AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-2: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 5/6 · 18/10/2026
Moat56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 3/4 · Multiyear supply expansion, substantial booking demand, repeat direct app use, and concentrated Genius engagement demonstrate an established marketplace and brand advantage. They do not establish exclusivity or an insurmountable network effect.
durability · 2/4 · Supply expansion and repeat demand support persistence, balanced against low entry barriers, paid-channel dependence, and actual restrictions on commercial practices. No exceptional long-term durability is demonstrated.
customer dependency · 2/4 · Higher-tier Genius travelers book more frequently and return more consistently, and apps generate repeat direct demand. This demonstrates preference and engagement, but not necessity or substantial switching friction; suppliers also have direct distribution channels.
erosion resilience · 2/4 · Second-quarter 2026 room nights and first-half operating income grew despite travel disruption. Total direct mix was flat in the comparable March periods, while regulatory constraints and reduced marketing returns demonstrate vulnerabilities. Generic AI risks are possibilities, not realized displacement.
Pricing power50
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Observed monetization is mixed: revenue as a percentage of gross bookings fell from 14.3% to 14.1% in 2022 because of merchandising and mix, partly offset by payment revenues. More recent payment revenues exceeded incremental variable expenses, but current comparable commission trends are absent. The 2026 ADR increase is an underlying accommodation-price outcome, not proof of Booking setting higher fees.
retention · 3/4 · Reported repeat direct app behavior, higher-tier Genius booking frequency, and their disproportionate room-night contribution provide strong engagement evidence. This assesses retention through disclosed booking behavior rather than a quantified cohort retention rate, and does not establish retention after fee increases.
margin resilience · 2/4 · First-half 2026 operating income rose faster than revenue, although second-quarter operating margin was slightly lower year over year. Positive payment contribution helps, while cancellations produced realized acquisition inefficiency. These mixed outcomes establish resilience without proving that pricing caused it.
contractual freedom · 1/4 · Contracts establish commission or margin consideration, but actual commitments constrain price presentation, discount claims, and ranking disclosures. Switzerland ordered lower hotel commissions; that order is suspended pending appeal, so no implemented commission reduction is assumed. Commercial freedom is materially constrained.
Predictability88
Five consecutive annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 100.00
- Revenue growth volatility (pp)
- 17.88
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 4.57
Financial strength67
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, or reported pretax profit plus reported interest expense when operating income is unavailable. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 84.83
- netDebtEbitGrade
- 96.53
- interestCoverageGrade
- 40.52
- currentRatioGrade
- 46.67
- Debt / FCF (x)
- 2.06
- Net debt / operating income (x)
- 0.17
- Interest coverage (x)
- 5.46
- Current ratio (x)
- 1.33
Capital allocation—
Missing required inputs: operatingReturn, cashConversionGrade. Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income or, if unavailable, EBIT calculated from reported pretax profit plus reported interest expense; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. Nonpositive invested capital has no defined return and remains unavailable. Does not establish acquisition quality or buyback timing.
- 3-year average dilution (%)
- -6.60
- 3-year average SBC / revenue (%)
- 2.43
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Strong 2025 cash generation, net share-count reduction after compensation issuance, and limited dilution support discipline. However, cumulative returns exceeded free cash flow, first-half 2026 repurchases and dividends exceeded operating cash flow, and a failed acquisition incurred a paid termination fee. Working-capital inflows support part of recent cash generation, and repurchase value creation is unproven.
incentive alignment · 3/4 · Approved three-year PSU grants, relative TSR modification, an absolute TSR governor, and limited realized dilution demonstrate meaningful alignment. Adjusted EBITDA incentives exclude competition-fine adjustments, weakening accountability for some costs. Actual executive ownership amounts are missing.
execution · 3/4 · Supply expansion, 2025 room-night growth, Connected Trip transaction adoption, rising app usage, and continued 2026 revenue and operating-income growth demonstrate execution. Attribution to management is partly indirect operating evidence; these results do not establish that every strategic investment has earned attractive returns.
governance · 2/4 · Independent committees, related-person review procedures, and effective-control disclosures support functioning oversight. Realized competition fines and required practice changes provide contrary evidence on compliance outcomes. The auditor attestation is disclosed, but its full opinion is not supplied; proposed officer exculpation is not treated as adopted.
