Expedia Group Inc. (NASDAQ:EXPE)

The analysis of the annual property, plant, and equipment data reveals several notable trends over the five-year period.

Capitalized software development

This asset category shows a consistent increase from 2017 through 2020, peaking at 3,374 million USD. However, there is a decline in 2021 to 2,892 million USD, indicating a possible slowdown or revaluation in capitalization activities for software development during the last year.

Computer equipment

The value of computer equipment fluctuated modestly, starting at 658 million USD in 2017 and declining to 351 million USD by 2021. This steady decrease suggests potential reduced investment or disposal of computer hardware assets over the period.

Furniture and other equipment

Furniture and other equipment show a gradual upward trend from 85 million USD in 2017 to a peak of 128 million USD in 2020, followed by a slight decrease to 106 million USD in 2021. The pattern indicates moderate growth in this asset class up to 2020 with some decline thereafter.

Buildings and leasehold improvements

This category experienced significant growth, rising from 283 million USD in 2017 to 1,230 million USD in 2020, then slightly declining to 1,220 million USD in 2021. The substantial increase reflects considerable investment in buildings and leasehold improvements over the reviewed period.

Land

Land assets remained stable, valued at 129 million USD from 2017 through 2019, with a minor increase to 146 million USD in 2020 and 2021, suggesting minimal acquisition or revaluation activity.

Projects in progress

Projects in progress peaked at 531 million USD in 2018 before showing a steady decline to 33 million USD by 2021. This sharp reduction may indicate project completions or cancellations.

Property and equipment, cost

The total cost of property and equipment increased consistently from 3,631 million USD in 2017 to a high of 5,546 million USD in 2020, followed by a decrease to 4,748 million USD in 2021. The increase until 2020 represents active asset additions, while the 2021 decline suggests asset disposals or write-downs.

Accumulated depreciation

Accumulated depreciation rose continuously from -2,056 million USD in 2017 to -3,289 million USD in 2020, indicating ongoing amortization of assets. However, in 2021, it decreased to -2,568 million USD, which may imply asset disposals or adjustments affecting accumulated depreciation.

Property and equipment, net

The net property and equipment value increased steadily from 1,575 million USD in 2017 to 2,257 million USD in 2020, then slightly declined to 2,180 million USD in 2021. This reflects a general growth in net fixed assets over the period, with a minor reduction in the last year.

Overall, the data indicates a period of active investment and asset growth through 2020 across multiple categories, particularly in buildings and capitalized software development, followed by some retrenchment or asset adjustments in 2021. The reduction in accumulated depreciation and projects in progress in 2021 further supports the interpretation of asset disposals or completions impacting the asset base.

Average age ratio

The average age ratio exhibited minor fluctuations over the analyzed period. It started at 58.7% in 2017, increasing slightly to 59.35% in 2018, then decreased to 57.79% in 2019. A notable rise to 60.91% occurred in 2020, followed by a significant decline to 55.8% in 2021. This pattern suggests periods of both aging asset accumulation and subsequent renewal or replacement efforts.

Estimated total useful life

The estimated total useful life was stable at 6 years in 2017 and 2018, increased to 7 years in 2019 and 2020, then reduced back to 6 years in 2021. This variation indicates adjustments in asset longevity assumptions, likely reflecting changes in maintenance policies or asset composition.

Estimated age, time elapsed since purchase

The estimated asset age increased from 3 years in 2017 to 4 years by 2018 and remained constant at 4 years through 2021. This stability in elapsed time suggests a relatively steady replacement or acquisition cycle during these years.

Estimated remaining life

The estimated remaining life showed an increase from 2 years in 2017 to 3 years in 2018, maintaining this level through to 2021. This indicates an extension in the expected usability period of the assets following adjustments made between 2017 and 2018.

The analysis of the property, plant, and equipment financial data reveals several noteworthy trends over the five-year period ending December 31, 2021.

Property and Equipment, Cost

The cost of property and equipment increased steadily from $3,631 million in 2017 to a peak of $5,546 million in 2020. However, in 2021, the cost declined to $4,748 million, indicating a possible reduction in capital expenditures or disposals during that year.

Accumulated Depreciation

Accumulated depreciation rose consistently from $2,056 million in 2017 to $3,289 million in 2020, reflecting ongoing depreciation of assets. In 2021, accumulated depreciation decreased to $2,568 million, which deviates from the prior upward trend and suggests potential asset retirements or write-downs affecting the total accumulated depreciation.

Land

The value of land remained stable at $129 million from 2017 through 2019, then increased slightly to $146 million in 2020 and remained unchanged in 2021. This minor increase may result from land acquisitions or revaluation adjustments.

Average Age Ratio

The average age ratio, which indicates the proportion of accumulated depreciation to asset cost, fluctuated modestly over the period. It started at 58.7% in 2017, increased to 60.91% in 2020, revealing an aging asset base, and then declined to 55.8% in 2021. This decline suggests a relative rejuvenation of the asset base, possibly due to asset additions or disposals of older assets.

