Online travel sites on Tuesday began tallying their own damage inflicted by the Sept. 11 attacks on America.
Expedia Inc. said that bookings had declined by as much as 60 to 65 percent following last week’s events in New York City. Meanwhile, Travelocity
third quarter revenues will be below its previous guidance.
The Bellevue, Wash.-based Expedia, confirming what many had expected not only for online travel firms but off-line as well, said travelers booked new reservations on Expedia’s sites at between 35 percent and 40 percent of the levels for the same days in the prior week.
The company’s stock had been trading at about $36 a share before the events of Sept. 11.
However, Travelocity was still trying to cast a positive spin on its downturn. In its statement issued late Tuesday, the Fort Worth, Texas company said it is still maintaining its earnings guidance for the third quarter of 8 to 10 cents a share.
“Since September 11, we have already seen bookings rise to more than 50 percent of prior levels compared to 30 percent to
40 percent immediately after the events, and we fully expect improved growth in travel spending in 2002,” said Terrell B. Jones, president and chief
executive officer of Travelocity.
Priceline has not commented on bookings.
All three stocks took a beating on Monday (as did general airline stocks) and continued lower on Tuesday.
Expedia’s statement said that bookings Monday were on the rise, up to “approximately 45 percent of the levels for the same day in the prior week.”
“In light of last week’s tragedies, we believe our early booking levels are an encouraging indication of the resilience of the American spirit,” said Richard N. Barton, president and chief executive officer of Expedia.
Moving to bolster investor confidence, Expedia also reported that the company recorded revenue for July and August at a quarterly run rate of approximately $90 million. Further, “as of Sept. 15, Expedia had a very strong balance sheet with more than $225 million in cash,” said Gregory S. Stanger, chief financial officer. “It’s too early to assess the near-term impact on our business, but long term, we believe our travel bookings will again increase at an attractive growth rate.”
Expedia said it is continuing to work with USA Networks to complete the acquisition of a majority interest in Expedia, which was announced on July 16.
Ironically, before Sept. 11, the travel sector had been considered one of the shining stars of e-commerce, seeing steady growth and real profits.
