Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Expedia Group Inc., profitability ratios
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).
- Gross Profit Margin
- The gross profit margin remained relatively stable from 2017 to 2019, fluctuating slightly between 82.54% and 83.39%. There was a notable decline in 2020 to 67.69%, which indicates a significant reduction in gross profitability during that year. However, gross profit margin rebounded strongly in 2021, returning to approximately 82.3%, near previous levels before 2020. This suggests a recovery in cost management or pricing power after the 2020 downturn.
- Operating Profit Margin
- Operating profit margin showed modest positive growth from 6.21% in 2017 to 7.48% in 2019, indicating improving operating efficiency. In 2020, the margin sharply deteriorated to -52.3%, reflecting severe operating losses likely due to extraordinary challenges in that period. In 2021, there was a partial recovery to 2.16%, though still significantly below pre-2020 levels, suggesting ongoing operational difficulties or incomplete recovery.
- Net Profit Margin
- Net profit margin followed a similar pattern, remaining steady and positive between 3.62% and 4.68% from 2017 through 2019. The margin turned sharply negative to -50.24% in 2020, indicating substantial net losses. In 2021, the net profit margin improved to a marginal positive level of 0.14%, which reflects a minimal net profitability and the company not yet fully regaining profitability post-crisis.
- Return on Equity (ROE)
- Return on equity increased consistently from 8.36% in 2017 to 14.24% in 2019, revealing enhanced shareholder returns and value creation. The ROE experienced a dramatic reversal to -103.16% in 2020, signifying a considerable erosion of equity value during that period. By 2021, ROE had marginally improved to 0.58%, indicating an initial but very limited recovery in shareholder returns.
- Return on Assets (ROA)
- Return on assets increased gradually from 2.04% in 2017 to 2.64% in 2019, showing steady improvement in asset utilization. In 2020, ROA plunged sharply to -13.98%, mirroring the substantial operating and net losses, and reflecting impaired asset profitability. In 2021, it slightly improved to 0.06%, indicating the company's assets began to generate positive returns again but remained at a very low level.
Return on Sales
Return on Investment
Gross Profit Margin
Expedia Group Inc., gross profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Gross profit | 7,076) | 3,519) | 9,990) | 9,359) | 8,303) | |
| Revenue | 8,598) | 5,199) | 12,067) | 11,223) | 10,060) | |
| Profitability Ratio | ||||||
| Gross profit margin1 | 82.30% | 67.69% | 82.79% | 83.39% | 82.54% | |
| Benchmarks | ||||||
| Gross Profit Margin, Competitors2 | ||||||
| Amazon.com Inc. | 42.03% | 39.57% | — | — | — | |
| Home Depot Inc. | 33.95% | 34.09% | — | — | — | |
| Lowe’s Cos. Inc. | 33.01% | 31.80% | — | — | — | |
| TJX Cos. Inc. | 23.66% | 28.46% | — | — | — | |
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).
1 2021 Calculation
Gross profit margin = 100 × Gross profit ÷ Revenue
= 100 × 7,076 ÷ 8,598 = 82.30%
2 Click competitor name to see calculations.
- Revenue Trend
- Revenue showed a steady increase from 2017 through 2019, rising from approximately $10.1 billion to $12.1 billion. However, there was a significant decline in 2020, where revenue dropped sharply to about $5.2 billion. This was followed by a partial recovery in 2021, with revenue increasing to roughly $8.6 billion, though it had not yet returned to pre-2020 levels.
- Gross Profit Trend
- Gross profit mirrored the revenue trend closely. It increased from $8.3 billion in 2017 to nearly $10 billion in 2019, reflecting growth over those years. In 2020, gross profit fell dramatically to $3.5 billion, consistent with the downturn in revenue. The subsequent year saw a rebound to $7.1 billion in gross profit, indicating an improvement but still below the earlier peak.
- Gross Profit Margin Analysis
- The gross profit margin remained relatively stable and high from 2017 through 2019, fluctuating narrowly around 82-83%. In 2020, there was a notable decline to approximately 67.7%. This sharp reduction suggests either increased cost pressures or changes in revenue mix during this period. In 2021, the margin improved significantly, rising back to over 82%, which indicates a return towards more normalized profitability levels.
- Overall Insights
- The financial data reveal a strong growth phase from 2017 to 2019, followed by a severe impact in 2020 likely due to external market disruptions. Recovery commenced in 2021 but remained incomplete relative to historical highs. The gross profit margin's decline in 2020 highlights operational challenges, possibly reflecting cost inefficiencies or changes in pricing. The restoration of margin levels in 2021 is a positive indicator, pointing to improved cost management or favorable revenue composition.
