Booking at Bank of America Global Technology Conference: Growth and Innovation

On Wednesday, 04 June 2025, Booking Holdings Inc (NASDAQ:BKNG) participated in the Bank of America Global Technology Conference 2025. The company highlighted its robust position in the global travel market, with a focus on growth in Asia and the US, while also addressing challenges in the US consumer market. The conversation underscored Booking’s strategic initiatives and commitment to shareholder value.

Key Takeaways

• Booking is targeting at least 8% revenue growth and 15% EPS growth.
• Emphasis on generative AI to enhance customer service and drive traffic.
• Global diversification helps mitigate challenges in the US market.
• The Genius loyalty program boosts customer frequency and bookings.
• A productivity program aims to save $150 million in 2025.

Financial Results

• Revenue Growth: Aiming for at least 8% growth.
• EPS Growth: Targeting 15% increase.
• EBITDA: Focus on leveraging marketing and expenses for low teens growth.
• Capital Return: Active share buybacks and dividends to return capital to shareholders.
• Productivity Program: Expected savings of $150 million in 2025, with $170 million reinvested in growth.

Operational Updates

• Alternative Accommodations: Outpacing traditional options, with growth faster than the largest competitor for 15 of the last 16 quarters.
• Connected Trip: Transactions growing at 40% period-over-period.
• Advertising Revenue: Primarily from Kayak and OpenTable, with plans to expand.
• Attractions: 92% growth year-over-year in the first quarter.
• Asia Expansion: Localized payment options and brand marketing to deepen penetration.
• Genius Program: Mid 50% of bookings from tier levels 2 and 3.

Future Outlook

• Growth Initiatives: Investment in advertising, attractions, OpenTable, and generative AI.
• Generative AI: Enhancements in technology infrastructure and customer service.
• Traffic Generation: AI expected to replace traditional search for lead generation.
• US Market: Monitoring consumer bifurcation and its impact on travel demand.

Q&A Highlights

• US Market Performance: Challenges due to fewer international travelers and pressure on lower-end segments.
• Attractions Market: Large and attractive, with plans to scale using aggregators and customer data.
• Capital Structure: Focus on organic reinvestments, inorganic opportunities, and shareholder returns.

The full transcript provides a detailed account of Booking’s strategic vision and operational updates.

Full transcript - Bank of America Global Technology Conference 2025:

Justin: Thank you everyone for joining us. We are very happy to have Iwout Steenbergen,

Iwout Steenbergen, CFO, Booking: did I pronounce it right? Hope. For

Justin: a little Q and A with booking, covered booking, it used to be Priceline for eighteen years and have always appreciated the company and the access. So thank you so much for coming. Maybe just to start, know you’re not new anymore, but you

Iwout Steenbergen, CFO, Booking: kind of came a little

Justin: bit more on your background and what you love about Booking. Maybe start there.

Iwout Steenbergen, CFO, Booking: Yeah. So first of all, Justin, thanks for organizing. I think a really great event. Yeah. So I joined Booking Now fifteen months ago, and when I got the phone call from the search firm, if I was interested and I started to do a little bit of my homework, I thought this is a really fascinating company.

It’s really global, it’s active in 02/20 countries around the world. It has a number of very strong brands. Obviously the performance had been very strong, but then also if you start to dive deeper into it, you notice the number of opportunities there are. And I think that’s still now fifteen months in, that’s still how I feel very much today. It has of course grown so rapidly, the scale is incredible, but then there’s so many things that we still look at and say, commercially, these are opportunities.

Just from a prioritization perspective, we haven’t even gone after those in a really meaningful way. And we know that if booking is going after opportunities and really puts a lot of effort and investments and management focus on it, it can really take off. I think we have proven that with flights. So we started to really focus on that the last two, three years, and we are now one of the largest flight OTAs in the world. So that’s of course incredible.

We put out a number about attractions. That is a new area that we’re focused on. We set 92% growth in the first quarter year over year. Still modest base, but it’s just showing how much more we can do. So the list is actually quite long.

