Expedia Group Inc (EXPE) 2005 Q2 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the Expedia second-quarter 2005 earnings conference call. At this point, all the participant lines are in a listen-only mode. However, there will be an opportunity for your questions, and instructions will be given at that time. (OPERATOR INSTRUCTIONS). And as a reminder, today's call is being recorded.

女士們先生們，謝謝你們的支持。歡迎參加 Expedia 2005 年第二季財報電話會議。此時，所有參與線路都處於只聽模式。但是，您將有機會提問，屆時將給予說明。 （操作員說明）。提醒一下，今天的通話正在錄音。

I would now like to turn the conference over to the Vice President, Investor Relations, Mr. Stu Haas. Please go ahead, sir.

我現在將會議交給投資者關係副總裁 Stu Haas 先生主持。請繼續，先生。

Good morning and welcome to Expedia, Inc.'s financial results conference call for the second quarter ended June 30, 2005. Joining us on today's call are Barry Diller, Expedia, Inc.'s Chairman; and Dara Khosrowshahi, our CEO.

早安，歡迎參加 Expedia, Inc. 截至 2005 年 6 月 30 日的第二季財務業績電話會議。參加今天電話會議的有 Expedia, Inc. 董事長 Barry Diller；以及我們的執行長達拉·科斯羅薩西 (Dara Khosrowshahi)。

The following discussion and responses to your questions reflect management's views as of today, August 2, 2005, only and will include forward-looking statements. Actual results may differ materially. Additional information about factors that could potentially impact our financial results is included in today's press release and the Company's filings with the SEC, including IAC/InterActiveCorp.'s 2004 Annual Report on Form 10-K, as well as Form S-4 and amendments thereto filed in relation to the spin-off transaction of IAC's travel and travel-related assets.

以下討論和您問題的答案僅反映了截至今天（2005 年 8 月 2 日）管理層的觀點，並且將包含前瞻性陳述。實際結果可能存在重大差異。有關可能影響我們財務表現的因素的更多資​​訊包含在今天的新聞稿和公司向 SEC 提交的文件中，其中包括 IAC/InterActiveCorp. 的 2004 年年度報告表 10-K 以及表 S-4 和修正案該文件涉及IAC 旅行和旅行相關資產的分拆交易。

As you listen to today's call, we encourage you to have our press release in front of you, which includes our financial results as well as metrics and commentary on the quarter.

當您收聽今天的電話會議時，我們鼓勵您閱讀我們的新聞稿，其中包括我們的財務表現以及本季度的指標和評論。

During this call, we will discuss certain non-GAAP financial measures. In our press release and our filings with the SEC -- each of which is posted on the IR website at IAC.com/investors -- you will find additional disclosures regarding these non-GAAP measures, including reconciliations of these measures with comparable GAAP measures. The results to be discussed in this call relate to the travel and travel-related businesses, subsidiaries, and investments that will be part of Expedia, Inc. following the spin-off from IAC/InterActiveCorp.

在本次電話會議中，我們將討論某些非公認會計準則財務指標。在我們的新聞稿和向SEC 提交的文件中（每份文件均發佈在IAC.com/investors IR 網站上），您會發現有關這些非GAAP 衡量標準的其他披露信息，包括這些衡量標準與可比GAAP衡量標準的調節表。本次電話會議討論的結果涉及旅遊和旅遊相關業務、子公司和投資，這些業務、子公司和投資將在從 IAC/InterActiveCorp 分拆後成為 Expedia, Inc. 的一部分。

The spin-off is expected to occur next week with IAC and Expedia, Inc. beginning trading as independent public companies on August 9, 2005. We strongly encourage you to review the sections entitled "The Spin-Off" and "Basis of Presentation" in today's earnings release for more details and how we are presenting results for the periods ended June 30, 2005. Finally, unless otherwise stated, all comparisons in this call will be against our results for the comparable period of 2004.

分拆預計將於下週進行，IAC 和 Expedia, Inc. 將於 2005 年 8 月 9 日開始作為獨立​​上市公司進行交易。我們強烈建議您閱讀標題為“分拆”和“演示基礎”的部分請請參閱今天的收益報告，以了解更多詳細資訊以及我們如何呈現截至2005 年6 月30 日的業績。最後，除非另有說明，本次電話會議中的所有比較都將與2004 年可比期間的業績進行比較。

And with that, let me turn the call over to Barry for some introductory remarks.

接下來，讓我將電話轉給巴里，讓他做一些介紹性發言。

Well, good morning again, at least I presume for some of you, probably many of you. I think in the future, probably we will not do these calls one after another. But time will tell for the next quarter. But by the next quarter, the companies will be formally separated. And I think that some of this one trading under the other kind of complications, confusions of just meeting the spin date will have passed us by. So thanks for taking the time to listen in. On this though is Expedia's first standalone earnings call. I want to make some very brief remarks before letting Dara take you through the businesses in the quarter.

好吧，再次早上好，至少我想對你們中的一些人來說，可能是你們中的許多人。我想，將來我們可能不會再接二連三地打這些電話了。但時間會在下個季度給出答案。但到下個季度，兩家公司將正式分拆。我認為，在另一種複雜情況下進行的一些交易，以及剛剛滿足旋轉日期的混亂將會過去。感謝您抽出寶貴時間收聽。不過，這是 Expedia 的第一次獨立財報電話會議。在讓 Dara 帶您了解本季的業務之前，我想先做一些非常簡短的評論。

Some 7 months ago, back in December of 2004, we announced the intended spin-off of IAC's travel assets. What the spin does -- what it is intended to do -- is to allow each of these companies to increase the clarity and focus of their operations. Clarity for investors -- they analyze historical results and forecast the future prospects of their respective entities. And focus for the management and employee teams as they go about the business of enhancing shareholder value over the long-term with an equity currency that allows them the utmost flexibility to adapt to changing competitive landscapes.

大約 7 個月前，也就是 2004 年 12 月，我們宣布打算分拆 IAC 的旅遊資產。分拆的目的——它的目的——是讓這些公司提高其營運的清晰度和重點。為投資者提供清晰的資訊—他們分析歷史結果並預測各自實體的未來前景。並專注於管理層和員工團隊，因為他們致力於透過股本貨幣長期提高股東價值，使他們能夠擁有最大的靈活性來適應不斷變化的競爭格局。

What has not changed is the commitment of both IAC and Expedia to provide insightful disclosure to help investors assess these businesses -- all the good, all the warts for all to see. And I hope you will be more than pleased with what the Expedia earnings release on our call here today have to offer on that.

不變的是 IAC 和 Expedia 的承諾，即提供富有洞察力的披露信息，幫助投資者評估這些業務——所有的優點和缺點都有目共睹。我希望您會對我們今天在電話會議上發布的 Expedia 財報所提供的內容感到非常滿意。

Earlier, we announced the renewal and the expansion of our strategic partnership with Microsoft MSN properties. There is a separate release on this. But what is very exciting is the broadening of the relationship to include, not just Expedia properties across the world, but also the other powerful brands under the Expedia umbrella -- namely, Hotels.com, Hotwire, and TripAdvisor. Just as our diverse brand portfolio maximizes Expedia's relevance for travel customers, it also greatly enhances its appeal to travel suppliers and strategic partners, such as Microsoft.

早些時候，我們宣布續簽並擴大與 Microsoft MSN 的策略合作夥伴關係。對此有一個單獨的版本。但令人興奮的是，雙方關係不斷擴大，不僅包括全球各地的 Expedia 酒店，還包括 Expedia 旗下的其他強大品牌，即 Hotels.com、Hotwire 和 TripAdvisor。正如我們多元化的品牌組合最大限度地提高了 Expedia 與旅遊客戶的相關性一樣，它也大大增強了其對旅遊供應商和策略合作夥伴（例如 Microsoft）的吸引力。

And the reason that I am especially highlighting this today, as Expedia returns to the stand-alone public ownership, is that it all began with Microsoft. Without their very early and consistent support with a totally unproven concept for online travel, there would be no Expedia. It is really a great complement to Microsoft that they nurtured that always messy and costly early effort during the primordial soup era of online commerce. And then, that an extremely talented and entrepreneurial group of Microsoft engineers and product managers leveraged the combined power of the PC and the Internet to transform the way people around the world plan and purchase travel.

