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IAC's stock rose 15% today after it reported earnings that beat analysts' expections. But IAC CEO Barry Diller and CFO Dara Khosrowshahi admitted to challenges in the online travel market. Here are IAC's results and the key issues IAC faces in 200 of their own words:

(I'm providing these excerpts as a prelude to a series of non-consensus pieces discussing Internet trends and how they will impact the results of the leading Internet companies.)


Quotes are from the CCBN StreetEvents transcripts.

The core issue is inside our merchant hotel business… our growth in domestic travel has slowed... our price advantage has weakened, as hotel occupancy has gone up and competition has increased...

…revenue was up 13% on a comparable net basis to $1.5 billion… on organic growth in Q3 revenue was up 8% and operating income before amortization was up 23%… [excluding one-time charges] margins would have expanded from 15.2% to 16.6%… Year-to-date cash from operating activities was $1.03 billion…

Travel growth bookings were up 25% to 3.4 billion, driven largely by international which was up 78%… Gross bookings growth from the U.S. has slowed, principally due to our merchant hotel business which was essentially flat on room nights…

At HSN US, revenue was up 3% to 437 million... Personals revenue was up 3% to 50 million…

… even though we came in above street expectations we are not raising our outlook for full year 2004 operating income before amortization of about a billion... based on… the domestic travel trends that we've talked about, the continued tough macro environment in the tickets business, continued restructuring, repositioning of our personals offering and negative comps at HSN Germany… that translates to around 3% [year over year growth in operating income] for Q4…

Source: InterActiveCorp (IACI) discusses the online travel market (3Q04 conf call)