Why Expedia stock price fell by double digits today

stock Expedia Group (experience -14.20%) The online travel agency pulled out today after reporting strong results in its first quarter earnings report but providing disappointing guidance for the second quarter.

As of 11:28 a.m. ET, the stock was down 13.4%.

Image source: Getty Images.

Expedia delivers solid results but sees slowing growth.

Expedia posted 8% revenue growth to $2.89 billion, beating consensus estimates of $2.81 billion, but bookings growth was somewhat more modest, signaling a slowdown in key summer growth. The company also brought the site onto Expedia’s platform, allowing Vrbo customers to take advantage of Expedia’s loyalty program, while also citing weaknesses in Vrbo’s vacation rental service.

Total bookings for the quarter rose just 3% to $30.2 billion. Nights stayed increased 7% to 101.2 million, reflecting a decline in price per night.

Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 38% to $255 million, and adjusted earnings per share improved to $0.21 per share from a loss of $0.20 in the year-ago quarter. The loss of $0.24 beat analyst consensus.

CEO Peter Kern said:

Our first quarter results exceeded revenue and revenue, but met guidance with less robust gross bookings. We’ve seen continued momentum in B2B, Brand Expedia and advertising. However, Vrbo’s recovery following its recent platform change has been slower than expected.

Can Expedia come back?

The slowdown in growth heading into summer is certainly disappointing. The company lowered its full-year revenue guidance to the mid-single digits, below the analyst consensus of 9.4%.

With the summer months being so important to the travel business, it’s no surprise that Expedia isn’t in the news. While the company must overcome these headwinds, a stock sale makes sense.