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
Moat—
Insufficient evidence for every rubric criterion; no category score is inferred.
structural advantage · — · Platform consolidation and API distribution are demonstrated, but relative cost superiority, protected supply and reinforcing network effects remain unestablished. The moat verdict is uncertain.
durability · — · One 10-year supply agreement establishes specific relationship duration, not durable competitive superiority across the business.
customer dependency · — · API use and loyalty behavior indicate utility, but customer dependence and material switching friction cannot be established.
erosion resilience · — · Improved results coexist with search dependence, hotel direct-booking incentives and emerging AI competition. The passages cannot establish resilience of a structural moat.
Pricing power56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 2/4 · Revenue margin remained relatively consistent in first-quarter 2026, supporting maintained aggregate monetization. Percentage-based supplier agreements transmit accommodation rate changes into revenue; neither those changes nor stable aggregate monetization proves independent fee-raising power.
retention · 2/4 · The issuer reports higher repeat behavior among loyalty members and app users; continued room-night growth and a long-term B2B agreement provide additional indirect support. Cancelable listings and supplier direct-booking incentives limit dependence. No retention rate is inferred.
margin resilience · 3/4 · Operating income increased over 2023–2025 and again in first-half 2026, while payment efficiencies reduced cost of revenue relative to revenue. This demonstrates operating resilience, although lower impairments, legal items, business mix and cost control contribute; it does not isolate pricing power or establish a moat.
contractual freedom · 2/4 · Vrbo charges a separate traveler service fee, demonstrating a direct monetization mechanism. Supplier percentages are negotiated and listings are generally cancelable, so the disclosed freedom is conditional rather than unilateral control over overall travel pricing.
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)
- 12.01
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 7.43
Financial strength56
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
- 85.99
- netDebtEbitGrade
- 92.00
- interestCoverageGrade
- 47.80
- currentRatioGrade
- 0.00
- Debt / FCF (x)
- 1.98
- Net debt / operating income (x)
- 0.40
- Interest coverage (x)
- 6.26
- Current ratio (x)
- 0.73
Capital allocation98
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 pre-tax operating return (%)
- 30.77
- 3-year average dilution (%)
- -7.14
- 3-year average SBC / revenue (%)
- 3.09
- cashConversionGrade
- 100.00
Management56
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 3/4 · Actual cash generation supported investment, repurchases and dividends, while 2026 financing included debt repayments exceeding new note proceeds. Equity disclosures show repurchases alongside continuing compensation issuance. Cash generation benefits materially from merchant working capital and seasonality; repurchase valuation and acquisition returns remain unproven.
incentive alignment · 2/4 · Actual modification of missed-threshold 2021 PSUs weakened performance discipline. The unmodified 2022 awards vested zero shares, and adopted 2025 PSU terms introduced annual performance measurements. These establish mixed alignment, without assuming future vesting or ownership compliance.
execution · 3/4 · Completed platform migration, subsequent payment efficiencies, global API-led B2B growth and improved reported operating results provide strong demonstrated execution evidence. Attribution to particular executives is indirect, and results include accounting and business-mix effects.
governance · 1/4 · Independent standing committees provide oversight, but unequal voting rights, unusually strong chairman-removal protections and the actual retrospective PSU modification materially weaken shareholder accountability.
Evidence
As part of our platform operating model strategy, we migrated both the Hotels.com and Vrbo front-end stacks onto the Brand Expedia stack and created one unified front-end stack in 2023, which increases our test-and-learn capacity and feature release velocity while also providing a scalable and efficient base to operate upon.
Business: completed unified front-end platform migration · Filed 09/02/2024
for the periods presented above. Our B2C segment Adjusted EBITDA increased in 2025 compared to 2024 as a result of revenue growth, including our high-margin advertising revenue, and cost efficiencies in cost of revenue, technology expenses as well as direct marketing spend through ongoing optimization.
MD&A: B2C operating efficiencies in 2025 · Filed 13/02/2026
Cost of revenue increased $26 million and $46 million during the three and six months ended June 30, 2026 compared to the same periods in 2025, but decreased as a percentage of revenue during the period driven by continued efficiencies in payments.
MD&A: payment efficiencies in the second quarter and first half of 2026 · Filed 06/08/2026
We rely heavily on internet search engines, such as Google, through the purchase of travel-related keywords and through organic search, to generate a significant portion of the traffic to our websites and the websites of our affiliates.
Risk factors: dependence on search-generated traffic · Filed 07/02/2025
Selling and marketing - direct increased $199 million and $298 million during the three and six months ended June 30, 2026, compared to the same periods in 2025, primarily driven by an increase in B2B partner commissions to support revenue growth.
