A month has gone by since the last earnings report for Expedia (EXPE Quick QuoteEXPE - Free Report) . Shares have lost about 1.1% in that time frame, underperforming the S&P 500.

But investors have to be wondering, will the recent negative trend continue leading up to its next earnings release, or is Expedia due for a breakout? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for Expedia Group, Inc. before we dive into how investors and analysts have reacted as of late.

Expedia Group Q2 Earnings & Revenues Beat Estimates, Increase Y/Y

Expedia Group reported second-quarter 2026 adjusted earnings of $5.76 per share, up 36% year over year. The figure surpassed the Zacks Consensus Estimate by 5.69%.

Revenues increased 14% year over year to $4.32 billion and beat the consensus mark by 3.13%. Sustained B2B momentum, stronger consumer-brand performance and disciplined cost management drove the results.

EXPE's Q2 Bookings Gain Across Business Lines

In the second quarter, total gross bookings climbed 12% year over year to $33.93 billion. Lodging gross bookings increased 11% to $24.60 billion, while non-lodging gross bookings advanced 12% to $9.33 billion.

Merchant gross bookings grew 14% to $20.61 billion, outpacing an 8% increase in agency gross bookings to $13.32 billion. Average daily rate booked rose 5% to $220.60, partly supporting the higher booking value. Booked air tickets, however, declined 5% to 14.2 million. Booked room nights rose 6% to 111.5 million.

Expedia Group's Revenue Mix Favors B2B

In the second quarter, B2B revenues surged 23% year over year to $1.49 billion, supported by double-digit growth across all regions and elevated marketing activity from some large partners. B2B gross bookings increased 21% to $10.74 billion.

B2C revenues rose 8% to $2.68 billion, while gross bookings increased 8% to $23.19 billion. Management noted that the consumer business benefited from sustained U.S. momentum, with the market growing at its strongest pace in 15 quarters.

EXPE Improves Profitability and Cost Leverage

Second-quarter adjusted EBITDA increased 23% year over year to $1.12 billion. The adjusted EBITDA margin expanded 196 basis points to 25.9%, reflecting disciplined cost management, favorable revenue mix and marketing leverage.

B2C adjusted EBITDA rose 22% to $889 million, with margin expanding 380 basis points to 33.2%. B2B adjusted EBITDA increased 12% to $369 million, though margin contracted 258 basis points to 24.8% because of partner mix and acquisition consolidation.

Expedia Group Controls Core Operating Costs

In the reported quarter, adjusted cost of revenues increased 7% to $399 million but declined 61 basis points as a percentage of revenues to 9.2%. The improvement reflected continued efficiencies in payments.

Direct selling and marketing expenses rose 10% to $2.12 billion. B2C direct marketing costs increased only 1% to $1.10 billion and declined 31 basis points as a percentage of B2C gross bookings to 4.7%, indicating improved returns across marketing channels.

EXPE’s Q2 Balance Sheet & Cash Flow Details

As of June 30, 2026, cash and cash equivalents and short-term investments were $7.13 billion, up from $5.79 billion as of March 31, 2026.

Long-term debt was $5.46 billion as of June 30, 2026, up from $4.47 billion as of March 31, 2026.

The company repurchased approximately 880,000 shares for $200 million during the quarter. Through the first six months of 2026, purchases of treasury stock totaled $1.06 billion.

Expedia Group also declared a quarterly cash dividend of 48 cents per share, payable Sept. 17, 2026.

Net cash provided by operating activities rose 32% to $1.48 billion in the quarter. Free cash flow grew 39% to $1.28 billion, underscoring the company’s ability to convert improved operating performance into cash.

EXPE’s Q3 & Raised 2026 Guidance

For the third quarter of 2026, Expedia Group expects gross bookings between $32.2 billion and $32.8 billion, representing growth of 5-7%. Revenues are projected in the range of $4.65 billion to $4.75 billion, implying growth of 5-8%.

Adjusted EBITDA is expected between $1.51 billion and $1.56 billion. The outlook factors in slower top-line growth than in the second quarter, while maintaining a strong level of adjusted profitability.

Expedia Group raised its 2026 gross bookings forecast to $129.5-$130.8 billion from $127-$129 billion. The revised range represents projected growth of 8-9%, compared with the prior expectation of 6-8%.

The company now anticipates revenues of $16.05-$16.22 billion, up from its earlier range of $15.6-$16 billion. Adjusted EBITDA margin expansion is expected to reach 1.5-1.75 percentage points, compared with the prior outlook of 1-1.25 points.

How Have Estimates Been Moving Since Then?

Since the earnings release, investors have witnessed a upward trend in estimates revision.

VGM Scores

At this time, Expedia has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. Following the exact same course, the stock has a score of B on the value side, putting it in the top 40% for value investors.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Expedia has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.