Priceline Shares Climb on Strong Earnings
Shares of Priceline.com jumped more than 15 percent in early trading Friday, after the online travel company reported its quarterly net profit more than doubled, helped by a non-cash tax benefit.
Priceline said on Thursday that its third-quarter profit amounted to $104.4 million, or $2.27 per share, compared with $47.8 million, or $1.05 per share, a year earlier.
"It happened by a combination of great earnings growth in our international business, which was up year-over-year 98 per cent, and good top-line growth in our domestic business, with gross bookings growing 19 percent in the quarter," CEO Jeffrey Boyd told CNBC on Friday.
Priceline said that excluding a $47.9 million non-cash tax benefit, it earned $1.58 per share. On that basis, Priceline had been expected to earn $1.29 per share, according to Reuters Estimates.
The company reported bookings amounting to $1.39 billion, an increase of 54 percent year over year. Bookings through European operations increased almost 98 percent.
This was consistent with a trend for online travel agencies, which are seeing dramatic growth in Europe, while U.S. bookings growth has leveled off.
"The (European) business has performed extremely well for several quarters," Boyd told Reuters. "We're certainly guiding to continued high growth rates."
Priceline predicted an increase of 50 percent in travel bookings in the fourth quarter and income, excluding items, between 77 cents and 85 cents per share.
The company expects net income of 51 cents to 59 cents per share for the fourth quarter.