MD&A: increased B2B partner commissions · Filed 06/08/2026
In addition to the growth of online travel agencies, we have seen continued interest in the online travel industry from search engine companies such as Google, evidenced by continued product enhancements, and prioritizing its own AdWords and metasearch products such as Google Travel, Google Flights and Hotel Ads, in search results.
Competition: Google travel products and search prioritization · Filed 06/08/2026
Competitive entrants such as “metasearch” companies, including Kayak.com (owned by Booking Holdings), trivago (in which Expedia Group owns a majority interest) as well as TripAdvisor, introduced differentiated features, pricing and content compared with the legacy online travel agency companies, as well as various forms of direct or assisted booking tools.
Competition: metasearch entrants and Booking Holdings · Filed 06/08/2026
Businesses such as Airbnb, Vrbo and Booking.com have emerged as the leaders, bringing incremental alternative accommodation inventory to the market.
Competition: alternative accommodation platforms · Filed 06/08/2026
1 Table of Contents Moreover, to streamline activities and enhance focus on our core businesses, we shut down or sold a number of businesses since the beginning of 2020, including Egencia, a travel management company focused on corporate travel, in November 2021 and shifted to a 10-year lodging supply agreement with its purchaser, American Express Global Business Travel (“GBT”).
Business: Egencia disposition and 10-year lodging supply agreement · Filed 13/02/2026
B2B gross bookings grew globally with Rapid API the largest contributor to growth.
MD&A: global B2B gross bookings growth and Rapid API · Filed 06/08/2026
In April 2026, Expedia Group entered into a marketing partner arrangement whereby Expedia Group provides Uber with access to its global lodging inventory via an application programming interface ("API") to enable Uber to remarket the inventory on Uber’s apps and websites.
Related person transactions: April 2026 Uber API distribution arrangement · Filed 29/04/2026
To date, payments made to and received from Uber in connection with this arrangement have been less than $120,000.
Related person transactions: limited payments under the Uber arrangement · Filed 29/04/2026
Our B2B business has grown significantly but faces competition from other online travel agencies (“OTAs”) with B2B offerings, as well as other competitors such as independent B2B providers.
Competition: B2B competitor categories · Filed 06/08/2026
Revenue margin remained relatively consistent in the three months ended March 31, 2026 compared to the same period in 2025.
MD&A: first-quarter 2026 revenue margin · Filed 08/05/2026
Since our hotel and alternative accommodation supplier agreements are generally negotiated on a percentage basis, any increase or decrease in ADRs has an impact on the revenue we earn per room night.
MD&A: percentage-based supplier agreements and ADR sensitivity · Filed 08/05/2026
With that goal in mind, we focused towards increasing customer loyalty and app adoption as loyalty members and app users typically experience higher repeat rates, gross profits and bookings relative to non-loyalty members and non-app users.
Business: issuer observation about loyalty-member and app-user repeat behavior · Filed 09/02/2024
Under pay-per-booking arrangements, each booking is a separate contract as listings are typically cancelable at any time and the related revenue, net of amounts paid to property owners, is recognized at check in, which is the point in time when our service to the traveler is complete.
Revenue recognition: cancelable Vrbo listings and separate booking contracts · Filed 13/02/2026
Vrbo also charges a traveler service fee at the time of booking.
Revenue recognition: Vrbo traveler service fee · Filed 13/02/2026
CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except share and per share data) (Unaudited) Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Revenue $ 4,315 $ 3,786 $ 7,741 $ 6,774 Costs and expenses: Cost of revenue (exclusive of depreciation and amortization shown separately below) (1) 403 377 780 734 Selling and marketing - direct 2,119 1,920 3,975 3,677 Selling and marketing - indirect (1) 217 213 419 412 Technology and content (1) 325 325 649 645 General and administrative (1) 204 197 400 377 Depreciation and amortization 228 223 456 442 Legal reserves, occupancy tax and other 6 2 (58) 2 Restructuring and related reorganization charges(1) 13 44 69 70 Operating income 800 485 1,051 415 Other income (expense): Interest income 73 74 133 128 Interest expense (61) (58) (172) (116) Other, net 215 (78) 40 (221) Total other income (expense), net 227 (62) 1 (209) Income before income taxes 1,027 423 1,052 206 Provision for income taxes (152) (101) (189) (81) Net income 875 322 863 125 Net loss attributable to non-controlling interests 3 8 9 5 Net income attributable to Expedia Group, Inc.
Unaudited statements of operations: second-quarter and first-half 2026 results · Filed 06/08/2026
Operating Income Year ended December 31, % Change 2025 2024 2023 2025 vs 2024 2024 vs 2023 ($ in millions) Operating income $ 1,871 $ 1,319 $ 1,033 42 % 28 % % of revenue 12.7 % 9.6 % 8.0 % In 2025, the increase in operating income was primarily due to growth in revenue in excess of operating costs and lower impairment charges in the current period, partially offset by the higher legal reserves, occupancy tax and other charges discussed above.
