Expedia, the US-based travel booking giant, has seen its share price recover sharply from a slump earlier this year, rising 33% from its low in early 2026 to trade near its 52-week high. The rebound comes despite headwinds including higher jet fuel costs linked to the US-Iran conflict and a cost-of-living crisis that has made many Britons question whether they can afford a holiday.
The group, which owns brands including Expedia.com, Hotels.com and Vrbo, generates roughly two-thirds of its revenue from consumer-facing booking sites. The remainder comes from supplying technical infrastructure to hotels, car-hire firms and other travel operators. Profits have more than quadrupled since 2022, and the company boasts operating margins above 30% and a return on capital employed of more than 30%, enabling it to raise dividends and buy back $5 billion of shares.
Earlier this year, markets fretted that advances in 'agentic AI' — software that could autonomously book holidays via chatbots — might bypass comparison websites like Expedia. However, analysts now consider those fears overblown. Few consumers, and even fewer corporate travel managers, are willing to trust an AI chatbot to handle hotel and flight bookings without human oversight. Moreover, Expedia's exclusivity agreements with several hotel chains and low-cost carrier Allegiant Travel provide a buffer, while the firm is exploring how to use AI to enhance its own operations.
For UK investors, Expedia's valuation appears attractive: the shares trade on just 12 times forecast 2027 earnings. The stock is above both its 50-day and 200-day moving averages, a technical sign of bullish momentum. However, the travel sector remains sensitive to geopolitical tensions and fuel price spikes, which could squeeze household budgets further. The Bank of England's interest rate decisions also influence consumer spending on discretionary items such as holidays.
For UK travellers, Expedia's performance reflects broader trends: post-pandemic demand for experiences remains strong, particularly among younger people who prioritise travel over possessions. Yet higher jet fuel costs and inflation continue to push up package prices. Savers and mortgage holders may note that any sustained weakness in travel stocks could signal a broader economic slowdown, while a resilient Expedia suggests consumer confidence is holding up for now.