隨著 Expedia 回歸獨立公有製，我今天特別強調這一點的原因是，這一切都是從微軟開始的。如果沒有他們早期對完全未經證實的線上旅遊概念的持續支持，就不會有 Expedia。這確實是對微軟的一個很好的補充，他們在線上商務的原始湯時代培育了總是混亂且成本高昂的早期努力。然後，由 Microsoft 工程師和產品經理組成的極具才華和創業精神的團隊利用 PC 和互聯網的綜合力量改變了世界各地人們計劃和購買旅行的方式。

Microsoft unveiled Expedia.com to the world in October 1996. And by early 2001, Expedia had leap-frogged its competitors and achieved the leadership position in online travel, a tremendous feat that deserves our continuing respect for the founders and all who worked then and now at the Company during its formative years.

微軟於1996 年10 月向全世界推出了Expedia.com。到2001 年初，Expedia 已經超越了競爭對手，取得了在線旅遊領域的領導地位，這是一項巨大的壯舉，值得我們繼續向創始人和當時的所有工作人員表示敬意。現在在公司的形成時期。

That leadership position, I might add, has held and steadily grown since 2002. In fact, since the time IAC had the good fortune to acquire Expedia in full 2 years ago at the $7 billion mark in gross bookings, we returned the new Expedia, Inc. to the public markets with nearly double that level of gross bookings and a truly global position.

我要補充的是，自2002 年以來，這一領先地位一直保持著並穩步增長。事實上，自從2 年前IAC 有幸以70 億美元的總預訂量全面收購Expedia 以來，我們就歸還了新的Expedia， Inc. 以近兩倍的總預訂量和真正的全球地位進入公開市場。

As we prepare to spin off the travel companies formally comprising IAC Travel, we are confident Expedia, Inc. will continue to build on the legacy that sprang from Microsoft's early efforts.

當我們準備分拆正式組成 IAC Travel 的旅遊公司時，我們相信 Expedia, Inc. 將繼續在 Microsoft 早期努力的基礎上繼續發展。

So with that, over to you, Dara, and the businesses.

那麼，就交給你了，達拉和企業。

Thanks, Barry. And welcome to everyone joining us in this morning's call. I'm going to quickly review the financials and then move on to some more qualitative comments. But as it does relate to our financials, I do want to remind everyone that we are presenting the results on a combined historical basis for the businesses formally comprising IAC Travel, excluding TVTS and Interval and including TripAdvisor.

謝謝，巴里。歡迎大家參加今天早上的電話會議。我將快速回顧一下財務狀況，然後進行一些更定性的評論。但由於它確實與我們的財務狀況有關，我確實想提醒大家，我們是在綜合歷史基礎上呈現正式組成 IAC Travel 的業務的結果，不包括 TVTS 和 Interval，包括 TripAdvisor。

This was a good quarter for Expedia, and we're very pleased with our first-half performance. Gross bookings for the quarter grew 26% to just over 4 billion. This is an acceleration from the year-over-year growth rates that we have seen in the prior 2 quarters. International gross bookings grew strongly at 73% to 909 million, and domestic gross bookings grew 17% to 3.2 billion.

對於 Expedia 來說，這個季度表現不錯，我們對上半年的表現非常滿意。該季度的總預訂量增加了 26%，達到略高於 40 億。這比我們在前兩個季度看到的同比增長率有所加速。國際總預訂量強勁成長 73%，達到 9.09 億，國內總預訂量成長 17%，達到 32 億。

Many of you know, gross bookings are the rawest indicator of commerce volume being generated throughout our worldwide points of sale, without regard to the relative economic benefit we derive from those transactions against our supplier partners.

很多人都知道，總預訂量是我們全球銷售點產生的商業量的最原始指標，而不考慮我們從與供應商合作夥伴的這些交易中獲得的相對經濟利益。

Revenue, which is essentially Expedia's share of this gross booking value, rose 14% in the second quarter to 555 million, primarily driven by the international merchant hotel business, acquisitions and our air business. Excluding the impact of acquisitions, second-quarter growth was up 9%. For the first half of 2005, our revenue growth was 16% or 11%, excluding the impact of acquisitions.

收入（本質上是 Expedia 在總預訂價值中所佔的份額）在第二季度增長了 14%，達到 5.55 億美元，這主要是由國際商務酒店業務、收購和我們的航空業務推動的。剔除收購的影響，第二季成長9%。 2005年上半年，剔除收購的影響，我們的營收成長率為16%或11%。

Continuing down the income statement, selling and marketing expense increased 10%, including a 60% increase in our international spend, as we continue to support these new businesses, build name recognition for Expedia in international markets, and prepare for future country launches.

繼續關注損益表，銷售和行銷費用增加了10%，其中國際支出增加了60%，因為我們將繼續支持這些新業務、為Expedia 在國際市場上建立知名度，並為未來在各個國家/地區的推出做好準備。

As a reminder, second quarter 2004 included a reversal of a $6.4 million charge associated with the resolution of a contract dispute. Excluding this one-time item, selling and marketing increased 6% versus the prior-year period.

提醒一下，2004 年第二季沖銷了與解決合約糾紛相關的 640 萬美元費用。排除這項一次性項目，銷售和行銷比去年同期成長了 6%。

As a reminder from our Q1 call, we have made a conscious decision to more evenly spread our marketing spend throughout the year versus our past practice of front-loading spend. So we do expect to see higher growth in the back half of the year versus the 7% growth in the first half spend. And given our desire to build our international presence and the continuing competitive environment in pay, search and other online marketing vehicles -- we do expect absolute amount spent in sales and marketing to continue to increase over time.

第一季電話會議提醒我們，我們有意識地決定，與過去提前支出的做法相比，更均勻地分配全年的行銷支出。因此，我們確實預計今年下半年的支出將比上半年的 7% 成長更高。考慮到我們希望建立國際影響力以及支付、搜尋和其他線上行銷工具方面持續的競爭環境，我們確實預計銷售和行銷支出的絕對金額將隨著時間的推移而繼續增加。

I want to emphasize that the anticipated increases in sales and marketing do not mean that we are shifting our focus from continuing to drive efficiencies in our marketing spend. We are pleased with our initial efforts on this front, but we still have a lot of work to do to make sure we are driving efficient ROI with our marketing budgets.

我想強調的是，預期的銷售和行銷成長並不意味著我們將重點從持續提高行銷支出效率上轉移。我們對我們在這方面的初步努力感到滿意，但我們仍然有很多工作要做，以確保我們透過行銷預算提高有效的投資報酬率。

G&A expense increased 16% versus the prior year. The second quarter includes an estimated 1.2 million related to costs incurred in connection with the spin-off. Please note as you think about forecasting results that G&A on a historical combined basis would not include any amounts we expect to incur going forward as a stand-alone public company. In addition, we do plan to increase our headcount in various areas, especially as we continue to invest aggressively in product development to ensure that we continue to deliver the best on-site experience that our customers deserve.

G&A 費用比前一年增加 16%。第二季包括估計 120 萬美元與分拆相關的成本。請注意，當您考慮預測結果時，歷史合併基礎上的一般管理費用不包括我們作為一家獨立上市公司預計未來產生的任何金額。此外，我們確實計劃增加各個領域的員工人數，特別是我們繼續積極投資於產品開發，以確保我們繼續提供客戶應得的最佳現場體驗。

Operating income before amortization is a primary internal metric used to evaluate our business. And for the second quarter, it grew 15% or 17%, excluding 3.3 million in net benefit from acquisitions and a 6.4 million prior-year benefit from the reversal of the contractual dispute. For the first half of the year, OIBA grew 24% or 21%, excluding acquisitions and the reversal.

攤銷前營業收入是用於評估我們業務的主要內部指標。第二季成長了 15% 或 17%，不包括收購帶來的 330 萬美元淨收益和合約糾紛逆轉帶來的 640 萬美元上年收益。今年上半年，不包括收購和逆轉，OIBA 成長了 24% 或 21%。

Operating income before amort -- margins continued to expand, up 147 basis points in the second quarter after adjusting for the legal settlement reversal. Operating leverage or flow-through was 42% during the second quarter after accounting for these adjustments.

