Booking Holdings expects to make annual savings of up to $450 million as a result of organizational changes it announced in early November.
About a third of the savings would come from job cuts, which the company said previously would be at Booking.com, with the rest coming from modernizing processes and systems and reducing real estate, the company said in a regulatory filing on Tuesday.
“Our intention is to grow our top line faster than our fixed effects line over the next couple of years, and we have been upside down from that perspective in the more recent past, said Ewout Steenbergen, chief financial officer of Booking Holdings.
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Steenbergen, who was speaking at the Nasdaq Investor Conference in London, also said that the company is looking for “transformation” because as it has added new initiatives, “the organizational complexity has grown.”
“We get feedback from our teams, and they’re saying that decision making has become slower, accountability has become a little bit more unclear, and the reasons why, they’re saying, is we have been adding so many new initiatives over the last few years, from flights to payments to many other activities,” he said.
A third reason, Steenbergen said, is about reinvesting in growth initiatives adding that the company has “so many growth opportunities it can still go after and actually grow faster than the market” including flights, attractions, ride-share, Asia and fintech.
Although some of the benefit of the cost savings would be realized in the second half of 2025, Steenbergen said, most will not come until after 2025.
Steenbergen also spoke about flights and said 13 million tickets had been sold in the last quarter, a growth of 39%. He said other airline industry players are not seeing that kind of growth adding that “it’s a great proposition because it is an element towards the connected trip vision.”
“We need to put all these pieces together on the platform, we need to be able to facilitate payments underneath, put the gen AI tools on top of it. So we’re not looking at these all in isolation.”
The company's ability to offer additional products once a customer comes to the platform for something is working well, Steenbergen said. And, despite add-ons often being low-margin businesses, the company only has one customer acquisition cost.
The conversation moved on to generative AI which Steenbergen described as “the perfect element to make the real connected trip come to life.”
“We have the data and background of you as a traveler. We know what you’re looking for, what you’ve done in the past, what you don’t like. We can build that whole itinerary for you. We can make sure it’s immediately bookable, and we know availability.”
And, he touched on how search could change going forward “maybe through Google or another platform”, so the company is talking to all the AI tools to see how it can work with them.