Booking Holdings Inc (NASDAQ: BKNG) is hardly seeing any “ancillary” effect from a 40% increase in air fares over the past six months, CEO Glenn Fogel confirmed on a CNBC interview this morning.
Booking Holdings is benefitting from pent-up demand
According to the chief executive, pent-up demand after two years of COVID restrictions is more than sufficient to offset the ongoing inflationary pressures this summer. On “Squawk on the Street”, he said:
It’s not as though people are saying, well, I spent all this money on air fares; I can’t afford a nice hotel. We’re not seeing that at all. We’re seeing people are absolutely willing, able, and going to travel right now.
Last month, Booking Holding reported a massive 136% increase in its Q1 revenue – an indication that it was already benefitting greatly from the pent-up demand even ahead of summer travel.
Wall Street is constructive on Booking Holdings stock
Shares of the American travel technology company that acquired Etraveli Group last year are down nearly 30% from their year-to-date high in mid-February. Wall Street also has an “overweight” rating on the stock.
CEO Fogel agrees the airlines were understaffed and struggling with cancellations right now, but the bigger picture for Booking Holdings, he reiterated, remains strong as ever.
Most people have incredible savings over the last couple of years; they’ve benefitted from all the programmes and not being able to spend. [But] now they want to spend it and we are enjoying that benefit right now.
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