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Short-term rental platform Vrbo recorded $1.8 billion in traveler bookings between July and September, a 12.5 percent uptick compared to the same period a year earlier, according to a third-quarter earnings call by parent company Expedia Group on Thursday.
The strong performance, the second this week by a short-term rental platform, suggests economic turbulence hasn’t scared off vacation-loving Americans seeking travel destinations or homeowners interested in renting out their homes as an additional revenue stream.
The surge in Vrbo bookings stood among an overall 28 percent increased in the number of rooms booked among all Expedia brands, which includes Hotels.com, Travelocity, Orbitz, Expedia and others.
“Travel demand has remained strong and [average daily rates] remain substantially elevated relative to pre-pandemic levels,” Expedia CEO Peter Kern told investors in a call on Thursday. “There has been no real letup in ADR, and there has been no real letup in demand.”
Expedia’s net income rose 33 percent compared to the year before, to $482 million, for the third quarter. Overall revenue was $3.62 billion, up 22 percent from the prior year.
Despite Vrbo’s uptick in bookings, its biggest competitor, Airbnb, outperformed the company, according to an analysis.
Airbnb, the leader in the short-term rental platform space, released its earnings on Tuesday showing the firm grew revenue by 29 percent compared to a year before. Net revenue increased by 46 percent.
That was driven by a 25 percent growth in bookings of nights and experiences, plus a rise in the cost of each of those.
Vrbo also benefited from higher average daily rates (ADRs), or the price of each night booked on the platform.
Kern said repeatedly that both demand and average daily rates remained high heading into the final months of the year.
“The answer is no,” Kern said. “We have not seen any major moves [or] shifts in demand patterns.”
“The pacings for next year are strong,” he added. “A lot to still be filled in next year but we haven’t seen any (slowdown).”
Expedia has spent the better part of the year building and testing an app that will roll all of its companies into one platform, including Vrbo.
The goal is to create an incentive for repeat customers who book on the platform. Repeat bookings will lead to discounts and other loyalty benefits, Kern said.
He noted Expedia is going to be careful when testing Vrbo, given the booking process is different from reserving a hotel or rental car.
“We mean to disrupt it as little as possible,” Kern said.
This post will be updated as new information is received.