I won’t go through everything in the interest of time. But if you think about it geographically, Asia is an incredible opportunity for us. We have two very strong brands there with Agoda and Booking.com. The next five to ten years, there will be the largest growth of the travel industry in Asia, so very well positioned. We’re a challenger in The US, so that gives us growth, faster growth than the market in The US.

In general, I was speaking about attractions, we have advertising, we can do much more with rides, we can do a lot with FinTech. Alternative accommodation is already, of course, a very big business. Today, we’re about 70% of the largest incumbent in that space, but we’re growing faster than anyone in that area. So there’s so many of those things. So that makes me so enthusiastic about booking.

Great. This predated your arrival, but I think it still holds. Talked about 8% bookings growth, kind

Justin: of an algorithm around that multi year. Maybe talk about some of the drivers that give you confidence in that number, and then how do think about revenue take rates versus that bookings growth?

Iwout Steenbergen, CFO, Booking: Yep. So we said indeed eight eight fifteen, so at least 8% revenue growth and growth bookings growth, and then 15% EPS growth. And we think those percentages are achievable. If you look first at accommodations, in general, the accommodations market is growing in line with GDP plus plus. So if you think about GDP plus, there is more growth usually in travel than GDP, because when people get more income, they tend to spend more on travel exploring the world.

So that is additive. Then if you add the shift from offline to online, that’s additive. And then we have all those growth initiatives that I was just mentioning and many more. So we think at least growing 8% from our top line metrics is therefore achievable. We’re very focused on achieving leverage, leverage on the marketing side, leverage on the expense side.

So that should bring us to low teens from an EBITDA perspective. We have a very active return of capital to shareholders through buybacks and dividends. We generate a lot of free cash flow so that that should get the EPS in the mid teens level. So we feel very good about that framework. We have delivered on the framework, and we think that is a framework we can stand by for the next period as well.

Justin: Great. And I know you have a presentation on your site that’s new, so people might want to check that out. But I think you talked in there about driving nights growth maybe above the hotel industry. So maybe talk a little bit about that as well.

Iwout Steenbergen, CFO, Booking: Yeah. So first of all, we are putting indeed more out there on the sides because we think creating a lot of transparency around our metrics and telling a story and having a narrative. I mean, it’s such a great company, so we have a great story to tell around the company. If you think about nights, indeed, we have several areas where we think there is opportunity. First, if you think about alternative accommodations, alternative accommodations for the last multiple quarters have grown faster than traditional or core accommodations, how we call it.

And we have seen that in each and every market around the world. And we have been growing faster than the largest incumbent in that space for 15 out of the last 16 quarters. So most likely this is going to continue that alternative accommodations is growing faster. It’s clearly demand from our customers. We are putting traditional and alternative accommodations side by side on our platform.

So it’s very seamless. People can look at both and then ultimately decide what fits in their situation the best. So we think that proposition is quite unique. And so that is going to be helpful. Then, of course, our position in Europe is very strong.

I think we have the benefit of being the go to in Europe. People like us, trust us, go to our app. This is how they just look for opportunities to travel, book their opportunities, have it all in one platform. This is where is their credit card. It’s easy to adjust, easy to to cancel, easy to book something else.

So for Europe, we are so deeply embedded, and we really have that benefit of being the go to for travel for many customers, therefore also a lot of direct traffic that we’re getting. And then I already mentioned our challenger position in The US, that’s a nice advantage of the largest travel market, where we are trying every period to grow a bit faster than the market in general, that is what we have been doing so far, And that will help to drive overall growth. And then Asia, as I mentioned, as another opportunity. So that’s why we think there’s even with our scale, it’s not that, and I know sometimes there is that perception of, well, because you are so large, therefore your growth will be basically a proxy for the market growth. We’re not believing in that.

We think actually our growth opportunity is better than the market on average. Got it. And while I revisit your philosophy as CFO a little bit, it

Justin: me like transparency is increasing and you’re, I don’t know, any differences you’re making on that front or investor outreach or anything to highlight? Yeah, first of all,

Iwout Steenbergen, CFO, Booking: I always like to meet our investors. I like to meet analysts. You learn a lot and they also keep you on your toes. So you better deliver on what you tell them in one period, you better deliver on it when you meet them the next time. So I think that’s really important.

