Booking.com’s Q1 2025 Results: Alternative Accommodations Growth, U.S. Headwinds, and Strategic Cost-Cutting

📈 Strong Results in Alternative Accommodations

Booking.com posted solid first-quarter financial results, highlighting continued growth in its “Alternative Accommodations” segment—a category crucial for vacation rental managers.

Key Q1 figures from the earnings call:

• Alternative accommodations bookings grew 12% year-over-year.
• Total alternative accommodation listings rose to 8.1 million globally.
• This segment now makes up 37% of all Booking.com room nights (up from 36% in Q1 2024).

Note on terminology:

Booking.com’s definition of “alternative accommodations” is broader than vacation rentals. It also includes:

• Bed-and-breakfasts (B&Bs)
• Guesthouses
• Hostels
• Other non-hotel property types

Thus, direct comparisons to Airbnb’s predominantly vacation rental-centric portfolio are not completely apples-to-apples.

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🇺🇸 U.S. Market Faces International Visitor Headwinds

Booking.com has long emphasized the U.S. market as a growth priority. Historically, its strength in America has been attracting international travelers—especially Europeans, Australians, and Middle Eastern guests—to its accommodations.

Current challenges in the U.S.:

Earlier this spring, we explored how rising tariffs, shifting travel sentiment, and policy uncertainty under the Trump administration could start to impact international travel to the U.S.—and in turn, bookings on platforms that rely more heavily on foreign guests.

Now, Booking.com’s Q1 2025 financials may offer the first signs of that very shift.

In the earnings call, CFO Ewout Steenbergen noted:

• “We saw a moderation in trends for inbound travel into the U.S., particularly from bookers in Canada and to a lesser extent from bookers in Europe,” Steenbergen said.
• Meanwhile, domestic U.S. travelers are showing signs of caution, with shorter stays and some preference for higher-star-rated accommodations, indicating increased consumer sensitivity to economic conditions.

Booking.com has traditionally drawn a large share of international travelers into the U.S.—especially from Europe and Canada. So, while the platform’s alternative accommodations segment is growing globally (+12% YoY), softness in U.S. inbound demand may reflect exactly the kind of exposure we anticipated.

Whether it’s trade tariffs, border control rhetoric, or overall political climate, travelers appear to be weighing more than just price when deciding where to book.

It is not set in stone that this is a direct result of Trump’s tariffs or trade restrictions—but it’s worth noting that as uncertainty increases, travel behaviors shift. And Booking.com’s latest results offer a window into what that may look like in real time.

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💼 Strategic Cost-Cutting and Shifting Workforce Away from Amsterdam

Despite reporting healthy financial performance—including a 21% increase in adjusted EBITDA to $1.1 billion in Q1—Booking.com remains proactive about controlling costs.

Amsterdam Layoffs: Featured in Dutch Media

Although the Q1 earnings call did not directly address layoffs, the Dutch financial press has highlighted these plans prominently:

• Het Financieele Dagblad (FD, April 24, 2025) reported that Booking.com plans workforce reductions exceeding 10% at its Amsterdam headquarters.
• Approximately 900 Amsterdam-based employees could be affected, following earlier management layoffs.
• The reasons cited for these changes include high operational costs, housing shortages, and stringent labor regulations in the Netherlands.

Additionally, Booking.com recently faced costly legal setbacks in the Netherlands, notably:

• Losing a major pension-related court ruling, requiring substantial back payments.
• A high-profile greenwashing case in 2024, which led to suspension of their sustainability program.

Centers of Excellence: A Strategic Shift to Lower-Cost Regions

Booking.com is increasingly investing in international “Centers of Excellence,” specialized operational and technology hubs located in lower-cost, talent-rich regions.

The Centers of Excellence in Romania and India were set up by Booking Holdings to support several of its brands—not just Booking.com, but also Agoda, Priceline, and others. On the other hand, the center in Tel Aviv was created specifically by Booking.com and focuses on tech and AI innovation.

These international centers allow Booking.com to reduce costs significantly while maintaining or enhancing productivity, which aligns with their long-term cost efficiency goals.

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🔍 Key Takeaways for Vacation Rental Managers

• Alternative accommodation growth remains robust, demonstrating Booking.com’s continued investment and expanding opportunities for vacation rental managers.
• International travel softness into the U.S. market may require adjustments to attract more domestic travelers.
• Strategic workforce and cost shifts indicate an ongoing evolution in how Booking.com operates, with the long-term profitability of the platform a major priority.