Why Expedia's Share Price Is Popping

Expedia (NASDAQ: EXPE) is up 21% since Wednesday, Nov. 5.

What's going on with the online travel company?

Well, it reported third-quarter results Thursday morning, and they were extremely solid.

Revenue for the quarter rose 9% year over year to just over $4.4 billion. The consensus Wall Street estimate was for $4.3 billion. And earnings came in at $7.57 a share, which was 23% higher than a year ago and 9% higher than Wall Street's estimate of $6.95 a share.

The company also reported 11% year-over-year growth in booked room nights, its fastest pace of room night growth in more than three years, with business-to-business sales driving the growth.

Raised guidance

Best of all, management raised its guidance for full-year 2025 revenue growth to 6%-7%. Previous guidance was for 3% to 5% growth. And it now estimates gross bookings for the year will climb 7%; previously it predicted that would rise 3% to 5%.

Image source: Getty Images.

CEO Ariane Gorin said the better-than-expected quarterly performance and revised guidance reflect an improved travel demand environment.

Investors love when a company raises guidance, as it's a good sign that things are trending in the right direction. And company insiders have a much better view on future performance than investors. Plus, share prices reflect future earnings growth, so a rosier outlook will nearly always lift the stock price.

Matthew Benjamin has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.