Booking Holdings (BKNG) 10-K risk factor changes: FY2021 vs FY2020

- The adverse impact of the COVID-19 pandemic on our business, financial [removed: performance] [added: performance,] and travel [removed: demand, generally, including the impact on our liquidity, credit ratings and ongoing access to capital, the restructuring of our business and our utilization of government stimulus packages;][added: demand;]

- Any write-downs or impairments of goodwill or intangible assets related to acquisitions or investments, any increases in provisions for expected credit losses on receivables from and cash advances made to our travel service provider and restaurant [removed: partners] [added: partners,] and any increases in cash outlays to refund consumers for prepaid reservations;

- Any change by our search and meta-search partners in how they present travel search results or conduct their auctions for search placement [removed: in a manner] that [removed: is competitively disadvantageous to us;][added: would impact us negatively;]

- IT systems-related failures or security [removed: breaches] [added: breaches,] and data privacy risks and obligations;

- Tax, [removed: legal] [added: legal,] and regulatory risks;

[removed: - Risks] [added: *There are various risks] associated with the facilitation of payments from consumers, including [removed: fraud and] [added: risks related to fraud,] compliance with evolving rules and [removed: regulations] [added: regulations,] and reliance on third [removed: parties;][added: parties.*]

- Success of investments and acquisitions, including integration of acquired [removed: businesses; and][added: businesses.]

- Financial risks including increased debt levels and stock price [removed: volatility.][added: volatility; and]

These [removed: government mandates] [added: measures] have [removed: forced] [added: had a significant adverse effect on] many of the partners on [removed: whom] [added: which] our business relies, including hotels and other accommodation providers, [removed: airlines] [added: airlines,] and [added: restaurants, as well as on our consumers, operations, and workforce.]

The COVID-19 pandemic and the resulting economic conditions and government [removed: orders have] [added: restrictions] resulted in a material decrease in consumer spending and [removed: an unprecedented] [added: a significant] decline in travel and restaurant activities and consumer demand for related services.

Our financial results and prospects are almost entirely dependent on the sale of [removed: such travel and restaurant-related] [added: travel-related] services.

We believe that as [removed: effective] vaccines [added: and other medical interventions that prevent or reduce the impact of COVID-19] become [removed: widely distributed,] [added: widespread globally,] people will [added: increasingly] feel it is safe to travel again and government restrictions will be relaxed, although the timing remains uncertain.

The extent of the effects of the COVID-19 pandemic on our business, results of operations, cash [removed: flows] [added: flows,] and growth prospects is highly uncertain and will ultimately depend on future developments.

These include, but are not limited to, the severity, [removed: extent] [added: extent,] and duration of the global pandemic, including as a result of any new variants of COVID-19 and any resurgences of the [removed: pandemic,] [added: pandemic; availability] and [removed: its impact] [added: efficacy of vaccines and other medical interventions to prevent or alleviate COVID-19, and their impacts] on the travel and restaurant industries and consumer spending more broadly; actions taken by national, [removed: state] [added: state,] and local governments to contain the disease or treat its [removed: impact, including travel restrictions and bans, required closures of non-essential businesses, constraints on businesses during reopening transitions and aid and economic stimulus efforts;] [added: impact;] the [removed: effect of our restructuring activities and] [added: impact on] attrition, as well as the changes in hiring levels and remote working arrangements that we have implemented on our operations, including the health and productivity of management and our employees, and our ability to maintain our financial reporting processes and related controls; the impact on our contracts and relationships with our [removed: partners, including the impact of invoking *force majeure* provisions;] [added: partners;] our ability to withstand increased [removed: cyberattacks that we and many businesses are experiencing;] [added: cyberattacks;] the speed and extent of the recovery across the broader travel [removed: ecosystem, including the speed at which customers feel comfortable traveling again once restrictions on travel have been lifted, which we believe will be impacted by how quickly there can be effective and widespread vaccinations, treatments or cures;] [added: ecosystem;] and the duration, [removed: timing] [added: timing,] and severity of the impact on customer spending, including [removed: the length and the severity of] [added: how long it takes to recover from] the economic recession resulting from the pandemic.

The [added: effects of the] pandemic may continue to [removed: expand] [added: fluctuate] throughout the [removed: world and/or worsen in areas that had seen progress in reducing or containing the disease,] [added: world,] which could continue to affect our business.

Also, [removed: existing] restrictions in affected regions could be extended after the virus has been contained in order to avoid relapses and there may be restrictions on certain travel activity related to whether travelers have been vaccinated.

Our business is dependent on the availability of a large number of accommodations (particularly independently-owned accommodations) and restaurants, and on the ability of consumers to travel to such accommodations and restaurants on airlines, [removed: railways] [added: railways,] and rental cars.

The ability of consumers to travel [removed: internationally] [added: across international borders] has been significantly impacted by the various travel restrictions between [removed: countries, including for example, the restrictions on travel between the European Union and the United States.][added: countries.]

We do not expect economic and operating conditions for our business to [removed: improve] [added: recover fully] until [removed: consumers are once again willing] [added: there is widespread consumer confidence] and [removed: able] [added: ability] to travel, and our travel service provider and restaurant partners are [removed: once again willing and] able to [removed: serve those][added: meet the demand for services.]

[removed: Increased] [added: Any increased] unemployment [removed: resulting from the COVID-19 pandemic] is likely to have a negative impact on consumer discretionary spending, including for the travel and restaurant industries.

Even [removed: if] [added: though we have seen some improvements in the] economic and operating conditions for our business [removed: improve,] [added: since the outset of the COVID-19 pandemic,] we cannot predict the long-term effects of the pandemic on our business or the travel and restaurant industries as a whole.

[removed: To the extent that] [added: If] the COVID-19 pandemic continues to adversely affect our business and financial performance, it may also [removed: have the effect of heightening] [added: heighten] many of the other risks identified in this [removed: section, such as those relating to our substantial amount of outstanding indebtedness.][added: section.]

