Business Context and Reporting Period
Company: Expedia, Inc.
Filing Type: Form 8-K (Current Report)
Date: April 9, 2015
Context: The Company is furnishing this report under Regulation FD to recast selected financial data for 2014 and 2013. This action reflects a change in segment reporting effective January 1, 2015, following a continuous review of assets and operations.
Key Financial Metrics
This filing does not report new revenue, profit, cash flow, or debt figures. Instead, it clarifies that the recasting of previously issued financial information:
- Does not represent a restatement of previously issued financial statements.
- Does not affect the Company's reported gross bookings, revenue, or adjusted EBITDA for any previously reported periods.
- Provides historical data consistent with the new reporting structure.
Specific recast financial data for 2014 and 2013 quarterly periods is contained in Exhibit 99.1, which includes non-GAAP measures and reconciliations to GAAP measures.
Material Changes Versus Prior Period
The primary material change is the realignment of reportable segments. Effective January 1, 2015, the Company now operates under four distinct segments:
- Core OTA: Includes Expedia.com, Hotels.com, Expedia Affiliate Network, Hotwire.com, Travelocity, Venere, Wotif Group, CarRentals.com, and Classic Vacations.
- trivago: Generates advertising revenue via hotel metasearch websites.
- Egencia: Provides managed travel services to corporate customers.
- eLong: Consists of the majority ownership interest in eLong, Inc., focusing on mobile and online travel in China.
Beginning with the quarter ending March 31, 2015, financial statements will reflect this new structure with prior periods recast accordingly.
Guidance, Outlook, and Risks
Management Commentary: The change in segment reporting is part of a continuous review of the business to better align with current operations. The filing ensures the financial community has historical data presented on a basis consistent with the current reportable segments.
Risks and Contingencies: The filing notes that information furnished under Item 7.01 shall not be deemed "filed" for purposes of Section 18 of the Exchange Act or incorporated by reference in other filings, except as expressly set forth by specific reference.
Investor Verification Checklist
- Review Exhibit 99.1 for the specific recast segment financial data for 2014 and 2013 quarterly periods.
- Verify the reconciliation of non-GAAP measures to the most directly comparable GAAP measures included in Exhibit 99.1.
- Confirm that future financial statements (starting Q1 2015) utilize the new four-segment structure.
- Note that total company-level gross bookings, revenue, and adjusted EBITDA remain unchanged from prior reports.