Orbitz Worldwide Inc (NYSE:OWW) reported a lower-than-expected quarterly profit, due partly to higher marketing costs related to a new loyalty program for users of its travel booking websites.
Orbitz's shares were down nearly 2 percent in premarket trading after the company also forecast full-year revenue below analysts' expectations.
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The operator of the Orbitz and CheapTickets websites said it expected full-year revenue to rise by 9 percent to 10 percent. This implies 2014 revenue of $923.2 million to $931.7 million.
Analysts on average were expecting $937.3 million, according to Thomson Reuters I/B/E/S.
Orbitz said its marketing costs jumped 26 percent to $92.4 million in the third quarter ended Sept. 30, partly due to the launch in August of its ebookers Bonus+ loyalty program. (http://bit.ly/1onKYU7)
The program earns customers points when they book hotels, flights and vacation packages on the ebookers.com website and app.
Orbitz's total expenses rose 18 percent to $227.5 million.
Net income fell to $9.0 million, or 8 cents per share, from $13.0 million, or 11 cents per share, a year earlier.
Analysts on average expected earnings of 14 cents per share.
Revenue rose 14.6 percent to $253.1 million, slightly above the average analyst estimate of $253.0 million.
Orbitz's shares closed at $8.48 on the New York Stock Exchange on Wednesday. Up to Wednesday's close, they had risen about 19 percent in the past 12 months, while the S&P 500 index increased 14 percent.
(Reporting by Sagarika Jaisinghani in Bangalore; Editing by Sriraj Kalluvila and Robin Paxton)