*Impairments of goodwill, long-term [removed: investments] [added: investments,] and long-lived assets, increases in provisions for expected credit losses on receivables from and cash advances made to our travel service provider and restaurant [removed: partners] [added: partners,] and increases in cash outlays to refund consumers for prepaid reservations have a negative impact on our results of operations.*

Future events and changing market conditions may lead us to re-evaluate the assumptions [removed: reflected in] [added: used to estimate] the [removed: current forecast disclosed above,] [added: fair value of OpenTable and KAYAK,] particularly the assumptions related to the length and severity of the COVID-19 pandemic, the shape and timing of the subsequent [removed: recovery] [added: recovery,] and the performance of the businesses during and following the COVID-19 pandemic, which may result in a need to recognize an additional goodwill impairment charge, which could have a material adverse effect on our results of operations.

In addition, [added: in 2020,] given the severe downturn in the global travel industry and the financial difficulties faced by many of our travel service provider and restaurant partners [removed: as a result of the COVID-19 pandemic,] [added: and marketing affiliates,] we [removed: have] increased our provision for expected credit losses on receivables from and [removed: cash advances made] [added: prepayments] to our travel service provider and restaurant [removed: partners.][added: partners and marketing affiliates.]

[removed: Moreover, due] [added: Due] to the high level of cancellations of existing reservations, we [removed: have incurred, and may continue to incur,] [added: incurred] higher than normal cash outlays to refund consumers for prepaid reservations.

In some instances, we [removed: do] [added: did] not estimate a recovery of prepayment already made to a travel service provider where we [removed: have] [added: had] agreed to provide free cancellations to [removed: customers] [added: consumers] for non-refundable [removed: reservations, and this has resulted in an aggregate reduction in revenue of $44 million for the year ended December 31, 2020.][added: reservations.]

Any [removed: additional] significant increase in our provision for expected credit losses [removed: on receivables from] and [removed: cash advances made to travel service provider and restaurant partners, and] any [removed: additional] significant increase in cash outlays to refund [removed: consumers,] [added: consumers] would have a corresponding [removed: negative] [added: adverse] effect on our results of operations and related cash flows.

*We face risks [removed: associated with] [added: related to] the [removed: restructuring] [added: growth] of our [added: alternative accommodations] business.*

See Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations - [removed: Trends for more information on the workforce reductions.][added: Trends.]

Travel, including [removed: accommodation (including hotels, motels, resorts, homes, apartments and other unique places to stay),] [added: accommodation,] rental [removed: car] [added: car,] and airline ticket reservations, is significantly dependent on discretionary spending levels.

[removed: As a result, sales] [added: Sales] of travel services decline during general economic downturns and recessions and times of political or economic [removed: uncertainty, such as currently being experienced due to the COVID-19 pandemic,] [added: uncertainty] as consumers engage in less discretionary spending, are concerned about unemployment or inflation, have reduced access to [removed: credit] [added: credit,] or experience other concerns or effects that reduce their ability or willingness to travel.

Perceived or actual adverse economic conditions, including slow, [removed: slowing] [added: slowing,] or negative economic growth, high or rising unemployment rates, [removed: inflation] [added: inflation,] and weakening currencies, and concerns over government responses such as higher taxes or tariffs, increased interest [removed: rates] [added: rates,] and reduced government spending have impaired and could in the future [removed: impair consumer spending and] adversely affect travel demand.

Political [removed: uncertainty, conditions or events] [added: uncertainty] can also negatively affect consumer spending and adversely affect travel demand.

In the past, [removed: and prior to the significantly changed circumstances brought on by the onset of the COVID-19 pandemic,] we experienced volatility in transaction growth rates, increased cancellation [removed: rates] [added: rates,] and weaker trends in accommodation average daily rates ("ADRs") [removed: across many regions of the world,] particularly in [removed: those] countries [removed: that appear to be] most affected by economic and political uncertainties, which we believed were due at least in part to these macro-economic conditions and concerns.

Further economic or political disruptions [removed: beyond those resulting from the COVID-19 pandemic] could cause, contribute [removed: to] [added: to,] or be indicative of deteriorating macro-economic conditions, which in turn could negatively affect travel [removed: or the travel industry in general] and [removed: therefore] have an adverse impact on our results of operations.

While lower occupancy rates have historically resulted in accommodation providers increasing their distribution of accommodation reservations through third-party intermediaries such as us, our remuneration for accommodation reservation transactions changes proportionately with price, and [removed: therefore,] lower ADRs generally have a negative effect on our accommodation reservation business and on our revenues and results of operations.

These and other macro-economic [removed: uncertainties, such as oil prices, geopolitical tensions and differing central bank monetary policies,] [added: uncertainties] have led to significant volatility in the exchange rates between the U.S. Dollar and the Euro, the British Pound [removed: Sterling] [added: Sterling,] and other currencies.

Significant fluctuations in foreign currency exchange rates, stock [removed: markets] [added: markets,] and oil prices can also impact consumer travel behavior.

For example, although lower oil prices may lead to increased travel activity as consumers could have more discretionary funds and airline fares decrease, declines in oil prices may be indicative of broader macro-economic weakness, which in turn could negatively affect the travel industry, our [removed: business] [added: business,] and results of operations.

Our business and financial results are subject to risks and uncertainties, including those described below, which could adversely affect our business, results of operations, financial condition, and cash flows.

*Industry and Business Risks*

- Adverse changes in market conditions for travel services;

- Risks related to cyberattacks;

- Risks associated with the facilitation of payments from consumers;

- Risks related to the increased focus on our environmental, social, and governance responsibilities;

*Financial Risks*

In response to the outbreak of the novel strain of the coronavirus, COVID-19 (the "COVID-19 pandemic"), as well as subsequent outbreaks driven by new variants of COVID-19, governments and businesses around the world have implemented, and continue to implement, a variety of restrictive measures to reduce the spread of COVID-19.

In addition, the spread of new

variants of COVID-19 has caused uncertainty as to when restrictions will be lifted, if additional restrictions may be initiated or reimposed, if there will be permanent changes to travel behavior patterns, and the timing of distribution and administration of COVID-19 vaccines and other medical interventions globally.

