Booking Holdings (BKNG) — Q2 2026 Earnings Preview

Report date: Tuesday, August 4, 2026, after market close | Event: 2026Q2 Earnings Call

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Setting the Stage

Booking Holdings has had one of the more turbulent years in its recent history. The stock ran to a 52-week high near $228 (split-adjusted) last summer before a Middle East conflict that started at the end of February escalated into a much broader Iran war and Strait of Hormuz shipping/travel crisis, which disrupted Europe–Asia transit corridors, spiked oil prices, and forced Booking to cut its full-year guidance in April. Shares bottomed near $154 in mid-May before staging a sharp recovery — including a roughly 5% single-day jump on July 27 as oil fell below $70 and the Strait of Hormuz prepared to reopen, unwinding the disruption that forced a guidance cut — before flaring back up again as fighting between the U.S./Saudi forces and Iranian-backed militias resumed in Iraq and Jordan in late July. Shares closed at $192.74 on August 3, still well off the highs, and going into tomorrow's print, the market is essentially trying to figure out how much of the "Middle East drag" narrative is over versus still live.

Q1 2026 Recap (the setup quarter)

Booking's Q1 results (reported April 28) were solid on an underlying basis but clouded by conflict-related noise:

• Room nights grew 6% compared to the first quarter of 2025... negatively impacted by approximately 2 percentage points by the conflict in the Middle East
• Gross bookings grew 15%... or approximately 8% on a constant currency basis, and Revenue grew 16%... or approximately 10% on a constant currency basis
• Net income and Adjusted EBITDA grew 225% and 19%, respectively, compared to the first quarter of 2025 (net income was flattered by one-time FX/litigation items)
• Management noted excluding these impacts, our first quarter growth rates would have exceeded the high end of our guidance ranges across all key metrics, and specifically that March room night growth [was] 1%... the impact of the conflict on March room night growth was about 6 percentage points — showing just how acute the initial shock was.
• A bright spot: the U.S. accelerated for the fourth consecutive quarter to low teens growth, driven primarily by domestic travel, with management citing improving conditions even in the lower-end consumer segment.
• Capital returns were aggressive: a record $3.6 billion of buybacks in the quarter, an $0.42/share dividend, and the 25-for-1 stock split effected April 2, 2026.

Q2 2026 Guidance — The Bar Management Set

For Q2, Booking guided (as of April 28) assuming the Middle East conflict's direct/indirect impact would persist through the entire quarter:

Metric	Q2 2026 Guidance
Room Nights Growth	2% – 4%
Gross Bookings Growth	4% – 6% (CC: 2%–4%)
Revenue Growth	4% – 6% (CC: 2%–4%)
Adjusted EBITDA Growth	4% – 6%
Adjusted EPS Growth	Low to mid-teens

CFO Ewout Steenbergen quantified the drag explicitly: approximately 3 points of headwind in the second quarter... we have assumed that this situation will continue from a direct and indirect impact perspective for 3 months, so for the full second quarter. Full-year 2026 guidance was cut at the midpoint (gross bookings/EPS held at the high end of prior ranges) to: gross bookings up high-single to low-double digits, revenue up high-single digits, adjusted EBITDA growing slightly faster than revenue, and adjusted EPS up low-to-mid teens — assuming a second-half recovery in bookings.

What the Street Expects

Consensus has actually crept above the low end of Booking's own guidance in places:

• Consensus diluted EPS: ~$2.46, up 10.8% y/y from $2.22 — BKNG has exceeded Wall Street's EPS estimates in all of the past four trailing quarters
• Consensus revenue: roughly $7.3B, which implies growth modestly above the top of the company's guided 4–6% range
• FY2026 EPS consensus: analysts expect the company to report EPS of $10.45, up 14.6% from $9.12 in fiscal 2025... projected to increase another 18% year over year to $12.33 in fiscal 2027

Interestingly, the 10.8% EPS growth baked in is a touch below management's "low-to-mid teens" guide — suggesting some analysts are still cautious about the conflict's drag, even as others have turned more constructive following the de-escalation headlines in late July.

