What Happened?
Shares of online travel agency Expedia (NASDAQ: EXPE) jumped 5.4% in the morning session after the Trump administration announced a new peace deal that would lead to the reopening of the Strait of Hormuz.
The Hormuz blockade had disrupted the most direct flight corridors linking Europe, South Asia, and East Asia, forcing reroutes that made journeys longer and more expensive. Booking Holdings had cut its full-year revenue growth forecast from low double-digits to high single-digits, attributing roughly two percentage points of room-night deceleration directly to the conflict. With the strait preparing to reopen, those routes become viable again. Cheaper jet fuel allows airlines to reduce fares, which historically triggers a recovery in discretionary travel bookings. Online platforms earn commissions on those bookings. They benefit from both the restored supply of affordable routes and the pent-up consumer intent to travel that builds quickly when geopolitical risk fades.
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What Is The Market Telling Us
Expedia’s shares are quite volatile and have had 16 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock gained 19.7% on the news that the company reported stronger-than-expected third-quarter results and provided an upbeat forecast for the upcoming quarter.
The online travel agency posted adjusted earnings of $7.57 per share on revenue of $4.41 billion. Both figures comfortably surpassed analyst expectations, with earnings beating by 9% and revenue growing 8.7% year over year. A key driver of the strong performance was an 11.1% increase in room nights booked, indicating robust travel demand on its platforms. Looking ahead, the company issued fourth-quarter revenue guidance with a midpoint of $3.41 billion, which was more than 4% above Wall Street's consensus estimates, signaling management's confidence in continued momentum.
Expedia is down 15.6% since the beginning of the year, and at $238.68 per share, it is trading 20.8% below its 52-week high of $301.31 from January 2026. Despite the year-to-date decline, investors who bought $1,000 worth of Expedia’s shares 5 years ago would now be looking at an investment worth $1,404.
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