Booking credits AI with lower service costs as booking volumes rise

Booking Holdings says its early AI experiments are helping customers complete travel tasks while easing the service workload. In its third-quarter earnings update, CEO Glenn Fogel said customer-service costs fell despite higher booking volumes, with satisfaction remaining high. Management also disclosed stronger booking rates among users of AI assistants at Priceline and Agoda.

From a conversation to a completed task

The tools reach beyond suggesting destinations. Booking.com customers can ask questions and cancel reservations through agentic AI—software that can take action rather than only supply an answer. Fogel said these capabilities are reducing the workload on customer-service teams. Employees also use AI to handle routine requests and improve internal processes.

For purchases, Fogel described connecting the assistant to locations, photos, room choices, prices and live inventory. Booking’s platforms supply the reservation capabilities and subsequent service. The conversation is one part of a system that can complete the transaction, rather than simply recommend a trip.

• Agoda’s assistant helps travelers move from an idea to a bookable trip. Fogel said it is available in 21 markets.
• Priceline is incorporating capabilities from Penny, its AI travel assistant, into the standard Priceline experience.

These experiences show the difference between recommending a trip and actually enabling someone to book it seamlessly.

Glenn Fogel, Booking Holdings CEO, on the quarterly earnings call

Stronger booking rates, not yet an earnings figure

Management said users of Priceline’s Penny and Agoda’s AI assistants converted at approximately twice the rate of non-users, according to CNBC’s earnings coverage. Conversion measures whether a user completes a booking. Agoda’s AI-assistant users also generated average booking values roughly 20% higher, management said.

Booking.com’s daily AI trip-search visitors increased tenfold from the second quarter. But these early indicators do not establish that AI caused the stronger commercial results, and Booking has not quantified its incremental earnings contribution.

Outside AI sends relatively few bookings

The internal assistant results are distinct from business arriving through outside AI platforms. Referrals from services including ChatGPT accounted for significantly less than 1% of Booking.com’s room nights, CNBC reported. Direct channels continued to supply a mid-60% share of business-to-consumer room nights.

Across the wider business, third-quarter room nights rose 7% from a year earlier, while gross bookings increased 10% to $54.5 billion. Adjusted earnings per share rose 17% to $4.66, above the $4.49 Wall Street estimate cited by CNBC.