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Expedia Q3 Hotel Revenue Up 20 Percent

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Online travel agency Expedia's third-quarter hotel revenue rose 20 percent, while hotel room night bookings jumped 27 percent.

"We saw ongoing strength in our hotel business with room night growth accelerating across all major regions, especially in the Asia-Pacific regions and Europe," chief executive Dara Khosrowshahi said.

The company, which expanded its deal with Chinese online travel service Elong last month, reported a 22 percent increase in international revenue.

"With Elong's consistent share gains, we believe that we are one of the few global e-commerce companies that have established a significant and lasting position in China," Khosrowshahi said.

Air tickets sold grew by 11 percent primarily due to the acquisition of Nordic travel operator VIA Travel in March.

"It's clear that VIA travel is adding to their attach rates and that they are doing well capitalising on taking global market share," The Benchmark company analyst Daniel Kurnos said.

Expedia said adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) grew 6 percent, slightly lower than its July forecast of growth in the high-single-digit to low-double-digit percentage range.

The lower EBITDA growth is a result of the company's investment in its technology platforms and international expansion, analyst Kurnos said.

Saturation in the online travel markets in North America and Europe, and competition from new entrants such as Google and Yahoo, prompted Expedia to consolidate its websites.

In August, the company also launched mobile and tablet applications that offer discounts, to tap the large pool of customers who use smartphones to book rooms and air tickets.

"Expedia made these investments and upgraded their technology in the hope of improving conversions and there is evidence that they are starting to see the benefits of that play out," White said.

Conversion rate -- or the percentage of visitors to the company's website that buy hotel or air packages -- is a key metric for online travel agencies.

Net income from continuing operations fell to USD$169.9 million from USD$170.9 million a year earlier.

Revenue rose 17 percent to USD$1.20 billion.

(Reuters)