Guarantor and Non-Guarantor Supplemental Financial Information

12 Months Ended

Dec. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Guarantor and Non-Guarantor Supplemental Financial Information

NOTE 22 — Guarantor and Non-Guarantor Supplemental Financial Information

Condensed consolidating financial information of Expedia, Inc. (the “Parent”), our subsidiaries that are guarantors of our debt facility and instruments (the “Guarantor Subsidiaries”), and our subsidiaries that are not guarantors of our debt facility and instruments (the “Non-Guarantor Subsidiaries”) is shown below. The debt facility and instruments are guaranteed by certain of our wholly-owned domestic subsidiaries and rank equally in right of payment with all of our existing and future unsecured and unsubordinated obligations. The guarantees are full, unconditional, joint and several with the exception of certain customary automatic subsidiary release provisions. In this financial information, the Parent and Guarantor Subsidiaries account for investments in their wholly-owned subsidiaries using the equity method.

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Year Ended December 31, 2017



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue	$	—		$	7,661,878		$	2,817,310		$	(419,344	)	$	10,059,844
Costs and expenses:
Cost of revenue	—			1,342,847			430,662			(16,978		)	1,756,531
Selling and marketing	—			3,714,710			1,985,541			(402,419		)	5,297,832
Technology and content	—			991,291			395,504			(8		)	1,386,787
General and administrative	—			408,949			266,951			61			675,961
Amortization of intangible assets	—			181,778			93,667			—			275,445
Legal reserves, occupancy tax and other	—			25,412			—			—			25,412
Restructuring and related reorganization charges	—			4,924			11,814			—			16,738
Intercompany (income) expense, net	—			695,328			(695,328		)	—			—
Operating income	—			296,639			328,499			—			625,138
Other income (expense):
Equity in pre-tax earnings of consolidated subsidiaries	493,013			336,300			—			(829,313		)	—
Other, net	(179,541		)	(59,547		)	30,714			—			(208,374		)
Total other income, net	313,472			276,753			30,714			(829,313		)	(208,374		)
Income before income taxes	313,472			573,392			359,213			(829,313		)	416,764
Provision for income taxes	64,492			(67,406		)	(42,491		)	—			(45,405		)
Net income	377,964			505,986			316,722			(829,313		)	371,359
Net loss attributable to non-controlling interests	—			846			5,759			—			6,605
Net income attributable to Expedia, Inc.	$	377,964		$	506,832		$	322,481		$	(829,313	)	$	377,964
Comprehensive income attributable to Expedia, Inc.	$	509,430		$	698,106		$	563,978		$	(1,262,084	)	$	509,430

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Year Ended December 31, 2016



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated
	(In thousands)
Revenue	$	—		$	6,807,279		$	2,267,516		$	(301,231	)	$	8,773,564
Costs and expenses:
Cost of revenue	—			1,263,828			346,200			(13,330		)	1,596,698
Selling and marketing	—			3,071,762			1,583,993			(288,338		)	4,367,417
Technology and content	—			903,444			331,230			345			1,235,019
General and administrative	—			429,015			249,185			92			678,292
Amortization of intangible assets	—			248,634			68,507			—			317,141
Impairment of intangibles	—			—			34,890			—			34,890
Legal reserves, occupancy tax and other	—			26,498			—			—			26,498
Restructuring and related reorganization charges	—			30,322			25,585			—			55,907
Intercompany (income) expense, net	—			656,273			(656,273		)	—			—
Operating income	—			177,503			284,199			—			461,702
Other income (expense):
Equity in pre-tax earnings of consolidated subsidiaries	383,883			286,016			—			(669,899		)	—
Other, net	(162,455		)	(21,206		)	(1,441		)	—			(185,102		)
Total other income (expense), net	221,428			264,810			(1,441		)	(669,899		)	(185,102		)
Income before income taxes	221,428			442,313			282,758			(669,899		)	276,600
Provision for income taxes	60,420			(50,168		)	(25,567		)	—			(15,315		)
Net income	281,848			392,145			257,191			(669,899		)	261,285
Net loss attributable to non-controlling interests	—			—			20,563			—			20,563
Net income attributable to Expedia, Inc.	$	281,848		$	392,145		$	277,754		$	(669,899	)	$	281,848
Comprehensive income attributable to Expedia, Inc.	$	280,297		$	373,649		$	238,299		$	(611,948	)	$	280,297

CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS

Year Ended December 31, 2015



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries⁽¹⁾			Eliminations			Consolidated
	(In thousands)
Revenue	$	—		$	5,194,549		$	1,682,677		$	(204,909	)	$	6,672,317
Costs and expenses:
Cost of revenue	—			1,009,785			308,463			(8,689		)	1,309,559
Selling and marketing	—			2,347,919			1,230,059			(196,892		)	3,381,086
Technology and content	—			584,560			245,495			189			830,244
General and administrative	—			373,162			200,268			483			573,913
Amortization of intangible assets	—			58,524			97,934			—			156,458
Impairment of intangible assets	—			—			7,207			—			7,207
Legal reserves, occupancy tax and other	—			(104,587		)	—			—			(104,587		)
Restructuring and related reorganization charges	—			76,422			28,449			—			104,871
Intercompany (income) expense, net	—			742,010			(742,010		)	—			—
Operating income	—			106,754			306,812			—			413,566
Other income (expense):
Equity in pre-tax earnings of consolidated subsidiaries	839,779			870,108			—			(1,709,887		)	—
Gain on sale of business	—			—			508,810			—			508,810
Other, net	(119,451		)	64,576			58,461			—			3,586
Total other income, net	720,328			934,684			567,271			(1,709,887		)	512,396
Income before income taxes	720,328			1,041,438			874,083			(1,709,887		)	925,962
Provision for income taxes	44,137			(194,251		)	(53,100		)	—			(203,214		)
Net income	764,465			847,187			820,983			(1,709,887		)	722,748
Net loss attributable to non-controlling interests	—			—			41,717			—			41,717
Net income attributable to Expedia, Inc.	$	764,465		$	847,187		$	862,700		$	(1,709,887	)	$	764,465
Comprehensive income attributable to Expedia, Inc.	$	763,202		$	822,898		$	742,132		$	(1,709,887	)	$	618,345

___________________________________


(1)	Includes results through our disposal of eLong on May 22, 2015.

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2017



	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
	(In thousands)
ASSETS
Total current assets	$	358,251	$	3,493,392	$	2,263,166	$	(575,220	)	$	5,539,589
Investment in subsidiaries	10,265,237		4,249,014		—		(14,514,251		)	—
Intangible assets, net	—		1,735,988		572,548		—			2,308,536
Goodwill	—		6,366,378		1,862,487		—			8,228,865
Other assets, net	5,056		1,677,397		775,421		(19,236		)	2,438,638
TOTAL ASSETS	$	10,628,544	$	17,522,169	$	5,473,622	$	(15,108,707	)	$	18,515,628
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total current liabilities	$	750,922	$	6,797,895	$	905,093	$	(575,220	)	$	7,878,690
Long-term debt, excluding current maturities	3,749,054		—		—		—			3,749,054
Other long-term liabilities	—		494,134		262,084		(19,236		)	736,982
Redeemable non-controlling interests	—		9,673		12,661		—			22,334
Stockholders’ equity	6,128,568		10,220,467		4,293,784		(14,514,251		)	6,128,568
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	10,628,544	$	17,522,169	$	5,473,622	$	(15,108,707	)	$	18,515,628

CONDENSED CONSOLIDATING BALANCE SHEET

December 31, 2016



	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated
	(In thousands)
ASSETS
Total current assets	$	293,759	$	2,535,711	$	1,829,191	$	(1,208,410	)	$	3,450,251
Investment in subsidiaries	9,536,273		3,410,687		—		(12,946,960		)	—
Intangible assets, net	—		1,921,519		525,133		—			2,446,652
Goodwill	—		6,392,479		1,549,544		—			7,942,023
Other assets, net	4,107		1,608,218		331,818		(5,523		)	1,938,620
TOTAL ASSETS	$	9,834,139	$	15,868,614	$	4,235,686	$	(14,160,893	)	$	15,777,546
LIABILITIES AND STOCKHOLDERS’ EQUITY
Total current liabilities	$	981,700	$	5,733,755	$	620,153	$	(1,208,410	)	$	6,127,198
Long-term debt, excluding current maturities	3,159,336		—		—		—			3,159,336
Other long-term liabilities	—		629,634		173,798		(5,523		)	797,909
Stockholders’ equity	5,693,103		9,505,225		3,441,735		(12,946,960		)	5,693,103
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	9,834,139	$	15,868,614	$	4,235,686	$	(14,160,893	)	$	15,777,546

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Year Ended December 31, 2017



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
	(In thousands)
Operating activities:
Net cash provided by operating activities	$	—		$	1,310,451		$	488,703		$	1,799,154
Investing activities:
Capital expenditures, including internal-use software and website development	—			(546,679		)	(163,651		)	(710,330		)
Purchases of investments	—			(1,221,821		)	(589,534		)	(1,811,355		)
Sales and maturities of investments	—			875,497			220,907			1,096,404
Acquisitions, net of cash acquired	—			(169,836		)	(803		)	(170,639		)
Transfers (to) from related parties	—			(5,031		)	5,031			—
Other, net	—			6,657			6,873			13,530
Net cash used in investing activities	—			(1,061,213		)	(521,177		)	(1,582,390		)
Financing activities:
Proceeds from issuance of long-term debt, net of debt issuance costs	989,600			—			—			989,600
Purchases of treasury stock	(312,089		)	—			—			(312,089		)
Payment of dividends to stockholders	(175,775		)	—			—			(175,775		)
Proceeds from exercise of equity awards and employee stock purchase plan	228,187			—			894			229,081
Withholding taxes for stock option exercises	(5,398		)	—			(3,665		)	(9,063		)
Changes in controlled subsidiaries, net	—			—			(18,137		)	(18,137		)
Transfers (to) from related parties	(724,525		)	605,047			119,478			—
Other, net	—			(14,909		)	(1,194		)	(16,103		)
Net cash provided by financing activities	—			590,138			97,376			687,514
Effect of exchange rate changes on cash and cash equivalents	—			36,052			109,588			145,640
Net increase in cash and cash equivalents	—			875,428			174,490			1,049,918
Cash and cash equivalents at beginning of year	—			425,471			1,371,340			1,796,811
Cash and cash equivalents at end of year	$	—		$	1,300,899		$	1,545,830		$	2,846,729