Operating Profit Margin
Expedia Group Inc., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income (loss) | 186) | (2,719) | 903) | 714) | 625) | |
| Revenue | 8,598) | 5,199) | 12,067) | 11,223) | 10,060) | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 2.16% | -52.30% | 7.48% | 6.36% | 6.21% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Amazon.com Inc. | 5.30% | 5.93% | — | — | — | |
| Home Depot Inc. | 13.84% | 14.37% | — | — | — | |
| Lowe’s Cos. Inc. | 10.77% | 8.75% | — | — | — | |
| TJX Cos. Inc. | 1.81% | 10.59% | — | — | — | |
| Operating Profit Margin, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 7.38% | 8.11% | — | — | — | |
| Operating Profit Margin, Industry | ||||||
| Consumer Discretionary | 8.79% | 6.48% | — | — | — | |
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).
1 2021 Calculation
Operating profit margin = 100 × Operating income (loss) ÷ Revenue
= 100 × 186 ÷ 8,598 = 2.16%
2 Click competitor name to see calculations.
- Revenue Trends
- Revenue showed a consistent growth from 2017 through 2019, increasing from 10,060 million US dollars in 2017 to 12,067 million US dollars in 2019. However, a significant decline occurred in 2020, when revenue dropped to 5,199 million US dollars, less than half of the previous year’s figure. There was a partial recovery in 2021, with revenue increasing to 8,598 million US dollars, though it remained below the pre-2020 levels.
- Operating Income (Loss) Trends
- Operating income increased from 625 million US dollars in 2017 to 903 million US dollars in 2019, reflecting improving operational efficiency. In 2020, a sharp loss of 2,719 million US dollars was recorded, indicating considerable operational challenges during that year. The company returned to a positive operating income of 186 million US dollars in 2021, although this was significantly lower than the pre-2020 levels, suggesting a partial but incomplete recovery.
- Operating Profit Margin Trends
- The operating profit margin remained relatively stable and positive from 2017 to 2019, rising slightly from 6.21% to 7.48%. A drastic deterioration occurred in 2020, with the margin falling to negative 52.3%, signaling substantial operational losses relative to revenue. In 2021, the margin improved to 2.16% but remained considerably lower than the earlier years, indicating ongoing challenges in restoring profitability to historical levels.
- Summary and Insights
- The data shows a pattern of growth in revenue and profitability from 2017 through 2019, followed by a severe downturn in 2020. This downturn impacted all financial measures, with revenue and operating income plunging, and the operating margin turning sharply negative. The 2021 figures demonstrate recovery efforts yielding improved results, though profitability and revenue remain below the higher pre-2020 levels. The trends suggest that while the company faced significant operational and market challenges, likely due to external factors, it has begun stabilizing and incrementally improving financial performance.
Net Profit Margin
Expedia Group Inc., net profit margin calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Expedia Group, Inc. | 12) | (2,612) | 565) | 406) | 378) | |
| Revenue | 8,598) | 5,199) | 12,067) | 11,223) | 10,060) | |
| Profitability Ratio | ||||||
| Net profit margin1 | 0.14% | -50.24% | 4.68% | 3.62% | 3.76% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Amazon.com Inc. | 7.10% | 5.53% | — | — | — | |
| Home Depot Inc. | 9.74% | 10.20% | — | — | — | |
| Lowe’s Cos. Inc. | 6.51% | 5.93% | — | — | — | |
| TJX Cos. Inc. | 0.28% | 7.84% | — | — | — | |
| Net Profit Margin, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 7.21% | 6.58% | — | — | — | |
| Net Profit Margin, Industry | ||||||
| Consumer Discretionary | 9.20% | 5.24% | — | — | — | |
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).
1 2021 Calculation
Net profit margin = 100 × Net income (loss) attributable to Expedia Group, Inc. ÷ Revenue
= 100 × 12 ÷ 8,598 = 0.14%
2 Click competitor name to see calculations.
- Revenue Trend
- Revenue showed consistent growth from 2017 to 2019, increasing from $10,060 million to $12,067 million. However, in 2020, revenue declined sharply to $5,199 million, reflecting a significant contraction. In 2021, there was a partial recovery with revenue increasing to $8,598 million, though still below pre-2020 levels.
- Net Income (Loss) Trend
- Net income rose steadily from $378 million in 2017 to $565 million in 2019, indicating healthy profitability during the period. In 2020, a dramatic reversal occurred with a net loss of $2,612 million, signaling substantial financial distress. The following year, 2021, net income returned to a positive figure, though marginal at $12 million, suggesting a fragile recovery.
- Net Profit Margin Trend
- The net profit margin mirrored net income trends, remaining positive and relatively stable at approximately 3.6% to 4.7% between 2017 and 2019. In 2020, the margin plummeted sharply to -50.24%, highlighting a severe loss relative to revenue. By 2021, the margin improved to a minimal 0.14%, indicating a near break-even performance after the substantial 2020 downturn.
- Overall Financial Insights
- The data reveals a period of steady growth and profitability from 2017 through 2019, followed by a significant disruption in 2020, likely due to extraordinary external factors causing dramatic declines in revenue and profitability. The partial rebound in 2021 depicts early-stage recovery, but financial performance remains below historic peaks, emphasizing ongoing challenges and a cautious outlook.
