Orbitz Beats Street; Shares Soar 15%
Orbitz Worldwide
(OWW)
widened its loss in the first quarter, as bookings decreased 17% and writedowns hindered results.
Minus the write-downs, though, the company beat expectations, sending shares soaring 15% to $2.42 in afternoon trading.
Orbitz posted a loss of $336 million, or $4.02 a share, compared with a loss of $15 million, or 18 cents, a year earlier.
Excluding a charge related to the decline in value of its assets and stock price, the company earned 1 cent a share. Analysts expected a loss of 2 cents for the quarter.
Revenue decreased 14% to $188 million.
Orbitz's total bookings were $2.28 billion. Domestic bookings decreased 13%, and international bookings dropped 36%.
Travel companies are in a fierce pricing battle.
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Expedia
(EXPE) - Get Expedia Group, Inc. Report
ignited the competition when it removed booking fees on its flights through May 31. The company was following
Priceline.com
(PCLN)
, which canceled air-booking fees about two years ago.
As a result, last month Orbitz reduced the service fee it charges travelers to book hotel rooms on its Web site. The promotion will run until July 15.
Last week Expedia posted a 23% decline in its first quarter to $39.4 million, or 14 cents a share, from $51.3 million, or 17 cents a share, a year ago.
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