攤銷前營業收入－利潤率繼續擴大，在對法律和解逆轉進行調整後，第二季上升了 147 個基點。考慮到這些調整後，第二季的營運槓桿或資金流通率為 42%。

Operating income growth was 31% during the quarter, significantly higher than OIBA growth, as amortization expenses were essentially flat versus the prior-year quarter. Below the operating income line, I also want to highlight some differences between the historical statements and what we anticipate going forward as a result of the spin. First, our interest expense is likely to increase, as we've signed a 1 billion, 5-year revolving Credit Facility; on which, we will incur interest, facility fee and other charges going forward. We anticipate caring an outstanding balance on the facility throughout the remainder of this year. Further details about this facility and anticipated charges are included in our 8-K filings on July 14th and July 17th of 2005 with also an S-4 filing.

本季營業收入成長 31%，顯著高於 OIBA 成長，因為攤銷費用與去年同期基本持平。在營業收入線下方，我還想強調歷史報表與我們對分拆結果的預期之間的一些差異。首先，我們的利息支出可能會增加，因為我們簽署了10億、5年的循環信貸安排；我們將因此產生利息、設施費和其他費用。我們預計今年剩餘時間該設施將保持良好的平衡。有關該設施和預期費用的更多詳細資訊包含在我們 2005 年 7 月 14 日和 7 月 17 日提交的 8-K 文件以及 S-4 文件中。

In addition, it is expected that post-spin, we will begin with approximately 100 million in cash and cash equivalents and restricted cash, excluding the cash of eLong, which is shown consolidated on our balance sheet. Therefore, the interest income that we earn going forward will be significantly lower than what we show on the combined historical statements.

此外，預計分拆後，我們將擁有約1億現金和現金等價物以及限制性現金，不包括藝龍的現金，該現金已在我們的資產負債表中合併顯示。因此，我們未來賺取的利息收入將大大低於我們在合併歷史報表中所顯示的水平。

Now, let me talk a bit about business trends and what we are seeing for the balance of the year. We are obviously pleased with our year-to-date performance versus our first-half expectations. Early gross bookings results in July, however, have been affected by certain exogenous factors, including the bombings in London and hurricanes in Florida. It is too soon to tell how and whether these factors will affect our balance of the year results. And as a result, we don't think it is appropriate to change our previously stated outlook of mid to low teens OIBA growth for the full year at this time.

現在，讓我談談商業趨勢以及我們對今年餘下時間的看法。與上半年的預期相比，我們顯然對今年迄今為止的表現感到滿意。然而，7 月的早期總預訂量結果受到了某些外部因素的影響，包括倫敦爆炸事件和佛羅裡達州颶風。現在判斷這些因素如何以及是否會影響我們的年度業績還為時過早。因此，我們認為此時改變我們先前提出的全年中低青少年 OIBA 成長前景並不合適。

With that bit of housekeeping complete, let me turn to the strategic and operational side of our business and an update on the areas of focus we laid out on the last couple of calls. As you heard earlier, our international business continues to grow nicely. And international revenues as a percentage of total revenue increased to 21% from 15% in the prior-year period.

完成這些內務處理後，讓我談談我們業務的策略和營運方面，以及我們在最後幾次電話會議中列出的重點領域的最新情況。正如您之前所聽到的，我們的國際業務繼續良好成長。國際收入佔總收入的比例從去年同期的 15% 上升至 21%。

While we are optimistic about our ability to grow our international business over the long term, we have felt those sect (ph), as I mentioned, of the recent events in London on our gross bookings growth. Additionally, we do expect to continue investing aggressively in China through eLong to build awareness and our customer experience, as well as our upcoming Asia Pacific markets.

雖然我們對長期發展國際業務的能力持樂觀態度，但正如我所提到的，我們也感受到了倫敦最近發生的事件對我們總預訂量成長的影響。此外，我們確實希望透過藝龍繼續在中國積極投資，以提高知名度和我們的客戶體驗，以及我們即將到來的亞太市場。

Hotels.com continues to work largely behind the scenes on its hotel expert rebranding strategy. We have seen improvements the last two quarters in gross bookings growth. And for the first time ever, Hotels.com eclipsed 500 million in quarterly gross bookings. Hotels continue to add properties during the second quarter, including the new Wynn Las Vegas and Mandalay Group Properties in Vegas, as well as improve its hotel content. We're hopeful that our rebranding execution in upcoming quarters will augment the positive growth trend, particularly as we approach the back half of the year with easier comparables for the Hotels.com business.

Hotels.com 繼續在幕後主要實施其酒店專家品牌重塑策略。我們看到過去兩個季度總預訂量成長有所改善。 Hotels.com 的季度總預訂量首次突破 5 億。酒店在第二季度繼續增加物業，包括拉斯維加斯的新永利酒店和曼德勒集團在維加斯的酒店，並改善其酒店內容。我們希望未來幾季的品牌重塑執行將增強積極的成長趨勢，特別是隨著我們接近今年下半年，Hotels.com 業務的可比性變得更加容易。

On the supply relations front, last month, we announced the formation of a centralized global Partner Services Group. This is a key initiative for the Company, as it brings our relationships with hotel, air and other travel suppliers under one roof. This allows suppliers easier access through our multiple points of sale. It also presents an opportunity for us to focus and improve our supply relationships across all product groups in all geographies. We continue to work closely with our supplier partners and just recently announced the addition of Budget, Payless, and Europcar for a Platinum Marketing Program, which guarantees rental car customers access to the same low rates found anywhere else, including the rental cars' companies' own websites. The program also features guarantees of excellent customer care and special offers for Expedia's customers.

在供應關係方面，上個月，我們宣布成立一個集中的全球合作夥伴服務集團。這是公司的一項重要舉措，因為它將我們與酒店、航空和其他旅行供應商的關係融為一體。這使得供應商可以更輕鬆地透過我們的多個銷售點進行存取。它還為我們提供了一個機會，可以集中精力並改善我們在所有地區的所有產品組的供應關係。我們繼續與我們的供應商合作夥伴密切合作，最近剛剛宣布將 Budget、Payless 和 Europcar 納入白金行銷計劃，保證租車客戶能夠享受與其他地方（包括租車公司）相同的低費率。自己的網站。該計劃還保證為 Expedia 的客戶提供卓越的客戶服務和特別優惠。

Our decision to form the Partner Services Group is the first and most tangible outcome of the strategic review we undertook back in May of this year internally code named "Project Apollo." Apollo's charter was to find innovative ways to best leverage a Company's core assets with particular emphasis on our ongoing branding strategy and resolving potential operating efficiencies arising from these brand silos. While we're still in the early stages of planning our execution for Apollo, our preliminary estimates are that we could see 50 million or more in annual operating efficiencies. We're early in the process, but we do expect to see some of these efficiencies begin to appear in 2006. Project Apollo and the Partner Services Group are both good examples of another piece of our 2005 game plan, which is using the Company's scale to its advantage.

我們組成合作夥伴服務小組的決定是我們今年 5 月進行的策略審查的第一個也是最切實的成果，內部代號為「阿波羅計畫」。 Apollo 的宗旨是尋找創新方法來最好地利用公司的核心資產，特別強調我們持續的品牌策略並解決這些品牌孤島帶來的潛在營運效率問題。雖然我們仍處於阿波羅計畫執行的早期階段，但我們的初步估計是我們可以看到每年 5,000 萬或更多的營運效率。我們還處於這個過程的早期階段，但我們確實希望看到2006 年開始出現一些效率。阿波羅計畫和合作夥伴服務小組都是我們2005 年計畫的另一個很好的例子，該計畫利用了公司的規模以其優勢。

Similar to using scale, we are focused on improving marketing efficiencies in 2005 and beyond. First-half sales and marketing as a percentage of revenue improved 250 basis points year-over-year or 326 basis points, excluding the litigation settlement reversal in Q2 of 2004. Some of this improvement is certainly due to more evenly spread marketing dollars, and we don't at this time expect to see this large an improvement in the second half of the year. But we also believe some of our work on improving spend ROI is bearing fruit. We will continue to remain focused on this, as 1 of every $3 of our revenues goes to sales and marketing spend.