I think really putting more out there from a disclosure perspective to transparency. Let me give you an example. Mean, we have been talking for a long time about connected trip. But last year we said, you know what, let’s put some metrics around it because otherwise people don’t know, is it purely a concept and it isn’t there in practice, or is it really already there? And we said, we are in the high single digits in terms of connected trip, meaning someone that purchases for one trip more than one kind of a vertical.

So it could be a flight and a rental car or an accommodation and an activity. So that’s an important one. And we said high single digits and it’s growing every period, something like 40%, and we will continue to give those disclosures. So the benefit of that is we’re not just telling what we are doing, we’re not only explaining our strategy and our vision, but then if we can show that in the results, the actual results, it’s showing up, that all the effort we put behind it, and we can point our investors to where it’s showing up, I think that’s a real benefit. So that’s one part of the philosophy.

Obviously, we’re always careful that we’re not in the end saying too much to make competition smarter. So when we speak about what are we exactly doing, performance marketing and our algorithms there, we have to be a little bit more careful. But yeah, I think transparency generally is a positive. The other is, I think the philosophy that we put out around on the one hand being very disciplined from an efficiency perspective, from a leverage perspective. We have the scale, we have the infrastructure, so we should have a positive differential between our top line growth and our expense growth.

But then on the other hand, we also want to reinvest in this business. We are philosophically thinking about this business really from a medium and long term value generation perspective. So that means that the resources we are freeing up on the one hand, we can reinvest in growth initiatives, but those are very explicit initiatives that we then can track and we can monitor and we can report about, and again, the transparency around that. So you heard us saying this year from the productivity program that we announced in 2024, we will realize 150 in year savings in 2025, but then we are actually reinvesting 170,000,000 in 2025 in these growth initiatives. And then at the same time, we can also deliver margin expansion because of the general leverage we have also on other line items.

So I think that’s a good indication of running a disciplined company, reinvesting for the future, and also delivering financial results for the shareholders at the same time.

Justin: Great. We’ll get into margins,

Iwout Steenbergen, CFO, Booking: but maybe we’ll start with some of the growth drivers that you

Justin: are spending the $170,000,000 on. So why don’t we start with the advertising opportunity and sponsored listings? And I know you have a preferred partner program and maybe touch on that a little bit and then how you see the advertising opportunity.

Iwout Steenbergen, CFO, Booking: Yeah. Yeah. If you look at our income statements and the breakdown that we’re giving in our filings, you see advertising revenues. So that is mostly coming from Kayak, which is by definition an advertising business. It’s a meta business, so we make money from referrals that we’re giving to the underlying OTAs.

And then also OpenTable is in that category. I think where you are referring to as well and where we also focus on as part of our investment program is really advertising on our platforms, on our apps, and generating more advertising income. That is an area that is really an opportunity that we’re only in the early stages in terms of building that out. We have some competitors that are much larger in that. Again, for us, that’s an opportunity.

That’s just something that we can add on what we are doing today. So advertising is a part of our 170,000,000 program. So we expect that that will drive significant revenue growth in the future. And that will be more sponsored ads that we can add to our proposition to our customers, particularly because we have become so much a platform where people go to naturally. So that will be a big benefit.

Obviously, you have to be always careful because if you go too far and you’re annoying your customers, it will negatively impact conversion. So we need to always test to make sure that we’re not pushing this too far, but at this moment, I think on the careful side, so we can absolutely scale it up. And it’s one of those opportunities that is one of the items on the top of the list.

Justin: Got it. And then anything else in that 170 to highlight the people that you’re excited about?

Iwout Steenbergen, CFO, Booking: Yeah, so attractions is one that we’re highlighting the growth we’re seeing there. We’re focused on expanding in Asia. Asia is such an important market, but you have to localize in terms of payment options, in terms of UX, in terms of brand marketing campaigns. So this is one penetrating deeper in Asia is a very important one. Expanding the network of OpenTable.