In 2021, many countries experienced spikes in COVID-19 cases due to the spread of variants of COVID-19.

The COVID-19 pandemic has caused significant changes to our accommodation room nights trends.

We had approximately 20,300 employees worldwide at December 31, 2021.

In addition, our customer service resources and outsource arrangements for customer support may be unable to provide adequate customer service support, particularly during peak periods.

The COVID-19 pandemic has had and will have a long-term effect on how and from where people work, the attractiveness of our office environments, and remote working policies, and there may continue to be operational and workplace cultural challenges that may adversely affect our business, including talent retention, in the

shorter term.

We are unable to predict if there will be any significant and continuing impact on our workforce as a result of the COVID-19 pandemic.

The competition for talent in our industry has intensified, including among established technology companies and startups, and our personnel expenses to attract and retain key talent are increasing.

There is also competition for technology talent from companies with whom we did not historically compete for talent that are transitioning to digital.

The competition for talent is exacerbated by an increased willingness of certain companies to offer flexible and remote working policies, which expands the pool of candidates from which our competitors may attract talent.

This could continue in the future due to an actual or perceived slower pace of recovery of the travel industry as a result of the COVID-19 pandemic than other industries and other factors beyond our control.

For a discussion of the impact of COVID-19 on occupancy rates and ADRs, see Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations - Trends.

Because these events and their impacts are largely unpredictable, they can dramatically and suddenly affect travel behavior by consumers, demand

- online travel reservation services;

- online travel meta-search and price comparison services;

- "Super apps" that offer consumers a wide range of everyday and other services including travel bookings;

- online restaurant reservation services; and

Some competitors and new entrants to the travel services industry include private equity funded entities, which can more easily withstand significant losses for an extended period of time while such new entrants build market share through heavy marketing and/or discounting of their services.

cancellations, adverse changes in travel market conditions, and the competitiveness of the market.

Certain markets in which we operate have unique localized preferences and lower operating margins compared to other markets.

These markets often have competitors willing to make little or no profit through discounting in order to gain market share.

In addition, the emergence of super-apps in many of these markets may make it even more difficult or costly to compete in these markets than in our other markets.

Scaling and growing our business in these markets, in particular in Asia, could require significant investment, which could have a negative impact on our profit margins.

As our alternative accommodations business continues to grow, we face new risks relating to characteristics of this business that impact our profits and other metrics.

We may also face new claims of liability and are subject to regulatory developments that affect our business.

As we increase our alternative accommodation business, these different characteristics negatively impact our

We have no control over the actions or ability to predict the actions of our consumers, property owners, and other third parties during the customer’s stay, and as a result we cannot guarantee the safety of our consumers, property owners, and third parties.

In addition, we have not in the past and may not in the future undertake to independently verify the safety, suitability, location, quality, and legal compliance, such as fire code compliance or the presence of carbon monoxide detectors, of all our alternative accommodation listings.

We have in the past relied and may in the future rely on property owners to disclose information relating to their listings and such information may be inaccurate or incomplete.

From time to time, we are subject to inquiries related to compliance with alternative accommodation laws, rules, and regulations that we may not be able to respond to in a timely manner or in full satisfaction of such requests.

The following risk factors and other information included in this Annual Report on Form 10-K should be carefully considered.

The risks and uncertainties described below are not the only ones we face.

Additional risks and uncertainties not presently known to us or that we currently believe are immaterial may also impair our business, results of operations or financial condition.

If any of the following risks occur, our business, financial condition, operating results and cash flows could be materially adversely affected.

- Adverse changes in general market conditions for travel services, including the effects of macroeconomic conditions, terrorist attacks, natural disasters, health concerns, civil or political unrest or other events outside our control;

- Risks associated with the restructuring of our business;

In response to the outbreak of the novel strain of the coronavirus, COVID-19 (the "COVID-19 pandemic"), many governments around the world have implemented, and continue to implement, a variety of measures to reduce the spread of COVID-19, including travel restrictions and bans, instructions to residents to practice social distancing, curfews, quarantine advisories, including quarantine restrictions after travel in certain locations, shelter-in-place orders, required closures of non-essential businesses and additional restrictions on businesses as part of re-opening plans.

restaurants, to seek government support in order to continue operating, to curtail drastically their service offerings, to file for bankruptcy protection or to cease operations entirely.

Further, these measures have materially adversely affected, and may further adversely affect, consumer sentiment and discretionary spending patterns, economies and financial markets, and our workforce, operations and customers.

Our results for the year ended December 31, 2020 were significantly and negatively impacted, with a material decline in gross bookings, room nights booked, total revenues, net income and cash flow from operations, as compared to 2019.

Due to the uncertain and rapidly evolving nature of current conditions around the world, we are unable to predict accurately the impact that the COVID-19 pandemic will have on our business going forward.

Newly-booked room night reservations, excluding the impact of cancellations, declined rapidly as the COVID-19 pandemic spread in the first quarter and the beginning of the second quarter of 2020, but then steadily improved through the end of the second quarter and into the summer travel period in the third quarter of 2020.

In September 2020, variants of COVID-19 that spread more easily and quickly than other variants were discovered and have since spread to other countries.

In the fourth quarter of 2020, multiple COVID-19 vaccines were approved for widespread distribution throughout various parts of the world, including the United States and in Europe.

While this news is encouraging, it is still unknown when these vaccines will be available to broader populations and whether they will be as effective against variants of COVID-19, including the variants mentioned above.

In the fourth quarter of 2020, we saw room nights decline further, as well as an increase in cancellation rates, in each case as compared to the third quarter of 2020.

In January 2021, room nights declined slightly more than the decline in the fourth quarter of 2020, however, we have seen some improvement in these booking trends in recent weeks.

If these recent trends were to continue, we currently expect that room nights and gross bookings in the first quarter of 2021 will decline relative to the first quarter of 2019 by a few percentage points less than those metrics declined in the fourth quarter of 2020 relative to the fourth quarter of 2019.

We currently expect revenue in the first quarter of 2021 to decline by a similar amount as our expected decline in gross bookings in the first quarter of 2021, both relative to the first quarter of 2019.

