Priceline Group Inc., the largest U.S. online travel-reservation service, reported better-than- forecast second-quarter bookings as more consumers used its websites to plan summer trips.
Bookings in the recent period rose 34 percent to $13.5 billion, the Norwalk, Connecticut-based company said today in a statement. That topped Priceline's May projection for a 32 percent gain. Third-quarter bookings may jump as much as 29 percent, the company said.
Priceline is expanding beyond travel reservations, seeking to maintain growth at a company that's boosted revenue by at least 20 percent for seven straight years. The company last month completed its acquisition of restaurant-booking website OpenTable Inc. for $2.6 billion, and Chief Executive Officer Darren Huston today said Priceline is investing in marketing as well as pushing into regions such as China.
"Chinese bookers, they're one of the fastest-growing bookers on all of our properties," Huston said on a conference call today. "Tapping into China is going to be a huge benefit."
Priceline shares rose 2.6 percent to $1,314.90 at 10:43 a.m. in New York. The stock had gained 10 percent this year through the market's close on Aug. 8.
OpenTable is part of Priceline's mobile strategy for its brands to connect to various aspects of a traveler's experience. Today, Priceline unveiled OpenTable's mobile payments program in New York, allowing restaurant-goers to pay their checks on their phones, Huston said on the call. The company plans to expand the program to 20 other cities before year-end.
Priceline also will jointly market the OpenTable application with its hotel offerings, encouraging travelers who book accommodations with Priceline's sites to also find restaurants and make reservations through OpenTable.
"We're also working really hard on our international expansion plan -- that's an area that was key to the acquisition," Huston said in a phone interview. "The theme with mobile is a reflection of customers' changing digital lifestyle. Everyone has mobile screens, and we're trying to connect those screens, connect that experience."
Priceline has used acquisitions and investments to spur growth and surpass Expedia Inc. in revenue, with the bulk of business coming from Priceline's Amsterdam-based Booking.com unit. Last year's purchase of Kayak Software Corp. helped Priceline capture revenue in hotel search. Last week, Priceline announced a $500 million investment in Ctrip.com International Ltd., China's largest travel website, seeking to capture business from people traveling to and from the world's most populous nation.
The company also said it expects third-quarter profit, excluding certain costs, of $19.60 to $21.10 a share. Analysts anticipated $21.31, the average of estimates compiled by Bloomberg.
"We're quite prudent in the way we give guidance, particularly in costs we can't control, including online marketing costs," Huston said. "We're spending a little more in offline marketing, more than people would assume."
In the second quarter, profit, excluding some items, was $12.51 a share, topping the average estimate of $12.02. Revenue climbed 26 percent to $2.12 billion. Analysts predicted $2.15 billion.