MD&A: operating income from 2023 through 2025 and drivers · Filed 13/02/2026
CONSOLIDATED STATEMENTS OF CASH FLOWS Year ended December 31, 2025 2024 2023 (In millions) Operating activities: Net income $ 1,301 $ 1,224 $ 688 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation of property and equipment, including internal-use software and website development 847 781 748 Amortization of stock-based compensation 398 458 413 Amortization of intangible assets 40 57 59 Impairment of goodwill and intangible assets — 147 426 Deferred income taxes 78 74 62 Foreign exchange (gain) loss on cash, restricted cash and short-term investments, net (120) 95 (16) Realized (gain) loss on foreign currency forwards, net (128) 40 — (Gain) loss on minority equity investments, net 167 (289) (16) Other 124 79 55 Changes in operating assets and liabilities, net of effects from acquisitions and dispositions: Accounts receivable (983) (467) (741) Prepaid expenses and other assets (3) 67 98 Accounts payable, merchant 155 (10) 332 Accounts payable, other, accrued expenses and other liabilities 163 (11) 101 Tax payable/receivable, net (17) 46 (91) Deferred merchant bookings 1,858 794 572 Net cash provided by operating activities 3,880 3,085 2,690 Investing activities: Capital expenditures, including internal-use software and website development (770) (756) (846) Purchases of investments (628) (549) (28) Sales and maturities of investments 747 78 49 Other, net 120 (35) 25 Net cash used in investing activities (531) (1,262) (800) Financing activities: Proceeds from issuance of long-term debt, net of issuance costs 985 — — Payment of long-term debt (1,044) — — Purchases of treasury stock (1,930) (1,839) (2,137) Payment of dividends to stockholders (200) — — Proceeds from exercise of equity awards and employee stock purchase plan 50 116 101 Other, net 3 (22) (60) Net cash used in financing activities (2,136) (1,745) (2,096) Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents 189 (165) 16 Net increase (decrease) in cash, cash equivalents and restricted cash and cash equivalents 1,402 (87) (190) Cash, cash equivalents and restricted cash and cash equivalents at beginning of year 5,574 5,661 5,851 Cash, cash equivalents and restricted cash and cash equivalents at end of year $ 6,976 $ 5,574 $ 5,661 Supplemental cash flow information Cash paid for interest $ 213 $ 231 $ 231 Income tax payments, net 218 184 281 See notes to consolidated financial statements.
Consolidated cash flows: spending, cash generation and financing from 2023 through 2025 · Filed 13/02/2026
Our cash flows are as follows: Six months ended June 30, 2026 2025 $ Change (In millions) Cash provided by (used in): Operating activities $ 5,409 $ 4,073 $ 1,336 Investing activities (1,208) (220) (988) Financing activities (2,057) (1,180) (877) Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents (36) 208 (244) For the six months ended June 30, 2026, net cash provided by operating activities increased compared to the prior year period due to higher working capital benefits driven mostly from an increase in deferred merchant bookings and merchant accounts payable as well as higher operating income after adjusting for impacts of depreciation and amortization.
MD&A: first-half 2026 operating cash flow and working-capital contribution · Filed 06/08/2026
For the six months ended June 30, 2026, net cash used in financing activities primarily included $1.8 billion of payments related to the redemption of our 5.0% Notes and our 0% Convertible Notes in February 2026 as discussed above as well as $1.1 billion of cash paid to acquire shares, including the repurchased shares under the authorization discussed below and for treasury stock activity related to the vesting of equity instruments as well as cash dividend payments of $116 million, partially offset by proceeds from the issuance of 5.5% senior notes with net proceeds of $986 million.