The comparison of the first quarter of 2021 to the first quarter of 2019 avoids the distortion created from comparing to the initial spread of the COVID-19 pandemic late in the first quarter of 2020.

In addition, we currently expect that we will experience a greater operating loss in the first quarter of 2021 as compared to the fourth quarter of 2020.

With the continued spread of COVID-19 and other variants throughout the world, we expect the COVID-19 pandemic and its effects to continue to have a significant adverse impact on our business, financial condition, results of operations and cash flows for the duration of the pandemic, during any resurgences of the pandemic and during the subsequent economic recovery, which could be an extended period of time.

consumers.

*Utilization of governmental stimulus packages may negatively impact our business, operations and/or reputation.*

Certain governments have passed or are considering legislation to help businesses during the COVID-19 pandemic through loans, wage subsidies, tax relief or other financial aid, and some of these governments have extended or are considering extending these programs.

We have participated in several of these programs, including the Netherlands' wage subsidy program and the United Kingdom's job retention scheme.

In some cases, these programs restrict the ability of participating companies to take certain actions, such as restructurings, while participating in the program, though we are not currently under any such restrictions.

Additionally, in certain jurisdictions, there has been public scrutiny of government aid beneficiaries, including us, and as a result, our reputation could be harmed by having participated in these programs or participating in the future.

As a result of the deterioration of our business due to the COVID-19 pandemic, we evaluated goodwill, long-term investments and long-lived assets for possible impairment as of March 31, 2020.

As a result of this evaluation, we determined that our goodwill relating to OpenTable and KAYAK experienced a decline in value due to the COVID-19 pandemic, and therefore we recognized a goodwill impairment charge of $489 million (which is non-deductible for income tax purposes) as of March 31, 2020.

In addition, we recorded an impairment charge of $100 million at March 31, 2020 related to our investment in Didi Chuxing due to the impact of the COVID-19 pandemic on the business of the investee and our estimate of the resulting decline in the value of the investment.

As of September 30, 2020, we performed our annual goodwill impairment testing.

As a result of this testing, we recognized an additional goodwill impairment charge of $573 million (which is non-deductible for income tax purposes) for the three months ended September 30, 2020 relating to OpenTable and KAYAK.

The determination of the fair value reflects numerous assumptions that are subject to various risks and uncertainties, including key assumptions regarding OpenTable and KAYAK’s expected growth rates and operating margins, expected length and severity of the impact from the COVID-19 pandemic and the shape and timing of the subsequent recovery, the performance of the businesses during and following the COVID-19 pandemic, as well as other key assumptions with respect to matters outside of our control, such as discount rates and market comparables.

The evaluations required significant judgments and estimates and actual results could be materially different than those judgments and estimates utilized in the fair value estimates.

For the year ended December 31, 2020, there was a $161 million increase in expected credit loss expense compared to the same period in the prior year.

Due to the impact of the COVID-19 pandemic on our business volumes, we took actions to reduce the size of our workforce, and there could be further reductions in the size of our workforce and/or consolidations to optimize efficiency and reduce costs.

We have incurred and expect to incur charges related to the reductions in our workforce, changes in our facilities requirements, contract terminations and other non-cash charges, and there could be unanticipated costs in the future.

Implementation of these restructuring actions presents several significant risks, including the potential negative impact on employee morale and productivity, the loss of talented employees that we would not otherwise want to lose, difficulty retaining valuable key employees that have not been terminated, adverse impact on our culture, diversion of attention away from operating our business, public scrutiny, personnel capacity constraints, adverse effects on our internal control environment, actual or perceived disruption of service to our customers and hampering of our ability to grow, develop innovative products and compete, any of which could adversely impact our business and reputation.

If we do not successfully manage the restructurings, the anticipated efficiencies and cost savings may be delayed or not realized.

The following discussion should be read in conjunction with our Consolidated Financial Statements, including the notes to those statements, [removed: included elsewhere in this Annual Report on Form 10-K,] and the Section entitled "Special Note Regarding Forward-Looking [removed: Statements"] [added: Statements," included elsewhere] in this Annual Report on Form 10-K.

Our actual results may differ materially from the results discussed in [removed: the] [added: any] forward-looking [removed: statements.][added: statements, which may be due to factors discussed in "Risk Factors" and elsewhere in this Annual Report on Form 10-K.]

We connect consumers [removed: wishing] [added: who wish] to make travel reservations with [removed: providers of] travel [removed: services] [added: service providers] around the world through our online platforms.

Consumers can also use our meta-search services to easily compare travel reservation [removed: information, such as airline ticket, hotel reservation and rental car reservation information,] [added: information] from hundreds of online travel platforms at once.

[removed: In addition, we] [added: We also] offer various other services to consumers and partners, such as [removed: certain] travel-related insurance products and restaurant management services to restaurants.

We offer these services through six primary consumer-facing brands: Booking.com, Priceline, agoda, Rentalcars.com, [removed: KAYAK] [added: KAYAK,] and OpenTable.

[removed: While historically our brands operated on a largely independent basis and many of them focused on a particular service (e.g., accommodation reservations) or geography, we are increasing] [added: We continue to increase] the collaboration, [removed: cooperation] [added: cooperation,] and interdependency among our brands [removed: in our efforts] to provide consumers with the [removed: best and] most comprehensive services.

[added: The results of our business outside of the U.S. consist of the results of Booking.com, agoda, and Rentalcars.com in their entirety and the parts of the KAYAK and OpenTable businesses located outside of the U.S.] This classification is independent of where the consumer resides, where the consumer is physically located while using our [removed: services] [added: services,] or the location of the travel service provider or restaurant.

For example, a reservation made through Booking.com (which is domiciled in the Netherlands) at a hotel in New York by a consumer in the [removed: United States] [added: U.S.] is part of [added: the results of] our [removed: international results.][added: businesses outside of the U.S. In 2021, the revenues from our businesses outside of the U.S. (the substantial majority of which is generated by Booking.com through facilitating accommodation reservations) represented approximately 87% of our consolidated revenues.]

