- Income Tax Expense (Benefit)
- Effective Income Tax Rate (EITR)
- Components of Deferred Tax Assets and Liabilities
- Deferred Tax Assets and Liabilities, Classification
- Adjustments to Financial Statements: Removal of Deferred Taxes
- Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
- Adjusted Net Profit Margin
- Adjusted Total Asset Turnover
- Adjusted Financial Leverage
- Adjusted Return on Equity (ROE)
- Adjusted Return on Assets (ROA)
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- Balance Sheet: Assets
- Balance Sheet: Liabilities and Stockholders’ Equity
- Analysis of Liquidity Ratios
- Enterprise Value to EBITDA (EV/EBITDA)
- Selected Financial Data since 2005
- Current Ratio since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
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Income Tax Expense (Benefit)
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Current Income Tax Expense
-
The current income tax expense demonstrated significant fluctuations over the observed periods. It started at $149 million in 2017 and rose sharply to $395 million in 2018, indicating an increased tax burden from current operations. This amount then decreased to $294 million in 2019, followed by a more pronounced decline to $65 million in 2020. In 2021, there was a modest rebound to $92 million. Overall, the trend shows volatility with a peak in 2018 and a notable decline during 2020, potentially reflecting operational or earnings variations, tax rate changes, or extraordinary tax adjustments during the pandemic period.
- Deferred Income Tax Benefit
-
The deferred income tax benefit showed substantial variability, with all values recorded as benefits (negative values). The benefit increased from -$103 million in 2017 to a larger benefit of -$308 million in 2018, indicating a growing recognition of deferred tax assets or timing differences. However, in 2019, the benefit decreased considerably to -$91 million, suggesting reversal or reduced deferred tax assets. A significant spike occurred in 2020, with the benefit reaching -$488 million, implying a large deferred tax adjustment that positively impacted the tax expense. In 2021, the benefit diminished to -$145 million, closer to earlier levels but still indicating ongoing deferred tax activity.
- Total Income Tax Expense (Benefit)
-
The total income tax expense (benefit), netting current and deferred amounts, displayed a diverse trajectory. Starting from a modest expense of $45 million in 2017, it nearly doubled to $87 million in 2018. In 2019, it increased substantially to $203 million, reflecting higher overall tax charges despite a reduced deferred benefit. The year 2020 marked a sharp reversal with a substantial tax benefit of -$423 million, driven primarily by the large deferred tax benefit. In 2021, the total tax expense remained negative at -$53 million, indicating a continued net tax benefit position. This pattern highlights material swings in tax obligations, possibly connected to varying profitability, tax strategy adjustments, or significant temporary differences affecting deferred taxes.
Effective Income Tax Rate (EITR)
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
U.S. federal statutory income tax rate | ||||||
Effective income tax rate |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The effective income tax rate exhibits significant variability over the analyzed periods, contrasting with the relatively stable statutory income tax rate from 2018 onward.
- Statutory Income Tax Rate
- The U.S. federal statutory income tax rate reduced sharply from 35% in 2017 to 21% in 2018 and remained constant at 21% through 2021, reflecting regulatory or legislative changes affecting federal tax policy.
- Effective Income Tax Rate
- The effective income tax rate demonstrated considerable fluctuations across the years. It increased from 10.89% in 2017 to 17.94% in 2018, then continued to rise to 26.19% in 2019. In 2020, it declined sharply to 13.42%, before surging dramatically to 139.47% in 2021.
This divergence between the statutory and effective rates suggests the impact of various factors such as adjustments for deferred taxes, tax credits, or other non-recurring tax effects. The unusually high effective tax rate in 2021 indicates a possible substantial tax expense relative to pre-tax income, potentially due to extraordinary items, one-time charges, or tax-related adjustments adversely affecting profitability in that period.
Components of Deferred Tax Assets and Liabilities
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Provision for accrued expenses
- The provision increased steadily from 50 million USD in 2017 to a peak of 100 million USD in 2019, followed by a moderate decline to 85 million USD by 2021. This suggests a rising trend in accrued expenses up to 2019, with subsequent stabilization and slight reduction.
- Deferred loyalty rewards
- Deferred loyalty rewards showed consistent growth from 131 million USD in 2017 to 186 million USD in 2021. The increments were gradual, indicating a steady accumulation of loyalty liabilities over the period.