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Year Ended December 31, 2016



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
	(In thousands)
Operating activities:
Net cash provided by operating activities	$	—		$	940,191		$	624,143		$	1,564,334
Investing activities:
Capital expenditures, including internal-use software and website development	—			(635,534		)	(113,814		)	(749,348		)
Purchases of investments	—			—			(45,352		)	(45,352		)
Sales and maturities of investments	—			37,830			23,105			60,935
Acquisitions, net of cash acquired	—			—			(777		)	(777		)
Transfers (to) from related parties	—			(172,731		)	172,731			—
Proceeds from sale of business, net of cash divested and disposal costs	—			—			67,088			67,088
Other, net	—			(50,029		)	(838		)	(50,867		)
Net cash provided by (used in) investing activities	—			(820,464		)	102,143			(718,321		)
Financing activities:
Proceeds from issuance of long-term debt, net of debt issuance costs	(2,093		)	—			—			(2,093		)
Payment of HomeAway Convertible Notes	—			(401,424		)	—			(401,424		)
Purchases of treasury stock	(455,746		)	—			—			(455,746		)
Payment of dividends to stockholders	(150,159		)	—			—			(150,159		)
Proceeds from exercise of equity awards and employee stock purchase plan	141,043			—			—			141,043
Withholding taxes for stock option exercises	(1,282		)	—			—			(1,282		)
Changes in controlled subsidiaries, net	—			—			208,016			208,016
Transfers (to) from related parties	468,511			(118,179		)	(350,332		)	—
Other, net	(274		)	(1,484		)	(27,216		)	(28,974		)
Net cash used in financing activities	—			(521,087		)	(169,532		)	(690,619		)
Effect of exchange rate changes on cash and cash equivalents	—			(14,865		)	(20,017		)	(34,882		)
Net increase (decrease) in cash and cash equivalents	—			(416,225		)	536,737			120,512
Cash and cash equivalents at beginning of year	—			841,696			834,603			1,676,299
Cash and cash equivalents at end of year	$	—		$	425,471		$	1,371,340		$	1,796,811

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

Year Ended December 31, 2015



	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidated
	(In thousands)
Operating activities:
Net cash provided by operating activities from continuing operations	$	—		$	624,327		$	743,718		$	1,368,045
Investing activities:
Capital expenditures, including internal-use software and website development	—			(709,679		)	(77,362		)	(787,041		)
Purchases of investments	—			(473,538		)	(47,791		)	(521,329		)
Sales and maturities of investments	—			327,191			83,732			410,923
Acquisitions, net of cash acquired	(126,779		)	(1,873,079		)	(63,791		)	(2,063,649		)
Transfers (to) from related parties	126,779			(303,846		)	177,067			—
Proceeds from sale of business, net of cash divested and disposal costs	—			—			523,882			523,882
Other, net	—			54,226			11,728			65,954
Net cash provided by (used in) investing activities	—			(2,978,725		)	607,465			(2,371,260		)
Financing activities:
Proceeds from issuance of long-term debt, net of issuance costs	1,441,860			—			—			1,441,860
Purchases of treasury stock	(60,546		)	—			—			(60,546		)
Proceeds from issuance of treasury stock	22,575			—			—			22,575
Payment of dividends to stockholders	(108,527		)	—			—			(108,527		)
Proceeds from exercise of equity awards and employee stock purchase plan	96,526			—			1,190			97,716
Withholding taxes for stock option exercises	(85,033		)	—			—			(85,033		)
Changes in controlled subsidiaries, net	—			—			(8,518		)	(8,518		)
Transfers (to) from related parties	(1,396,210		)	2,350,385			(954,175		)	—
Other, net	89,355			(11,998		)	27,315			104,672
Net cash provided by (used in) financing activities	—			2,338,387			(934,188		)	1,404,199
Effect of exchange rate changes on cash and cash equivalents	—			(86,269		)	(41,116		)	(127,385		)
Net increase (decrease) in cash and cash equivalents	—			(102,280		)	375,879			273,599
Cash and cash equivalents at beginning of year	—			943,976			458,724			1,402,700
Cash and cash equivalents at end of year	$	—		$	841,696		$	834,603		$	1,676,299