Slide 1: Company Overview Q4 2010
Exhibit 99.2 Company Overview Q4 2010 Q410 Company Overview
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, including any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-loo
Slide 3: Global Opportunity
th th Sources: U.S. Online Travel Overview 10 Edition (November 2010); U.S. Online Travel Overview 8 th Edition Update: 2009 – 2010 (April 2009); U.S. Corporate Travel Distribution 4 Edition (July 2009); th th European Online Travel Overview 6 Edition (November 2010); European Online Travel Overview
Slide 4: World’s Largest and Most Intelligent Travel Marketplace
World’s Largest and Most Intelligent Travel Marketplace Suppliers Customers Hotels Leisure travelers Travel Airlines products Corporate travelers Car rental companies Travel service providers Cruise lines Travel info (“white label”) Global distribution system (GDS) partners Offline retail travel Tec
Slide 5: Expedia - the Travel Sector Leader
1 Sources: comScoreMediaMetrix, December 2010 & company data; ² See Appendix B for reconciliation of non-GAAP to GAAP numbers. Adjusted EBITDA Expedia - the Travel Sector Leader is calculated as operating income plus depreciation, restructuring charges, intangibles amortization, stock-based compensa
Slide 6: Largest Worldwide Audience
Largest Worldwide Audience U.S. Worldwide 1,300 30 80 1,200 1 1 1,100 25 +152% 70 +126% 1 +171% 1,000 60 900 20 800 700 50 700 600 1 15 40 +87% 600 1 500 +150% 30 500 400 10 1 400 +152% 300 20 300 200 5 200 10 100 100 0 0 0 0 UV's Min Spent Online Page Views UV's Min Spent Online Page Views Orbitz T
Slide 7: Expedia’s Virtuous Cycle
Expedia’s Virtuous Cycle Cash flow to invest in Compelling More ad supplier & revenue advertising channel Growth/ User- Scale Better generated supplier content economics Improved More traveler travelers experience Scale drives opportunity to enhance supplier, traveler & advertiser value propositions
Slide 8: Revenue by Product & Geography
Revenue by Product & Geography Product Categories (2010) Geographic Split (2010) Revenue Revenue Car, Cruise & Other International 13% 38% Advertising & Media 13% Air 12% Domestic Hotel 63% 62% * Hotel & Advertising – >75% of revenue base * Europe & other international markets benefit and key revenu
Slide 9: Product Category - Hotel
Product Category - Hotel Business Overview •Merchant hotel —Expediamerchant of recordwith no inventoryrisk —Expediareceivescashupfront from travelers,payshoteliersseveralweekslater —Somecontrol over pricing,highermargins & ability to packagewith other products —1- 3 year contracts with major chain l
Slide 10: Trended Worldwide Hotel Growth Statistics (y/y)
Trended Worldwide Hotel Growth Statistics (y/y) 30% 20% 10% 0% -10% -20% -30% Hotel Revenue ADRs Room Nights Stayed Source: Company financial reports . 2005 – 2007 data is for merchant hotel only; 2008 – 2010 data is for both agency and merchant hotel. Q410 Company Overview 10
Slide 11: Product Category - Advertising & Media
Product Category - Advertising & Media Business Overview Revenue Drivers •Two primary businesses – •Offer advertisers targeted audiences •TripAdvisor Media Network(leading global collection •CPC, CPM & subscription based ad models of user-generated content sites) •TripAdvisor leverages industry-lead
Slide 12: Product Category - Air
Product Category - Air Business Overview • Air revenue = 12% of Expedia’sworldwide annual revenue - 95% of airplane tickets sold over Expedia’sonline propertiesare agencytransactions,in which Expedia acts as an agent on behalf of a supplier and collects a commission - Customer pays supplier directly
Slide 13: Trended Worldwide Air Growth Statistics (y/y)
Trended Worldwide Air Growth Statistics (y/y) 35% 25% 15% 5% -5% -15% -25% -35% Air Revenue Airfares Rev. Per Ticket Ticket Growth Source: Company financial reports Q410 Company Overview 13
Slide 14: Stable Supplier Relationships & Economics
Stable Supplier Relationships & Economics Trended Revenue Margin (TTM) Excluding ad & media revenue Including ad & media revenue 12.5% 13.8% 12.6% 14.0% 12.6% 14.1% 12.4% 13.9% 12.1% 13.6% 13.1% 12.8% 12.8% 12.9% 11.6% 11.3% 11.2% 11.3% 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 Recent reductions
Slide 15: 2010 Results
* Excludes stock-based compensation. ** OIBA includes realized gain/(loss) from revenue hedges *** Adjusted EBITDA is calculated as operating income plus depreciation, restructuring charges, intangibles 2010 Results amortization, stock-based compensation, any impairments and certain legal reserves a
Slide 16: Trended Free Cash Flow (TTM)
Trended Free Cash Flow (TTM) $millions ‘10 cash flows improved ‘08 cash flows down due due to higher earnings, to taxes, slowing lower occupancy tax merchant hotel & one- assessment payments 900 time cap ex and lower cash tax 800 payments ‘09 cash flows improved 700 due to higher earnings, 600 merch