- Net operating loss and tax credit carryforwards
- There was a significant jump in net operating loss and tax credit carryforwards starting in 2020, rising sharply from 100 million USD in 2019 to 654 million USD, and increasing further to 939 million USD in 2021. This large increase may reflect accumulated tax benefits, likely due to operating losses or tax planning strategies.
- Stock-based compensation
- Stock-based compensation rose from 52 million USD in 2017 to a peak of 86 million USD in 2019 but declined substantially thereafter to only 25 million USD by 2021. This suggests a notable scaling back of stock-based incentive expenses in recent years.
- Property and equipment
- Data for property and equipment shows an increase from 55 million USD in 2018 to a peak of 102 million USD in 2019, followed by a sharp decline to 19 million USD by 2021. This trend indicates a reduction in fixed asset investments or possible disposals after 2019.
- Operating lease liabilities
- Operating lease liabilities first appear in 2019 at 136 million USD, remaining relatively stable in 2020 at 135 million USD, but then declined to 96 million USD by 2021. This could indicate a reduction in lease obligations or changes in leasing arrangements from 2019 onward.
- Long-term investments
- Long-term investments are only recorded in 2021 at 106 million USD, indicating a new or resumed allocation towards this asset category during the latest period.
- Other (assets/liabilities)
- The 'Other' category increased significantly in 2020 to 172 million USD before decreasing to 62 million USD in 2021, reflecting a temporary peak that may be associated with unusual or one-time items during 2020.
- Deferred tax assets
- Deferred tax assets showed strong growth, more than tripling from 402 million USD in 2017 to 1,518 million USD in 2021. This suggests an increasing recognition of future tax benefits possibly linked to accumulated losses or timing differences.
- Valuation allowance
- The valuation allowance slightly increased negatively from -76 million USD in 2017 to a peak negative of -216 million USD in 2020, followed by a decrease to -171 million USD in 2021. This pattern may reflect reassessments of the realizability of deferred tax assets over time.
- Deferred tax assets, less valuation allowance
- Net deferred tax assets, after accounting for valuation allowance, rose consistently from 325 million USD in 2017 to 1,347 million USD in 2021, reinforcing the trend of growing recognized tax assets on the balance sheet.
- Goodwill and intangible assets
- Goodwill and intangible assets recorded negative values throughout, with a small decrease in magnitude from -499 million USD in 2017 to -418 million USD in 2021, possibly indicating amortization or impairment reducing these assets’ carrying values.
- Anticipatory foreign tax credits
- Only reported in 2021 with a negative value of -113 million USD, reflecting a newly recognized liability or adjustment related to foreign tax credits during that year.
- Operating lease right-of-use (ROU) assets
- Operating lease ROU assets, recognized starting 2019 with a negative value of -128 million USD, showed a slight reduction in liability through 2021 (-93 million USD), corresponding with the decline in operating lease liabilities, indicating changes in lease asset valuation or lease terminations.
- Deferred tax liabilities
- Deferred tax liabilities fluctuated over the five years, decreasing from -636 million USD in 2017 to -486 million USD in 2018, then increasing to -639 million USD by 2021, suggesting variability in deferred taxable amounts or tax rate changes affecting these balances.
- Net deferred tax assets (liabilities)
- The net deferred tax position improved markedly, moving from a negative 311 million USD in 2017 to a positive 708 million USD in 2021. The lack of data in some years impedes full analysis, but this trend indicates an overall strengthening of net deferred tax asset positions.
Deferred Tax Assets and Liabilities, Classification
Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
---|---|---|---|---|---|---|
Deferred tax assets | ||||||
Deferred tax liabilities |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
The analysis of the deferred tax assets and liabilities over the five-year period reveals several notable trends.
- Deferred Tax Assets
-
Deferred tax assets exhibit a consistent and substantial upward trend throughout the period. Starting from a relatively low base of 18 million US dollars at the end of 2017, there is a gradual increase to 69 million in 2018 followed by a doubling to 145 million in 2019. The growth accelerates significantly in subsequent years, reaching 659 million in 2020 and further increasing to 766 million by the end of 2021. This upward movement suggests a substantial rise in temporary differences or carryforwards that are expected to reduce future tax liabilities, reflecting potential improvements in the company's tax planning or changes in accounting estimates and regulations affecting deferred tax recognition.
