Though Nvidia's strong earnings report (covered here) has understandably taken the spotlight, it was far from the only noteworthy tech earnings release delivered on Tuesday afternoon. Priceline (PCLN) , Yelp (YELP) and Acacia Communications (ACIA) are making sizable moves in response to their numbers as well. Here are some takeaways.
The online travel giant reported first-quarter revenue of $2.42 billion (up 13% annually) and adjusted EPS of $9.88 (up 7%). The latter beat an $8.82 consensus analyst estimate, but the former missed a $2.45 billion consensus. Its closely-watched gross bookings totaled $20.69 billion, up 24% (27% in constant currency) and beating a $20.29 billion consensus.
But second-quarter bookings growth guidance of 12% to 17% (15% to 20% in constant currency - the euro and pound's declines are weighing) fell short of a 20% pre-earnings consensus. And EPS guidance of $13.30 to $14.00 is below a $14.99 consensus. Booked hotel room nights are expected to rise 16% to 21%, after having grown 27.4% in Q1.
Priceline's bookings and EPS guidance has often been conservative. But with its stock up over 50% during the prior 12 months, markets clearly wanted more. Shares fell about 4.5% on Wednesday.
The company's top-line numbers still suggest the long-term trends that have fueled its growth -- the shift in travel spending from offline to online channels, a growing base of hotel partners and share gains against smaller online travel agencies (OTAs) -- are still in place. Priceline mentioned on its call that its Booking.com unit (Europe's biggest online travel firm) saw its property count rise 36% annually to over 1.2 million, and (amid fears of growing competition from Airbnb) that 8 million of its 25.5 million bookable rooms now consist of homes, apartments and other non-hotel listings.
And Priceline is still outgrowing archrival Expedia (EXPE) , whose sales skew more towards the U.S. Expedia's gross bookings rose 14% in Q1 to $23.6 billion, and its room nights rose by 12%. Priceline claims its picked up share in both the U.S. and overseas last quarter. The company partly blames seasonal factors -- Easter weekend fell in Q2 this year, after falling in Q1 last year -- on its expected Q2 growth slowdown.
Priceline also predicts heavy "performance marketing" spending -- much of which involves buying search ads from Alphabet/Google (GOOGL) -- will weigh on its Q2 bottom line. Its outlook assumes a lower return on investment (ROI) for performance marketing spend relative to a year ago, and continued strong growth in bookings stemming from search traffic and other paid channels (for example, metasearch platforms such as Trivago (TRVG) and TripAdvisor (TRIP) ).
Priceline's "performance advertising" spend rose 26% in Q1 to $980.8 million (41% of revenue). In other news, Google reported its total paid ad clicks and impressions on its own sites and apps rose 53% in Q1, with mobile search growth the biggest catalyst. In addition to traditional hotel search ads, Google is now doing brisk business selling ads via the Hotel Finder tool built into its search engine, which in turn is a headwind for a company like TripAdvisor, which just posted a Q1 miss.