與利用規模類似，我們致力於提高 2005 年及以後的行銷效率。上半年銷售和行銷佔收入的百分比比去年同期提高了250 個基點或326 個基點（不包括2004 年第二季度的訴訟和解逆轉）。這種改善的部分原因肯定是由於行銷費用分佈更加均勻，以及目前我們預計下半年不會有這麼大的改善。但我們也相信，我們在提高支出投資報酬率方面的一些工作正在取得成果。我們將繼續關注這一點，因為我們每 3 美元的收入就有 1 美元用於銷售和行銷支出。

I am going to close with the strides we continue to make on our wider brand portfolio, beginning with our flagship, Expedia.com, where we saw strong growth bookings growth and continuing innovation, including the buildup of over 50,000 traveler reviews of hotel properties. These are highly qualified reviews, as we require the customer to log a paid stay of the property prior to submitting a review. They are for real. We also introduced our "Air Seats Going Fast" feature, where customers are alerted when a given fare has only a few seats remaining at that price.

最後，我將以我們在更廣泛的品牌組合上繼續取得的進步作為結束語，從我們的旗艦產品Expedia.com 開始，我們看到了預訂量的強勁增長和持續的創新，包括積累了超過50,000 條酒店物業的旅客評論。這些都是高品質的評論，因為我們要求客戶在提交評論之前記錄該酒店的付費住宿情況。他們是真的。我們也推出了「航空座位快速搶購」功能，當特定票價只剩下幾個座位時，乘客會收到提醒。

In addition, just yesterday, we introduced our Hassle-free Hurricane Promise. This promise is simply the latest reflection of our dedication on providing excellent customer service. Should customers need to cancel or change their travel plans for destinations affected by a hurricane, Expedia.com travel specialists will waive any Expedia.com cancellation fees, advocate on behalf of the customers for travel partners to do the same, and provide new travel options for consideration -- all to help provide travelers piece of mind during this year's hurricane season. We plan to continue innovating for our customers and suppliers, and we plan to continue working hard to deliver best-in-class customer service.

此外，就在昨天，我們推出了無憂颶風承諾。這項承諾只是我們致力於提供卓越客戶服務的最新體現。如果客戶需要取消或更改前往受颶風影響的目的地的旅行計劃，Expedia.com 旅遊專家將免除 Expedia.com 的任何取消費用，並代表客戶建議旅遊合作夥伴也這樣做，並提供新的旅行選擇供考慮——所有這些都是為了幫助旅行者在今年的颶風季節保持安心。我們計劃繼續為客戶和供應商創新，並計劃繼續努力提供一流的客戶服務。

Moving on to some of the brands, I wanted to touch on TripAdvisor, the world's most popular travel information website. I just checked the site before the call, and it now has over 2.3 million reviews and opinions of hotels, attractions, and restaurants across the world. We have recently enabled our traveler enthusiast to post photographs of their stay, which adds to the incredible variety of content that helps consumers when deciding what hotel to stay at and what to do once they get there.

說到一些品牌，我想談談 TripAdvisor，世界上最受歡迎的旅遊資訊網站。我剛剛在打電話前檢查了該網站，現在它有超過 230 萬條關於世界各地酒店、景點和餐廳的評論和意見。我們最近讓旅行者愛好者可以發布他們住宿的照片，這增加了令人難以置信的內容多樣性，可以幫助消費者決定入住哪家酒店以及到達那裡後做什麼。

Hotwire continued its strong execution in a tough environment with high load factors and low prices by augmenting their original opaque product with both semi-opaque and retail air offerings. Despite these challenges, Hotwire saw solid profitability gains in the first half of the year versus 2004. The availability of opaque and semi-opaque products in the Expedia portfolio provides value to both our customers and our suppliers.

Hotwire 透過以半透明和零售空氣產品增強其原有的不透明產品，在高負載率和低價格的嚴峻環境中繼續保持強勁的執行力。儘管面臨這些挑戰，與 2004 年相比，Hotwire 上半年的盈利能力仍然強勁增長。Expedia 產品組合中不透明和半透明產品的可用性為我們的客戶和供應商提供了價值。

Classic Custom Vacations is executing on its path to profitability and its mission to tailor a luxury vacation for travel agent customers and ultimately the end consumer. And meanwhile, Expedia Corporate Travel, or ECT, had another successful quarter signing up one of its largest clients to date, a global company with 30 to $40 million in annual travel spend. ECT has worked closely with Southwest Airlines, and our corporate clients can now book Southwest within the ECT platform on any city pair served by Southwest.

Classic Custom Vacations 正在走上獲利之路，履行為旅行社客戶乃至最終消費者量身定制奢華假期的使命。同時，Expedia Corporate Travel (ECT) 又一個成功的季度與其迄今為止最大的客戶之一簽約，這是一家年旅行支出達 30 至 4000 萬美元的跨國公司。 ECT 與西南航空密切合作，我們的企業客戶現在可以在 ECT 平台內預訂西南航空飛往的任何城市對的航班。

From a leadership perspective, we were very pleased last month to name Cheryl Rosner as the new president of ECT. Cheryl was previously Head of our Hotels.com business in Dallas, and she brings extensive sales, leadership and travel industry experience to the ECT team.

從領導力的角度來看，我們上個月非常高興任命 Cheryl Rosner 為 ECT 的新總裁。 Cheryl 曾擔任達拉斯 Hotels.com 業務的負責人，她為 ECT 團隊帶來了豐富的銷售、領導力和旅遊業經驗。

In closing, I want to bring us back to Barry's opening. In the post-spin world, Expedia, Inc. will have a better opportunity than ever to leverage its brand to leadership position in the online travel industry. We have a great base from which to build it. But we also have lots of executional challenges to overcome, and we must do so in an environment that is very competitive. So we are up for the fight, and we're focused as ever on growing long-term shareholder value. Okay, Stu, let's take some questions.

最後，我想讓我們回到巴里的開場白。在後旋轉世界中，Expedia, Inc. 將有比以往更好的機會利用其品牌在線上旅遊業中佔據領導地位。我們擁有良好的基礎來建構它。但我們還需要克服許多執行上的挑戰，而且我們必須在競爭非常激烈的環境中做到這一點。因此，我們已經做好了戰鬥的準備，並且一如既往地專注於增加長期股東價值。好的，斯圖，我們來回答一些問題。

Great, thanks, Dara. Let's move on to the Q&A portion of the call with Dara and Barry. As a reminder, please limit yourself to one question. Operator, will you please remind our listeners how to ask a question.

太好了，謝謝，達拉。讓我們繼續與 Dara 和 Barry 進行電話問答部分。提醒一下，請限制自己回答一個問題。接線員，請您提醒我們的聽眾如何提問。

(OPERATOR INSTRUCTIONS). Anthony Noto, Goldman Sachs.

（操作員說明）。安東尼·諾托，高盛。

My first question is on -- marketing has obviously been a lever that you have been optimizing, and that has helped with the profitability. As I look at the gross bookings share of the major third-party travel aggregators, so ISE travel in total -- Orbitz, Orbitz, Priceline and Travelocity -- it looks like on a sequential basis, the Company has lost a little bit of share, as you probably have traded off some share for profitability. And I am just wondering, do you think you could continue to do that? And is that the plan, as you try to smooth out the marketing spend?

我的第一個問題是——行銷顯然是你們一直在優化的槓桿，這有助於提高獲利能力。當我查看主要第三方旅遊聚合商的總預訂份額時，ISE 旅行總計——Orbitz、Orbitz、Priceline 和 Travelocity——看起來按順序來看，該公司失去了一點份額，因為您可能為了盈利而犧牲了一些份額。我只是想知道，你認為你可以繼續這樣做嗎？當您試圖平滑行銷支出時，這就是計劃嗎？

And then the second question as it relates to mix shift to agency revenue, it is obviously up on a year-over-year basis and it's hurting your net rate a little bit. Is there a mix shift to agency in that there's just a greater percentage of air tickets that are being purchased? Or is there a mix shift within hotels in that people are switching from merchant hotels to agency hotels? And if so, what is the underlying driver of that?

第二個問題與代理收入的混合轉移有關，它顯然同比增長，並且對您的淨利率造成了一些影響。是否存在向代理商的混合轉變，因為購買的機票比例更高？或者酒店內部是否存在混合轉變，人們從商業酒店轉向代理酒店？如果是這樣，其根本驅動因素是什麼？

And then last, Dara, could you just clarify the point about hurricanes? I cover what Walt Disney Company as well, and last year, this summer was just horrendous for hurricanes in Florida specifically. With the month of August actually closing down the parks a couple of times. But I haven't really seen any specific hurricanes in Florida this year. Is it fear of hurricanes or actual events that we're not aware of? Thanks.

