Expedia 2013 Annual Report Download - page 62

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Gross Bookings and Revenue Margin
Year ended December 31, % Change
2013 2012 2011 2013 vs 2012 2012 vs 2011
($ in millions)
Gross Bookings
Leisure $34,910 $30,374 $26,567 15% 14%
Egencia 4,533 3,585 2,614 26% 37%
Total gross bookings $39,443 $33,959 $29,181 16% 16%
Revenue Margin
Leisure 12.6% 12.3% 12.3%
Egencia 8.1% 8.1% 6.9%
Total revenue margin 12.1% 11.9% 11.8%
The increase in worldwide gross bookings in 2013 as compared to 2012 was primarily driven by 23%
growth in hotel room nights and 9% increase in air tickets. The increase in worldwide gross bookings in 2012 as
compared to 2011 was primarily driven by 27% growth in hotel room nights and 7% increase in air tickets.
Revenue margin increased in 2013 compared to 2012 due to a favorable mix shift to our higher margin
products, including hotel revenue as well as advertising and media revenue, partially offset by lower revenue per
room night on our hotel product. The increase in revenue margin related to advertising and media revenue is
primarily due to the 2013 acquisition of trivago, a metasearch company, which does not have associated gross
bookings. However, trivago is included in revenue used to calculate total revenue margin. Revenue margin
remained relatively consistent for 2012 compared to 2011.
Results of Operations
Revenue
Year ended December 31, % Change
2013 2012 2011 2013 vs 2012 2012 vs 2011
($ in millions)
Revenue by Segment
Leisure $4,406 $3,739 $3,270 18% 14%
Egencia 365 291 179 25% 63%
Total revenue $4,771 $4,030 $3,449 18% 17%
In 2013, revenue increased primarily due to an increase in worldwide hotel revenue as well as advertising
and media revenue within our Leisure segment. In 2012, revenue increased primarily due to an increase in
worldwide hotel revenue. Acquisitions added approximately 5% and 2% to the year-over-year growth rates in
total revenue for 2013 and 2012.
Worldwide hotel revenue increased 15% in 2013 primarily due to a 23% increase in room nights stayed
driven by eLong, Brand Expedia and Hotels.com, partially offset by a 7% decrease in revenue per room night.
Revenue per room night decreased primarily due to efforts to expand inventory availability as well as our global
supply portfolio, including contracts signed as part of our ETP program, continued hotel mix shift to Asia-Pacific
and promotional activities, such as couponing and growing our loyalty programs’ membership. Worldwide hotel
revenue increased 20% in 2012 primarily due to a 27% increase in room nights stayed, partially offset by a 5%
decrease in revenue per room night. Revenue per room night decreased in 2012 primarily due to changes in our
hotel product mix, of which mix shift to regions with lower hotel economics was becoming a significant
component.
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