So OpenTable is doing very well, so a lot of energy into OpenTable at the moment. So we really want to expand the network going to other geographical areas and really have more customers in more restaurants in network that will drive, of course, more traffic in the future. Generative AI, there’s a lot of generative AI investments that we are funding from that 170,000,000 program. So those are a couple of those areas. Got

Justin: it. Let’s dive into Gen AI and you had an announcement with OpenAI and operators. How do

Iwout Steenbergen, CFO, Booking: you see the world of

Justin: traffic coming to you? I don’t know if you wanna talk about Google shifting or anything related to the traffic, but why did you do that deal, and do you

Iwout Steenbergen, CFO, Booking: see a world where you’re getting more AI generated traffic? Yeah. Yeah. I think like everyone else, no one can really predict where the Gen AI world is going, ultimately what will be happening with consumers and consumer preferences, and who are ultimately going to be winners. So our strategy is actually to prepare for all and to really anticipate on many different directions this might go.

So what are we doing? First of all, from a foundational perspective, modernizing our technology infrastructure, our data environments, tokenizing our data, so that our technology and data environment is ready really for an agentic world, that’s one. The second is to think about where can we find efficiencies internally with generative AI. And there’s many of those opportunities. I know many companies talk about it, but again, in the spirit of transparency and our management’s philosophy, we actually like to point at, okay, and here, investors, shareholders of the company, you can really see that showing up.

So for example, what we’re doing with generative AI and customer service, think about our agents. Well, first of all, do you still need to speak to a human? I think over time, I think some of those large language models is incredibly human like, very natural, and that will, simple matters, you don’t need to wait in line anymore. You get a better customer experience faster and more efficient. For more complex matters, yes, you still may need a human agent, but can find the information much quicker, doesn’t need to spend the time on writing notes afterwards.

So that’s a big benefit. That’s where we’re going after. If you look at our sales and other line, that was a line that showed deleverage over the last periods. And that had mostly to do with the growth of our payments business and the costs we are incurring on the pay in. But now what we are seeing is with the efficiencies on customer service, it’s going in the other direction.

So the sales and other line has moved from deleverage to basically neutral and we’ll of course continue to work on that. So that’s example and that’s second category of efficiencies. I think the third is what you are referring to with respect to the partnerships that we’re building with all the hyperscalers, all the large language model developers, because we think it’s really important to be close to that world, understand what is happening, be their partner, doing joint product development, because ultimately those might become more leads generating platforms replacing traditional search, and we want to be their really close partners in that. So indeed, we were partner, or we are partnering with OpenAI very closely with Microsoft. Of course, we’re having discussions with all others, including Google that of course now with AI mode is really pushing much harder in that area.

We think that’s over time that will be a positive because now we’re of course in traditional search, very dependent on one player, but there will be many players out there. Most likely, they want to partner with us because they like a monetization option. They need a revenue model. They have spent so much CapEx on their developments, and we can provide that to them. And then the last thing to mention, the fourth area to mention is, but we would like, of course, also to build our own travel specific vertical agent, because we want to make sure that customers that are coming direct to us today will stay with us as direct customers.

And they want to use our agents because this agent is the most knowledgeable about travel, has the most insights in your personal preferences, your data, is coming from a company that the customer knows, trusts, and know where to go to if something goes wrong. Yeah, you can go to a generic agent, if it goes wrong, where did it book ultimately your trip and where should you go to if there is a problem or who is touching your money? So we can take care of all those trust factors because we have the relationship, the trust of our customers. We’re working on all of those, and then we’ll see how things will play out from a scenario perspective over time.

Justin: Got it. One thing I think happens with AI and agents is they’re gonna be really things are going become even more transparent. Like they’re going to find great deals and stuff like that. And I know your Genius program adoption is really growing. You give some nice stats on that in your investor presentation.

But how do you see that Genius program as an asset? I’d love to hear your thoughts there. Are you happy with what you’re seeing there?

Iwout Steenbergen, CFO, Booking: Yeah, we’re very happy. We now have mid 50% of our bookings coming from Genius tier levels two and three, so the two highest tiers, which is more than half of our bookings, that’s really great. But we’re not really looking at this just then on a standalone basis. So we’re seeing it more a part of our overall ecosystem proposition. So what we are seeing is in general, customers coming more direct to us.