MD&A: first-half 2026 debt repayments, issuance and shareholder distributions · Filed 06/08/2026
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY (In millions, except share and per share data) Common stock Class B common stock Additional paid-in capital Treasury stock - Common and Class B Retained earnings (deficit) Accumulated other comprehensive income (loss) Non-redeemable non-controlling interest Total Shares Amount Shares Amount Shares Amount Balance as of December 31, 2022 278,264,235 $ — 12,799,999 $ — $ 14,795 137,783,429 $ (10,869) $ (1,409) $ (234) $ 1,445 $ 3,728 Net income (loss) 797 (109) 688 Other comprehensive income, net of taxes 25 2 27 Proceeds from exercise of equity instruments and employee stock purchase plans 3,884,341 — 101 101 Withholding taxes for stock options (7) (7) Treasury stock activity related to vesting of equity instruments 973,946 (106) (106) Common stock repurchases 19,145,610 (2,031) (2,031) Other changes in ownership of non-controlling interests 16 (86) (70) Stock-based compensation expense 474 474 Other 19 — (17) (20) (18) Balance as of December 31, 2023 282,148,576 — 12,799,999 — 15,398 157,902,985 (13,023) (632) (209) 1,252 2,786 Net income (loss) 1,234 (10) 1,224 Other comprehensive loss, net of taxes (23) (5) (28) Proceeds from exercise of equity instruments and employee stock purchase plans 5,360,219 — 116 116 Withholding taxes for stock options (2) (2) Treasury stock activity related to vesting of equity instruments 1,539,783 (206) (206) Common stock repurchases 12,071,915 (1,616) (1,616) Other changes in ownership of non-controlling interests — — 5 5 Stock-based compensation expense 531 531 Other — — (11) — (11) Balance as of December 31, 2024 287,508,795 — 12,799,999 — 16,043 171,514,683 (14,856) 602 (232) 1,242 2,799 Net income 1,294 7 1,301 Other comprehensive income, net of taxes 41 10 51 Payment of dividends to common stockholders (declared at $1.60 per share) — (200) (200) Proceeds from exercise of equity instruments and employee stock purchase plans 3,938,782 — 50 50 Withholding taxes for stock options (19) (19) Treasury stock activity related to vesting of equity instruments 1,236,537 (257) (257) Common stock repurchases 8,998,160 (1,662) (1,662) Other changes in ownership of non-controlling interests 3 — 4 7 Stock-based compensation expense 488 488 Other — — (11) — (11) Balance as of December 31, 2025 291,447,577 $ — 12,799,999 $ — $ 16,565 181,749,380 $ (16,786) $ 1,696 $ (191) $ 1,263 $ 2,547 See notes to consolidated financial statements.
Stockholders' equity: actual equity issuance, repurchases and stock-based compensation · Filed 13/02/2026
Based on our meetings with stockholders, as well as the foregoing analyses, the Compensation Committee determined that the primary reason for the decline in support was related to its modification of the PSU awards granted to our executive officers in 2021 following the completion of the three-year performance period to provide for a partial payout of the target number of units subject to such awards, despite not having achieved the threshold performance level contemplated by the awards.
Compensation discussion: modification of 2021 PSUs despite missed performance threshold · Filed 29/04/2026
As disclosed in our 2025 Proxy Statement, the Compensation Committee did not exercise its discretion to modify the 2022 PSU awards, which had a performance measurement period ending December 31, 2024, and resulted in zero shares vesting.
Compensation discussion: 2022 PSUs resulted in zero shares vesting · Filed 29/04/2026
Further, in designing the 2025 PSU awards for our NEOs, the Compensation Committee adopted a new structure featuring three consecutive one-year measurement periods, each tied to pre-established financial performance metrics (annual revenue growth and Adjusted EBITDA margin growth for the first annual measurement period).
Compensation discussion: adopted structure for 2025 PSU awards · Filed 29/04/2026
The Board has standing Audit, Compensation, and Nominating Committees, each solely composed of independent directors, as well as an Executive Committee.
Governance: independent standing committees · Filed 29/04/2026
Expedia Group’s amended and restated certificate of incorporation provides that the Chairman of the Board may only be removed without cause by the affirmative vote of at least 80% of the entire Board of Directors, which provision may not be amended, altered changed or repealed, or any provision inconsistent therewith adopted, without the approval of at least (1) 80% of the entire Board of Directors and (2) 80% of the voting power of Expedia Group’s outstanding voting securities, voting together as a single class.
Governance risk: chairman removal and amendment requirements · Filed 13/02/2026
Common stock is entitled to 1 vote per share and Class B common stock is entitled to 10 votes per share.
Stockholders' equity: unequal voting rights · Filed 13/02/2026
In the meantime, certain hotel chains have been focusing on driving direct bookings on their own websites and mobile applications by advertising lower rates than those available on third-party websites as well as incentives such as loyalty programs, increased or exclusive product availability and complimentary benefits.
Competition: hotel direct-booking rates and benefits · Filed 08/05/2026
Room nights booked grew 6% in the second quarter of 2026, as compared to growth of 8% in 2025 and 9% in 2024.
MD&A: room-night growth in 2024, 2025 and second-quarter 2026 · Filed 06/08/2026
Technological developments in generative artificial intelligence (“AI”) tools are increasingly being used to create competing offerings, such as AI powered digital planning and assistance, further increasing competition.
Competition: emerging AI travel offerings · Filed 06/08/2026
In addition, the emergence of AI search platforms and changing consumer behavior adversely affect search traffic and margins.
Search risk discussion: stated adverse effects from AI search and changing behavior · Filed 13/02/2026