We also earn revenues from [removed: credit card processing rebates and customer processing fees,] advertising services, restaurant reservations and restaurant management services, and various other services, such as travel-related insurance revenues.

The COVID-19 pandemic and the resulting economic conditions and government [removed: orders have] [added: restrictions] resulted in a material decrease in consumer spending and [removed: an unprecedented] [added: a significant] decline in travel and restaurant activities and consumer demand for related [removed: services.][added: services as compared to 2019 levels.]

[removed: Newly-booked] [added: Accommodation] room [removed: night reservations, excluding] [added: nights, which include] the impact of cancellations, declined rapidly as the COVID-19 pandemic spread in the first quarter [added: of 2020] and the beginning of the second quarter of [removed: 2020, but then steadily improved through the end of the second quarter and into the summer travel period in the third quarter of] 2020.

Since [removed: April] [added: the second quarter of] 2020, [removed: we have seen a substantial year-over-year increase in] the share of [removed: newly booked] room nights booked for [added: international travel has been substantially lower than 2019 levels, as government-imposed travel restrictions have generally limited international travel more than] domestic travel (travelers booking a stay within their own [removed: country) while bookings for international travel have remained very limited throughout the pandemic.][added: country).]

[removed: In addition, we] [added: We] have observed an improvement in cancellation rates since the high in [removed: April,] [added: April 2020,] though we have seen [removed: additional] periods of [removed: highly] elevated cancellation rates typically coinciding with [added: significant increases in COVID-19 cases and] newly imposed [removed: travel] restrictions.

[removed: For more information, see] [added: See] Part [removed: II,] [added: I,] Item 1A, Risk Factors - "*The COVID-19 pandemic has materially adversely affected, and may further adversely impact, our business and financial [added: performance.*" and "*Declines or disruptions in the travel industry could adversely affect our business and financial] performance."*

[removed: In response] [added: Restructuring and other exit costs principally relate] to the [removed: COVID-19 pandemic, we have taken and are taking various] [added: restructuring charges as a result of restructuring] actions [added: taken in response] to [removed: address] the impact of the [added: COVID-19] pandemic on our business.

In response to the reduction in our business volumes as a result of the impact of the COVID-19 pandemic, during [removed: the year ended December 31, 2020,] [added: 2020] we took actions at all of our brands to reduce the size of our workforce to optimize efficiency and reduce costs, which [removed: we expect to result] [added: resulted] in annualized [added: personnel] cost savings [added: relative to our personnel expense run rate at the end] of [added: the first quarter of 2020 of] approximately $370 [removed: million in personnel-related expenses.][added: million.]

Certain governments [removed: have] passed [removed: or are considering modifying] legislation to help businesses during the COVID-19 pandemic through loans, wage subsidies, tax [removed: relief] [added: relief,] or other financial [removed: aid, and some of these governments have extended or are considering extending these programs.][added: aid.]

We [removed: have] participated in several of these programs, including the Netherlands' wage subsidy program and the United Kingdom's job retention scheme.

Prior to the COVID-19 pandemic, we experienced many years of [removed: significant] growth in our accommodation reservation services.

We believe this growth was the result of, among other things, the broader shift of travel purchases from offline to online, the widespread adoption of mobile [removed: devices] [added: devices,] and the growth of travel overall.

We also believe this growth was the result of the continued innovation and execution by our teams around the world to increase the number and the variety of accommodations we offer consumers, increase and improve content, build [removed: distribution] [added: distribution,] and improve the consumer experience on our online platforms, as well as [added: to] consistently and effectively [removed: marketing] [added: market] our brands through performance and brand marketing efforts.

However, we believe that [removed: the] [added: we have an] opportunity to grow [added: the size of] our business beyond pre-COVID-19 pandemic levels [removed: exists for the markets] in [removed: which we operate, including in] both mature and less mature markets.

Historically, our growth has primarily been generated by the worldwide accommodation reservation business of [removed: Booking.com, which is] our most significant brand, [removed: and has been due,] [added: Booking.com, due] in [removed: part,] [added: part] to the availability of a large number of properties through Booking.com.

Booking.com included approximately [removed: 2,373,000] [added: 2.4 million] properties on its website at December 31, [removed: 2020,] [added: 2021,] consisting of [removed: approximately 434,000] [added: over 400,000] hotels, [removed: motels] [added: motels,] and [removed: resorts] [added: resorts,] and [removed: approximately 1,939,000] [added: over 1.9 million] homes, [removed: apartments] [added: apartments,] and other unique places to stay, [removed: compared to approximately 2,580,000] [added: all of which were about in line with the number of] properties [removed: (including approximately 460,000 hotels, motels and resorts and approximately 2,120,000 homes, apartments, and other unique places to stay)] [added: on its website] at December 31, [removed: 2019.][added: 2020.]

Booking.com categorizes properties listed on its website as either (a) hotels, [removed: motels] [added: motels,] and resorts, which groups together more traditional accommodation types (including hostels and inns), or (b) homes, [removed: apartments] [added: apartments,] and other unique places to stay, also referred to as alternative accommodations, which encompasses all other types of accommodations, including bed and breakfasts, villas, [removed: apart-hotels] [added: apart-hotels,] and beyond.

[removed: We intend to] continue to improve the accommodation choices available for reservation on our [removed: platforms, however,] [added: platforms but] the number of accommodations on our platforms may vary in part as a result of removing [added: or adding] accommodations from time to time.

We may [removed: also] experience lower profit margins [removed: with respect to these properties] due to certain additional costs, such as increased customer service costs, related to offering [removed: these] [added: alternative] accommodations on our platforms.

As our alternative accommodation business has grown, these different characteristics have negatively impacted our profit margins and [removed: we expect] this trend [removed: to] [added: may] continue.

We are constantly innovating to grow our business by, among other things, providing a best-in-class user experience with intuitive, easy-to-use online platforms [removed: (i.e., websites and mobile apps)] to ensure that we are meeting the needs of online consumers while aiming to exceed [removed: their expectations.]