- Deferred Tax Liabilities
-
Deferred tax liabilities demonstrate a different pattern. They start at a high point of 329 million US dollars in 2017 but experience a sharp decline to 69 million in 2018. After 2018, the values decrease gradually to 56 million in 2019 and slightly fluctuate between 67 million in 2020 and 58 million in 2021. This general declining trend indicates a reduction in taxable temporary differences or possibly changes in asset valuations or tax regulation that reduce the taxable amounts deferred to future periods.
Overall, the contrasting trends between deferred tax assets and liabilities over these years result in a growing net deferred tax asset position. This suggests an increasing expectation of tax benefits from deductible temporary differences or losses that the company anticipates utilizing, alongside a diminishing expectation of future taxable amounts. Such dynamics may reflect strategic shifts in asset management, changes in tax jurisdictions, or favorable adjustments in accounting for taxes. The significant increases in deferred tax assets, particularly in the later years, warrant attention to the underlying components to assess the sustainability and realization prospects of these deferred tax benefits.
Adjustments to Financial Statements: Removal of Deferred Taxes
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Total Assets
- The reported total assets showed a fluctuating trend over the five-year period. Starting at approximately 18.5 billion USD in 2017, assets decreased slightly in 2018, then increased significantly in 2019 reaching over 21.4 billion USD. There was a decline in 2020 to around 18.7 billion USD, followed by a rebound in 2021 to about 21.5 billion USD. Adjusted total assets followed a similar pattern but were consistently lower than reported assets, indicating some deductions or adjustments primarily related to deferred income taxes or other accounting considerations.
- Total Liabilities
- The company’s total liabilities exhibited an overall increasing trend. Reported liabilities started at approximately 12.4 billion USD in 2017 and remained relatively stable through 2018. A sharp rise occurred in 2019 to nearly 15.9 billion USD, followed by a slight decrease in 2020, and then another increase in 2021 reaching roughly 18.0 billion USD. Adjusted liabilities mirrored this pattern closely but were marginally lower each year, suggesting consistent adjustments affecting the liabilities figure.
- Stockholders’ Equity
- Reported stockholders’ equity demonstrated a clear downward trajectory over the period, declining from about 4.5 billion USD in 2017 to just over 2.0 billion USD by the end of 2021. Adjusted equity followed a similar decreasing trend, starting higher than reported equity in 2017 but falling below reported figures in later years, dropping to around 1.3 billion USD by 2021. This reduction in equity, particularly the significant drop starting in 2019, reflects deteriorating retained earnings or other equity components possibly due to net losses and other comprehensive items.
- Net Income (Loss)
- Net income attributable to the company varied notably across the five years. The reported net income began with moderate profits in 2017 and 2018, rising to its peak in 2019 at 565 million USD. However, there was a substantial loss in 2020, reaching negative 2.6 billion USD, likely due to extraordinary conditions during that period. In 2021, the company returned to a minimal profit of 12 million USD. Adjusted net income reflected a similar pattern but with lower profitability and deeper losses, particularly in 2020 and 2021, indicating additional negative adjustments affecting earnings, such as deferred tax impacts or other non-operating losses.
Expedia Group Inc., Financial Data: Reported vs. Adjusted
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
- Net Profit Margin Trends
- The reported net profit margin exhibited a decline from 3.76% in 2017 to 3.62% in 2018, followed by a recovery to 4.68% in 2019. This positive trend was interrupted sharply in 2020, plunging to -50.24%, then recovering slightly to nearly breakeven at 0.14% in 2021. The adjusted net profit margin follows a similar path but with slightly lower values, starting at 2.73% in 2017, dropping to 0.87% in 2018, recovering to 3.93% in 2019, then falling more deeply to -59.63% in 2020, and remaining negative at -1.55% in 2021.
- Total Asset Turnover Trends
- The reported total asset turnover ratio shows moderate fluctuations, increasing from 0.54 in 2017 to 0.62 in 2018, then decreasing to 0.56 in 2019. A significant decline occurred in 2020, reaching 0.28, before recovering to 0.40 in 2021. Adjusted total asset turnover mirrors this pattern closely, with marginally higher values in 2019, 2020, and 2021, indicating a consistent trend in operational efficiency over the observed period despite disruptions.
