How we source: figures on this page come from the company’s own filings (SEC 10-K, 10-Q and earnings releases, or its annual report), with the period stated next to each number. Last refreshed October 2026. Our methodology.
In short
Booking Holdings earns a commission or margin on travel booked through Booking.com, Priceline and Agoda, recognised when the trip starts. In FY2025 that produced $26.9 billion of revenue on $186.1 billion of gross bookings, a 14.5% take. It spent $8.2 billion on marketing, 30.4% of revenue, mostly to buy traffic from Google and other channels.
How Booking Holdings Inc. (NASDAQ: BKNG) makes money, FY2025: the income statement as a flow, to scale. Booking now handles payment on 70% of the bookings it takes.. Source: Booking Holdings Inc. (NASDAQ: BKNG) Form 10-K for fiscal 2025 (filed 2026-02-18). Gross profit, margins and shares calculated.
Room nights are the engine. Booking Holdings sold 1,235 million in FY2025, up 8.0%, with the company citing demand in Europe and Asia. Gross bookings rose 12.4% to $186.1 billion.
Booking revenue by fiscal year, FY2021 to FY2025, from the company's filings. Chart: The Business Engineer.
Revenue comes in three lines. Merchant revenues, where Booking collects the traveller’s payment and keeps a commission or margin plus payment fees, were $17.8 billion, 66% of the total. Agency revenues, commissions on stays paid at the property, were $8.0 billion. Advertising and other revenues, mainly KAYAK referrals and ads and OpenTable restaurant fees and subscriptions, were $1.2 billion.
Marketing is the largest cost: $8.2 billion in FY2025, 30.4% of revenue. The company says performance marketing, mainly search engines (primarily Google), affiliates, meta-search and social media, is a substantial majority of it; it does not give the dollar split.
How Booking compares
Against its own history, revenue has grown from $10.96 billion in FY2021 to $26.9 billion in FY2025. Operating margin rose to 32.8% from 31.8% in FY2024.
Within the group, KAYAK and OpenTable are small. Advertising and other revenues, where both sit, were 4.4% of FY2025 revenue, and neither contributes to gross bookings. The 10-K gives no revenue figure for either brand on its own.
The merchant model took over. Merchant gross bookings rose 24.8% while agency gross bookings fell 8.7%; merchant reached 70% of gross bookings, up from 63%. The company says this lifted payment revenues but also raised merchant transaction costs by $381 million.
Booking revenue by line, prior year against FY2025, as reported. Chart: The Business Engineer.
Booking wrote down KAYAK by $457 million, $180 million of goodwill and $277 million of intangibles, citing expected increases in customer acquisition costs for meta-search.
Net income fell 8.1% to $5.4 billion even as operating income rose 16.8%, mainly because of a $1.38 billion foreign-exchange loss on euro-denominated debt and higher interest expense.
What to watch
Booking says Gen AI assistants from large platforms and AI-native rivals may reduce visits to dedicated travel sites and could disintermediate online travel companies.
Marketing returns: the average performance marketing ROI was down slightly in FY2025, which the company attributes to paid traffic mix and more social media spend. The direct share of room nights, a mid-fifties percentage, offsets this.
Regulation and tax: the EU designated Booking a gatekeeper under the DMA, and the Dutch Innovation Box rate of 9% versus 25.8% has a significant effect on its tax rate.
Frequently asked questions
How does Booking Holdings make money?
Mostly from commissions and margins on travel bookings. In FY2025 merchant revenues were $17.8 billion, agency revenues $8.0 billion and advertising and other revenues $1.2 billion, out of $26.9 billion in total.
What is the difference between merchant and agency revenue?
In merchant transactions Booking takes the traveller’s payment and keeps a commission or margin plus payment-related fees. In agency transactions the traveller pays the property and Booking earns a commission. Merchant was 70% of gross bookings in FY2025, up from 63%.
How do KAYAK and OpenTable make money?
