Expedia Soars as Senior Executives Depart

The online travel company said its CEO and chief financial officer would be stepping down effective immediately.
Author:
Publish date:

Expedia (EXPE) - Get Report shares took off Wednesday, rising 6.5% to $105.87, after the online travel company said its CEO and chief financial officer would be stepping down effective immediately.

"Ultimately, senior management and the board disagreed on strategy," Chairman Barry Diller said in a statement about the resignations of CEO Mark Okerstrom and CFO Alan Pickerill.

"Earlier this year, Expedia embarked on an ambitious reorganization plan with the goal of bringing our brands and technology together in a more efficient way," Diller said. 

"This reorganization, while sound in concept, resulted in a material loss of focus on our current operations, leading to disappointing third-quarter results and a lackluster near-term outlook."

The board, Diller continued, "disagreed with that outlook, as well as the departing leadership's vision for growth, strongly believing the company can accelerate growth in 2020."

"That divergence necessitated a change in management," he said.

Diller said that he would be purchasing additional shares in the company "as a tangible sign of my faith in and commitment to Expedia’s long-term future.”

Diller and Vice Chairman Peter Kern, director of Expedia, will oversee the company’s executive leadership team, managing day-to-day operations, while the board determines the long-term leadership.

"While we share and understand the investment community’s unhappiness with our third quarter results and how 2019 has shaped up overall, we are keenly focused on the future and all of the opportunities ahead of us," Kern said.

Last month, Expedia's shares tumbled after the company missed Wall Street's third-quarter earnings expectations. 

The company reported earnings of $3.38 a share, below the $3.82-a-share estimate of analysts surveyed by Zacks Investment Research.