Name: Expedia Group Inc. (NASDAQ:EXPE) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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Expedia Group Inc., consolidated income statement

US$ in millions

12 months ended:	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Revenue	8,598)	5,199)	12,067)	11,223)	10,060)
Cost of revenue, exclusive of depreciation and amortization	(1,522)	(1,680)	(2,077)	(1,864)	(1,757)
Gross profit	7,076)	3,519)	9,990)	9,359)	8,303)
Selling and marketing	(4,221)	(2,546)	(6,078)	(5,721)	(5,298)
Technology and content	(1,074)	(1,010)	(1,226)	(1,122)	(1,387)
General and administrative	(705)	(597)	(815)	(774)	(676)
Depreciation and amortization	(814)	(893)	(910)	(959)	(275)
Impairment of goodwill	(14)	(799)	—)	(86)	—)
Intangible and other long-term asset impairment	(6)	(175)	—)	(42)	—)
Legal reserves, occupancy tax and other	(1)	13)	(34)	59)	(25)
Restructuring and related reorganization charges	(55)	(231)	(24)	—)	(17)
Operating income (loss)	186)	(2,719)	903)	714)	625)
Interest income	9)	18)	59)	71)	34)
Interest expense	(351)	(360)	(173)	(190)	(182)
Loss on debt extinguishment	(280)	—)	—)	—)	—)
Gain (loss) on sale of business, net	456)	(13)	—)	—)	—)
Foreign exchange rate gains (losses), net	(48)	71)	(34)	3)	(46)
Gains (losses) on minority equity investments, net	(29)	(142)	8)	(111)	(14)
Other	19)	(6)	12)	(2)	(1)
Other, net	(58)	(77)	(14)	(110)	(61)
Other expense, net	(224)	(432)	(128)	(229)	(208)
Income (loss) before income taxes	(38)	(3,151)	775)	485)	417)
Provision for income taxes	53)	423)	(203)	(87)	(45)
Net income (loss)	15)	(2,728)	572)	398)	371)
Net (income) loss attributable to non-controlling interests	(3)	116)	(7)	8)	7)
Net income (loss) attributable to Expedia Group, Inc.	12)	(2,612)	565)	406)	378)
Preferred stock dividend and loss on redemption of preferred stock	(281)	(75)	—)	—)	—)
Net income (loss) attributable to Expedia Group, Inc. common stockholders	(269)	(2,687)	565)	406)	378)

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 financial performance from 2017 to 2021 is characterized by a period of steady growth followed by a severe contraction and a subsequent partial recovery. Revenue increased consistently from 2017 through 2019, peaking at 12,067 million US dollars. However, a significant downturn occurred in 2020, where revenue fell to 5,199 million US dollars, representing a decline of approximately 57% from the previous year. By 2021, a recovery trend emerged as revenue rose to 8,598 million US dollars, although it remained below pre-2020 levels.

Gross Profit and Margin Analysis: Gross profit margins remained relatively stable between 2017 and 2019, maintaining a level above 82%. In 2020, the gross profit margin compressed significantly to approximately 67.7%, reflecting the inability to scale the cost of revenue in direct proportion to the sharp drop in top-line earnings. By 2021, the gross profit margin recovered to 82.3%, aligning closely with the historical performance observed prior to the 2020 contraction.
Operating Expense Trends: Selling and marketing expenses showed a strong correlation with revenue, scaling upward during the growth phase and decreasing sharply in 2020 to 2,546 million US dollars. In contrast, technology and content expenses remained more rigid, fluctuating only slightly between 1,010 million and 1,387 million US dollars over the five-year period. Depreciation and amortization costs increased substantially in 2018 and remained elevated through 2021, creating a higher fixed-cost base that pressured operating margins during the 2020 revenue slump.
Operating Income and Asset Impairments: Operating income trended upward from 625 million US dollars in 2017 to 903 million US dollars in 2019. The 2020 fiscal year saw a dramatic reversal, resulting in an operating loss of 2,719 million US dollars. This loss was heavily influenced by non-cash impairment charges, including 799 million US dollars for goodwill and 175 million US dollars for intangible and other long-term assets. A return to profitability was achieved in 2021 with an operating income of 186 million US dollars.
Net Income and Common Stockholder Returns: Net income attributable to the company grew steadily until 2019, reaching 565 million US dollars. The 2020 collapse led to a net loss of 2,612 million US dollars. While the 2021 net income attributable to the company returned to a positive 12 million US dollars—aided by a 456 million US dollar gain on the sale of a business—the net income attributable to common stockholders remained negative at 269 million US dollars. This discrepancy is primarily attributed to 281 million US dollars in preferred stock dividends and redemption losses.
Financial Obligations and Other Expenses: Interest expenses nearly doubled from 2017 levels, rising from 182 million US dollars to 351 million US dollars by 2021. This increase in debt service costs, combined with a 280 million US dollar loss on debt extinguishment in 2021, indicates a heightened cost of capital and active balance sheet restructuring during the recovery phase.

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