Booking Holdings Inc. (NASDAQ:BKNG)

The analysis of the provided annual financial data reveals several notable trends in the intangible assets of the company over the five-year period ending December 31, 2024.

Goodwill

The goodwill value increased significantly from $1,895 million in 2020 to a peak of $2,887 million in 2021. Following this peak, the goodwill value has gradually declined to $2,799 million by 2024, indicating a possible revaluation or impairment adjustment after 2021.

Trade Names

The value of trade names has remained relatively stable over the period, showing only minor decreases from $1,824 million in 2020 to $1,802 million in 2024. This stability suggests steady valuation with no significant acquisitions or impairments affecting these assets.

Supply and Distribution Agreements

Supply and distribution agreements exhibited a growth trend from $1,136 million in 2020 to $1,407 million in 2021, followed by slight fluctuations but maintaining near this level through 2024, ending at $1,377 million. The initial increase and subsequent stability could indicate acquisition activity or contract renewals around 2021, with consistent value thereafter.

Other Intangible Assets

Other intangible assets rose from $220 million in 2020 to $340 million in 2021 and then slightly decreased and stabilized around $326 million by 2024. The increase in 2021 may reflect increased capitalization or acquisitions of smaller intangible assets.

Intangible Assets, Gross Carrying Amount

The aggregate gross carrying amount of intangible assets rose from $3,180 million in 2020 to $3,561 million in 2021, followed by slight declines and stabilization around $3,505 million in 2024. This pattern mirrors the trends observed in the component intangible assets, with the peak in 2021 followed by moderate decreases.

Accumulated Amortization

Accumulated amortization shows a consistent upward trend in absolute terms, increasing from -$1,368 million in 2020 to -$2,123 million in 2024. This steady rise reflects ongoing amortization expenses that reduce the net carrying amount of intangible assets yearly.

Intangible Assets, Net Carrying Amount

The net carrying amount of intangible assets grew from $1,812 million in 2020 to $2,057 million in 2021, then declined each subsequent year to $1,382 million in 2024. The increase followed by a continuous decline suggests that while new intangible assets may have been added until 2021, amortization and possible impairments or disposals outweighed additions in later years.

Goodwill and Intangible Assets (Combined)

The total value of goodwill and intangible assets combined increased markedly from $3,707 million in 2020 to $4,944 million in 2021, followed by a progressive downward trend to $4,181 million in 2024. This overall pattern reflects the initial asset growth and subsequent decline primarily driven by decreases in goodwill and net intangible assets.

In summary, the data illustrates a significant asset growth phase culminating in 2021, followed by a period of gradual reduction in goodwill and net intangible assets. Amortization consistently decreases net intangible asset values, while the slight declines in goodwill suggest some write-downs or reclassifications. Trade names and supply/distribution agreements remain relatively stable, indicating steady long-term value in these categories. The trends suggest strategic asset management with a focus on controlled amortization and possible impairment reviews post-2021.

The financial data reveals several noteworthy trends and shifts over the reviewed periods. Total assets, both reported and adjusted for goodwill, exhibit an overall upward trajectory, indicating growth in the company's asset base. Reported total assets increased steadily from approximately 21.9 billion US dollars at the end of 2020 to about 27.7 billion US dollars by the end of 2024. Adjusted total assets followed a similar pattern, rising from roughly 20.0 billion to 24.9 billion US dollars over the same timeframe, though the adjusted figures are consistently lower than reported totals due to the exclusion of goodwill.

Stockholders’ equity presents a contrasting trend. Reported stockholders’ equity started at around 4.9 billion US dollars at the end of 2020 and reached a peak of approximately 6.2 billion by the end of 2021. However, it then declined sharply to about 2.8 billion in 2022, before turning negative in both 2023 and 2024, reaching deficits of approximately 2.7 billion and 4.0 billion US dollars, respectively. The adjusted equity values, which account for goodwill, show a similar but more pronounced decline. Adjusted stockholders’ equity decreased from roughly 3.0 billion US dollars in 2020 to a slight negative in 2022, and then deepened to deficits of around 5.6 billion and 6.8 billion US dollars in 2023 and 2024. This trend signals deteriorating net asset value when excluding goodwill, potentially reflecting impairments, losses, or other adjustments impacting equity.

