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Expedia, Inc.
Notes to Consolidated Financial Statements Ì (Continued)
Equity Investment in Unconsolidated Affiliates
The following is a list of investments that we record using the equity method, the principal market in
which the venture operates, and the relevant ownership percentage:
December 31,
2005 2004 2003
L'Agence Voyages-SNCF.com (France)ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 49.9% 49.9% 47.0%
eLong, Inc. (People's Republic of China)ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 30.0% Ì
L'Agence Voyages-SNCF.com. We made an investment in travel and travel-related businesses abroad
through a joint venture with Sociπetπe Nationale des Chemins de Fer Fran•cais (""SNCF''), the state-owned
railway group in France, which operates www.voyages-sncf.com, an online site for e-tourism in France.
SNCF owns 50.1% and we own 49.9% of the joint venture as of December 31, 2005.
eLong. In August 2004, we purchased a 30% ownership interest in eLong, a publicly-traded Cayman
Island company, whose principal business is the operation of an internet-based travel business in the
People's Republic of China, for approximately $59.0 million in cash, which we accounted for under the
equity method. Concurrent with this investment, eLong issued a warrant to allow us to acquire additional
shares, with an exercise price of approximately $6.21 per share, or $108 million.
In October 2004, eLong completed an initial public offering (""IPO'') of its shares. As a result of the
IPO, our warrant became subject to the mark-to-market provisions of SFAS No. 115 ""Accounting for
Certain Investments in Debt and Equity Securities.'' As such, we recorded an unrealized gain of
$27.2 million, net of deferred taxes of $16.4 million, related to the warrant in other comprehensive income
in 2004. We reversed the unrealized gain in January 2005 upon exercise of our warrant.
For additional information about our acquisition of eLong, see Note 5, Business Acquisitions.
NOTE 8 Ì Goodwill and Intangible Assets
The following table presents our goodwill and intangible assets as of December 31, 2005 and 2004.
December 31,
2005 2004
(In thousands)
Goodwill ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $5,859,730 $5,790,111
Intangible assets with indefinite lives ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 912,972 895,446
Intangible assets with definite lives, net ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 263,531 383,915
$7,036,233 $7,069,472
Our indefinite lived intangible assets relate principally to trade names and trademarks acquired in
various acquisitions. As of October 1, 2005, 2004 and 2003, we performed our annual impairment
assessment for goodwill and intangible assets. We do not have any goodwill or intangible assets that we
consider impaired.
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