Is Post-Pandemic Travel Demand Normalizing?

27.02.2024 - 20:22 / travelpulse.com / North America / Spring Break / Glenn Fogel / David Goulden / Donald Wood

Online travel agency Booking Holdings revealed lower expectations for the first quarter and full year of 2024 as travel demand in the United States begins to normalize following a post-pandemic surge.

During a quarterly financial call, officials from Booking Holdings announced that gross travel bookings grew 24 percent in 2023, but losses could top roughly $11 billion in market value if 2024 projections are accurate, according to Reuters.com.

Room nights booked during the final quarter of 2023 grew 9.2 percent, while gross travel bookings were $31.7 billion, compared with a projection of $31.3 billion. In addition, the company’s revenue rose 18 percent to $4.78 billion in the fourth quarter, topping the $4.73 billion analysts had projected.

Along with other companies like Hilton and Marriott, demand is expected to grow more slowly this year, disappointing investors. As a result, Booking Holdings shares fell eight percent on Friday morning. 

“After two plus years of strong stock performance, the room nights booked deceleration could drive a bit of a pause in the shares,” RBC Capital Markets analyst Brad Erickson said.

Booking Holdings Chief Financial Officer David Goulden said the lowered expectations for 2024 have been impacted by the ongoing conflict around Israel, as well as exchange rate changes.

Despite the negative response to the 2024 outlook, Chief Executive Officer Glenn Fogel still believes in a strong upcoming summer season. 

“As we look to the year ahead, we see strong growth on the books for travel that’s scheduled to take place in 2024, which gives early indications of potentially another record summer travel season,” Fogel said.

The travel advisor community is feeling the pressure as well.

“Post-pandemic travel demand is gradually normalizing,” Stepping Out Travel Services CEO Mandee Migliaccio said. “Although clients are eager to embark on vacations and are actively seeking quotes, the escalating expenses linked with air travel are giving them pause, prompting a reassessment of their plans or a search for alternative destinations.”

“Nevertheless, amidst this financial caution, a heartening trend is unfolding: multi-generational travel is on the rise,” Migliaccio continued. “Grandparents, in particular, are choosing to invest in shared experiences, prioritizing the creation of lasting memories over the traditional focus on passing down inheritances.”

While ongoing wars in the Middle East and Ukraine, along with inflation, have resulted in less disposable income, agents are finding that people still want to see the world.

“I do not think that post-pandemic travel demand is normalizing just yet,” Travel Hub 365 CEO Stephen Scott said. “We are entering another major booking period for Spring Break