We see them coming more frequently to us. So more times per year, they do their bookings with us. We see them booking across more verticals. So in the past, maybe only for a hotel, now they do a hotel and an alternative accommodation, and next time they say, oh, I can also book a flight. Oh, it actually was a good experience, and they come back again for that.

So we see that. Then we see them doing those connector trip or multi vertical transactions for one trip. So moving up in the loyalty status level from Genius, getting more economic benefits coming out of that, and therefore coming back more frequently, and they do it more and more on the app. So all of that hangs together, it’s all correlated to each other. So we’re not really looking at loyalty as something that’s standalone.

Yeah. It will become more and more important because if I can quickly add it back to GenAI, GenAI is of course opening up the world of a real connected trip in the sense of logic between what you’re booking, what you have done in the past. So if you book a rental car, your hotel should have a parking place for you. If your flight gets delayed, your restaurant reservation has to be pushed out and all the just the issues that are today, the messiness of travel and things that happen, the peace of mind that we can provide with Gen AI. So that means it’s even more, I think, a benefit of being personalized piece mind, and then people come more and more back, and that will then help also from a loyalty perspective.

So that’s, think, what is opening up with GenAI.

Justin: Got it. Want make sure we get margins and macro in, so why don’t we start with margins. And you’ve talked about growing margins, I don’t know if that’s part of your algorithm, but what are the drivers for growing margins over time?

Iwout Steenbergen, CFO, Booking: So yes, by the way, we are of course already running at industry best margins, EBITDA margins post stock based compensation, I just want to emphasize post stock based compensation, because from our perspective, it doesn’t make any sense that a big cost that you pay your staff is not considered a normal cost of running your business. So that’s why we think you need to include that. And our margins are there on that basis already really at a very good level. But then we have the opportunity of the scale, the efficiencies, the leverage, the productivity program we announced last year to simplify the organization, to make it more nimble, to go after opportunities across the board, like real estate and procurement and several others. So that will, of course, help margins.

Driving marketing leverage will help margins general leverage, because we know for the next incremental traveler that comes to us, we don’t need another office building, we don’t need another layer of management, etcetera. So the incremental margins should always be better on the next one. And clearly this is a business where scale is really important, scale really matters. So being large is clear advantage. So all of that should help drive margins.

The flip side is a little bit what I talked about before is, but we also want to reinvest in the business and we want to grow ultimately the best way from our perspective to create value for our shareholders is driving the top line as fast as we can. And by reinvesting in talking about advertising and attractions and many other areas, ultimately, that’s of course a very good way to to reinvest. How that ultimately the balance of the two will play out is is to be seen over time, but at least we want to make sure that we can explain all of these moving parts so that our shareholders see that and it’s not somewhere hidden and it’s unclear what is really going on.

Justin: Internet companies do like to hide things.

Iwout Steenbergen, CFO, Booking: So, alright, I didn’t say that. Yeah,

Justin: great. And then on the macro, I don’t know what you can share with us right now, clearly The US has trailed other regions. And maybe with a little bit more hindsight now as the year progressed, why do you think that happened, and what can you share us on the macros? Yeah,

Iwout Steenbergen, CFO, Booking: and you’re right. We don’t give normally intra quarter updates on trends, so I can’t do that here. But what I, of course, can speak about is also what we have been talking about on our first quarter earnings call. And to some extent, it’s really fascinating that The US is having the impact from a number of factors, and it’s all on The US at the same time. Canadians traveling less to The US, Europeans traveling less to The US, and then where we see within The US, from a US Booker perspective, more an impact on the lower end of the consumer segments.

So we saw this a little bit last year that there is a bifurcation of The US consumer, where at the high end, people have income, have well four or five star rated hotels, demand is staying strong, ADRs are strong, international travel is strong, but at the lower end, one, two star rated hotels, more domestic travel, budget travel, it’s definitely more difficult and we see more pressure, shorter stays, shorter booking windows for The US and at the lower end. The US market is having all of these factors all coming together at the same time. Will that go away soon? That is to be seen. I sometimes, when I see the economic news, I think there’s always this talk about general indicators, is the economy going better, is the PMI going better, etcetera.