The Wildcard: The Iran War / Strait of Hormuz Situation

This is the single biggest swing factor for both the Q2 print and — more importantly — the Q3 outlook management will give tomorrow. What started as a regional conflict escalated materially:

• Tensions between Iran, the United States, and Israel escalated in the lead-up to 2026, stemming from failed nuclear negotiations in Geneva and a prior 12-day air conflict in 2025
• The 2026 Iran war disrupted global travel and trade, halted flights in and out of the Middle East, and led to shipping reroutes to avoid the Strait of Hormuz
• A ceasefire/reopening framework helped sentiment mid-year, but as of late July, Iran rejected a compromise to reopen the Strait of Hormuz and launched a surprise attack against American forces in Jordan... U.S. and Saudi warplanes have attacked Iranian-backed militias inside Iraq
• Even the more benign path is fragile: while a conditional ceasefire is in place... shipping levels through the strait remain very low

Booking's own disclosure noted the Middle East (inbound + outbound bookers) represents roughly 7% of global room nights, and management has stressed the Europe–Asia transit corridor disruption as a second-order effect beyond the region itself. Given the whipsaw in headlines through Q2 and into Q3, investors should expect heavy Q&A on the Q3/H2 outlook — whether management still believes in a second-half recovery or pushes that assumption out further.

Stock & Sentiment Check Into the Print

• Shares are down roughly 20% over the trailing 52 weeks even after the recent bounce, badly lagging the broader market
• The stock fell nearly 5% on July 8 after "Trump declared the Iran ceasefire 'over' and threatened fresh strikes," then rallied hard in late July on de-escalation optimism, hitting local highs near $201 on July 29 before settling back to ~$193
• Sell-side positioning has been split heading into the print: UBS raised its price target to $266 from $249 (Buy), the firm expects ongoing demand recovery, while BofA trimmed its target to $231 from $235 the same week — a sign analysts are still debating the pace of recovery
• Broader sell-side view remains bullish: among the 38 analysts covering the stock, 26 recommend a "Strong Buy," 10 rate it "Hold," and two recommend a "Strong Sell." The average price target of $221.98 implies a potential 22.2% upside

Other Themes to Watch on the Call

1. U.S. momentum — Can the low-teens room-night growth streak (now 4 quarters running) extend into a 5th, and is direct-channel/mobile mix still improving?
2. Asia — High-single-digit growth with intra-region strength; any incremental read on China outbound or broader APAC travel given the Hormuz-related disruption to Asia-Europe routes.
3. Connected Trip / Genius — Connected transactions grew in the high teens last quarter; management flagged plans to "strengthen Genius" in 2026 — any concrete detail here would matter for the loyalty/retention narrative.
4. GenAI and agentic AI — Progress on Priceline's Penny, Booking.com natural-language search, and partnerships with OpenAI, Google, Anthropic and Amazon. Watch for updated commentary on whether AI agents are additive (expanding travel TAM, driving traffic) or disintermediating (bypassing direct bookings) — management has been firmly in the "opportunity, not threat" camp.
5. Cost discipline / Transformation Program — On track for $500–550M of in-year savings in 2026; margin leverage is a key lever supporting EPS growth given softer top-line growth this year.
6. Capital returns — Pace of buybacks after the record $3.6B Q1 quarter, and any change to the $18.2B remaining repurchase authorization.
7. FX — Guidance assumed EUR/USD near $1.16; a weaker dollar has been a modest tailwind (~2pts to Q2 revenue growth) that could either persist or fade depending on how currency moved through the quarter.

Bottom Line

This print is less about the Q2 numbers themselves — which are likely to land close to or slightly ahead of a conservative guide — and much more about the Q3/H2 2026 outlook and management's updated read on the Iran war/Hormuz situation. The stock's recent rally suggests the market is pricing in a genuine recovery narrative, so the bar for "good enough" guidance has risen. A cautious tone on H2 recovery, given the late-July escalation in Iraq/Jordan, could reverse the recent bounce; conversely, confirmation that bookings are normalizing and that U.S./Asia strength is broadening would validate the bullish sell-side repositioning (UBS's $266 target) seen over the past two weeks.