As part of these ongoing efforts, we have a long-term strategy to build a more integrated offering of multiple elements of [removed: travel,] [added: travel connected by a payment platform,] which we refer to as the "Connected [removed: Trip",] [added: Trip,"] and we expect these efforts to increase room night growth and revenue growth over time.

[removed: Although we expect our efforts to build the Connected Trip will increase revenue growth over time, we] [added: We] may see a negative impact on our operating margins in the near term as we incur the expenses associated with [removed: these] [added: Connected Trip-related] investments.

Further, to the extent our non-accommodation services [added: (e.g., airline ticket reservation services) have lower margins and] grow faster than our accommodation services, whether as part of the Connected Trip or otherwise, our operating margins may be negatively [removed: affected if we experience an increasing mix of revenues from lower-margin services.][added: affected.]

As part of our strategy to provide more payment options to consumers and travel service providers, increase the number and variety of accommodations available on [removed: Booking.com] [added: Booking.com,] and enable [removed: the growth of] our [removed: in-destination activities businesses,] [added: long-term Connected Trip strategy,] Booking.com is increasingly processing transactions on a merchant basis, where it facilitates payments from travelers for the services provided.

We believe that adding these types of service offerings will benefit consumers and travel service providers, as well as our gross bookings, room [removed: night] [added: night,] and earnings growth rates.

However, this results in additional expenses for personnel, payment processing, [removed: customer] chargebacks (including those related to [removed: fraud)] [added: fraud),] and other expenses related to these transactions, which are recorded in "Personnel" and "Sales and other expenses" in our Consolidated Statements of Operations, as well as associated incremental revenues [removed: in the form of] [added: (e.g.,] credit card [removed: rebates, for example,] [added: rebates),] which are recorded in "Merchant revenues." To the extent more of our business is generated on a merchant basis, we [removed: will] incur a greater level of these merchant-related expenses, which [removed: would] negatively [removed: impact] [added: impacts] our operating margins despite increases in associated incremental revenues.

[removed: In addition, the] [added: The] revenue earned on a mobile transaction may be less than a typical desktop transaction due to different consumer purchasing patterns.

For example, accommodation reservations made on a mobile device typically are for shorter lengths of stay, have lower accommodation [removed: ADRs] [added: average daily rates ("ADRs"),] and are not made as far in advance.

Although we believe that providing an extensive collection of properties, excellent customer [removed: service] [added: service,] and an intuitive, easy-to-use consumer experience are important factors influencing a consumer's decision to make a reservation, for many consumers, particularly in certain markets, the price of the travel service is the primary factor determining whether a consumer will book a reservation.

As a result, it is increasingly important to offer travel services, such as accommodation reservations, at [added: a] competitive [removed: prices,] [added: price,] whether through discounts, coupons, closed-user group rates or loyalty programs, [added: increased flexibility in cancellation policies,] or otherwise.

The COVID-19 pandemic and the resulting implementation of travel restrictions by governments around the world resulted in a significant decline in travel activities and consumer demand for related services in 2020 in particular.

Since the beginning of the second quarter of 2020 and through 2021, accommodation room night declines versus the comparable period in 2019 have generally improved as government-imposed travel restrictions have eased, vaccines and other medical interventions have become more widespread, and consumer demand for travel has started to rebound.

However, there have been periods of worsening trends due to spikes in COVID-19 cases and newly implemented travel restrictions, primarily related to new variants.


The cancellation rate in 2021 improved meaningfully when compared to 2020 but remained a few percentage points higher than in 2019.

Increases in cancellation rates can negatively impact our marketing efficiency and we may see increased customer service costs as we did early in the COVID-19 pandemic.

In 2021, we saw an increase in the share of room nights booked for international travel (travelers booking a stay at a property located outside their own country) versus 2020, however, the share remained well below 2019 levels.

We have seen an increase in the share of room nights booked on a mobile device and an increased share of mobile app bookings in 2021 as compared to 2019 and 2020.

We also see favorable repeat direct booking behavior from consumers in our apps and they allow us more opportunities to engage directly with consumers.

Our global ADRs increased in 2021 as compared to 2019, due in part to changes in the geographical mix of our business driven primarily by stronger room night performance in North America, which is a high ADR region, and weaker room night performance in Asia, which is a low ADR region.

In addition, our global ADRs in 2021 benefited from higher ADRs in Europe and North America as compared to 2019, driven by rate increases across many destination types with notable strength in beach-oriented leisure destinations.

Global ADRs in 2020 were meaningfully below 2019 ADRs due to the COVID-19 pandemic.

their expectations.

For more information, see Part I, Item 1A, Risk Factors - "*We may not be able to keep up with rapid technological or other market changes.*"

In 2021, our marketing expense increased significantly versus 2020 as a result of the improving demand environment and our own efforts to invest in marketing, but remained below 2019 levels.

Marketing efficiency can also be impacted by the extent to which consumers come directly to our platforms for bookings.

In 2021, the share of room nights booked by consumers coming directly to our platforms increased as compared to 2020 and 2019, which benefits marketing efficiency.

In recent years, we observed periods of stable or increasing ROIs.

In 2021, ROIs were about in line with 2019 levels and increased versus 2020 when ROIs were negatively impacted by a significant increase in cancellation rates early in the COVID-19 pandemic.

We expect volatility in our ROIs as the pandemic continues to affect travel, and that ROIs could be negatively impacted in the future by increased levels of competition and other factors.

We intend to

The share of Booking.com’s room nights booked for alternative accommodation properties in 2021 was about 29%, which was about the same as the share of room nights in 2019 and down slightly from 2020.

Prior to the pandemic, we observed an overall longer-term trend of an increasing share of room nights booked for alternative accommodation properties as consumer demand for these types of properties has grown, and as we have increased the number and variety of alternative accommodation properties available to consumers on Booking.com.

While the Organisation for Economic Co-operation and Development has been working on multinational tax changes that could require all member parties to remove all digital services taxes, the timing and details are not yet known.

For example, total revenues from our businesses outside of the U.S. increased by 58% in 2021 as compared to 2020, but without the impact of changes in foreign currency exchange rates, increased year-over-year on a constant-currency basis by approximately 57%.

