Expedia scares investors with CEO change

Expedia Group Inc. shares fell 13% in Thursday’s extended session, as investors appeared nervous about the CEO change and looked beyond the online travel company’s quarterly pace.

Expedia EXPE,
earned $132 million, or 92 cents per share, in the fourth quarter, compared with $177 million, or $1.11 per share, in the same period a year ago.

Excluding one-time items, the company earned $1.72 per share. Revenue rose 10% to $2.89 billion. Analysts polled by FactSet had expected adjusted earnings per share of $1.67 on revenue of $2.87 billion.

“We delivered on our full-year guidance and delivered record results, all while completing a massive transformation and addressing the inherent volatility that comes with it,” Chief Executive Peter Kern said in a statement. “Our work is finally starting to pay off and we are in the best position we have ever been in from a technological perspective.”

In a separate press release, however, Expedia said Kern will be replaced by Ariane Gorin, who has held various executive roles at Expedia since 2013 and most recently served as president of Expedia for Business.

The appointment will take effect May 13, the company said. Kern has been Expedia’s CEO since 2020 and will remain a member of the company’s board of directors and vice president to “ensure a smooth transition,” Expedia said.

Expedia shares ended the regular trading day Thursday up 3.3%. The stock has gained 33% over the past 12 months, compared to the S&P 500 SPX index’s 21% rise over the same period.

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