Return on Equity (ROE)
Expedia Group Inc., ROE calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Expedia Group, Inc. | 12) | (2,612) | 565) | 406) | 378) | |
| Total Expedia Group, Inc. stockholders’ equity | 2,057) | 2,532) | 3,967) | 4,104) | 4,522) | |
| Profitability Ratio | ||||||
| ROE1 | 0.58% | -103.16% | 14.24% | 9.89% | 8.36% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Amazon.com Inc. | 24.13% | 22.84% | — | — | — | |
| Home Depot Inc. | 390.00% | — | — | — | — | |
| Lowe’s Cos. Inc. | 406.05% | 217.09% | — | — | — | |
| TJX Cos. Inc. | 1.55% | 55.01% | — | — | — | |
| ROE, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 35.05% | 40.86% | — | — | — | |
| ROE, Industry | ||||||
| Consumer Discretionary | 34.37% | 25.29% | — | — | — | |
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).
1 2021 Calculation
ROE = 100 × Net income (loss) attributable to Expedia Group, Inc. ÷ Total Expedia Group, Inc. stockholders’ equity
= 100 × 12 ÷ 2,057 = 0.58%
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Expedia Group, Inc.
- The net income showed an upward trend from 2017 through 2019, increasing from $378 million to $565 million, indicating improving profitability in this period. However, in 2020, there was a significant reversal with a substantial loss of $2.612 billion, a clear indication of a severe adverse impact on earnings. In 2021, the company returned to profitability, although the net income was marginal at $12 million, suggesting a still fragile recovery.
- Total Expedia Group, Inc. Stockholders’ Equity
- Stockholders’ equity exhibited a consistent decline over the five-year period. Starting at $4.522 billion in 2017, it decreased gradually each year to $2.057 billion by the end of 2021. The most notable decline occurred between 2019 and 2020, coinciding with the substantial net loss, indicating that accumulated losses and possibly other factors eroded the equity base significantly.
- Return on Equity (ROE)
- ROE followed a pattern similar to net income. It rose from 8.36% in 2017 to a peak of 14.24% in 2019, reflecting strong profitability relative to equity during these years. In 2020, ROE plummeted dramatically to negative 103.16%, mirroring the massive loss experienced and a sharp contraction in equity. By 2021, ROE improved substantially to 0.58%, suggesting a slight return to profitability but remaining well below pre-2020 levels.
- Overall Analysis
- From 2017 to 2019, the company displayed solid financial health with increasing net income, stable ROE growth, and moderate declines in equity. The year 2020 marked a turning point with a severe financial setback that resulted in a large net loss and a significant decrease in shareholders' equity, critically impacting financial ratios. By 2021, there were signs of recovery, with net income returning to positive territory and ROE improving, though both remained significantly lower than the pre-2020 performance, indicating ongoing challenges in regaining previous profitability levels.
Return on Assets (ROA)
Expedia Group Inc., ROA calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Expedia Group, Inc. | 12) | (2,612) | 565) | 406) | 378) | |
| Total assets | 21,548) | 18,690) | 21,416) | 18,033) | 18,516) | |
| Profitability Ratio | ||||||
| ROA1 | 0.06% | -13.98% | 2.64% | 2.25% | 2.04% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Amazon.com Inc. | 7.93% | 6.64% | — | — | — | |
| Home Depot Inc. | 18.23% | 21.94% | — | — | — | |
| Lowe’s Cos. Inc. | 12.49% | 10.85% | — | — | — | |
| TJX Cos. Inc. | 0.29% | 13.55% | — | — | — | |
| ROA, Sector | ||||||
| Consumer Discretionary Distribution & Retail | 9.17% | 9.20% | — | — | — | |
| ROA, Industry | ||||||
| Consumer Discretionary | 8.07% | 4.42% | — | — | — | |
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).
1 2021 Calculation
ROA = 100 × Net income (loss) attributable to Expedia Group, Inc. ÷ Total assets
= 100 × 12 ÷ 21,548 = 0.06%
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Expedia Group, Inc.
- The net income showed an increasing trend from 2017 through 2019, rising from $378 million to $565 million, indicating improving profitability during this period. However, a significant reversal occurred in 2020, with a substantial loss of $2,612 million, reflecting a major adverse impact on profitability. In 2021, the net income improved drastically but remained marginally positive at $12 million, signaling a partial recovery yet still at a minimal profit level compared to pre-2020 figures.
- Total Assets
- Total assets experienced relative stability with moderate fluctuations over the five-year period. After a slight decline from $18,516 million in 2017 to $18,033 million in 2018, assets increased significantly to $21,416 million by 2019. In 2020, total assets decreased again to $18,690 million before rising back to $21,548 million in 2021. This pattern suggests asset base volatility but overall recovery towards the end of the period.
- Return on Assets (ROA)
- The ROA followed a trajectory consistent with net income trends. It improved steadily from 2.04% in 2017 to 2.64% in 2019, indicating enhanced efficiency in asset utilization to generate profit. This metric sharply deteriorated to -13.98% in 2020, highlighting the substantial losses and inefficiency caused by the adverse financial event during that year. By 2021, ROA rebounded significantly to 0.06%, demonstrating a recovery in asset profitability, although still substantially below the pre-2020 levels.