- Financial Leverage Trends
- There is a clear upward trajectory in financial leverage, with the reported ratio increasing steadily from 4.09 in 2017 to 10.48 in 2021. The adjusted financial leverage ratio follows a similar pattern but at higher levels starting from 3.83 in 2017 up to 15.41 in 2021. This trend suggests increasing reliance on debt or other liabilities relative to equity, intensifying financial risk exposure.
- Return on Equity (ROE) Trends
- Reported ROE rose from 8.36% in 2017 to a peak of 14.24% in 2019 before plunging dramatically to -103.16% in 2020 and recovering to a marginal 0.58% in 2021. Adjusted ROE displays more volatility, starting at 5.68% in 2017, dropping to 2.39% in 2018, rebounding to 12.22% in 2019, then falling sharply to -159.79% in 2020, and remaining negative at -9.86% in 2021. The data reflects significant earnings volatility and possible impacts of extraordinary items or tax adjustments affecting equity returns.
- Return on Assets (ROA) Trends
- Reported ROA increased modestly from 2.04% in 2017 to 2.64% in 2019 before deteriorating sharply to -13.98% in 2020 and improving slightly to 0.06% in 2021. Adjusted ROA values are consistently lower and show a similar trend, with values of 1.48%, 0.55%, 2.23%, -17.19%, and -0.64% respectively. This indicates that asset profitability was significantly impacted during 2020 and recovery remained incomplete as of 2021.
- Overall Insights
- The data depicts a business significantly affected in 2020, with sharp declines in profitability and returns metrics coinciding with increased financial leverage. Operational efficiency (total asset turnover) declined noticeably in the crisis period but showed signs of recovery. The persistence of negative adjusted returns in 2021 suggests continuing financial challenges or adjustment effects even as reported figures slightly improved. The marked increase in financial leverage signals increased risk, reinforcing the need for close monitoring of solvency and capital structure going forward.
Expedia Group Inc., Financial Ratios: Reported vs. Adjusted
Adjusted Net Profit Margin
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
2021 Calculations
1 Net profit margin = 100 × Net income (loss) attributable to Expedia Group, Inc. ÷ Revenue
= 100 × ÷ =
2 Adjusted net profit margin = 100 × Adjusted net income (loss) attributable to Expedia Group, Inc. ÷ Revenue
= 100 × ÷ =
The financial data reveals significant fluctuations in both reported and adjusted net income attributable to Expedia Group, Inc. over the five-year period ending December 31, 2021.
- Reported Net Income
- From 2017 to 2019, reported net income showed an upward trend, increasing steadily from $378 million to $565 million. However, in 2020, there was a drastic decline to a significant loss of $2,612 million, followed by a recovery to a slightly positive $12 million in 2021.
- Adjusted Net Income
- Adjusted net income followed a similar pattern, starting at $275 million in 2017, then dropping sharply to $98 million in 2018 before rising again to $474 million in 2019. Like the reported figures, adjusted net income plunged to a large loss of $3,100 million in 2020 and improved to a negative $133 million in 2021, still remaining below breakeven.
- Reported Net Profit Margin
- The reported net profit margin mirrored the income trends, ranging from 3.76% in 2017 and slightly decreasing to 3.62% in 2018. It peaked at 4.68% in 2019 before experiencing a sharp contraction, plunging to -50.24% in 2020 and recovering marginally to 0.14% in 2021. This indicates a severe profitability impact followed by a limited recovery.
- Adjusted Net Profit Margin
- Adjusted net profit margin was notably lower than reported margin, starting at 2.73% in 2017, dropping significantly to 0.87% in 2018, and rising to 3.93% in 2019. Subsequently, it fell to -59.63% in 2020, the steepest decline among the margins, and improved slightly to -1.55% in 2021, remaining negative and reflecting continued operational challenges.
Overall, the period from 2017 through 2019 demonstrated growth in income and profitability, with 2019 marking the peak. The dramatic downturn in 2020 corresponds with a substantial loss and sharply negative profit margins, indicative of extraordinary adverse factors affecting the company. Although there is some recovery in 2021, both net income and profit margins remain relatively weak, particularly when adjusted for deferred income taxes and other factors, suggesting ongoing financial pressures.
