Booking Tops Forecasts but Tumbles 9% as Travel Demand Shows Signs of Cooling

By Trey Thoelcke Published Feb 19, 10:55AM EST

Quick Read

Booking Holdings (BKNG) dropped 8.8% after earnings despite beating estimates and growing revenue 16%.
Booking’s Q1 2026 constant-currency revenue guidance of 7% to 9% decelerates from 11% in Q4.
Free cash flow surged 120% to $1.42B while adjusted EBITDA margin expanded to 34.6%.
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Booking Tops Forecasts but Tumbles 9% as Travel Demand Shows Signs of Cooling — © PeopleImages.com - Yuri A / Shutterstock.com

Booking Holdings (NASDAQ: BKNG | BKNG Price Prediction) posted Q4 2025 results yesterday evening, reporting $6.35 billion in revenue, up 16% year-over-year. This morning, shares opened sharply lower at $3,908.51, down 8.8% from the $4,285 close on the day of the filing. The stock is now down 27% year-to-date, extending a selloff that began well before earnings.

Solid Quarter, But 2026 Guidance Disappoints

The numbers themselves were strong. Adjusted EPS of $48.80 beat the $48.50 consensus tracked by prediction markets, and free cash flow surged 120% to $1.42 billion. Room nights grew 9%, the fourth consecutive quarter of acceleration. Adjusted EBITDA margin expanded to 34.6% from 33.8% a year earlier, driven by $550 million in annual savings from the company’s transformation program.

What investors appear concerned about is the path ahead. For Q1 2026, management guided to 5% to 7% room night growth and 7% to 9% constant-currency revenue growth. That represents a deceleration from the 11% constant-currency revenue growth posted in Q4. For the full year, the company expects high single-digit constant-currency revenue growth and mid-teens adjusted EPS growth. While EPS is expected to grow faster than revenue, the top-line outlook suggests a cooling travel market.

Management Stays Optimistic Despite Market Skepticism

CEO Glenn Fogel emphasized operational strength and long-term positioning. “We are pleased to report strong results for 2025, delivering double-digit revenue growth, expanding Adjusted EBITDA margin by 193 basis points, and accelerating room night growth in every quarter,” he said. He also highlighted the company’s focus on “advancing our use of Generative AI to enhance the value we deliver to both travelers and partners.”

The company also announced a 25-to-1 stock split effective April 2, 2026, and raised its quarterly dividend to $10.50 per share, up 9.4%. It repurchased $2.1 billion in stock during Q4 alone, with $21.8 billion remaining under its buyback authorization.

Despite management’s confidence, the market is clearly focused on the softer 2026 outlook. The stock’s forward P/E of 15x reflects expectations for significant earnings growth, but investors appear concerned that travel demand may be normalizing faster than anticipated.

What to Watch Next

Investors will be tracking whether this morning’s decline holds through the session or if buyers step in at these levels. The company’s Q1 results in late April will be the next test of whether the guidance proves conservative or realistic. With 28 analysts rating the stock a buy or strong buy versus 11 holds, the Street remains broadly constructive. But today’s price action suggests investors want to see the growth algorithm stabilize before re-engaging.

About the Author Trey Thoelcke →

Trey has been an editor and author at 24/7 Wall St. for more than a decade, where he has published thousands of articles analyzing corporate earnings, dividend stocks, short interest, insider buying, private equity, and market trends. His comprehensive coverage spans the full spectrum of financial markets, from blue-chip stalwarts to emerging growth companies.

Beyond 24/7 Wall St., Trey has created and edited financial content for Benzinga and AOL's BloggingStocks, contributing additional hundreds of articles to the investment community. He previously oversaw the 24/7 Climate Insights site, managing editorial operations and content strategy, and currently oversees and creates content for My Investing News.

Trey's editorial expertise extends across multiple publishing environments. He served as production editor at Dearborn Financial Publishing and development editor at Kaplan, where he helped shape financial education materials. Earlier in his career, he worked as a writer-producer at SVE. His freelance editing portfolio includes work for prestigious clients such as Sage Publications, Rand McNally, the Institute for Supply Management, the American Library Association, Eggplant Literary Productions, and Spiegel.

Outside of financial journalism, Trey writes fiction and has been an active member of the writing community for years, overseeing a long-running critique group and moderating workshop sessions at regional conventions. He lives with his family in an old house in the Midwest.