Priceline 2014 Annual Report Download - page 5

Special Note Regarding Forward-Looking Statements
This Annual Report on Form 10-K and the documents incorporated herein by reference contain forward-looking statements. These
forward
-looking statements reflect our views regarding current expectations and projections about future events and conditions and are based
on currently available information. These forward-looking statements are not guarantees of future performance and are subject to risks,
uncertainties and assumptions that are difficult to predict, including the Risk Factors identified in Part I, Item 1A of this Annual Report;
therefore, actual results could differ materially from those expressed, implied or forecast in any such forward-looking statements.
Expressions of future goals and expectations and similar expressions, including "may," "will," "should," "could," "expects," "plans,"
"anticipates," "intends," "believes," "estimates," "predicts," "potential," "targets," and "continue," reflecting something other than historical fact
are intended to identify forward-looking statements. Our actual results could differ materially from those described in the forward-looking
statements for various reasons including the risks we face, which are more fully described in Part I, Item 1A, "Risk Factors." Unless required by
law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or
otherwise. However, readers should carefully review the reports and documents we file or furnish from time to time with the Securities and
Exchange Commission (the "SEC" or the "Commission"), particularly our quarterly reports on Form 10-Q and current reports on Form 8-K.
PART I
Item 1. Business
We are a leading provider of online travel and travel related reservation and search services. Through our online travel agent ("OTA")
services, we connect consumers wishing to make travel reservations with providers of travel services around the world. We offer consumers
accommodation reservations (including hotels, bed and breakfasts, hostels, apartments, vacation rentals and other properties) through our
Booking.com, priceline.com and agoda.com brands. Our priceline.com brand also offers consumers reservations for rental cars, airline tickets,
vacation packages and cruises. We offer rental car reservations worldwide through rentalcars.com. We also allow consumers to easily compare
airline ticket, hotel reservation and rental car reservation information from hundreds of travel websites at once through KAYAK. We recently
acquired OpenTable, a leading provider of online restaurant reservations. We believe that the online restaurant reservation business is
complementary to our online travel businesses, and that both OpenTable and our travel businesses will benefit from adding OpenTable to The
Priceline Group. We refer to our company and all of our subsidiaries and brands, including Booking.com, priceline.com, KAYAK, agoda.com,
rentalcars.com and, as of July 24, 2014, OpenTable, collectively as "The Priceline Group," the "Company," "we," "our" or "us."
We launched our business in the United States in 1998 under the priceline.com brand and have since expanded our operations to include
Booking.com, KAYAK, agoda.com, rentalcars.com and OpenTable, which are independently managed and operated brands. Our principal goal
is to serve consumers and our travel service provider and restaurant partners with worldwide leadership in online reservation services. Our
business is driven primarily by international results, which consist of the results of Booking.com, agoda.com and rentalcars.com and the results
of the internationally based websites of KAYAK and, as of July 24, 2014, OpenTable (in each case regardless of where the consumer resides,
where the consumer is physically located while making a reservation or the location of the travel service provider or restaurant). During the year
ended December 31, 2014 , our international business (the substantial majority of which is generated by Booking.com) represented
approximately 87% of our gross bookings (an operating and statistical metric referring to the total dollar value, generally inclusive of all taxes
and fees, of all travel services purchased by our customers), and approximately 94% of our consolidated operating income. A significant
majority of our gross profit is earned in connection with facilitating accommodation reservations. See Note 18 to the Consolidated Financial
Statements for more geographic information.
The Priceline Group Inc. was formed as a Delaware limited liability company in 1997 and was converted into a Delaware corporation in
July 1998. On April 1, 2014, the Company changed its name from priceline.com Incorporated to The Priceline Group Inc. Our common stock is
listed on the NASDAQ Global Select Market under the symbol "PCLN." Our principal executive offices are located at 800 Connecticut Avenue,
Norwalk, Connecticut 06854.
The Priceline Group Business Model
We derive substantially all of our gross profit from the following sources:
1
•
Commissions earned from facilitating reservations of accommodations, rental cars, cruises and other travel services;