Evidence
We have established widely-used and recognized brands through marketing and promotional campaigns.
MD&A / established brands · Filed 04/08/2026
The mix of our room nights booked on our mobile apps over the trailing twelve months ended June 30, 2026, was a high-fifties percentage, up from a mid-fifties percentage over the trailing twelve months ended June 30, 2025.
MD&A / trailing-twelve-month mobile app room-night mix · Filed 04/08/2026
The significant majority of room nights booked on our mobile apps are direct, and we continue to see favorable repeat direct booking behavior from consumers in our mobile apps, which allow us more opportunities to engage directly with them.
MD&A / repeat direct app bookings · Filed 04/08/2026
Last year, Level 2 and Level 3 Genius travelers represented over 30% of our active base and accounted for a high-50% share of room nights, up from 2024.
Proxy / 2025 Genius active base and room-night contribution · Filed 21/04/2026
These travelers book more frequently, book further in advance, and return more consistently.
Proxy / higher-tier Genius booking behavior · Filed 21/04/2026
The mix of total room nights booked by consumers coming directly to our platforms was a mid-fifties percentage over the trailing twelve months ended March 31, 2026 and March 31, 2025, respectively.
MD&A / total direct room-night mix · Filed 28/04/2026
Our performance marketing expenses, which represent a substantial majority of our marketing expenses, are primarily related to the use of online search engines (primarily Google), affiliate marketing (i.e., business-to-business or "B2B"), meta search, and social media channels to generate bookings through our platforms.
MD&A / performance marketing and Google dependence · Filed 04/08/2026
The estimated value of the incentives granted and the loyalty points expected to be redeemed is generally recognized as a reduction of revenue at the time they are granted.
Revenue recognition / incentives and loyalty points · Filed 18/02/2026
Gen AI and other new technologies could influence how consumers search for and book travel, diminish the relevance or competitiveness of our existing technology and service offerings, or require us to modify or adapt our services or infrastructure, any of which could adversely affect our results of operations and financial condition.
Risk factors / AI-driven changes to travel discovery · Filed 18/02/2026
For instance, we have incurred costs related to customer reimbursement and customer service, reputational harm, and lost revenue from fictitious listings and account takeovers.
Risk factors / realized fictitious-listing and account-takeover harm · Filed 18/02/2026
At December 31, 2023, Booking.com offered accommodation reservation services for approximately 3.4 million properties in over 220 countries and territories and in over 40 languages, consisting of over 475,000 hotels, motels, and resorts and over 2.9 million homes, apartments, and other unique places to stay.
Business / Booking.com property supply at December 2023 · Filed 22/02/2024
At December 31, 2025, Booking.com offered accommodation reservation services for approximately 4.4 million properties in over 220 countries and territories and in over 40 languages, consisting of approximately 500,000 hotels, motels, and resorts and approximately 3.9 million homes, apartments, and other unique places to stay.
Business / Booking.com property supply at December 2025 · Filed 18/02/2026
Partners also benefit from our trusted brands and marketing efforts, expertise in offering an excellent consumer experience, and ability to offer their inventory in markets and to consumers that they may otherwise be unable or unlikely to reach, for instance due to language or payments services we can offer on their behalf.
Business / partner distribution benefits asserted by issuer · Filed 18/02/2026
We booked more than 1.2 billion room nights, an increase of 8% year over year.
Proxy / 2025 room nights and growth · Filed 21/04/2026
The year-over-year increase in total gross bookings for the three months ended June 30, 2026 was due to a 5% increase in room nights, approximately 2% higher constant currency ADRs, a positive impact from changes in foreign currency exchange rates of about 1%, and a positive impact from the growth in flight gross bookings.
