Advertising spend grew almost as fast as bookings at Priceline’s travel companies during the December quarter – 36% to USD427 million, while gross travel bookings increased 39% to USD9.1 billion. Coincidence? Probably not.
Analysts have noted the ad spend increase has compressed Priceline’s operating margin (by 200 basis points year on year) but said the Q4 decline was less than expected as competition intensifies.
Meanwhile, Priceline’s IT spend more than doubled during period from USD11.7 million to USD23 million. Priceline owns Booking.com, Priceline.com, Agoda.com, Rentalcars.com and Kayak.com.