Shares of online travel agent Expedia (Nasdaq: EXPE) soared more than 20 percent on Tuesday, gaining 5-1/12 to 32-3/4 one day after the company reported strong fiscal 2000 second-quarter results and announced two acquisitions. After the markets closed on Monday, Expedia, which is the first Internet company that Microsoft has taken public, announced second-quarter revenue of $17.8 million — a 127 percent increase over the $7.9 million the company reported in the same quarter a year ago. Expedia also reported a net loss, excluding non-cash, stock-based compensation costs, of $5.9 million, or 16 cents per share. Analysts had expected the company to lose 29 cents per share.
What investors are probably more excited about is the news that Expedia is buying Internet lodging sites Travelscape.com and VacationSpot.com in separate transactions. Expedia will pay $95 million in stock for TravelScape.com and $82 million in stock for VacationSpot.com.
Even after Tuesday’s gain, Expedia, which went public in November at $14 a share, is trading at about half of its all-time high. Investors have lost a lot of their love for business-to-consumer (B2C) companies, even one owned by Microsoft.
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