最後，達拉，你能澄清一下關於颶風的問題嗎？我還報道了華特迪士尼公司，去年，今年夏天佛羅裡達州的颶風尤其可怕。八月份，公園實際上關閉了幾次。但今年我在佛羅裡達州還沒有真正看到任何具體的颶風。是對颶風的恐懼還是對我們不知道的實際事件的恐懼？謝謝。

Anthony, let me take those answers in opposite order. So on hurricanes, what I was referring to is -- in July, the big hurricane in Florida, we certainly felt its effect and its anticipated effect. It certainly wasn't as bad as people kind of anticipated it to be. So that did affect our July gross bookings. Obviously, August will be what it is. We did feel it last August. And again, we will see what happens on a go-forward basis.

安東尼，讓我以相反的順序回答這些問題。所以關於颶風，我指的是——七月佛羅裡達州的大颶風，我們當然感受到了它的影響和預期的影響。它當然沒有人們預期的那麼糟。所以這確實影響了我們 7 月的總預訂量。顯然，八月將會是這樣。去年八月我們確實感覺到了。再次，我們將看看未來會發生什麼。

On the agency -- on your question on agency bookings -- the mix in shift relates to air tickets. So one is the number of air tickets increased 21% on a year-over-year basis. And also the average price per air ticket has increased very significantly year-over-year, which creates the mix in shift. We are not seeing any kind of significant mix in shift between merchant and agency hotel bookings.

關於代理商 - 關於您關於代理商預訂的問題 - 輪班組合與機票有關。其中之一就是機票數量較去年同期增加了21%。而且，每張機票的平均價格年增率非常顯著，這造成了輪班組合。我們沒有看到商家和代理商飯店預訂之間有任何重大轉變。

And then as far as the share question goes, let me first start by saying that the top priority for us is not necessarily our competitors but building a big business over the long term. And if we execute for our leader customers or corporate customers or suppliers, we think we will be a winner long term. It is a huge market; it's an $850 billion market worldwide. And we think there can be plenty of winners out there.

就股票問題而言，我首先要說的是，我們的首要任務不一定是我們的競爭對手，而是建立長期的大業務。如果我們為我們的領先客戶、企業客戶或供應商執行任務，我們認為我們將成為長期贏家。這是一個巨大的市場；這是一個價值 8500 億美元的全球市場。我們認為可能會有很多贏家。

But specifically in relation to share, what you do have to take into account is that a number of our competitors in the online travel space are building their base -- they are building their revenue off of much smaller bases than we have. So one of our competitors for example announced year-over-year -- pretty high percentage year-over-year increases. And call it a $450 million increase in gross bookings quarter-over-quarter, which is a big increase. But if you compare that to our increase, we actually increased our gross bookings by 850 million year-over-year.

但具體到份額方面，你必須考慮到的是，我們在線旅遊領域的許多競爭對手正在建立自己的基礎——他們的收入基礎比我們小得多。例如，我們的一個競爭對手宣布同比增長相當高。總預訂量較上季增加了 4.5 億美元，這是一個很大的成長。但如果你將其與我們的成長進行比較，我們的總預訂量實際上比去年同期增加了 8.5 億。

So I certainly don't -- from a dollar share standpoint, we are gaining dollar share from a percentage standpoint because we are growing off of a much, much bigger base -- the percentages look smaller. But we certainly are not losing dollar share.

所以我當然不認為——從美元份額的角度來看，從百分比的角度來看，我們正在獲得美元份額，因為我們的成長基礎要大得多——百分比看起來更小。但我們肯定不會失去美元份額。

And lastly, it's your point, which is -- you have to keep profitability in mind, right? Our long-term goal is to grow the business profitably. And our trailing 12-month operating income before amortization is over $600 dollars. We have cash flow, free cash flow of $876 million in the last 12 months. So I think we are able to get profitable growth in a way that certainly our competitors have not been able to match yet.

最後，這是你的觀點，即──你必須牢記獲利能力，對嗎？我們的長期目標是實現業務獲利成長。我們過去 12 個月的攤銷前營業收入超過 600 美元。過去 12 個月我們的現金流、自由現金流為 8.76 億美元。因此，我認為我們能夠以我們的競爭對手尚無法匹敵的方式實現獲利成長。

Jake Fuller, Thomas Weisel Partners.

傑克‧富勒，湯瑪斯‧韋塞爾合夥人。

Could you talk to me a little bit about the trend in U.S. merchant room nights? Was that flat? Was that down? And also, the scale of losses, if any, in the international and corporate side of the business?

能跟我談談美國商務房住宿的趨勢嗎？那是平坦的嗎？那是下來了嗎？此外，國際和企業業務方面的損失規模（如果有）？

What was the second question, I'm sorry?

抱歉，第二個問題是什麼？

The scale of losses, if there are any, on the international and corporate side of the business?

國際和公司業務方面的損失規模（如果有）？

The room night growth in the U.S., we don't specifically disclose it, but it was consistent with Q1. And it was -- so we have not seen significant trends there. But overall room night growth, you saw the numbers; they are up 8%. Obviously, the international growth is stronger than domestic growth.

美國的間夜成長，我們沒有具體透露，但與第一季一致。確實如此，所以我們沒有看到明顯的趨勢。但整體間夜成長，你看到了數字；他們上漲了8%。顯然，國際成長強於國內成長。

We are encouraged by the progress in Hotels.com. The room night growth there has improved quarter-on-quarter, which has been partly responsible for our gross bookings getting better this quarter than the last 2 quarters.

我們對 Hotels.com 好訂網的進步感到鼓舞。那裡的間夜成長環比有所改善，這在一定程度上是我們本季的總預訂量比過去兩個季度更好的原因。

The international corporate business is doing actually very well. We have a great management team there. And it is running the business at close to breakeven. So we -- the business is actually pretty large; it is scaling very well. It is executing nicely in France. We are expanding in England now. And we are looking across Europe to see what kind of investments are appropriate. But overall, we are very happy with ECT worldwide and certainly in Europe as well.

國際企業業務實際上做得非常好。我們在那裡有一支優秀的管理團隊。而且該公司的業務運作接近收支平衡。所以我們——業務其實相當大；它的擴展性非常好。它在法國執行得很好。我們現在正在英格蘭擴張。我們正在歐洲各地尋找合適的投資類型。但總的來說，我們對全球的 ECT 非常滿意，當然在歐洲也是如此。

Dara, just to clarify -- what I was looking at was also the scale of losses for your international leisure business together with your corporate. Historically, you guys had talked about your U.S. business and then kind of everything else and talked about what the scale of losses were for everything else outside the U.S.?

達拉，我只是想澄清一下——我所關注的也是您的國際休閒業務以及您的公司的損失規模。從歷史上看，你們先討論了你們的美國業務，然後討論了其他所有業務，並討論了美國以外其他業務的損失規模是多少？

Yes, we make money internationally now. We have been -- international has been I would say solidly profitable for the Company since Q3 of last year. So part of the margin expansion that you see in the business is driven by international on a year-over-year basis. They are executing very well. And as of Q3 of last year, we were profitable internationally. We continue to be profitable. The biggest market for us internationally is the UK leisure market, and that is significantly profitable. The other markets are either unprofitable or not making a bunch of money. But it is really the UK market that is driving our international business from a profitability standpoint.

是的，我們現在在國際上賺錢。我想說，自去年第三季以來，我們一直在國際化方面為公司帶來了穩定的利潤。因此，您在業務中看到的部分利潤成長是由國際業務逐年推動的。他們執行得非常好。截至去年第三季度，我們在國際上實現了盈利。我們繼續獲利。我們最大的國際市場是英國休閒市場，利潤豐厚。其他市場要不是無利可圖，就是賺不到很多錢。但從獲利角度來看，真正推動我們國際業務發展的是英國市場。

Justin Post, Merrill Lynch.

賈斯汀·波斯特，美林證券。

I have two questions. First, it looks like in the U.S., you had 17% bookings growth and 6% revenue growth. I am just wondering when you think revenues -- is it may be sometime next year -- revenues really grow in line with bookings? Do you think there will ever be a catch-up? Or do you think the merchant hotel inventory margins continue -- raw margins continue to trend down longer term?

