Booking Holdings Beats Q4 Estimates, Unveils $700M AI Push and 25-for-1 Stock Split
Booking Holdings delivered stronger-than-expected fourth-quarter results, topping Wall Street forecasts on both revenue and earnings, while unveiling an aggressive artificial intelligence investment plan and a 25-for-1 stock split.
- Q4 revenue and earnings exceeded expectations, with double-digit growth across major metrics.
- Airline bookings and multi-vertical offerings are driving the “Connected Trip” strategy.
- A $700 million AI-focused investment plan aims to boost 2026 revenue growth.
- The board approved a 25-for-1 stock split and increased the quarterly dividend.
The online travel giant reported Q4 revenue of $6.35 billion, up 16% year-over-year and ahead of analyst estimates of $6.13 billion. Adjusted earnings per share came in at $48.80, rising 17% from a year earlier and narrowly beating consensus expectations. GAAP net income surged 34% to $1.4 billion, translating into GAAP EPS of $44.22.
Gross bookings climbed 16% to $43.0 billion, while adjusted EBITDA increased 19% to $2.2 billion, with margins expanding to 34.6%.
Travel Demand Remains Resilient
Operational metrics pointed to sustained global travel demand. Room nights booked reached 285 million in the quarter, marking 9% annual growth. Airline ticket bookings jumped 37% year-over-year, underscoring momentum behind the company’s “Connected Trip” strategy, which aims to integrate flights, accommodations, attractions, and payments into a unified experience.
Regionally, both Asia and the United States posted low double-digit growth, while Europe and other markets expanded at high single-digit rates.
For the full year, revenue rose 13% to $26.9 billion, while gross bookings advanced 12% to $186.1 billion. Adjusted EBITDA increased 20% to $9.9 billion, highlighting continued operating leverage despite macro uncertainty.
$700 Million AI Investment to Accelerate Growth
Looking ahead, Booking announced plans to reinvest approximately $700 million above its baseline spending during 2026. Management said the initiative is designed to accelerate revenue growth by roughly 100 basis points above its long-term average.
The investment will focus heavily on generative AI and so-called “agentic” capabilities, including natural-language trip search, intelligent filters, and interactive digital assistants capable of handling end-to-end travel planning. Additional capital will support expansion in Asia and the U.S., OpenTable’s international growth, advertising, fintech products, and loyalty programs.
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The company expects the incremental spending to generate around $400 million in additional revenue in 2026. However, it anticipates a roughly $300 million net drag on adjusted EBITDA as investments ramp up. Management plans to offset part of that impact through $500 million to $550 million in run-rate savings from its ongoing Transformation Program, which has already delivered approximately $550 million in annualized efficiencies.
Capital Returns and Stock Split
In addition to operational expansion, Booking is returning significant capital to shareholders. The board approved a 25-for-1 stock split effective April 2, 2026, a move likely aimed at improving accessibility and liquidity given the stock’s elevated price.
The company also declared a quarterly dividend of $10.50 per share, representing a 9.4% increase from the prior quarter. During Q4 alone, Booking repurchased $2.1 billion in shares, with $21.8 billion remaining under its existing authorization.
Shares of Booking Holdings closed at $4,269.99 on February 18, up more than 3% on the day following the earnings release, as investors reacted positively to both the strong quarterly performance and the company’s forward-looking AI strategy.
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