On February 23, Beijing time, Booking Holdings released its financial reports for the fourth quarter and full year of 2023, and announced the start of distributing quarterly dividends.
"The number of guest room nights in the fourth quarter increased by 9% year-on-year. Excluding Israel related businesses severely affected by the war, it increased by 11% year-on-year, and compared to 2019, it increased by 21%. For the whole year, bookings on our platform exceeded 1 billion guest room nights, and our total booking volume, revenue, and operating revenue reached record levels." said Glenn Fogel, CEO of Booking Holdings.
According to the financial report, the total booking amount for Booking in the fourth quarter was $31.7 billion, a year-on-year increase of 16%, and the total revenue from booked rooms was $4.8 billion, a year-on-year increase of 18%. For the entire year of 2023, the company's total booking amount was $150.6 billion, a year-on-year increase of 24%, and the number of room nights booked increased by 17% compared to the same period last year. The total revenue was 21.4 billion US dollars, a year-on-year increase of 25%. Its net income was $4.3 billion, a year-on-year increase of 40%. Non US GAAP net income was $5.6 billion, a year-on-year increase of 39%.
From the year-on-year room nights in various regions in the fourth quarter, Asia saw an increase of more than ten percentage points, while Europe saw a low double-digit growth. The growth rate in other regions of the world is in low single digits, while it remains the same in the United States.
Although multiple results in the financial report reached historic highs, it also showed that the company's net revenue in the fourth quarter was only $222 million, a year-on-year decrease of 82%. The adjusted non GAAP net income was $1.1 billion, a year-on-year increase of 18%.
The main reason is that in the fourth quarter and throughout 2023, the company incurred a loss of $276 million related to Dutch pension fund matters. In addition, the draft decision of the Spanish competition authority resulted in a loss of $530 million, totaling $806 million. Both of these losses were not included in non GAAP net income.
Booking is an online travel and related service provider headquartered in the United States, which includes six major online travel brands including Booking.com, Priceline, agoda, KAYAK, and OpenTable. It provides services in multiple countries and regions around the world. In 2023, Booking.com remains the world's most downloaded travel application.
In recent years, due to the impact of EU antitrust regulations, technology companies such as Google, Apple, and Microsoft have been repeatedly investigated and punished by relevant regulatory agencies in EU countries, and Booking's business has also been restricted.
During the financial report conference call, Glenn Fogel mentioned that currently, the Spanish competition authority has issued a draft decision accusing its Booking.com of violating Spanish competition law. However, the company does not recognize this decision and the arbitrary large fines it has imposed. If the draft decision becomes the final decision, the company plans to appeal. However, the appeal process may take several years.
The $276 million loss mentioned in the financial report related to the Dutch pension fund was due to a Dutch court ruling in January that most of Booking.com's employees in the Netherlands should join the tourism industry pension fund. This liability is a prior period liability related to the pension plan.
In addition to fines, Booking's acquisition actions have also been hindered. Last September, the European Commission rejected its proposed deal to acquire flight technology company Etraveli for nearly 1.6 billion euros, announced in 2021.
The European Commission stated that Booking is a leading hotel online travel agency (OTA) service provider in the industry, while eTraveli is one of the main providers of OTA services for European flights. The European Commission believes that this acquisition will consolidate Booking's dominant position in the hotel OTA market in the European Economic Area, "weaken competition, increase hotel and even consumer costs," and Booking has not provided sufficient remedial measures to address these concerns.
Although it was not able to acquire eTraveli, Booking still made expansion in its air ticket business. The total number of airline ticket bookings in the company increased by over 400% compared to the same period in 2023. The company hopes that this vertical field can bring new customers to the platform and provide more complete products to existing customers by increasing ticket services.
Affected by the global tourism industry recovery and company performance growth, Booking's current stock price has increased by about 90% compared to the end of 2022. But after the financial report was released, the post market decline of the company's US stock market expanded to nearly 10%.