Expedia, the online travel company that has been under fire from critics for what they have said are misleading ads, has reported a massive $2.5 billion operating profit.
Expedia, founded in 2004, has long struggled to gain traction among consumers as it focuses on online travel.
But the online retailer, which has been embroiled in a host of lawsuits including one filed by the US government against the company, posted its third straight profit this quarter, up 30% from a year earlier.
The company has been accused of misleading consumers about the amount of money they are likely to save by paying a premium for a hotel reservation, or by charging extra for other services.
Last year, the company said it had increased its hotel reservation fees to $100 per person from $40.
Expedia has denied those allegations, saying the fees were only for the purpose of improving the customer experience.
The company has struggled to attract customers, especially in a crowded market like the United States, where prices are high and most travelers have never been to an expo.
In addition to its hotel reservations, Expedia charges a flat rate for all online booking activities, including the ability to book through its booking platform, which allows visitors to book a hotel room or a suite for up to a night.
It is also unclear what percentage of its $1.6 billion in revenue came from the hotel business.
The real estate company owns and manages hotels and condominiums in most major US cities, including Los Angeles, New York, Boston and San Francisco.
Expanded reservation options could boost the company’s profitability, but it has yet to release its financials for that business.
While Expedia’s profit came from hotel sales, the rest of the company did not, according to the company.
That meant Expedia earned less than $300 million from hotel occupancy, which the company attributes to a combination of rising hotel prices and an inability to keep pace with the influx of visitors to the country.
The hotel occupancy revenue was only $150 million, according the company statement, which also attributed a portion of that revenue to the fact that the company doesn’t have a direct relationship with its hotel guests.
The report from Expedia is in line with expectations from other companies that have been criticized by travelers and regulators over their online booking fees, particularly those from major travel websites like Expedia.
The travel sites are not required to report hotel occupancy as an operating expense and do not report the hotel rooms or suites booked through the booking service.
The new profit from hotel stays came from a $1 billion loss in hotel room sales, which is largely attributed to a $200 million drop in occupancy due to the increased availability of Airbnb rentals, according an analysis by Bloomberg.
Airbnb, a New York-based website that hosts short-term rentals for short-duration stays, reported a net loss of $5.3 billion in the quarter.
The decline in hotel occupancy came despite an increase in reservations.
Airbnb booked 4,927,000 more rooms than it did a year ago.
The number of available rooms rose from 1.2 million to 2.6 million, which was the highest occupancy on record.
The firm said it expected occupancy to be higher in the second quarter because of the economic storm in the United Kingdom and Europe.
In its statement, Expesa said it will continue to improve its hotel booking experience.
It said that it has developed a suite of services to better serve our guests, including better user interface design and user-friendly customer service.