Booking Holdings Inc at Goldman Sachs Communacopia & Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : I would like to start with something a little more fun. You asked me before we came on stage -- and unfortunately, this conference didn't allow me a lot of summer travel. But what did you do this summer? What was exciting for you, whether it was travel, something else? Let's start on a lighter note before we get into the business.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Well, I'm glad you got some time off. You have earnings. You were right into August, and then now you're here at this conference. So I'm glad you got a little bit of downtime. I wanted to kick us off with a big-picture question. There's always such interesting things going on in the company. What would you frame up as your key strategic priorities? I mean, there's always the themes that we hear on the earnings call, but whether it's connected trip or driving more relationship with the consumer, level set for us, what are the big strategic priorities that you and Glenn are focused on?

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Okay. Probably the two overarching themes at this conference are AI, we'll get to that one, and also the health of the consumer. So you sit in a unique spot being a global company, really at the heartbeat of what's happening from a consumer demand standpoint. Maybe just reflect on what the key messages were coming out of this last earnings report, how the audience should be thinking about the health of the consumer, how the consumer is interacting with your product, how that maybe informs some of your forward forecasts from this level.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Yes, and not your statement but we got a statement similar to that from Delta Airlines in the US here this morning that's on the news headlines as well. So just looking forward and not guidance per se, but just are there things you want investors to keep in mind about how your business evolves from an ADR perspective or a geo perspective or a take-rate perspective that could be levers or elements of the business that you just want to make sure people are aware of where there's nuance in the business on a go-forward basis?

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Okay, super clear. You referenced it when we talked about strategic priorities. You built a very large alternative accommodation business in the last couple of years, and it continues to be something that you and Glenn talk about on the public call. Talk a little bit about the journey you've been on in building that business and how investors should think about that tying back to elements of growth and executing on these strategic priorities of the long term.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : And maybe just one follow up. How critical is continuing to grow supply in terms of alternative accommodations? I mean, you have a particularly powerful engine by mixing traditional alternative accommodations on one platform and presenting them to consumers. How do you think about the equation of continuing to acquire supply, build, scale the supply? Because as you proved out in hotels, supply advantages can lead to conversion advantages.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Okay, understood. Pivoting to the strategic priorities around the connected trip, when you think about getting that priority to where you want it to be over the next couple of years, what are the biggest unlocks you're trying to solve for in terms of stimulating adoption and booking habits around the connected trip? And talk a little bit about how [ARR] fits into that broader strategy.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Yes, and I want to build on that because I think Glenn on the earnings calls gives off a very positive messaging, and you guys are clearly leaning into AI broadly. So you touched upon it a little bit there, but when we think about the multi-year roadmap for this company, how many elements of how the consumer interacts with your platform are going to be touched by AI and you think could generally change the consumer landscape with respect to travel?

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Okay, understood. And sticking with the idea of scenarios and how it all sort of evolves over time, I think, and you probably get this question a fair bit, the overriding debate continues to be how the travel funnel might change over time. So when you think about what's in your control and what's out of your control, talk a little bit about futureproofing with AI for eventualities or different scenarios in travel. Maybe just build on that last point of the answer. And then I actually want to build into loyalty and things which probably feed into this as well.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : But one thing I think you guys have been very aggressive with is that you've moved a lot towards direct relationship with consumers, right, which is one of your strategic priorities. Talk about the journey you've been on with respect to building brand and then also building loyalty, and the continued investment piece you're on there and how to think about it as the output for the business as you continue to build scale both in direct traffic, brand, and loyalty. Yes.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : Okay. I want to build on what you said there. Because even within performance marketing, you've been on a bit of a journey where you talk more positively today about the output you're getting from social media than you did two years ago. So even the mix within your performance marketing continues to evolve. Talk about some of the key learnings as that performance marketing dollar has shifted and what you've seen from an efficacy standpoint as you've changed some of that mix.

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : So we've talked a lot -- I know we have a few minutes left, but we've talked a lot about where the company is going, the strategic priorities, all the growth initiatives. For a roomful of investors and folks on the webcast, bring it back to what is your key messages around the margins in this business over the next couple of years?

Question: Eric Sheridan - Goldman Sachs Group Inc - Analyst : I just want to end on one last question because it's probably an area where we've been so consistent over the last couple of years. When investors think about capital allocation inside this company, especially shareholder returns, just remind folks, what is the framework that you use on capital allocation, so investors know the way you think about an incremental dollar of capital and possibly returning it to shareholders?