Vrbo Growth Trajectory
Q: What's the outlook for Vrbo's growth recovery?
A: While Vrbo showed substantial acceleration ending the quarter with modest growth, July trends make it hard to predict precisely. Despite near-term headwinds, we expect to drive Vrbo back to where it used to be in the long term.

Guidance Amid Macro Softness
Q: How does macro softness affect lodging outlook and guidance?
A: We've adjusted our full-year guidance to 6% revenue growth and 4% bookings growth, reflecting impacts on the lodging business, including ADR weakening. These factors are incorporated into our overall expectations.

Margin Expansion Strategies
Q: How will you drive margin expansion amid investments and ADR pressures?
A: We've achieved cost of sales efficiencies, with costs down year-over-year, and expect continued leverage through operational improvements and AI technology. We're also benefiting from overhead reductions due to prior cost actions. While investing in marketing for Vrbo and international markets, we anticipate margin leverage in the longer term through increased direct traffic and marketing efficiencies.

B2B Growth and Outlook
Q: What's causing B2B growth deceleration and how do you view its outlook?
A: Despite slight deceleration, B2B growth remains strong at over 20%. As global demand normalizes, growth rates adjust accordingly. In July, macro factors impacted the U.S. segment, but we see significant opportunities ahead, and expect continued strong growth due to our leadership position and geographic diversity.

Macro Softness Impact
Q: Are you seeing softness in booking nights as well as ADRs?
A: Yes, we're seeing a reduction in nights booked, indicating a softening in travel demand that impacts transactions. It's a combination of factors, including shorter booking windows and lower ADRs.

Marketing Spend and Margins
Q: How are you managing B2C advertising expenses given the backdrop?
A: We're closely analyzing every marketing dollar, aiming to maintain EBITDA margins in line with last year. While investing in Vrbo and international markets, we're optimizing spend by evaluating returns across channels and focusing on efficiency in a potentially more volatile environment.

Platform Transformation Payoff
Q: What gives you confidence that the platform migration is paying off?
A: The replatforming has unlocked new capabilities, allowing us to run more tests and roll out features like flexible date search across all brands simultaneously. We've also implemented One Key, providing a unified customer view. These advancements wouldn't have been possible without the migration.

Brand Expedia Growth
Q: What drove the 20% growth in room nights for Brand Expedia?
A: Brand Expedia has been a highlight, benefiting from being the least disrupted brand and receiving our latest innovations. We've built strong brand value with substantial marketing over time, leading to a great app install base, high repeat usage, and a strong member base. The value proposition of booking multi-item trips is resonating with travelers, driving growth.

Pricing and Conversion
Q: How did recent pricing reductions impact conversion?
A: Our pricing actions have positively driven conversion rates. We only implement these reductions when we see returns, and we'll continue leveraging this effective marketing strategy, especially in light of consumer trade-down trends.

One Key Rollout Pause
Q: Does pausing One Key rollout affect loyalty programs and supply partners?
A: Yes, the Hotels.com 10-for-1 loyalty program remains unchanged outside the U.S. and U.K. For supply partners, the impact is minimal, as they participate in member deals across different loyalty schemes seamlessly. One Key isn't rolled out in B2B, so there's no effect on that front.

Booking Window Trends
Q: How are booking windows evolving?
A: In our B2C hotel business, booking windows had been slightly expanding year-over-year, but in July, they shortened a bit for the first time in a while. For Vrbo, booking windows have been shortening consistently.

Vrbo Marketing Strategy
Q: How will softness affect Vrbo's Q4 marketing strategy?
A: We plan to continue investing in Vrbo's marketing, especially heading into Q1, which is crucial for the brand. Our guidance assumes this investment, and we believe it's important for long-term growth, even if softness persists.

Advertising Growth Opportunities
Q: How will you grow the advertising business in the next 1–2 years?
A: We're excited about expanding our travel media network, offering new advertising opportunities in the upper funnel and post-booking moments. Introducing tools like self-serve options and video ads, and expanding partnerships with hotels, airlines, and destination organizations will drive robust growth.

Restructuring Progress
Q: How much of the restructuring has been implemented?
A: The majority of the restructuring actions announced earlier this year have been completed. Actions in Q1 and Q2 are contributing to overhead favorability, with only a small portion remaining to be actioned.

B2B vs. B2C Dynamics
Q: Could B2B success cannibalize your B2C business?
A: While there's overlap in some geographies, consumers use multiple channels for travel. Our B2B business complements our offerings by powering technology and inventory for various partners, ultimately expanding our reach and driving value to supply partners. It also pushes our B2C brands to be more competitive.