Adjusted Total Asset Turnover
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
2021 Calculations
1 Total asset turnover = Revenue ÷ Total assets
= ÷ =
2 Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= ÷ =
- Total Assets
- Both reported and adjusted total assets demonstrated an overall increasing trend from 2017 to 2021, with values rising from approximately $18.5 billion to about $21.5 billion reported, and from $18.5 billion to $20.8 billion adjusted. Notably, there was a dip in both reported and adjusted totals in 2020, reflecting a contraction compared to prior years. This decrease in 2020 aligns with a global economic slowdown during that period, followed by a recovery in 2021.
- Total Asset Turnover
- Total asset turnover ratios, both reported and adjusted, exhibited fluctuations over the observed years. From 2017 to 2019, turnover remained relatively stable, centered around the range of 0.54 to 0.62. However, a significant decline occurred in 2020, where the ratio dropped sharply to approximately 0.28 to 0.29, indicating a decrease in efficiency in generating revenue from assets during that year. A partial recovery is visible in 2021, with turnover increasing to around 0.40 to 0.41, though it did not return to pre-2020 levels.
- Insights
- The data suggest that while the company’s asset base experienced growth over the five-year period, a notable disruption occurred in 2020, impacting both the asset size and the efficiency in utilizing those assets to generate revenue. The decline in asset turnover ratio indicates reduced operational efficiency or lower revenue generation relative to assets, likely reflective of broader economic challenges. The recovery noted in 2021 signals an improving operational environment, though asset utilization efficiency had not yet fully normalized.
Adjusted Financial Leverage
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
2021 Calculations
1 Financial leverage = Total assets ÷ Total Expedia Group, Inc. stockholders’ equity
= ÷ =
2 Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Expedia Group, Inc. stockholders’ equity
= ÷ =
The financial data reveals notable trends in the assets, equity, and leverage ratios over the five-year period from 2017 to 2021.
- Total Assets
- Both reported and adjusted total assets demonstrate fluctuations throughout the period. Reported total assets decreased slightly from 18,516 million USD in 2017 to 18,033 million USD in 2018. They then increased significantly to 21,416 million USD in 2019 before declining again to 18,690 million USD in 2020 and rising to 21,548 million USD in 2021. Adjusted total assets follow a similar pattern but show slightly lower values in 2020 and 2021 compared to reported amounts.
- Stockholders’ Equity
- Reported stockholders’ equity consistently declined over the period, from 4,522 million USD in 2017 to 2,057 million USD in 2021. Adjusted equity displays a comparable downward trend but with a more pronounced decrease between 2019 and 2021, reaching 1,349 million USD by the end of 2021. This consistent reduction indicates a weakening in equity base over time.
- Financial Leverage
- Reported financial leverage escalated sharply, moving from 4.09 times in 2017 to 10.48 times in 2021. Adjusted financial leverage increased even more markedly, rising from 3.83 times in 2017 to 15.41 times in 2021. Both measures reveal a significant increase in reliance on debt financing relative to equity, with adjusted leverage suggesting even higher risk exposure due to the adjustments made.
Overall, while total assets have shown variability with an overall modest increase, the equity component has steadily eroded. This erosion combined with increased financial leverage suggests growing financial risk, as the company has become more dependent on debt financing relative to its equity base over the analyzed timeframe.
Adjusted Return on Equity (ROE)
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
2021 Calculations
1 ROE = 100 × Net income (loss) attributable to Expedia Group, Inc. ÷ Total Expedia Group, Inc. stockholders’ equity
= 100 × ÷ =
2 Adjusted ROE = 100 × Adjusted net income (loss) attributable to Expedia Group, Inc. ÷ Adjusted total Expedia Group, Inc. stockholders’ equity
= 100 × ÷ =
- Net Income (Loss) Analysis
- The reported net income attributable to the company showed an increasing trend from 2017 to 2019, rising from $378 million to $565 million. However, a significant decline occurred in 2020, resulting in a substantial loss of $2,612 million. A slight recovery is observable in 2021, with a small reported net income of $12 million. The adjusted net income shows a somewhat similar pattern but with lower values and more pronounced losses. It dropped from $275 million in 2017 to $98 million in 2018, increased to $474 million in 2019, then plummeted to a loss of $3,100 million in 2020 and a smaller loss of $133 million in 2021.
