A：Forward-looking statements are comments made by a company about future performance, which are not guarantees and can be affected by risks, uncertainties, and assumptions. These statements are intended to identify what the company expects in the future and are subject to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Risks that could cause actual results to differ materially from those expressed in the statements include those detailed in the company's filings with the Securities and Exchange Commission.

A：Booking Holdings discloses material information for SEC regulations on its Investor Relations page, which can be found at IR.bookingholdings.com. The company encourages investors to monitor this website, along with other public announcements and SEC filings, for such information.

A：The Middle East conflict at the end of February impacted Booking Holdings' bookings growth, specifically room nights and hotel bookings. However, despite this, the company still booked 338 million units, grew 6% year over year, and had strong results with 15% year-over-year growth in gross bookings, $5.5 billion in revenue, and an adjusted EBITDA of $1.3 billion, which increased 19%. Adjusted EPS grew 14% year over year.

A：Booking Holdings is focused on expanding its reach in key markets such as the U.S. and Asia, advancing its connected trip vision, and continuing to innovate across its AI capabilities. The company's confidence in these initiatives is reflected in its capital allocation strategy, including record share purchases in the first quarter, reducing its share count by over 40% in 12 years while preserving flexibility for organic and inorganic growth.

A：In the U.S., the company's room night growth accelerated to the low teens, driven by strong domestic demand and continued momentum in the direct channel with double-digit growth at Booking.com. In Asia, the company experienced high single-digit room night growth, with low double-digit growth in travel within the region, indicating continued structural growth opportunities.

A：Booking Holdings is approaching the Asian travel market by leveraging a global playbook informed by the reach and capability of Booking.com, combined with localized expertise across distinct countries and cultures in the region. The company is investing in granular localization, adapting products and payment methods to local markets, and building relationships with local properties. The distribution strategy involves engaging with travelers through social and messaging platforms, where the company is seeing encouraging traction across various channels.

A：The growth in connected trip transactions, which includes bookings across more than one vertical, increased in the high teens range and represented a low double-digit percentage of Total Transactions on bookings.com. This growth reinforces the belief that by reducing friction and providing value, travelers choose to book more with the company. It also drives more incremental value for partners as travelers engage with multiple verticals across the platform. This aligns with the company's vision to provide personalized benefits within the connected trip to both the traveler and the partner, with the Geni loyalty program being a key component of this strategy.

A：AI is being utilized to improve the travel and partner experience through various initiatives. At Priceline, the focus is on creating an end-to-end AI-driven journey, including features like a dynamic travel map and personalized trip building. At Booking.com, AI capabilities include enhanced natural language search and dynamic inspiration features. Additionally, AI is aiding partners by improving personalization and conversion, streamlining operations, and increasing self-service adoption. Examples include the AI Concierge at OpenTable and smarter restaurant operations with actionable insights and voice-enabled reservation tools.

A：AI has led to specific impacts on operations and cost efficiency. At Dakota, there was a double-digit year-over-year reduction in customer service costs per booking due to AI-assisted automation, resulting in cost savings and more efficient operations at scale. The technology is also being used to automate customer service interactions, improve self-service rates, and enhance handling internal workflows to speed product development and decision-making.

A：The company is partnering with leading AI organizations like OpenAI, Google, Meta, and Amazon to expand sources of demand and enhance the travel experience. These collaborations help in meeting travelers at every stage of their journey and enable the delivery of greater value to partners through improved personalization and conversion. Partners can also benefit from more efficient communication with guests, reduced customer service contact, and increased self-service adoption. The company's brands and direct engagement with travelers also serve as a differentiator, underpinned by the consistent delivery of value which differentiates the company over time.

A：The ongoing situation in the Middle East, particularly the conflict, led to elevated cancellations and impacted the company's financial results. The conflict impacted room net growth by about 6 percentage points and had a similar impact on gross bookings but a higher impact on revenue and adjusted EBITDA growth. Excluding the impact of the Middle East situation, the company's first quarter growth rates would have exceeded the high end of its guidance ranges across all key metrics. The conflict initially caused an increase in cancellation rates and lower travel demand.

A：In the first quarter, Europe experienced an upturn of mid single digits in room night growth, including the impact from the conflict on bookings to and within the Middle East and Asia. Intra-regional demand from European bookers increased by high single digits. Within Asia, intra-regional demand from Asian bookers grew by low double digits. The rest of the world, which includes the Middle East, had a decrease in room night growth of low single digits.

A：The growth in the direct channel, especially the B2C mix, is significant as it demonstrates resilience and continued improvement. The B2C direct mix remained steady at mid 60% range, consistent with prior year levels. This performance is attributed to ongoing growth in direct bookers, which is a small but important segment contributing to the overall direct channel.

A：The situation in the Middle East impacted alternative accommodation room nights, with growth that was in line with the total room night growth.

