Booking Holdings Downplays Concerns That Agentic AI Platforms Will Displace It

Glenn Fogel, the CEO of Booking Holdings, said he's been at the firm for nearly 25 years, and has heard it all before how emerging and disruptive technologies would "disintermediate" his company.

He said years ago the talk was that hotels were going to build great websites and take direct bookings, and later it was "Google was going to get rid of us etc."

Fogel said he's not surprised that the rise of generative AI has raised similar questions.

"One of the great things about this company is our our ability to evolve, adapt, use all of resources, our technological knowledge, the tremendous ability of our our people, capital," Fogel told analysts during the company's fourth-quarter earnings call. "In terms of agentic AI, one of the important things is data. It's something that I think about a lot as do many, many people in the management team — how can we change so we make sure that we are the winner of these new technologies."

Booking's Negotiations With AI Platforms Will Be Key

Fogel was asked whether there is a risk that the emergence of generative AI's agentic platforms means Booking will be forced to pay more to obtain customers versus getting them for free. Fogel said his company is aware of the issues.

"That is obviously something that people think about when you're putting together an agreement of any type with anyone in terms of what you're going to maintain proprietary to yourself, what you're going to be able to share with someone else, how the economic powers between the parties is going to work," Fogel said. "[There are] lots of things to still work out. That is something that's going to be a negotiation with a lot of the different parties involved in this, and we'll see how it plays out."

He said Booking Holdings is working on these issues with top players in Silicon Valley, and that Booking's trusted brand will be an advantage. Priceline has its Penny AI agent, Booking.com has an AI trip planner, and Booking's other brands have AI entries, as well.

"There will be ways for lots of players to do well,” Fogel said. “I am positive we are in a very good position with this going forward."

Will AI Platforms Build Their Own or Partner?

Chief Financial Officer Ewout Steenbergen said one important consideration is that agentic platforms — such as those from OpenAI, Perplexity and others — are spending huge amounts of capital to develop their systems, so that will be an important consideration on whether they build their own travel products or partner.

Booking gives them monetization opportunities, Steenbergen said.

There will be many agentic platforms, he added, and that can help Booking from an economic perspective.

Did Booking.com Make MarketShare Gains Versus Airbnb?

One highlight of the fourth quarter is that Booking.com saw its alternative accommodations room nights jump 19% year-over-year, and that was up from 14% growth in the third quarter.

It appears that Booking.com's alternative accommodations growth outpaced Airbnb, which saw a 12% jump in nights and experiences booked in the fourth quarter.

The comparison isn't apples to apples, but Booking.com is clearly showing momentum in the sector. Its alternative accommodations listings in the quarter grew 8% to 7.9 million. Fogel said its alternative accommodations business is at least two-thirds the size of the "leader," meaning Airbnb.

Airbnb declined to comment on Booking.com's growth in alternative accommodations.

Booking Holdings' revenue in the fourth quarter grew 14% to $5.5 billion. Net income soared 383% to $1.1 billion. In the fourth quarter a year earlier, Booking recorded $806 million in losses tied to a pension fund issue in the Netherlands and a regulatory matter in Spain.