Online Travel Agencies 1Q12: Domestic Gets Its Groove Back (But the Big Story is Still Overseas)

Summary

The U.S. online travel agencies (OTAs) began 2012 on a positive note. Despite rising oil prices and airfares, which dampened travel sentiment globally, aggregate gross bookings of the three public U.S. OTAs – Expedia, Orbitz and Priceline – in 1Q12, had an increase of 22% year over year. However, there are some near-term headwinds: Rising airfares are negatively affecting package sales and the ongoing eurozone crisis could cast a shadow over OTAs' international prospects.