Booking Q2 - Steady growth

Last week, online travel company Booking Holdings announced strong revenue and profit numbers. The company said that room nights sold grew 8% year-over-year, gross bookings rose 13%, airline tickets were up 44%, and its revenue rose 16%.

The travel industry in the US has seen some headwinds this year as some visitors, particularly Canadians, are boycotting them for political reasons. For Booking, those headwinds have been offset by market share growth in Europe as Airbnb loses popularity there.

One big advantage for Booking is that they offer an integrated travel option, where you can arrange your whole trip through the company - airline tickets, rental cars, accommodation, and sightseeing tours. Being able to encourage users to use the website for more than just accommodation presents a good growth opportunity.

Locking in users and building brand loyalty is still a central goal. Booking spent 31% of its revenue last quarter on advertising, which is huge. The hope is that once this industry matures, and users are more loyal, this marketing spend can drop which should unlock further profits for shareholders.

We like the travel industry, and owning the biggest player is the way to go.