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Priceline (PCLN) Stock 2Q Earnings Preview: Beat or Miss?

Priceline PCLN is slated to report second quarter earnings results on Aug 4 after the bell.

The company is one of two leading players in a highly fragmented online travel booking market, the other one being Expedia EXPE. But the two companies are really rather different because Priceline generates most of its revenues overseas particularly Europe while Expedia is more focused on North America. Both companies are expanding geographically. Therefore, Expedia’s disappointing results doesn’t necessarily spell doom for Priceline.

In fact, while many were speculating that online travel companies would be negatively impacted by the Brexit vote, this will likely not be the case. Brexit may impact how travellers move in and out of Britain, but there’s still quite a bit of traffic moving within the European Union and to and from destinations other than Britain. Moreover, this isn’t a change that will suddenly happen overnight but rather over time.

On the other hand, the company remains focused on improving the travel booking experience ( is now harnessing the power of artificial intelligence to increase personalization in phases). This kind of move has a direct impact on results.

Another emerging trend is the alternative accommodations segment, where both Priceline and Expedia have been strengthening their presence. Privately-held Airbnb is the frontrunner here, but the leading OTAs have huge reach and can come up strongly from behind.

Let’s take a quick look at how Priceline has been doing recently:

Quarter One Highlights

In the last quarter, Priceline...