But I don’t think there’s enough attention to, yeah, but how is that exactly impacting different parts of the consumer economics? Because I don’t think we should look at averages in The US because it’s so different in different parts of society. So that’s, I think, a very important one. So then coming to us as a company, I think we have, of course, a large benefit of being very globally diversified. About 50% of our bookings are coming from US based customers, about 25% from Asia, low double digits from The US.

So we have a little bit less exposure to The US, that’s a benefit. And some of those dynamics I’ve talked about in The US, we’re not seeing it any other part the world. So that’s really US specific in terms of dynamics. Great, I got

Justin: a couple more, but I just wanna see if there was a question from the audience over the last couple minutes. Alright. We know Airbnb is focused on attractions, and and you are as well. Do you see that as a big market? Like, is that interesting to you, that that the size of that market?

Iwout Steenbergen, CFO, Booking: Yeah. It’s a first of all, it’s a market with a big 10. Secondly, it’s a market with quite attractive take rates. Yeah. For us, we are trying to scale up very quickly by working together with the hyper sorry, with the aggregators in that space, so we can have a lot of supply and options to our customers.

Where it’s particularly economically attractive for us is we often don’t have to incur specific additional acquisition costs for that line of business. Because we know based on an airline ticket that we have sold or an accommodation booking, that someone is going to be in, for example, in Paris. So we can immediately send out emails to that traveler and say, Hey, great, you’re going to Paris. Have you thought about a tour here? Have you thought about a boat tour on the Seine River?

Have you thought about ticket for the Louvre or for the Eiffel Tower? So for us, therefore, it’s really attractive that it is naturally an add on on what we are already doing with those customers. And therefore it works very well from an economics perspective.

Justin: Yeah, the economics are good. So we’ve heard about tractions for ten years now, but it does seem like there’s greater folks. Has there been some unlocks with tech that is making this easier to target or is it just the right time? What’s kind of done here?

Iwout Steenbergen, CFO, Booking: To some extent, it’s the right time because, as I mentioned before, we can’t do everything at the same time. So naturally, had to build a payments engine because if we don’t have that, it was going to be very hard to expand in the future. And flights, clearly because flight is always at the start of trip planning in many cases, so that was really important. That is just a natural thing after flights and accommodations and rental cars to focus on attractions. We do own a technology platform in this space, but it is not so much an aggregator.

This is a company called Fair Harbor, and Fair Harbor provides technology for the activity operator itself. So this could be the boat tour operator or tour company, and we help them with technology on their platform. So if someone goes directly to them that you can book and ticket and pay, but we therefore have the relationship with all of these providers in the market. And that will give us an opportunity, of course, to do more with that strategically in the future as well.

Justin: Got it. The last thing, and I’m sure you’re happy about it, is your balance sheet and your cash flow. But how do you think about your capital structure? I know it’s been been buying backs for several years, but any any any thoughts there you wanna share on our last last question?

Iwout Steenbergen, CFO, Booking: Yeah. Obviously, I think we are in a very positive position from a cash flow generation perspective. If you think about the hierarchy, how we want to spend that, ideally, at the top of the list is organic reinvestments. Because organic reinvestments, we know our business the best, we know our management the best, we know our opportunities the best. But there’s always so much you can do at the same time in an organization.

Often, I always say financial resources, I wish that is the limiting factor because writing a check is the issues thing, but often that’s not the case. It’s just how many things can you do at the same time. Inorganic, yeah, for us a little bit more difficult, obviously, from an antitrust perspective, particularly with some rulings we had in the past in in Europe. But then a return of capital to shareholders is then, from a hierarchy perspective, the next the next step. So we are active with buybacks.

We are active with our dividends that was initiated last year, and we had a 10% growth of the dividend payout level this year. So I think it’s, to some extent, it’s boring, just because it’s the same thing. We can do it over and over, but I hope the predictability and the stability ultimately is a good thing. And certainly, I hope that’s something that our shareholders recognize. Great.

We’re we’re over time. So thank you so much for joining today. Thanks. Really appreciate it. Absolutely.

Thank you.

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