News

Expedia Still Has High Hopes for a Vrbo Bounce — Next Year

Expedia Still Has High Hopes for a Vrbo Bounce — Next Year'"When Expedia Group acquired HomeAway, now renamed Vrbo, in 2015, officials obviously knew they weren’t getting an Airbnb. Still, they may have obtained less than they bargained for because the journey so far has been very bumpy." — Dennis Schaal

 

In some ways, the Expedia Group narrative about its struggling alternative accommodations unit, Vrbo, in the second quarter was fairly similar to the messaging three months ago: We’re working hard, and it won’t be until 2020 until our labors bear fruit.

 

Expedia Group Mark Okerstrom said Thursday, during the company’s second quarter earnings call, that the Vrbo team is working hard, and that if you take into account the Easter holiday and other adjustments, then the story was “broadly consistent.”

 

Expedia Group rebranded its HomeAway business to Vrbo in the first quarter and took a resulting hit in its organic search, or search engine optimization, efforts, officials said at the time.

 

Okerstrom said Thursday that the team is working hard to get volumes from that free search engine traffic back on track, and he’s “comfortable” with the effort. He added that the company is “expecting more of the same for the next few quarters,” and Vrbo should probably be in the clear at some point next year.

 

In the second quarter, Vrbo’s gross bookings grew just 2 percent year-over year to $2.86 billion, and compared with a faster pace of 5 percent growth in the first quarter. Vrbo’s adjusted earnings, however, grew 8 percent year-over year to $84 million, and that was a bright spot compared with the first quarter when Vrbo notched a $40 million loss. Vrbo revenue jumped 17 percent to $347 million.

 

As of June 30, Expedia had placed 570,000 Vrbo properties on Expedia’s core online travel agency sites, which boasted 1.3 million lodging properties, including hotels, overall.

 

During the call, an analyst asked Okerstom if Expedia would consider investing in a property management company. Prominent venture capital-funded property management companies in the United States include rivals Vacasa, Turnkey Vacation Rentals, and Sonder, for example.

 

Okerstrom said he’s familiar with the various property management companies and has looked at them. However, he said property management is not Expedia Group’s core business so the company has shied away from getting more deeply involved although, “never say never.” Read more...

 

This article originally appeared on Skift.com.

Tags: News