have had a good quarter, so should you invest right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.

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The author has no position in any of the stocks mentioned.