Regarding profitability, reported net income grew markedly over the analyzed period. It started relatively low at 59 million US dollars in 2020 and rose significantly to 1.2 billion in 2021. This upward trend continued, reaching approximately 3.1 billion in 2022, then 4.3 billion in 2023, and further increasing to about 5.9 billion US dollars in 2024. Adjusted net income figures, which appear to exclude certain goodwill effects in earlier years, show congruence with reported net income from 2021 onward. The jump from 1121 million US dollars in 2020 to matching figures thereafter suggests the initial difference might have been due to reconciliation of goodwill adjustments. The steady gain in net income indicates improving operational performance or profitability throughout the periods.

In summary, the company illustrates an expanding asset base and robust growth in net income, reflecting strengthening profitability. However, the shift to negative stockholders’ equity, especially in adjusted terms, suggests underlying challenges in the capital structure or significant write-downs affecting retained earnings and net asset value. This divergence between increasing earnings and declining equity warrants further detailed examination of the components influencing equity and any related accounting or economic factors.

Total Assets

Upward trend from 21.9 billion to 27.7 billion US dollars (reported), and 20.0 billion to 24.9 billion US dollars (adjusted) over five years.

Stockholders’ Equity

Initial increase followed by sharp decline, turning negative by 2023; adjusted equity shows deeper negative deficits, indicating potential impairments or losses.

Net Income

Strong, consistent growth from 59 million US dollars in 2020 to nearly 5.9 billion US dollars by 2024, highlighting improved profitability.

The financial data demonstrates significant positive trends in profitability and efficiency metrics over the period assessed. Both reported and adjusted net profit margins have consistently increased from 2020 to 2024. Specifically, the reported net profit margin rose from 0.87% in 2020 to 24.78% in 2024, indicating substantial improvement in profitability. The adjusted net profit margin follows a similar trajectory, albeit starting higher due to adjustments, which suggests underlying operational improvements when excluding certain accounting factors.

Total asset turnover also presents an upward trend, reflecting enhanced asset utilization. The reported total asset turnover increased from 0.31 in 2020 to approximately 0.86 in 2024, while the adjusted total asset turnover improved from 0.34 to 0.95 across the same timeframe. These changes indicate better asset management and more efficient generation of revenues from assets.

Financial leverage exhibits notable variability in the reported figures, initially decreasing from 4.47 in 2020 to 3.83 in 2021, then rising sharply to 9.12 in 2022, with no available data for subsequent years. In contrast, the adjusted financial leverage shows a declining trend from 6.66 in 2020 to 6.31 in 2021, with missing data thereafter. The volatility and missing data in financial leverage metrics limit comprehensive interpretation but may reflect changes in capital structure or accounting adjustments related to goodwill.

Return on equity (ROE) increases dramatically from 1.21% in 2020 to an exceptionally high 109.92% in 2022 on a reported basis, though data for 2023 and 2024 is unavailable. Adjusted ROE also remains high, albeit with declining values from 37.39% in 2020 to 35.4% in 2021, with subsequent years' data missing. The large spike in reported ROE in 2022 might be influenced by changes in financial leverage or other non-operational factors.

Return on assets (ROA) patterns align with other profitability indicators, showing a steady increase in both reported and adjusted metrics. Reported ROA progressed from 0.27% in 2020 to 21.23% in 2024, while adjusted ROA moved from 5.61% in 2020 to 23.61% in 2024. The increasing ROA reflects improved efficiency in asset utilization to generate earnings over time.

In summary, the data reveals very strong improvements in profitability and asset efficiency metrics, as evidenced by rising net profit margins, total asset turnover, and ROA. The financial leverage and ROE figures present some inconsistencies or incomplete data, suggesting caution in interpreting leverage effects and equity returns. Overall, the trends depict enhanced operational performance and financial health through the years evaluated.

The financial data reveals notable trends in the net income and net profit margin figures over the five-year period. There is a substantial increase in both reported and adjusted net income from 2020 through 2024, indicating significant growth in profitability.

Net Income

Reported net income starts at a relatively low level in 2020, with a value of 59 million dollars, and rises sharply to 1,165 million dollars in 2021. This upward trajectory continues with net income increasing to 3,058 million dollars in 2022, reaching 4,289 million dollars in 2023, and finally attaining 5,882 million dollars in 2024. Adjusted net income mirrors the reported net income closely from 2021 to 2024 but shows a discrepancy in 2020, where the adjusted net income is significantly higher at 1,121 million dollars compared to the reported 59 million dollars. This suggests that adjustments related to goodwill or other items had a substantial impact on the 2020 figures.