- Stockholders’ Equity Analysis
- Reported total stockholders’ equity exhibits a decreasing trend over the period, starting at $4,522 million in 2017 and declining steadily each year to $2,057 million in 2021. Adjusted total stockholders’ equity follows a similar declining pattern, starting at a slightly higher $4,833 million in 2017 and falling to $1,349 million by 2021. The consistent decline suggests a weakening equity position over the years.
- Return on Equity (ROE) Analysis
- The reported ROE improved from 8.36% in 2017 to a peak of 14.24% in 2019, indicating increasing profitability relative to equity during this period. However, it drastically decreased to a negative -103.16% in 2020, reflecting significant losses that year, and slightly recovered to a positive 0.58% in 2021. The adjusted ROE mirrors the reported ROE's direction but is generally lower. It started at 5.68% in 2017, dropped to 2.39% in 2018, rose to 12.22% in 2019, then plummeted to -159.79% in 2020 and remained negative at -9.86% in 2021. The negative adjusted ROE reflects adjusted losses and the challenging operational environment in the latter years.
- Overall Insights
- The data indicates a period of growth and profitability up to 2019, followed by a severe downturn in 2020 that significantly impacted net income, equity, and profitability ratios. Although some recovery was noted in 2021, both reported and adjusted figures suggest ongoing challenges with profitability and equity depletion. The adjustments made to the financials, incorporating deferred income tax impacts, tend to exacerbate the declines and losses, indicating potential tax-related or non-operational influences on the financial performance.
Adjusted Return on Assets (ROA)
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
2021 Calculations
1 ROA = 100 × Net income (loss) attributable to Expedia Group, Inc. ÷ Total assets
= 100 × ÷ =
2 Adjusted ROA = 100 × Adjusted net income (loss) attributable to Expedia Group, Inc. ÷ Adjusted total assets
= 100 × ÷ =
- Net Income Trends
- The reported net income attributable to the company showed growth from 2017 through 2019, increasing from 378 million USD to 565 million USD. However, the period of 2020 marked a significant downturn with a substantial loss of 2,612 million USD, followed by a modest recovery to 12 million USD in 2021. The adjusted net income mirrored this pattern but with generally lower absolute values, starting at 275 million USD in 2017, dipping to 98 million USD in 2018, rebounding to 474 million USD in 2019, then plunging to a deeper loss of 3,100 million USD in 2020, and slightly improving to a loss of 133 million USD in 2021.
- Asset Base Trends
- The company's reported total assets experienced fluctuations over the five-year period. Assets decreased slightly from 18,516 million USD in 2017 to 18,033 million USD in 2018, then increased to 21,416 million USD in 2019. In 2020, total assets declined again to 18,690 million USD, before recovering to 21,548 million USD in 2021. Adjusted total assets followed a similar trajectory but with slightly lower figures overall, ranging from 18,498 million USD in 2017 to 20,782 million USD in 2021.
- Return on Assets (ROA) Analysis
- Reported ROA demonstrated a generally positive trend through 2019, rising from 2.04% in 2017 to 2.64% in 2019. The ROA sharply declined into negative territory in 2020, recording -13.98%, indicative of the adverse net income. A minor recovery occurred in 2021 with a ROA of 0.06%. Adjusted ROA values were consistently lower than reported ROA, starting at 1.48% in 2017 and dipping to 0.55% in 2018, before increasing to 2.23% in 2019. The adjusted ROA dropped markedly to -17.19% in 2020 and slightly improved, yet remained negative at -0.64% in 2021.
- Overall Observations
- The data illustrates a period of growth and profitability up to 2019, followed by a sharp decline in financial performance in 2020, likely reflecting significant challenges faced in that year. Both reported and adjusted metrics show a similar pattern of recovery in 2021, although adjusted results indicate a continued loss and negative returns, suggesting ongoing adjustments and financial impacts not fully resolved. The asset base fluctuated but generally recovered by 2021 after the dip in 2020. The divergence between reported and adjusted figures highlights the impact of adjustments made for income tax and other factors on the company's financial outcomes.