我有兩個問題。首先，在美國，預訂量增加了 17%，收入成長了 6%。我只是想知道你什麼時候認為收入——可能是明年的某個時候——收入真的會隨著預訂量的增長而增長嗎？你認為會有追趕的機會嗎？或者您認為商業酒店的庫存利潤率是否會持續下去——原始利潤率在長期內繼續呈下降趨勢？

I think there are some exogenous factors that affect revenue growth versus gross bookings growth that at this point, it is very hard for us to predict. One point is clearly this quarter, the increase in airfares helped gross bookings grow. But since our revenue on the air business is based on unit economics, it really doesn't have that much of an effect on revenue.

我認為有一些外生因素會影響營收成長與總預訂量成長，目前我們很難預測。一點顯然是，本季機票價格的上漲幫助了總預訂量的成長。但由於我們的航空業務收入是基於單位經濟效益，因此它實際上對收入沒有太大影響。

So to the extent that we see an environment on a go-forward basis of increasing revenue per ticket on the air business, you would see our raw margins naturally decline. It is a good thing for our partners, so we certainly like seeing higher ticket prices. And certainly with the load factors we see today, it is healthy for the business in general. It does cause lower raw margins for us.

因此，只要我們看到航空業務每張機票收入不斷增加的環境，您就會看到我們的原始利潤率自然下降。這對我們的合作夥伴來說是一件好事，所以我們當然希望看到更高的票價。當然，從我們今天看到的負載率來看，總體而言，這對業務來說是健康的。它確實導致我們的原始利潤降低。

That is a factor that is similar again in the merchant hotel business, which is -- as you see occupancy rates going up, the hotel ADRs go up, which is good for us. But in a -- if you step back and you look at the macro point of view in a very strong occupancy type of an environment, the distributors would tend to get lower raw margins, but higher ADRs would largely offset that. So you see that in our numbers as well, which is our revenue per room night on the hotel business is actually flat. We're naturally hedged.

這在商業酒店業務中也是一個類似的因素，即，當你看到入住率上升時，酒店平均房價也會上升，這對我們有利。但如果你退後一步，在入住率非常高的環境中從宏觀角度來看，分銷商往往會獲得較低的原始利潤，但較高的 ADR 將在很大程度上抵消這一影響。所以你也可以從我們的數據中看到，我們酒店業務每晚的收入實際上是持平的。我們自然會受到對沖。

On the other side of the coin, if we do get into a cyclical downturn, which we certainly don't anticipate, you would see ADRs come down, and you would probably see raw margins go up again. So a lot of the raw margins depend on kind of exogenous factors that we certainly cannot predict.

另一方面，如果我們確實陷入週期性衰退（我們當然沒有預料到），您會看到美國存託憑證下降，並且您可能會看到原始利潤率再次上升。因此，許多原始利潤取決於我們當然無法預測的外生因素。

The second question, just a housekeeping thing, I think you've said mid to low teens OIBA growth for 2005. Is that off of a number, I think, 553 for 2004 -- is that the number you're talking about?

第二個問題，只是一個內務管理問題，我認為您已經說過 2005 年 OIBA 增長率為中低水平。我認為，2004 年這個數字是 553，這是否超出了您所說的數字？

Stu is checking the number, but I believe that's correct. And we'll correct that if it is incorrect.

斯圖正在檢查號碼，但我相信這是正確的。如果不正確，我們會更正。

Heath Terry, CSFB.

希思·特里，CSFB。

Can you talk about your position right now as you try to expand relationships, particularly with the low-cost carriers? Obviously, Southwest has a pretty entrenched stance there. But as you try and expand the universe of airlines that you're working with, are you seeing any kind of softening of that stance with some of the others like JetBlue?

當您試圖擴大關係，特別是與廉價航空公司的關係時，您能談談您現在的立場嗎？顯然，西南航空在這方面的立場相當根深蒂固。但是，當您嘗試擴大與您合作的航空公司的範圍時，您是否發現捷藍航空等其他航空公司的立場有所軟化？

And then, if you could also talk a little bit about what you are seeing within TripAdvisor -- just what's going on within the advertising business, rates, sell-through, that kind of thing?

然後，您能否談談您在 TripAdvisor 中看到的情況——廣告業務、費率、銷售率等方面的情況？

As far as LCTs (ph) go, there's really no update to give you against last quarter or the last couple of quarters. We believe that we have a lot to offer as a distributor of travel products. We have seen Southwest for example appreciate that in our corporate business. And we are selling Southwest on ECT to our clients. So we are constantly talking to them. We would love to be selling their products as well, and we think over the long term, hopefully, we can come to terms.

就 LCT (ph) 而言，實際上沒有上季或過去幾季的更新資訊。我們相信，作為旅遊產品經銷商，我們可以提供很多服務。例如，我們已經看到西南航空公司在我們的企業業務中讚賞這一點。我們正在 ECT 上向客戶銷售西南航空。所以我們不斷地與他們交談。我們也很樂意銷售他們的產品，我們從長遠來看，希望我們能夠達成協議。

As is, we are very happy with our air partners. We think we've got a great product. You can see the gross bookings grow, increases -- our audience increases, etc. So certainly, it is not something that we are counting on.

事實上，我們對我們的航空合作夥伴非常滿意。我們認為我們有一個很棒的產品。你可以看到總預訂量的成長、增加——我們的觀眾增加等等。所以當然，這不是我們所指望的。

The traditional air carriers are certainly, in our mind at least, reducing the differences -- the cost differences that they historically had with LCTs, which we believe will make them more competitive going forward, and that is something that we will support.

至少在我們看來，傳統航空公司肯定會減少差異——他們過去與 LCT 之間的成本差異，我們相信這將使他們未來更具競爭力，這是我們將支持的事情。

TA's business is -- just turning to TripAdvisor, the business is doing great. Year-over-year growth rates are very good. TripAdvisor at the moment is not increasing rates so much as they are just very much focused on increasing the amount of content that they provide to their users. We are pretty focused on international growth as well, putting up pictures, grading discussion groups, etc. for travel enthusiasts to participate in. And right now, a lot of our increases are volume increases, which we think is pretty healthy.

TA 的業務是－只要轉向 TripAdvisor，業務就做得很好。年比成長率非常好。 TripAdvisor 目前並沒有大幅提高價格，而是非常注重增加提供給用戶的內容量。我們也非常關注國際成長，發布圖片、分級討論小組等供旅遊愛好者參與。目前，我們的成長很多是數量的成長，我們認為這是相當健康的。

Scott Devitt, Legg Mason.

斯科特·德維特，萊格·梅森。

Just a quick balance sheet question -- in the past, I think we had heard a $250 million number on a cash basis. You ended the quarter at 328, and I think, Dara, you mentioned 100 million in cash as well on the call. I'm trying to think about how to think about that in relation to the different merchant bookings that were transferred over. And are those margin bookings actually being funded through the receivables line in current assets? I'm just trying kind of circular around those three line items and particularly the deferred merchant bookings and then the receivables from IAC and subs at 2.4 billion.

只是一個簡單的資產負債表問題——過去，我想我們聽說過現金價值 2.5 億美元的數字。您以 328 美元結束本季度，我想達拉，您在電話會議上也提到了 1 億現金。我正在嘗試考慮如何考慮與轉移的不同商家預訂相關的問題。這些保證金預訂實際上是透過流動資產中的應收帳款額度提供資金的嗎？我只是嘗試圍繞這三個項目進行循環，特別是延期商家預訂，然後是來自 IAC 和 sub 的 24 億美元的應收帳款。

I think what you should refer to is our balance sheet, the pro forma balance sheet in the S-4, which will help you out. If you look at the balance sheet -- the balance sheet that we have in our announcement is a balance sheet of Expedia, Inc. essentially as a sub of IAC's. So, it might be confusing to you. But that is something that you can do with us too offline.

我認為您應該參考我們的資產負債表，即 S-4 中的預期資產負債表，這對您有幫助。如果您查看資產負債表，我們公告中的資產負債表是 Expedia, Inc. 的資產負債表，本質上是 IAC 的子公司。所以，這可能會讓你感到困惑。但這是您可以在線下與我們一起做的事情。

As far as the cash goes, the 250 was an initial estimate. The final number is 100 million of the parent, and then eLong had a bit over 100 million in cash as well. We did go ahead and secure the bank line of $1 billion, so we think that we've got plenty of liquidity on a go-forward basis. And the key for us is having liquidity. You know that business on an annual basis creates a whole bunch of free cash flow -- over 800 million in free cash flow.