Slide 17: Efficiently Managing Dilution
Efficiently Managing Dilution millions of adjusted diluted shares 340 2007 repurchased 55mm shares for $1.4b 330 320 2010 repurchased 20.6mm 310 shares for $489mm 300 290 280 270 260 13% reduction in share base since Q107 Source: Company financial reports Q410 Company Overview 17
Slide 18: Capitalization
Capitalization 12/31/10 Cash and Cash Equivalents¹ $714 Revolving Credit Facility² -- 5.950% Notes due 2020 750 7.456% Notes due 2018 500 3 debt issues with long- 8.500% Notesdue 2016 395 term maturities (2018 Notes have 2013 Total Debt $1,645 investor put) Net Debt 931 Market Value of Equity³ $6,84
Slide 19: Trended Credit Metrics
Trended Credit Metrics 12.31.06 12.31.07 12.31.08 12.31.09 12.31.10 Leverage Measures 1 Total Debt / TTM Adjusted EBITDA 0.8 1.5 2.0 1.0 1.7 1 Net Debt / TTM Adjusted EBITDA N/A 0.6 1.1 0.3 1.0 Coverage Measures TTM Adj. EBITDA / TTM Interest 37.5 13.8 10.8 10.3 9.4 1 Expense TTM Free Cash Flow / TT
Slide 20: Rating Agency Snapshot
Rating Agency Snapshot S&P (Analyst: Andy Liu) Rating maintained at ‘BBB-’; Outlook Stable Moody’s (Analyst: Stephen Sohn) Rating Affirmed at Ba1 / Outlook Positive November 5, 2010 and January 31, 2011 Credit Opinions: “The company’s investment-grade attributes include its leading position in the c
Slide 21: Summary
Summary • Attractive macro tailwind as travel industry shifts online • World’s #1 online provider of travel-related services — Leading traffic, supply, scale, bookings, revenue & cash flows — Strong and complementary portfolio of brands and products — Important partner to airlines, hotels and other
Slide 22: Appendix A
Appendix A Q410 Company Overview 22
Slide 23: Business Model – Income Statement (FY 2010)
Business Model – Income Statement (FY 2010) Customer books travel product or $ in millions service; total retail value (incl taxes and fees) constitutes “Gross Bookings.” Gross bookings $25,962 • Customer operations Expedia’s portion of the gross Revenue 3,348 • Credit card & fraud expense booking g
Slide 24: Trended Historical Results
Trended Historical Results (Figures in $millions) Growth 2006 2007 2008 2009 2010 2007 2008 2009 2010 Gross Bookings $16,882 $19,632 $21,269 $21,811 $25,962 16% 8% 3% 19% Revenue 2,238 2,665 2,937 2,955 3,348 19% 10% 1% 13% Cost & Expenses * 1,639 1,996 2,239 2,183 2,514 22% 12% (3%) 15% OIBA*** 599
Slide 25: Appendix B
Appendix B Q410 Company Overview 25
Slide 26: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Operating Income Before Amortization (figures in $000s) 3 Months 3 Months Ended Ended Dec 31, Dec 31, 2009 2010 OIBA $ 162,903 $ 175,055 Amortization of intangible assets (9,722) (11,625) Stock-based compensation (14,994) (13,126) Restructuring charges (5,57
Slide 27: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Operating Income Before Amortization Year Ended Year Ended Year Ended Year Ended Year Ended (figures in $000s) Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, 2006 2007 2008 2009 2010 OIBA $ 599,018 $ 669,487 $ 697,774 $ 761,532 $ 830,721 OIBA margin 27% 25% 24
Slide 28: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Costs & Expenses Year Ended Year Ended Year Ended Year Ended Year Ended (figures in $000s) Dec. 31, 2006 Dec. 31, 2007 Dec. 31, 2008 Dec. 31, 2009 Dec. 31, 2010 Total costs and expenses* $ 1,718,853 $ 2,058,694 $ 2,300,530 $ 2,244,505 $ 2,573,529 Less: stock
Slide 29: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Adjusted Earnings Before Interest, Taxes, Depreciation & Amortization Year Ended Year Ended Year Ended Year Ended Year Ended Dec. 31, Dec. 31, Dec. 31, Dec. 31, Dec. 31, (figures in $000s) 2006 2007 2008 2009 2010 Adjusted EBITDA 647,797 729,013 774,574 864,
Slide 30: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Costs & Expenses 12 Months 12 Months 3 Months 3 Months Ended Ended Ended Ended (figures in $000s) 12.31.09 12.31.10 12.31.09 12.31.10 Cost of revenue 607,251 692,832 145,540 176,198 Less: stock-based compensation (2,285) (2,401) (555) (576) Cost of revenue e
Slide 31: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Free Cash Flow (figures in $000s) 3 months ended 3 months ended Dec 31, 2009 Dec 31, 2010 Net cash used in operating activities (144,328) (160,234) Less: capital expenditures (29,085) (41,865) Free cash flow (173,413) (202,099) Q410 Company Overview 31
Slide 32: Tabular Reconciliations For Non-GAAP Data
Tabular Reconciliations For Non-GAAP Data Free Cash Flow (figures in $000s) TTM 3.07 TTM 6.07 TTM 9.07 TTM 12.07 TTM 3.08 TTM 6.08 TTM 9.08 TTM 12.08 Net cash provided by operating 703,569 831,140 859,228 712,069 737,792 660,510 514,242 520,688 activities Less: capital expenditures (97,925) (97,576)