Online travel agency Priceline Group on Tuesday forecast quarterly earnings below Wall Street's expectations, sending its stock down nearly 7 percent.
While the owner of travel websites Priceline.com, Booking.com and Kayak.com said a strong summer travel season had buoyed its third-quarter results, it said a weakening euro and a slow economic recovery in Europe, its most important market, were raising questions about holiday business.
The company said it expected earnings of $9.40 to $10.10 per share this quarter. Analysts on average had forecast $10.91, according to Thomson Reuters I/B/E/S.
Priceline expects revenues of nearly $1.82 billion for the quarter, below the analysts' average estimate of almost $1.91 billion.
S&P Capital IQ analyst Tuna Amobi said the outlook raised concern about the holiday season, an important time for the travel industry.
"They have tended to be somewhat realistic with their guidance," Amobi added.
On the company's earnings call on Tuesday morning, Chief Financial Officer Daniel Finnegan said Priceline had hedged against fluctuations of the euro or the pound against the U.S. dollar for the fourth quarter.
Still, European travelers facing the stronger dollar often "trade down, in terms of what they're willing to spend in dollars for a hotel room, to try and keep the cost of the trip (to the United States) consistent from a euro perspective," Finnegan said.