就現金而言，250 是初步估計。最後的數字是母公司的1億，那麼藝龍的現金也有1億多一點。我們確實取得了 10 億美元的銀行額度，因此我們認為我們在未來的基礎上擁有充足的流動性。對我們來說，關鍵是擁有流動性。你知道，企業每年都會創造大量的自由現金流——超過 8 億的自由現金流。

So we certainly don't need cash balances; what we want is liquidity. The reason why we do want liquidity is that our cash flows are pretty seasonal. Almost all of our cash flow comes in in Q1 and Q2. And then, in Q3 and Q4, our cash flow is flat to down. But from an annual basis, we are certainly not a company that needs cash balances. And certainly one of the benefits of the spin-off is that we can use our stock for acquisitions if we need to as well on a go-forward basis.

所以我們當然不需要現金餘額；我們想要的是流動性。我們確實需要流動性的原因是我們的現金流具有強烈的季節性。我們幾乎所有的現金流都來自第一季和第二季。然後，在第三季和第四季，我們的現金流量持平甚至下降。但從年度來看，我們肯定不是一家需要現金餘額的公司。當然，分拆的好處之一是，如果我們需要的話，我們可以使用我們的股票進行收購。

On the deferred merchant bookings and Accounts Payable balance, what I will tell you is that on average -- to the extent that our gross bookings line -- I will explain it this way -- to the extent that our payables terms don't change and the deferred common merchant bookings terms don't change -- if we are growing gross bookings on a go-forward basis, the business creates working capital. So those two numbers tend to balance off on an annual basis. Obviously, there is seasonality. But as we grow the business, assuming no other changes in policy, the working capital will increase, which is a reason for the high cash flow that you have seen for the business.

關於延期商家預訂和應付帳款餘額，我要告訴你的是，平均而言 - 在我們的總預訂線範圍內 - 我會這樣解釋 - 在我們的應付帳款條款不改變的範圍內延期的普通商家預訂條款不會改變－如果我們未來的總預訂量不斷成長，企業就會創造營運資金。因此，這兩個數字每年往往會平衡。顯然，存在季節性。但隨著我們業務的發展，假設政策沒有其他變化，營運資金將會增加，這就是您所看到的業務現金流量高的原因。

And just to answer -- specify on a prior question -- the OIBA base that we're talking about is 556.8 -- the low to mid-teens growth asset that we indicated.

只是為了回答——具體說明之前的問題——我們正在談論的 OIBA 基數是 556.8——我們指出的低至中青少年成長資產。

And just one follow-up, if I could -- what are your restrictions in terms of share buybacks?

如果可以的話，我只想問一個問題：你們在股票回購上有哪些限制？

We do have certain restrictions on share buybacks. Greg (ph), do you know specifically what they are?

我們對股票回購確實有一定的限制。格雷格（ph），你具體知道它們是什麼嗎？

There needs to be in the open market repurchases, and they are limited to approximately 20% of the outstanding. But it is a difficult calculation; it takes into account prior acquisitions. It's around 20% in the year (multiple speakers).

需要在公開市場進行回購，且回購規模限制在已發行債券的 20% 左右。但這是一個困難的計算；它考慮了先前的收購。一年中大約是 20%（多位發言者）。

If you worry about 20%.

如果你擔心20%。

I thought there was a limitation post-spin in terms of a time period before you actually could buyback shares.

我認為分拆後在你實際可以回購股票之前的時間段是有限制的。

No.

不。

It's during the first year, you have that limitation that they need to be in the open market.

在第一年，你有他們需要進入公開市場的限制。

Obviously, we have window restrictions, but none other than any other company.

顯然，我們有窗口限制，但不是別人，而是任何其他公司。

Doug Anmuth, Lehman Brothers.

道格·安姆斯，雷曼兄弟。

Dara, you talked a lot about gaining greater efficiency in terms of sales and marketing spending. Can you drill down on this a little bit, perhaps in talking about what you are doing offline versus online? And what you are seeing more specifically in the search space?

達拉（Dara），您談到如何在銷售和行銷支出方面提高效率。您能否深入探討這個問題，也許可以談談您在線下和線上所做的事情？您在搜尋空間中更具體地看到了什麼？

And then also a separate question just going back to the merchant hotel business. Is it fair to think about the split in terms of bookings between the major chains versus the independents and non-brandeds as 80/20, as you have mentioned in the past? And where are we seeing more of the raw margin decline between those two sides? Thank you.

然後還有一個單獨的問題，回到商業酒店業務。正如您過去提到的那樣，大型連鎖飯店與獨立飯店和非品牌飯店之間的預訂比例為 80/20，因此考慮是否公平？我們在哪裡看到這兩家公司之間的原始利潤率下降更多？謝謝。

The split between the major chains and the independent hotels is -- the major chains account for less than 20% of our merchant hotel business; that has been pretty consistent.

大型連鎖飯店和獨立飯店之間的劃分是－大型連鎖飯店占我們商務飯店業務的比例不到20%；這非常一致。

As far as the raw margin decline, I would guess that we've seen more of a raw margin decline in the major chains. But that is something that honestly, I don't have on me to quantify exactly what that number is. We do think that there has been more of a decline as far as the major chains go.

就原始利潤率下降而言，我猜測我們在主要連鎖店中看到了更多的原始利潤率下降。但老實說，我無法準確量化這個數字。我們確實認為，就主要連鎖店而言，下滑幅度更大。

On your marketing efficiency question, we are focused on all aspects of the business. We are trying to spend more on a variable marketing expense so that we know that we're getting a return for that marketing spend. We look at both our offline and online channels as to how we can be more efficient going forward. Obviously, online and search engine marketing, we are driving efficiencies there. That is a daily task of looking at what terms work, what terms don't work.

關於您的行銷效率問題，我們專注於業務的各個方面。我們正在嘗試在可變行銷費用上投入更多，以便我們知道我們正在從行銷支出中獲得回報。我們著眼於線下和線上管道，研究如何提高未來的效率。顯然，在線上和搜尋引擎行銷方面，我們正在提高效率。這是一項日常任務，看看哪些術語有效，哪些術語無效。

We are expanding the number of terms that we bid on so that we try to get the terms that are less popular, so to speak. And we are also working for example on the language that we have describing paid links as well. We are testing -- is it booked on Expedia or Expedia's repute, whatever language barriers there, we're optimizing for. It's kind of a front-to-back optimization of all aspects of our marketing spend. We are obviously pleased with results to date, and we think there's more to go.

我們正在擴大競標的術語數量，以便我們嘗試獲得不太受歡迎的術語。例如，我們也在研究描述付費連結的語言。我們正在測試 - 是在 Expedia 上預訂還是在 Expedia 的聲譽上預訂，無論存在任何語言障礙，我們都會對其進行最佳化。這是我們行銷支出各個面向的從前到後的優化。我們顯然對迄今為止的結果感到滿意，並且我們認為還有更多工作要做。

The other part of marketing that I'd like to mention is that we are going forward going to spend a higher share of our marketing spend on CRM-type activities. We think we are not where we want to be in email marketing, developing customer loyalty, etc. The advantage to that kind of marketing spend is that it is marketing spend that is direct to a consumer, and you get a consumer directly, rather than acquiring that consumer from a third party. That is an area of real focus for us. It has taken some upfront investment, and it will take some upfront investment, but we think that will pay out over the long term.

我想提到的行銷的另一部分是，我們未來將在 CRM 類型的活動上花費更多的行銷支出。我們認為，在電子郵件行銷、培養客戶忠誠度等方面，我們還沒有達到我們想要的目標。這種行銷支出的優勢在於，行銷支出是直接面向消費者的，你可以直接吸引消費者，而不是直接接觸消費者。從第三方取得該消費者。這是我們真正關注的領域。它已經需要一些前期投資，而且還會需要一些前期投資，但我們認為從長遠來看，這會帶來回報。

Let's just do two more questions, Operator.

我們再做兩個問題吧，接線生。

Bob Peck, Bear Stearns.

鮑伯‧佩克，貝爾斯登。

Dara, could you give us an update on the status of your direct connection with hotels and what potential upcoming targets you have there? Additionally, could you talk about any hotel contracts coming due and what's the current status of Intercontinental? Then, I just have a follow-up.

