Four years after stepping into the role of CEO of Expedia
Group, Peter Kern announced Thursday he will leave the position in mid-May and Ariane Gorin,
currently president of Expedia for Business, will become CEO.
Kern will remain in the role of vice chairman and as a member of
Expedia Group’s board of directors.
He shared the news at the start of the company’s call with
financial analysts to discuss its fourth quarter and full-year 2023 earnings
report, in which the company reported its highest ever full-year and
fourth quarter revenue, both up 10% year over year, and record full year
adjusted EBITDA of $2.7 billion.
In his four years as CEO, Kern has led a widespread transformation
at the company, including a complete overhaul
of its tech stack, the creation of a loyalty
program unified across brand Expedia, Vrbo and Hotels.com, substantial growth
of its B2B business and early experimentation with and adoption of generative
artificial intelligence.
“I am proud of
and grateful to the team we have built at Expedia Group and the tenacity and
resilience they demonstrated as we worked through an incredibly ambitious and
challenging transformation,” Kern said. “We have quite literally reset the company for the
future, and we are in position to lead our industry for decades to come.”
He called Gorin “a terrific choice terrific choice to take the company forward and build on what we have created.”
“She is a
proven leader, answering any challenge thrown at her, including most recently
as head of our tremendously successful B2B business. As vice chairman, I look
forward to working closely with Ariane and our leadership team as they continue
the momentum we have built and realize on all the opportunity that our
transformation has created.”
CFO Julie Whalen said Kern will be missed but has left Expedia Group in a good place.
“Peter has done an amazing job navigating us through the pandemic, driving our massive business transformation and setting us up for a very bright future,” she said.
In a one-on-one discussion at the Americas Lodging Investment
Summit in late January, Kern used the analogy of being a parent to describe how
the last four years as CEO have felt: “I was saying to
somebody recently, that it’s … like having kids you know, long days short
years … I can’t believe it’s been four years but in it … every day,
every grind felt like forever.”
But his pride in the company’s
work was clear.
“I’m sure there
are a thousand things I’d do differently now, but in the aggregate, I think
we’ve made an amazing transformation, amazing progress in four years, which
isn’t that long in a company’s life,” he said.
During Thursday analysts’ call, he spoke of that transformation as the high point of his time as CEO.
“You might assume that COVID was the defining part of my tenure. In reality, we quickly saw an opportunity to use our COVID time to embark on one of the most audacious and ambitious transformations I think a company of our size has ever attempted,” he said. “We had many fits and starts as we took on this massive overhaul, but when you do something as bold as we were attempting, you have to be prepared to deal with some mess. As much as anything, I’m proud that we were not afraid of the mess, and we pushed through.”
He made clear the end result was worth it when he spoke of the company’s new abilities.
“Our unified front end now allows us to deploy features around the globe and on any brand at a pace we could not contemplate just a couple of years ago,” he said. “What used to take months, even years, now takes weeks and sometimes just days.”
Ariane Gorin: “A superb executive”
Gorin has held various executive roles with Expedia Group since
2013. As president of Expedia for Business she led the company’s global supply
partner group, advertising business and B2B partner network that powers brands
such as Walmart
and Mastercard.
The company’s B2B revenue grew 33% in 2023 compared with 2022 to $3.4 billion.
“Ariane Gorin is a superb executive that all of us at Expedia
Group and our board have worked with for 10 years,” said Barry Diller, Expedia
Group’s chairman and senior executive.
“We very much wanted an internal candidate to
succeed to the CEO position, and following a comprehensive search, the board
determined Ariane was the best candidate given her exemplary leadership.”
CFO Whalen agreed with that assessment. “It will be great to have someone so familiar with our business and our ecosystem lead us into this next exciting page for our company,” she said.
And said Gorin, “I am truly honored to have the opportunity to lead Expedia Group
as we build on the foundations established by Peter, our leadership team and
our global workforce. Leading our multibillion-dollar B2B business has been an
incredible experience and I look forward to even greater growth ahead for the
entire company. It’s an exciting time in the company’s history, and I’m
energized by the opportunities ahead for our employees, travelers and partners.”
Expedia’s earnings for Q4 and 2023
Aside from his personal news, Kern had some upbeat numbers to discuss with on the call with analysts.
The record Q4 revenue came in at nearly $2.9 billion, helping to drive the record full-year revenue to $12.8 billion, both up 10% year over year. The record full-year adjusted EBITDA was up even more: 14%. And Q4 EBITDA topped that at 19%, good for $532 million.
Sales and marketing costs for the year reached nearly $6.9 billion, 12.5% higher year over year. The costs were 53% of revenues for the year, a tad more than 2022, when marketing costs represented about 52% of revenues.
“I’m incredibly pleased and proud of everything we have accomplished over the last few years, and I’m really excited about our path forward,” Kern said at the end of his 15-minute introductory remarks during Thursday’s call. “Thanks to our massive transformation, we are now a very different company than we were four years ago. We are set up to out-innovate our competition for the next decade and efficiently deliver the best experiences for our customers and partners. And if we do that, the business and shareholder returns will take care of themselves.”
In late January, Kern spoke with PhocusWire editor in chief Mitra Sorrells, with reflections on his career and future priorities for Expedia Group. Watch Kern’s full interview from the ALIS event below, followed by an interview with Gorin from Phocuswright Europe 2022.
PhocusWire Executive Interview: Expedia Group
Executive Interview: A Marketplace Reimagined – Phocuswright Europe 2022