MD&A / second-quarter 2026 booking growth components · Filed 04/08/2026
In 2025, connected transactions, meaning trips that included bookings across more than one vertical, grew in the high 20% range and represented a low double digit percentage of Booking.com’s total transactions.
Proxy / realized Connected Trip transaction adoption · Filed 21/04/2026
Barriers to entry are low, and we compete with online travel companies ("OTCs"), travel service providers offering direct booking (such as airlines, hotels, and rental car companies), traditional travel agencies and operators, companies offering travel-related software, payments, or technology solutions, financial services and credit card companies, and global technology companies with significantly greater scale, data, and financial resources.
Risk factors / low entry barriers and competing distribution channels · Filed 18/02/2026
The market for accommodations covers a wide range of property types including alternative accommodations and companies like Airbnb and Vrbo (owned by Expedia) compete directly with our accommodations businesses.
Risk factors / named accommodation competitors · Filed 18/02/2026
In 2025, Booking.com received a negative decision ordering a reduction of its average commission level for hotels located in Switzerland, which Booking.com disagrees with and has appealed.
Contingencies / Swiss commission-reduction decision · Filed 04/08/2026
The Swiss PSO order is suspended pending the outcome of the appeal, and the ordered reduction in commissions would only be effective for a three-year period after a negative final judgment.
Contingencies / suspension and conditional duration of Swiss order · Filed 04/08/2026
For example, the Company has previously made voluntary commitments related to showing prices inclusive of all mandatory taxes and charges, providing information about the effect of money earned on search result rankings, and adjusting how discounts and statements concerning popularity or availability are shown.
Contingencies / actual commitments concerning prices, rankings, and discounts · Filed 04/08/2026
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Merchant revenues $ 5,127 $ 4,457 $ 8,825 $ 7,375 Agency revenues 1,903 2,044 3,431 3,608 Advertising and other revenues 322 297 628 577 Total revenues 7,352 6,798 12,884 11,560 Operating expenses: Marketing expenses 2,371 2,139 4,439 3,916 Sales and other expenses 942 899 1,746 1,601 Personnel, including stock-based compensation of $140, $154, $281, and $296, respectively 900 896 1,793 1,589 General and administrative 217 199 317 341 Information technology 263 219 503 419 Depreciation and amortization 129 158 260 312 Transformation costs 30 38 55 70 Total operating expenses 4,852 4,548 9,113 8,248 Operating income 2,500 2,250 3,771 3,312 Interest expense (300) (418) (553) (1,067) Interest and dividend income 201 234 388 475 Other income (expense), net 159 (962) 353 (1,220) Income before income taxes 2,560 1,104 3,959 1,500 Income tax expense 610 209 926 272 Net income $ 1,950 $ 895 $ 3,033 $ 1,228 Net income applicable to common stockholders per basic common share $ 2.54 $ 1.10 $ 3.89 $ 1.50 Weighted-average number of basic common shares outstanding 768 812 779 817 Net income applicable to common stockholders per diluted common share $ 2.53 $ 1.10 $ 3.88 $ 1.50 Weighted-average number of diluted common shares outstanding 770 815 782 821 See Notes to Unaudited Consolidated Financial Statements.
Unaudited consolidated statements of operations / first-half and second-quarter comparisons · Filed 04/08/2026
Total revenues as a percentage of gross bookings was 14.1% in 2022, down from 14.3% in 2021 due to investments in merchandising and an increase in the mix of airline ticket gross bookings, partially offset by increased revenues from facilitating payments.
MD&A / realized 2022 revenue-to-gross-bookings decline · Filed 22/02/2024
Over the trailing twelve months ended June 30, 2026, the incremental revenues from facilitating payments were greater than the associated incremental variable expenses.
MD&A / payment revenues versus incremental variable expenses · Filed 04/08/2026
These contracts include payment terms and establish the consideration to which the Company is entitled, which includes either a commission or a margin on the travel transaction.