Dara，您能否向我們介紹一下您與飯店直接聯繫的最新情況以及您未來的潛在目標？另外，可以談談即將到期的飯店合約嗎？洲際酒店目前的狀況如何？然後，我只有一個後續行動。

On Hotel DC (ph), we have -- we do not want to give exact numbers, but we've had thousands of hotels on direct connect. And the status of our direct connect now is that it is not just about stating a connection, which avoids kind of faxes etc. to the hotels. We are direct connecting to the hotels' property management systems. They are sharing their inventory with us, their rates with us so that the rates in inventory that we have available on Expedia is essentially the same rates and inventory that the hotels have on their own website that they offer to their own consumers. It is a key in that the hotels themselves want consistency across all their sales channels. And it is certainly something that is in our interest.

在 DC 酒店（ph）上，我們不想給出確切的數字，但我們有數千家酒店可以直接連接。現在我們直接連接的狀態是，它不僅僅是聲明連接，這避免了向酒店發送傳真等。我們直接連接到酒店的物業管理系統。他們與我們分享他們的庫存和價格，這樣我們在 Expedia 上提供的庫存價格基本上與酒店在自己網站上向自己的消費者提供的價格和庫存相同。關鍵在於酒店本身希望所有銷售管道保持一致。這當然符合我們的利益。

As far as Intercontinental goes, we don't have a relationship with them. The business is obviously doing fine. We've got relationships with every other major hotel chain. Standent (ph) for example, which was a new add, is doing great for us. And we have re-signed a bunch of our hotel contracts.

就洲際而言，我們與他們沒有任何關係。生意顯然做得很好。我們與其他所有主要連鎖飯店都有合作關係。例如，新加入的 Standent (ph) 對我們來說效果很好。我們已經重新簽署了許多酒店合約。

And we're certainly open to talking to Intercontinental. Paul Brown, who runs our Partner Services Group, this is something he actually used to work at Intercontinental. So I'm sure that these are discussions that he will have go forward. And if it makes sense for them and if it makes sense for us, we will be doing business going forward. I cannot tell you right now whether that is going to come to fruition.

我們當然願意與洲際酒店交談。保羅·布朗（Paul Brown）是我們合作夥伴服務小組的負責人，他實際上曾在洲際酒店工作過。所以我確信他將繼續進行這些討論。如果這對他們有意義，對我們也有意義，我們就會繼續經營。我現在無法告訴你這是否會實現。

One quick follow-up here. What is the timeline for integration of bookings to Sabre? And do you think somewhere down the line if it makes sense, you could do enough synergies to acquire a GDS in the future?

這裡有一個快速跟進。將預訂整合到 Sabre 的時間表是什麼？您是否認為，如果有意義的話，您是否可以在未來發揮足夠的綜效來收購 GDS？

As far as Sabre grows, we have a good relationship, and we continue to work with them. I can't give you a specific timeline on that. Long term, does it make sense to buy a GDS? We are open to anything. But I will give you my opinion, which is -- I can see why a GDS would want to buy us. I don't necessarily see why we would want to buy a GDS. We attract -- we have a direct relationship with our customers. And obviously, we will go with the connectivity solution that works for us, that works for our suppliers.

就 Sabre 的發展而言，我們有著良好的關係，並且我們將繼續與他們合作。我無法給你具體的時間表。從長遠來看，購買 GDS 有意義嗎？我們對任何事情都持開放態度。但我會給你我的意見，那就是——我明白為什麼 GDS 想要收購我們。我不一定明白為什麼我們要買 GDS。我們吸引－我們與客戶有直接的關係。顯然，我們將採用適合我們、適合我們供應商的連接解決方案。

We are very happy with Worldspan, our partner, right now. And again, we have a good relationship with Sabre and expect to do so going forward. Next question?

我們現在對我們的合作夥伴 Worldspan 非常滿意。再說一遍，我們與 Sabre 有著良好的關係，並希望未來能繼續維持這種關係。下一個問題？

Paul Keung, CIBC.

保羅·姜，CIBC。

Dara, what trends are seeing on the site conversion rates among all your various sites, I guess be specific on Hotels.com repositioning?

Dara，您在各個網站之間的網站轉換率有何趨勢，我想具體是 Hotels.com 的重新定位？

And the second question -- I think in your filings, you mentioned some initiatives to reduce that float period to improve the supplier relationships. Where you with these initiatives? And how much longer should we expect that to impact your working capital and free cash flow?

第二個問題—我認為在您的文件中，您提到了一些縮短浮動期以改善供應商關係的舉措。這些舉措你在哪裡？我們預計這會影響您的營運資金和自由現金流多久？

Paul, can you -- let me answer the first question, and then I will ask you to repeat the second one. Conversion trends are stable. We told you at the beginning of the year that year-on-year conversion comps were difficult for us because of the competitive environments, direct connect, etc. But the conversion trends that we see in Q2 are stable with the trends that we've seen earlier this year. And that is the stabilization certainly that we are happy with.

保羅，你能－－讓我回答第一個問題，然後我會請你重複第二個問題。轉化趨勢穩定。我們在今年年初告訴您，由於競爭環境、直接連接等原因，同比轉換比較對我們來說很困難。但我們在第二季度看到的轉換趨勢與我們之前的趨勢保持穩定。今年早些時候見過。這當然是我們感到滿意的穩定。

We are optimistic about the Hotels.com -- the site relaunch and some of the activities there. So hopefully, we can get a positive change in conversion; although, again, I can't tell. What was your second question, Paul?

我們對 Hotels.com 網站的重新推出以及其中的一些活動持樂觀態度。希望我們能夠在轉化方面取得正面的改變；雖然我又說不出來。保羅，你的第二個問題是什麼？

In your filing, you mentioned some initiatives to reduce that float period to improve the supplier relations. Where are you with these initiatives and to what extent do you think it will continue to impact your free cash flow and working capital?

在您的文件中，您提到了一些縮短浮動期以改善供應商關係的舉措。您對這些措施的看法如何？您認為它將在多大程度上繼續影響您的自由現金流和營運資金？

I think on -- initiatives is a fancy word for paying our suppliers on a more timely basis. We have to make sure that we're certainly getting the consumers' money upfront. We just want to make sure that we are paying the suppliers on a timely basis. It is a focus of ours. It is part of this Project Apollo, which is -- in general, making sure that execution across the Company improves and is consistent, and that's really what the initiative is about. So it is an ongoing initiative.

我認為「主動行動」是一個花俏的詞，用來形容更及時地向我們的供應商付款。我們必須確保我們確實能預先收到消費者的錢。我們只是想確保及時向供應商付款。這是我們的一個重點。它是阿波羅計劃的一部分，總體而言，確保整個公司的執行力得到改善並保持一致，而這正是該計劃的真正目的。因此，這是一項持續的舉措。

I don't have a specific free cash flow number for you. But again, I don't expect to see huge changes there. The biggest driver of free cash flow is gross bookings growth. And certainly, we do expect to see gross bookings growth on a go-forward basis.

我沒有具體的自由現金流數字。但同樣，我不希望看到那裡發生巨大的變化。自由現金流的最大驅動力是總預訂量的成長。當然，我們確實預期總預訂量會持續成長。

But just reduce the floats modestly then, is what you're suggesting?

但只是適度減少浮動，這是你的建議嗎？

It might again, Paul. It might; it depends on the timing; it depends on the particulars.

可能還會再來一次，保羅。它可能;這取決於時間；這取決於具體情況。

I think that is it, Operator. Thank you very much for joining us. And we will talk to you next quarter.

我想就是這樣，接線生。非常感謝您加入我們。我們將在下個季度與您交談。

Ladies and gentlemen, this conference is available for replay. It starts today at 3 PM Eastern -- will last until August 16th at midnight. You may access the replay at anytime by dialing 1-800-475-6701. International parties, please dial 320-365-3844. The access code is 790365. (Repeat.) That does conclude your conference for today. We thank you for your participation, and you may now disconnect.

女士們、先生們，本次會議可以重播。活動於今天東部時間下午 3 點開始，將持續到 8 月 16 日午夜。您可以隨時撥打 1-800-475-6701 觀看重播。國際團體，請撥 320-365-3844。訪問代碼是 790365。（重複。）今天的會議到此結束。我們感謝您的參與，您現在可以斷開連接。