Booking guides to slower Q4 as October travel demand softens

Guidance and numbers

Booking Holdings set a cautious outlook for the fourth quarter, projecting gross bookings growth of 2% to 4% from a year ago. That trails the 7% increase analysts had penciled in. The softer guide follows a third quarter where revenue slipped 1.2% to $8.89 billion, below the $9.54 billion analyst estimate.

The company said global travel demand "moderated somewhat" toward the end of the third quarter, even as domestic demand held up. In a statement on Tuesday, it added that October bookings were pressured.

Why demand cooled

Booking pointed to "Disruptions to travel to and from the Middle East, the conflict's broader indirect effects such as elevated airfares, and localized unrest in certain European cities" as October headwinds. Higher airfares raise trip costs, and that, coupled with unrest, weighed on near term plans.

Paris was a notable weak spot.

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The tech angle and what it means for your portfolio

Investors are also debating whether artificial intelligence could bypass online travel platforms. Bloomberg Intelligence analyst Nicole D'Souza noted that AI agents such as Meta Platforms Inc's Muse could search and book flights and hotels directly, reducing the need for intermediaries. Truist analyst Gregory J. Miller wrote, "Messaging this week may still not be sufficient to counterbalance investor fears on AI disintermediation risk," and added it will take a few quarters of AI agent use to assess the effect on Booking and peers.

Booking is not standing still. The company said it is investing in its own AI capabilities, building the tech into its brands and working with AI platforms. The bottom line: softer near term bookings, higher airfares, and an emerging AI risk all feed the narrative investors will be tracking into year end.

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