We

Outlook

In December 2021, the spread of the Omicron variant and renewed travel restrictions in certain markets contributed to a 35% decline in room nights relative to December 2019.

In January 2022, we saw room nights decline about 22% relative to January 2019, and in the first half of February 2022 room nights were about in line with the first half of February 2019, in each case primarily driven by improving room night trends in Europe.

Given these rapid changes, particularly during the last six weeks, we cannot accurately predict the number of room nights that will be booked in the first quarter of 2022.

Following from the above, for the first quarter of 2022 we currently expect:

- the change in gross bookings relative to the first quarter of 2019 will be several percentage points better than the change in room nights for the same period primarily due to an increase in accommodation ADRs;

- revenues as a percentage of gross bookings will be lower than it was in the first quarter of 2019; and

- we will have an operating profit in the first quarter of 2022.

Prior to the COVID-19 pandemic, our gross bookings were generally similar in the first three quarters of the year and higher than in the fourth quarter.

However, we would generally recognize revenue from these bookings when the travel begins (at "check-in"), and accommodation check-ins in Europe and North America are generally highest in the third quarter during those regions’ peak summer travel season and lowest in the first quarter.

In addition to the typical seasonality effects on our business, our quarterly results and quarterly year-over-year growth rates can be impacted by:

- The level of acceleration or deceleration in the gross bookings growth rate.

For example, our operating margins are typically negatively impacted in the near term from gross bookings and related variable marketing expense growth acceleration, as revenue growth is typically less impacted by accelerating gross bookings growth in the near term.

- The date on which certain holidays (e.g., Easter and Ramadan) fall.

As discussed in more detail in the Section entitled "Special Note Regarding Forward-Looking Statements," this discussion contains forward-looking statements, which involve risks and uncertainties.

Factors that might cause those differences include those discussed in "Risk Factors" and elsewhere in this Annual Report on Form 10-K.

We seek to empower people to cut through travel barriers, such as money, time, language and overwhelming options, so they can use our services to easily and confidently go where they want to go, stay where they want to stay, dine where they want to dine, pay how they want to pay and experience what they want to experience.

Through one or more of our brands, consumers can: book a broad array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, hostels and other properties); make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a flight, cruise, vacation package, tour or activity.

We also seek to maximize the benefits of our scale by sharing resources and technological innovations, co-developing new services and coordinating activities in key markets among our brands.

For example, Booking.com, the world’s leading brand for booking online accommodation reservations (based on room nights booked), offers rental car and other ground transportation services, flights, tours and activities reservations, restaurant reservations and other services, many of which are supported by our other brands.

Similarly, hotel reservations available through Booking.com are also generally available through agoda and Priceline.

We refer to our company and all of our subsidiaries and brands collectively as "Booking Holdings," the "Company," "we," "our" or "us."

Our business is driven primarily by international results, which consist of the results of Booking.com, agoda and Rentalcars.com in their entirety and the international businesses of KAYAK and OpenTable.

In 2020, our international business (the substantial majority of which is generated by Booking.com) represented approximately 88% of our consolidated revenues.

A significant majority of our revenues, including a significant majority of our international revenues, is earned in connection with facilitating accommodation reservations.

In response to the outbreak of the novel strain of the coronavirus, COVID-19 (the "COVID-19 pandemic"), many governments around the world have implemented, and continue to implement, a variety of measures to reduce the spread of COVID-19, including travel restrictions and bans, instructions to residents to practice social distancing, curfews, quarantine advisories, shelter-in-place orders and required closures of non-essential businesses.

These government mandates have forced many of the partners on whom our business relies, including hotels and other accommodation providers, airlines and restaurants, to seek government support in order to continue operating, to curtail drastically their service offerings or to cease operations entirely.

Further, these measures have materially adversely affected, and may further adversely affect, consumer sentiment and discretionary spending patterns, economies and financial markets, and our workforce, operations and customers.

Our financial results and prospects are almost entirely dependent on the sale of travel-related services.

Our results for the year ended December 31, 2020 have been materially and negatively impacted, with a material decline in gross travel bookings, room nights booked, total revenues, net income and cash flow from operations as compared to the year ended December 31, 2019.

However, in the fourth quarter of 2020, we saw an increased decline in newly-booked room night reservations, due in part to increased COVID-19 case counts and reimposed or additional government-imposed travel restrictions, particularly in Europe.

In September 2020, a variant of COVID-19 that spreads more easily and quickly than other variants was first discovered in the United Kingdom, and has since spread across the country and to other countries, including the United States and in Europe.

Another variant of COVID-19 that also appears to spread more easily and quickly than other variants was detected in South Africa in October 2020.

In the fourth quarter of 2020, multiple COVID-19 vaccines were approved for widespread distribution throughout various parts of the world, including the United States and in Europe.

While this news is encouraging, it is still unknown when these vaccines will be available to broader populations and whether they will be as effective against variants of COVID-19, including the variants mentioned above.

We believe that as effective vaccines become widely distributed, people will feel it is safe to travel again and government restrictions will be relaxed, although the timing remains uncertain.

Over this same time period, we have seen a year-over-year increase in the share of our newly-booked room nights made on a mobile device.

Also, while we saw an increase in the share of newly-booked room nights for alternative accommodation properties in the early months of the pandemic, more recently the share has been consistent with pre-pandemic levels.

The overall improvement in cancellation rates since April benefits our room nights booked including cancellations but does not impact newly-booked room nights.

Our revenue decline in 2020 was impacted to a greater extent than newly-booked room night growth due to the impact of higher cancellations and lower accommodation average daily rates ("ADRs") as compared to 2019.

We expect to continue to see severely reduced new travel and restaurant reservation bookings as compared to 2019 levels for the foreseeable future, which will have a materially adverse impact on our business, financial condition, results of operations and cash flows.

Further, given the volatility in the global travel industry and the financial difficulties faced by many of our travel service provider and restaurant partners, we have increased our provision for expected credit losses on receivables from and cash advances made to our travel service provider and restaurant partners.

Due to the uncertain and rapidly evolving nature of current conditions around the world, we are unable to predict accurately the impact that the COVID-19 pandemic will have on our business going forward.