Overall, the data indicates a general expansion of the company's property and equipment assets until 2020, followed by a contraction in 2021. The unusual decrease in accumulated depreciation and average age ratio in 2021 highlights changes in asset composition that merit further investigation to understand the underlying causes, such as asset retirements, impairments, or capital spending shifts.

Property and Equipment, Cost

The recorded cost of property and equipment showed a general upward trend from 2017 to 2020, increasing from $3,631 million to $5,546 million. However, in 2021, there was a noticeable decline to $4,748 million, representing a reduction of approximately 14.4% from the previous year. This pattern suggests a peak in capital investment or asset addition in 2020, followed by a divestiture, asset write-down, or lower acquisition activity in 2021.

Land

The value of land remained stable at $129 million between 2017 and 2019, before rising modestly to $146 million in 2020 and maintaining at that level in 2021. The increase in 2020 could indicate new land acquisition or revaluation but shows no further change the following year, suggesting stability in land holdings.

Depreciation Expense of Property and Equipment, Including Internal-Use Software and Website Development

Depreciation expense consistently increased from $614 million in 2017 to a peak of $739 million in 2020. In 2021, it slightly decreased to $715 million. This upward trend corresponds with rising asset base costs until 2020 and the large capital expense in that year. The slight decline in 2021 may reflect the reduced asset base or changes in asset composition.

Estimated Total Useful Life

The estimated total useful life of property and equipment was six years in 2017 and 2018, increased to seven years for 2019 and 2020, then reverted to six years in 2021. This fluctuation could indicate reassessment of asset longevity or changes in asset mix influencing depreciation schedules.

The analysis of property, plant, and equipment (PP&E) data over the period from 2017 to 2021 reveals several noteworthy trends in accumulated depreciation, depreciation expense, and the age of assets.

Accumulated Depreciation

The accumulated depreciation exhibits an increasing trend from 2017 to 2020, rising from $2,056 million to $3,289 million. This indicates a steady allocation of asset costs over time, reflecting ongoing usage and aging of the property, plant, and equipment. However, in 2021, there is a marked decrease in accumulated depreciation to $2,568 million, which may suggest disposals, revaluation, or changes in accounting estimates related to the assets.

Depreciation Expense

Depreciation expense has generally increased annually from $614 million in 2017 to a peak of $739 million in 2020, reflecting continued investment or capitalization of assets leading to higher depreciation charges. In 2021, the expense slightly declined to $715 million, which could imply a reduction in new asset additions or changes in the depreciation method or estimates.

Time Elapsed Since Purchase

The average age of assets, indicated by "time elapsed since purchase," has remained relatively stable at around 4 years from 2018 onwards, increasing by one year from 3 years in 2017. This stability suggests a consistent asset replacement or acquisition cycle, with no significant acceleration or delay in capital expenditures affecting asset aging.

Overall, the property, plant, and equipment show a pattern of steady capital consumption as evidenced by increasing accumulated depreciation and depreciation expense over most of the period. The drop in accumulated depreciation in 2021 could suggest asset disposals or revaluations, which merits further investigation. The stable asset age indicates a consistent approach to asset management during these years.

The analysis of the property, plant, and equipment data over the five-year period reveals several notable trends and patterns concerning the asset base and related expenses.

Property and Equipment, Net

The net value of property and equipment increased consistently from 2017 through 2020, rising from 1,575 million US dollars to a peak of 2,257 million US dollars. However, in 2021, this value experienced a decline to 2,180 million US dollars. This overall trend suggests sustained investment in assets up to 2020, followed by a slight reduction or increased depreciation effect in the subsequent year.

Land

The reported value of land remained stable at 129 million US dollars during the initial three years, from 2017 to 2019, before increasing to 146 million US dollars in 2020 and maintaining that level into 2021. This indicates an addition or revaluation of land assets beginning in 2020, with no further changes in the following year.

Depreciation Expense of Property and Equipment

Depreciation expense, which includes internal-use software and website development, showed a steady increase from 614 million US dollars in 2017 to 739 million US dollars in 2020. However, it decreased slightly to 715 million US dollars in 2021. The rising depreciation expense over the majority of the period corresponds with the growth in net property and equipment, while the slight decrease in 2021 may indicate changes in asset composition or depreciation methods.

Estimated Remaining Life

The estimated remaining life of the assets increased from 2 years in 2017 to 3 years in 2018 and remained stable at 3 years through 2021. This reflects a reassessment or extension of the useful life assumption of the assets, which may impact depreciation calculations.

In summary, the data reveal a general trend of increasing investment in property and equipment, accompanied by rising depreciation expenses until 2020, followed by a modest decline in asset net value and depreciation expense in 2021. The stable increase in the estimated remaining life to three years suggests a conservative approach to asset useful lives that may influence financial reporting consistency over the analyzed period.