KAYAK earns referral fees from online travel companies and travel providers plus advertising. OpenTable charges restaurants fees for diners seated through its service and subscriptions for restaurant management software. Both are reported within advertising and other revenues, $1.2 billion in FY2025; the 10-K gives no separate figure for each.
How much does Booking spend on marketing?
$8.2 billion in FY2025, 30.4% of revenue and 4.4% of gross bookings. Performance marketing, mainly search engines led by Google, is a substantial majority; the dollar split with brandmarketing is not disclosed.
Booking Holdings is the company the controls six main brands that comprise Booking.com, priceline.com, KAYAK, agoda.com, Rentalcars.com, and OpenTable. Over 76% of the company revenues in 2017 came primarily via travel reservations commisions and travel insurance fees. Almost 17% came from merchant fees, and the remaining revenues came from advertising earned via KAYAK. As a distributionstrategy, the company spent over $4.5 billion in performance-based and brand advertising.ย
Booking Holding mission via six brands
Booking mission is “to help people experience the world.”
priceline.com:ย a hotel, rental car, airline ticket and vacation package reservation service in the US
KAYAK: a meta-search service to search and compare travel itineraries and prices
agoda.com:ย an accommodation reservation service primarily focused on the Asia-Pacific region
Rentalcars.com: a worldwide rental car reservation service
OpenTable:ย a provider of restaurant reservation and information services to consumers
How does Booking make money?
The three primary sources of income are broken down in three main segments:
agency
merchant
Advertising and other revenues
Agency revenues
Those comprise revenues derived from travel-related transactions where Booking doesn’t facilitate payments for the travel services provided. It can be broken down in:
travel reservation commissions;
certain GDS reservation booking fees
certain travel insurance fees
Merchant revenues
Those are revenues derived from services where Booking does facilitate payments for the travel services provided.
Advertising and other revenues
Those comprise revenues from:
KAYAK for sending referrals to travel service providers and advertising placements
OpenTable for reservation fees, and subscription fees
priceline.com for advertising on its websites
Booking.com’s BookingSuite branded accommodation marketing and business analytics services
The Booking business strategy
Booking focuses on a few key strategies to accomplish its mission:
leverage on a large inventory of options and low prices
creating a frictionless user experience to book travel destinations
enable business partners to track their success via insight tools and platforms
keep investing in enhancing the consumer experience
partner up with travel service providers and restaurants
How does Booking acquire traffic to be monetized?ย The key is performance-based and brand advertisingย
Traffic acquisition is the key ingredient for any digital business. Also, tech giants like Google and Facebook need to focus their efforts in keeping the traffic acquisition cost stable over time to be able to monetize their pages and sites at a margin which is high enough to generate a sustainable business model.
Booking Holding has managed so far to do that via two main channels:
TAC stands for traffic acquisition cost, and that is the rate to which Google has to spend resources on the percentage of its revenues to acquire traffic. Indeed, the TAC Rate shows Google percentage of revenues spent toward acquiring traffic toward its pages, and it points out the traffic Google acquires from its network members. In 2017 Google recorded a TAC rate on Network Members of 71.9% while the Google Properties TAX Rate was 11.6%.
If we look at Booking Holding numbers, you can notice how the company spent in 2017 33.3% of its gross profit in performance advertising:
In 2017 Booking spent $4.1 billion in performance advertisingย channels generate a significant amount of traffic to Booking Holding websites. Those expenses primarily comprise
referrals from meta-search and travel research websites
affiliate programs
other performance-based advertisements
Brand advertising spending was $392 million in 2017. Those expenses primarily consist of television advertising, online video advertising, and online display advertising.
Google is coming: Will Google threaten Booking business model?
Over the years Booking has been able to keep growing thanks to its expansion, acquisition of other brands, and its ability to create a sticky platform for its users. At the same time, most of the traffic that goes toward its sites comes from performance-based advertising, and a good chunk of it is paid traffic via Google.
As Google enters more and more into travel-related services (see Google Flights), it becomes harder for Booking to keep a competitive business model able to continue gaining traction. Therefore, Google does represent a threat for Booking sustainability in its businessmodel.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