Net Profit Margin

Reported net profit margins exhibit a striking improvement over the period. In 2020, the margin is extremely low at 0.87%, but it rises to 10.63% in 2021, accelerates further to 17.89% in 2022, moves up to 20.07% in 2023, and reaches a robust 24.78% in 2024. The adjusted net profit margin starts at a much higher level of 16.49% in 2020, reflecting the adjusted net income's impact. Subsequently, the adjusted and reported profit margins converge from 2021 onwards, both following the same positive trend through 2024.

Overall, the data suggests the company experienced significant profitability improvements, with particularly strong growth in net income and profit margins over the analyzed period. The adjustment for goodwill in 2020 had a considerable effect, indicating potential one-time or non-recurring expenses or write-offs in that year, after which the financial performance shows consistent and solid expansion.

The financial data reveals notable trends across the five-year span, highlighting variations in asset size and asset utilization efficiency.

Total Assets

Reported total assets exhibited a generally upward trajectory, increasing from 21,874 million US dollars in 2020 to 27,708 million US dollars in 2024. There is, however, a slight dip observed in 2023, where assets decreased to 24,342 million US dollars before rising again in the following year. Adjusted total assets, which account for goodwill adjustments, followed a similar pattern but consistently remained lower than reported assets, reflecting the impact of goodwill on the asset base. The adjusted total assets grew from 19,979 million in 2020 to 24,909 million in 2024, also showing a small decline in 2023.

Total Asset Turnover

Both reported and adjusted total asset turnover ratios show significant improvement over the analyzed period, indicating enhanced efficiency in generating revenue from the asset base. Reported total asset turnover increased from 0.31 in 2020 to a peak of 0.88 in 2023, followed by a minor decrease to 0.86 in 2024. Adjusted turnover ratios demonstrate a similar rise, starting at 0.34 in 2020 and reaching 0.99 in 2023, then slightly retreating to 0.95 in 2024. This trend suggests better operational performance and asset management over time, though a slight reduction in turnover ratios in the last recorded year could indicate the beginning of a stabilization phase or emerging operational challenges.

Overall, the data reflects growth in the company's asset base paired with a notable increase in asset utilization efficiency, particularly when adjustments for goodwill are considered. The observed dip in asset values and turnover ratios in 2023 and 2024 warrants attention, as it may reflect changing business conditions or strategic shifts impacting asset deployment and revenue generation capacity.

Total Assets:

The reported total assets demonstrated a generally increasing trend from 21,874 million US dollars in 2020 to 27,708 million US dollars in 2024, although a slight decline was observed in 2023. Adjusted total assets, which exclude goodwill, follow a similar upward trajectory, growing from 19,979 million US dollars in 2020 to 24,909 million US dollars in 2024, with a minor decrease in 2023 as well.

Stockholders’ Equity (Deficit):

Reported stockholders’ equity increased from 4,893 million US dollars in 2020 to peak at 6,178 million US dollars in 2021, then experienced a significant decline thereafter, reaching a deficit of 2,744 million US dollars in 2023 and further deteriorating to a deficit of 4,020 million US dollars in 2024. The adjusted stockholders’ equity, which accounts for goodwill adjustments, consistently presented a less favorable position, turning negative as early as 2022 (-25 million US dollars) and continuing to decline sharply into larger deficits of 5,570 million US dollars in 2023 and 6,819 million US dollars in 2024.

Financial Leverage Ratios:

Reported financial leverage decreased from 4.47 in 2020 to 3.83 in 2021 but then increased substantially to 9.12 by 2022, with no subsequent data available. Adjusted financial leverage ratios followed a somewhat similar declining trend initially, moving from 6.66 in 2020 to 6.31 in 2021, but data for later periods is missing, preventing further trend analysis. The available data indicates a significant increase in leverage based on reported values toward 2022, suggesting increased reliance on debt relative to equity.

Overall Trends and Insights:

The company’s total assets have grown over the analyzed period, both on a reported and adjusted basis, indicating asset expansion. However, the sharp decline and transition into negative stockholders’ equity suggest potential solvency concerns, particularly when goodwill adjustments are considered. The spike in reported financial leverage ratio by 2022 supports these concerns by indicating a higher risk profile due to increased debt levels relative to equity. The goodwill adjustments consistently show a more conservative financial position, highlighting the impact of intangible assets on the company’s balance sheet strength. The absence of some leverage data in later years limits a full assessment of recent leverage trends.

