Expedia, Inc. announced financial results for its second quarter ended June 30, 2007.

Gross bookings increased 14% for the second quarter of 2007 compared with the second quarter of 2006. North America bookings increased 8%, Europe bookings increased 38% (30% excluding the impact of foreign exchange) and Other bookings (including Expedia(R) Corporate Travel and our Asia Pacific operations) increased 27%.

Revenue increased 15% for the second quarter, primarily driven by increased worldwide merchant hotel revenue and advertising and media revenue, partially offset by a decline in North America air revenue. North America revenue increased 11%, Europe revenue increased 30% (23% excluding the impact of foreign exchange) and Other revenue increased 28%.

Worldwide merchant hotel revenue increased 14% for the second quarter due to a 10% increase in room nights stayed, including rooms delivered as a component of vacation packages, and a 4% increase in revenue per room night. Revenue per room night increased due to a 5% increase in worldwide average daily rates ("ADRs"), partially offset by a modest decrease in hotel raw margin compared to second quarter 2006.

Worldwide air revenue decreased 7% for the second quarter due to a 19% decrease in revenue per air ticket, partially offset by a 14% increase in air tickets sold. The decrease in revenue per air ticket primarily reflects decreased compensation from air carriers and global distribution system ("GDS") providers. Packages revenue increased 1% compared with the prior year period primarily due to higher package volumes in Europe.

Worldwide revenue from products and services other than merchant hotel and air (including advertising and media, car rentals, destination services and cruises), increased 40% for the second quarter due primarily to increases in advertising and media and car rental revenues.

"There is no more positive statement we could make about our confidence in Expedia than our current tender offer and outstanding share repurchase authorization," said Barry Diller, Expedia, Inc.'s Chairman and Senior Executive.

"The recent signings of Alaska Airlines, American Airlines, Delta Air Lines, JetBlue Airways, Northwest Airlines and Wyndham Worldwide by our Partner Services Group demonstrate Expedia's ongoing progress in assembling the world's most compelling marketplace of travel products and services," said Dara Khosrowshahi, Expedia Inc.'s CEO and President. "With the combination of our highest revenue growth rate in nearly two years, continued momentum at Expedia.com and strong growth in our advertising and media businesses, we are increasingly confident in our strategy and poised for continued execution in 2007 and beyond."

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