How Does Booking Holdings Company Work?

Payments by Booking acts as a payments stack and merchant-of-record solution to reduce friction, support cross-border methods and lower chargebacks while expanding ancillary revenue through flights, packages, insurance and rides.

• Merchant-of-record payments reduce supplier complexity and improve cash settlement.
• Cross-sell services (insurance, transfers, car rentals) raise average revenue per booking.
• Strategic partnerships include global hotel chains, airlines/GDSs, car fleets and restaurant groups for broader inventory access.
• Data and ML power ranking, dynamic pricing, personalization and fraud prevention at scale.

Allocation by model and trends underpinning monetization.

• Agency model ≈ 61% of 2023 revenue, the largest single stream.
• Merchant model ≈ 34% of 2023 revenue, rising with Payments by Booking and bundled offers.
• Advertising, OpenTable, insurance and other ≈ 5% of 2023 revenue.
• Overall take rate ≈ 15% (Revenue $21.4B / Gross bookings $143B in 2023).

Expanded product mix lifts AOV and retention through multi-product bookings and promotions.

• Flights and car rentals act as demand flywheels, increasing customer lifetime value.
• Insurance and activity sales are higher-margin, improving profitability per booking.
• Bundled merchant offers enable dynamic markups and promotional elasticity.
• Payments platform allows capture of payment fees and improved conversion.

Mix of organic, app, metasearch and paid channels shapes CAC and yield management.

• Rising app-driven direct traffic reduces dependence on paid marketing over time.
• Metasearch advertising (KAYAK) monetizes intent without owning the booking in many cases.
• Supplier relationships and channel parity management preserve commission rates.
• Regional channel mix affects margins: APAC often favors merchant models; Europe leans agency.

Payment scale, product expansion and regional recovery drive revenue composition shifts.

• Scaling Payments by Booking expands the merchant mix and captures incremental margin.
• Flight product adoption accelerates cross-sell and repeat bookings.
• OpenTable and local services smooth seasonality and deepen customer engagement.
• Regional recovery—especially intra‑APAC—supports higher long‑term growth rates.

For a focused breakdown of Booking Holdings revenue mechanics and figures, see Revenue Streams & Business Model of Booking Holdings.

• How Booking Holdings makes money: mix of agency, merchant and advertising.
• Comparison to peers highlights metasearch impact and differing take rates.
• Regulatory, data and payments trends influence long-term unit economics.
• Investor considerations include take-rate trends, payment penetration, and app retention metrics.

Booking Holdings sustains a virtuous ecosystem—lodging, flights, cars, dining, metasearch—creating multi-product engagement and scale-driven marketing efficiencies that improve unit economics and customer lifetime value.

• Unmatched global supply density increases choice and conversion.
• Superior mobile conversion drives direct revenue and lower acquisition cost.
• AI and data science improve personalization, pricing, and fraud detection.
• Payments enable capture of merchant economics and improved buyer protection.

With record scale and continued product diversification, Booking Holdings seeks to compound its network effects while facing regulatory and competitive headwinds; execution on direct monetization and AI will determine margin and growth trajectories.

• Prioritize app/direct share to lower marketing cost per booking and raise lifetime value.
• Expand payments platform to capture more merchant economics and reduce reliance on referral fees.
• Grow flights, packages and alternative stays to increase cross‑sell and traveler monetization.
• Mitigate regulatory risk by adapting data practices and platform policies ahead of DMA obligations in 2025.