Revenue recognition / contractual commission or margin consideration · Filed 18/02/2026
We generated approximately $9.4 billion in net cash provided by operating activities and approximately $9.1 billion in free cash flow.
Proxy / 2025 operating cash flow and free cash flow · Filed 21/04/2026
Since restarting our repurchase program in 2022, we have returned more than 100% of our free cash flow to stockholders and reduced our share count by 22%, after accounting for shares issued for employee equity compensation.
Proxy / cumulative capital returns and net share-count reduction · Filed 21/04/2026
6 Booking Holdings Inc. UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIT (In millions) Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Total Shares Amount Shares Amount Three Months Ended June 30, 2026 Balance, March 31, 2026 1,618 $ 13 (838) $ (58,337) $ 8,490 $ 41,420 $ (310) $ (8,724) Net income — — — — — 1,950 — 1,950 Other comprehensive loss, net of tax — — — — — — (38) (38) Exercise of stock options and vesting of restricted stock units and performance share units — — — — 1 — — 1 Stock-based compensation — — — — 144 — — 144 Repurchase of common stock — — (22) (3,792) — — — (3,792) Dividends — — — — — (324) — (324) Balance, June 30, 2026 1,618 $ 13 (860) $ (62,129) $ 8,635 $ 43,046 $ (348) $ (10,783) Six Months Ended June 30, 2026 Balance, December 31, 2025 1,613 $ 13 (816) $ (54,315) $ 8,344 $ 40,670 $ (290) $ (5,578) Net income — — — — — 3,033 — 3,033 Other comprehensive loss, net of tax — — — — — — (58) (58) Exercise of stock options and vesting of restricted stock units and performance share units 5 — — — 1 — — 1 Stock-based compensation — — — — 290 — — 290 Repurchase of common stock — — (44) (7,814) — — — (7,814) Dividends — — — — — (657) — (657) Balance, June 30, 2026 1,618 $ 13 (860) $ (62,129) $ 8,635 $ 43,046 $ (348) $ (10,783) 7 Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Shares Amount Shares Amount Total Three Months Ended June 30, 2025 Balance, March 31, 2025 1,613 $ 13 (795) $ (50,131) $ 7,854 $ 36,539 $ (387) $ (6,112) Net income — — — — — 895 — 895 Other comprehensive income, net of tax — — — — — — 84 84 Exercise of stock options and vesting of restricted stock units and performance share units — — — — 2 — — 2 Stock-based compensation — — — — 160 — — 160 Repurchase of common stock — — (7) (1,371) — — — (1,371) Dividends — — — — — (315) — (315) Balance, June 30, 2025 1,613 $ 13 (802) $ (51,502) $ 8,016 $ 37,119 $ (303) $ (6,657) Six Months Ended June 30, 2025 Balance, December 31, 2024 1,607 $ 12 (783) $ (47,877) $ 7,695 $ 36,525 $ (375) $ (4,020) Net income — — — — — 1,228 — 1,228 Other comprehensive income, net of tax — — — — — — 72 72 Exercise of stock options and vesting of restricted stock units and performance share units 6 1 — — 14 — — 15 Stock-based compensation — — — — 307 — — 307 Repurchase of common stock — — (19) (3,625) — — — (3,625) Dividends — — — — — (634) — (634) Balance, June 30, 2025 1,613 $ 13 (802) $ (51,502) $ 8,016 $ 37,119 $ (303) $ (6,657) See Notes to Unaudited Consolidated Financial Statements.
Statements of stockholders' deficit / actual 2026 repurchases, dividends, and equity compensation · Filed 04/08/2026
Six Months Ended June 30, (In millions) 2026 2025 Net cash provided by operating activities $ 6,934 $ 6,484 Net cash used in investing activities (196) (179) Net cash used in financing activities (6,220) (5,764) 30 Net cash provided by operating activities for the six months ended June 30, 2026 resulted from net income of $3.0 billion, a favorable net impact from adjustments for non-cash and other items of $510 million, and a favorable net change in working capital and other assets and liabilities of $3.4 billion.