A：The company believes in offering a compelling experience for travelers by seamlessly integrating alternative accommodations, independent properties, global change, and other travel verticals. This strategy is supported by the company's emergent payments platform, which facilitates a connected trip vision, adding flexibility for both travelers and partners and driving incremental revenue.

A：First quarter total gross bookings increased Ed year over year. On a constant currency basis, gross bookings grew about Ly, with a 1% increase in constant currency ADR and higher bookings growth from flights and other travel verticals. Consequently, first quarter revenue grew 16% year over year, or about 10% on a constant currency basis.

A：The situation in the Middle East is estimated to negatively impact revenue and expenses. While the exact impact on revenue will not be fully realized until future quarters, marketing expense is expected to increase due to the conflict. Despite this, the company remains on track to deliver its 2026 goal of $500 to $550 million in year savings from its transformation program.

A：The company's outlook for the second quarter accounts for the continued impact of the Middle East conflict through June. It anticipates fluctuations in traveler demand and ongoing disruptions due to the conflict. The company has initiated targeted cost management actions, such as managing discretionary spend and adjusting hiring, to protect near-term profitability while maintaining long-term innovation. The guidance assumes recent effect rates and anticipates a higher impact of the Middle East situation in the second quarter compared to the first.

A：The company expects the conflict in the Middle East to result in a direct and indirect impact through June, followed by a recovery in bookings in the second half of the year. Despite the variability of the current environment, the full year guidance reflects the resilience of the business model with gross bookings up high single digits to low double digits, revenue up high single digits, adjusted EBITDA growing slightly faster than revenue, and adjusted EBITDA margins expanding between 5 and 10 basis points year over year. Adjusted EPS is expected to be up low to mid-teens.

A：The company remains focused on its long-term growth ambition and is committed to achieving at least a 5% gross bookings growth, 8% revenue growth, and a 5% adjusted EPS growth for future years. They are monitoring the situation closely and while the second quarter and full year guidance are based on estimates and information available at the time, the company is still solidly positioned despite the challenges.

A：The company is focused on managing what it can control and is seeing cautiousness from consumers outside of the region, which is contributing to the overall disruption. However, it is unclear whether this is due to actual disruptive effects such as flight corridors and cancellations or more general wariness.

A：The company expects a headwind of approximately 100 basis points in the second quarter due to the Middle East situation, resulting in a slightly down ADR as a consequence. Room nights from script to script are assumed to have an additional 100 basis points headwind. The company has assumed that the impact will continue for the second quarter and there will be some recovery in the second half of the year.

A：The company is incredibly excited about the changes and believes that moving towards a performance marketing platform is a positive development. However, it is not the only entity making this transition, and the company is confident in its competitive position as a performance marketing platform.

A：The company is using AI to increase efficiency across its internal operations, which allows for more resources to be allocated towards enhancing the travel experience and strengthening relationships with partners.

A：The company views AI as an opportunity because it believes AI will positively impact their business by improving operations, personalization, and the overall customer experience, rather than being a competitive threat.

A：The strong growth in road nights in Q1 is attributed to the company's cross-selling efforts and the successful implementation of AI technology to improve the travel experience.

A：The company is cautious about potential softness in travel due to economic factors like rising airfares and gas prices, although they note that the Middle East has not been a factor in this specific softness.

A：The high-end segment of the travel market remains strong, and there is an encouraging improvement in the lower-end segment, which has been weak recently. The booking window has become more stable, and ADRs are flat, which is a positive change from many quarters where they were down.

A：The company is using AI technology to improve customer experiences across its brands by leveraging AI on both Priceline and Booking.com to create a unified approach to enhancing the travel experience and conversion rates.

A：The strategy involves using different teams to work on the project in various ways and then consolidating the efforts when the best outcomes are identified. This approach is based on the fast-paced technological changes and the need to ensure that the smartest people are working on the most effective strategies. Multiple brands have been utilized in the past to leverage different methods for similar results, and this principle is being applied to the current project phase.

A：Early positive signs have been observed in conversion rates, with a small sample showing improvement. Other metrics being tracked include a shorter path between search and booking, lower cancellation rates, positive customer satisfaction, and increased engagement. The company is collecting more data points to validate these trends, particularly around direct bookings and the use of AI travel planning tools, which are not widely available or possible with many competitors.

A：The main constraints to scaling the business appear to be related to testing and ensuring the program's effectiveness and alignment with regulatory requirements. The company's approach is to carefully test and refine offerings to prevent customer unhappiness and avoid potential regulatory issues. There is an emphasis on brand trust and loyalty, with the goal of protecting and expanding the direct channel for customers who book directly with the brand. The company is focused on going as fast as it can while ensuring that the strategic moves support the long-term vision and customer experience.