Net Income Trends

Reported net income exhibits a strong upward trajectory from 59 million US dollars in 2020 to 5,882 million US dollars in 2024. This reflects a substantial increase over the five-year period, with significant growth particularly noticeable between 2020 and 2021, followed by continued robust performance thereafter.

Adjusted net income data aligns closely with reported figures from 2021 onwards, indicating consistency in earnings adjustments applied after 2020. The adjusted net income rises from 1,121 million US dollars in 2020 to the same 5,882 million US dollars in 2024, mirroring the reported net income's growth pattern.

Stockholders' Equity Dynamics

Reported stockholders’ equity moved positively from 4,893 million US dollars in 2020 to 6,178 million in 2021, suggesting strengthened equity base during that period. However, a marked decline ensues in the subsequent years, dropping sharply to a deficit of 2,744 million in 2023 and further deteriorating to a negative 4,020 million by 2024. This indicates potential challenges in retaining equity or increased liabilities impacting shareholders' value.

The adjusted stockholders’ equity reveals a similar but even more pronounced decline after 2021, starting at 2,998 million US dollars in 2020, rising slightly to 3,291 million in 2021, then plummeting close to zero by 2022 (-25 million) and descending deeply into negative territory through 2023 (-5,570 million) and 2024 (-6,819 million). This adjusted measure underscores the weakening equity position over the recent years.

Return on Equity (ROE) Analysis

Reported ROE displays a significant ascending trend from a low 1.21% in 2020 to a high of 109.92% in 2022, with data absent for 2023 and 2024. This sharp rise in ROE corresponds with the surge in net income despite the diminishing equity base, potentially inflating the profitability ratio due to the shrinking denominator.

Adjusted ROE indicates a high and relatively stable level between 2020 (37.39%) and 2021 (35.4%), but lacks data for subsequent years. The consistent adjusted ROE suggests stable returns on equity before the severe equity declines noted in later years.

Overall Interpretation

The company demonstrates powerful earnings growth across the five years as captured by both reported and adjusted net income, illustrating operational success and profitability improvements. However, equity positions have weakened significantly, transitioning into substantial reported and adjusted deficits from 2022 onward. This decline in equity, paired with a rising ROE until 2022, implies that profitability ratios may be distorted by a shrinking equity base rather than purely by operational gains. The negative equity figures raise concerns regarding financial stability and capital structure that merit close monitoring.

The data reveals a strong upward trajectory in both reported and adjusted net income over the period from 2020 to 2024. Reported net income increased substantially from 59 million US dollars in 2020 to 5,882 million US dollars in 2024, while adjusted net income started at 1,121 million US dollars in 2020 and converged with the reported figures from 2021 onward, reflecting consistent growth.

Net Income Trends

Reported net income showed a remarkable rise beginning in 2021, surging from 59 million to over one billion and continuing an accelerated growth trend through 2024. Adjusted net income, initially higher than reported in 2020, aligns with the reported figures from 2021, indicating improved earnings quality or adjustments becoming less significant over time.

Total Assets

Both reported and adjusted total assets demonstrate moderate growth over the examined period. Reported total assets increased from 21,874 million US dollars in 2020 to 27,708 million in 2024, while adjusted total assets grew from 19,979 million to 24,909 million. Notably, adjusted assets remain consistently below reported assets, likely reflecting the exclusion of goodwill or other intangible adjustments, with the gap persisting across all years.

Return on Assets (ROA)

ROA figures, both reported and adjusted, have improved significantly. The reported ROA rose from a very low 0.27% in 2020 to a strong 21.23% in 2024, while adjusted ROA increased from 5.61% to 23.61%. The difference between reported and adjusted ROA was most prominent in the initial year but narrowed over time, reflecting that asset adjustments have had a notable impact on performance metrics, but this impact diminished as profitability increased.

Overall, the trends indicate enhanced profitability and more efficient asset utilization. The convergence of reported and adjusted net income and improvements in adjusted ROA suggest that goodwill and intangible asset adjustments had significant initial effects but became less impactful as the company's financial performance strengthened. Total asset growth remains steady but less pronounced than income, contributing to the improved ROA metrics.