Cash flow analysis / first-half 2026 operating cash generation and working capital · Filed 04/08/2026
In September 2023, the European Commission announced its decision to prohibit the acquisition and consequently a termination fee of $90 million was paid by the Company in October 2023 and is recorded in "General and administrative" expenses in the Consolidated Statement of Operations for the year ended December 31, 2023.
Acquisition note / prohibited Etraveli acquisition and paid termination fee · Filed 18/02/2026
57 EXECUTIVE COMPENSATION How We Make Compensation Decisions EXECUTIVE COMPENSATION Performance Share Units In 2025 the T&C Committee approved grants of PSUs with three‑year targets and performance periods, an rTSR modifier, and TSR governor.
Executive compensation / approved 2025 PSU grants and three-year terms · Filed 21/04/2026
This is the primary driver behind the TSR governor, which caps the PSU vesting factor at target unless absolute TSR is positive over the three‑year period of the award.
Executive compensation / absolute TSR payout governor · Filed 21/04/2026
We are proud that in 2025, our stock‑based compensation resulted in approximately 0.4% of stockholder dilution and during the last 5 years, resulted in less than 3% of cumulative dilution.
Executive compensation / realized annual and cumulative dilution · Filed 21/04/2026
As discussed in this proxy statement, we use Adjusted EBITDA (calculated as described in this proxy statement) as a key performance measure under our annual cash incentive bonus plan and long-term equity incentive awards, as they pertain to the named executive officers.
Non-GAAP disclosures / adjusted EBITDA in incentive awards · Filed 21/04/2026
(b)Adjustments related to the fine imposed by the Spanish competition authority are recorded in General and administrative expenses and excluded from Net income to calculate Adjusted Net income and Adjusted EBITDA.
Non-GAAP disclosures / exclusion of competition-fine adjustments · Filed 21/04/2026
Independent Board Committees. Each of the Audit Committee, Cybersecurity Subcommittee, CG Committee, and T&C Committee is comprised entirely of independent directors.
Corporate governance / independent board committees · Filed 21/04/2026
Certain Relationships and Related Person Transactions Review and Approval or Ratification of Related Person Transactions Pursuant to a written policy, the Audit Committee reviews all relationships and transactions in which we participate and in which any related person has a direct or indirect material interest and the transaction involves or is expected to involve payments of $120,000 or more in the aggregate per fiscal year.
Corporate governance / related-person transaction review policy · Filed 21/04/2026
Based on this evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2025.
Internal controls / management effectiveness conclusion at December 2025 · Filed 18/02/2026
Our independent registered public accounting firm also attested to and reported on the effectiveness of internal control over financial reporting.
Internal controls / independent auditor attestation disclosure · Filed 18/02/2026
Some investigations have resulted in fines and the Company could incur additional fines and/or be restricted in certain of its business practices in the future.
Contingencies / investigations with realized fines · Filed 04/08/2026
The impact of cancellation rates on ROIs was evident in the first quarter of 2026, as a notable portion of our spend occurred prior to the onset of the conflict in the Middle East, which resulted in diminished returns on performance marketing expenses as many bookings sourced through paid channels were subsequently canceled due to the conflict.
MD&A / realized cancellation-related reduction in marketing returns · Filed 28/04/2026
While the conflict in the Middle East continued to affect travel demand during the second quarter, cancellation rates normalized following the elevated levels in March 2026 immediately after the onset of the conflict.
MD&A / cancellation normalization following March disruption · Filed 04/08/2026
In the second quarter of 2026, our global average daily rates ("ADRs") on a constant currency basis were approximately 2% higher than the prior year primarily driven by higher ADRs in Europe and the U.S.
MD&A / second-quarter accommodation ADR outcomes · Filed 04/08/2026