The approval and distribution of COVID-19 vaccines throughout the world is encouraging, however, the COVID-19 pandemic continues to impact global travel and travel restrictions remain in place, particularly in Europe.

In the fourth quarter of 2020, we saw room nights decline further, as well as an increase in cancellation rates, in each case as compared to the third quarter of 2020.

In January 2021, room nights declined slightly more than the decline in the fourth quarter of 2020, however, we have seen some improvement in these booking trends in recent weeks.

If these recent trends were to continue, we currently expect that room nights and gross bookings in the first quarter of 2021 will decline relative to the first quarter of 2019 by a few percentage points less than those metrics declined in the fourth quarter of 2020 relative to the fourth quarter of 2019.

We currently expect revenue in the first quarter of 2021 to decline by a similar amount as our expected decline in gross bookings in the first quarter of 2021, both relative to the first quarter of 2019.

The comparison of the first quarter of 2021 to the first quarter of 2019 avoids the distortion created from comparing to the initial spread of the COVID-19 pandemic late in the first quarter of 2020.

In addition, we

currently expect that we will experience a greater operating loss in the first quarter of 2021 as compared to the fourth quarter of 2020.

With the continued spread of COVID-19 throughout the world, we expect the pandemic and its effects to continue to have a significant adverse impact on our business for the duration of the pandemic, during any resurgences of the pandemic and during the subsequent economic recovery, which could be an extended period of time.

Among other actions, we have:

- Raised $4.1 billion in debt and negotiated amendments to our revolving credit facility to provide additional financial flexibility

We have exposure to several types of market risk: changes in interest rates, foreign currency exchange [removed: rates] [added: rates,] and equity prices.

At December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the outstanding aggregate principal amount of our debt was [removed: $12.2] [added: $11.1] billion and [removed: $8.7] [added: $12.2] billion, respectively.

We estimate that the fair value of such debt was approximately [removed: $14.0] [added: $12.1] billion and [removed: $9.8] [added: $14.0] billion at December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

The estimated fair value of our debt in excess of the outstanding principal amount at December 31, [added: 2021 and] 2020 primarily relates to [added: the conversion premium on the Convertible] Senior Notes and the [removed: Convertible] [added: outstanding] Senior Notes issued in April 2020.

Excluding the effect on the fair value of our convertible senior notes, a hypothetical 100 basis point (1.0%) decrease in interest rates would have resulted in an increase in the estimated fair value of our other debt of approximately [removed: $544] [added: $401] million and [removed: $325] [added: $544] million at December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] respectively.

Therefore, because we report our results in U.S. Dollars, we face exposure to movements in foreign currency exchange rates as the financial results and the financial condition of our [removed: international] businesses [added: outside of the U.S.] are translated from local currencies (principally Euros and British Pounds Sterling) into U.S. Dollars.

If the U.S. Dollar weakens against the local currencies, the translation of these foreign-currency-denominated balances will result in increased net assets, gross bookings, revenues, operating [removed: expenses] [added: expenses,] and net income.

We have a significant investment that is denominated in Hong Kong Dollars and the related impact from the movements in foreign currency exchange rates is recognized in "Other income (expense), net" in the Consolidated Statements [removed: and] [added: of] Operations.

We designate certain portions of the aggregate principal value of [removed: the] [added: our] Euro-denominated debt as a hedge [removed: against the impact] of [added: the] foreign currency [removed: exchange rate fluctuations on] [added: exposure of] the net [removed: assets of one of our] [added: investment in certain] Euro functional currency subsidiaries.

[removed: Foreign] [added: The foreign] currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument for accounting purposes are recognized in "Other income (expense), net" in our Consolidated Statements of Operations (see Note 12 to our Consolidated Financial Statements).

Such foreign currency transaction gains or losses are dependent on the amount of [added: net assets of the Euro functional currency subsidiaries, the amount of the Euro-denominated debt that is designated as a hedge and fluctuations in foreign currency exchange rates.]

We [added: generally] enter into [removed: foreign currency forward contracts to hedge our exposure] [added: derivative instruments] to [added: minimize] the impact of [removed: movements in] foreign currency exchange [removed: rates] [added: rate fluctuations] on our transactional balances denominated in currencies other than the functional currency.

See Note 6 to our Consolidated Financial Statements for [removed: further information.][added: additional information related to our derivative contracts.]

We are exposed to equity price risk as it relates to changes in [removed: the] fair values of our investments in equity securities of publicly-traded companies and private companies.

The estimated fair values of our investments in equity securities of publicly-traded companies and private companies, excluding [removed: certain] investments classified as debt securities for accounting purposes, were [removed: $3.1] [added: $2.9] billion and [removed: $455] [added: $325] million, respectively, at December 31, [removed: 2020,] [added: 2021,] and [removed: $1.8] [added: $3.1] billion and [removed: $501] [added: $455] million, respectively, at December 31, [removed: 2019.][added: 2020.]

Our investments in private companies, excluding [removed: certain] investments classified as debt securities for accounting purposes, are measured at cost less impairment, if [removed: any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.][added: any.]

A hypothetical 10% decrease in the fair values [removed: of these investments] at December 31, [added: 2021 and] 2020 [added: of our investments in equity securities of publicly-traded companies] and [removed: 2019] [added: private companies] would have resulted in a loss, before tax, of approximately [removed: $355] [added: $320] million and [removed: $230] [added: $355] million, respectively, being recognized in net income.

Our businesses outside of the U.S. represent a substantial majority of our financial results.

For example, total revenues from our businesses outside of the U.S. increased by 58% in 2021 as compared to 2020, but without the impact of changes in foreign currency exchange rates, increased year-over-year on a constant-currency basis by approximately 57%.

We recorded net losses of $569 million and net gains of $1.8 billion and $745 million related to these equity securities for the years ended December 31, 2021, 2020, and 2019, respectively (see Notes 5 and 6 to our Consolidated Financial Statements).

Such investments are also required to be measured at fair value as of the date of certain observable transactions for the identical or a similar investment of the same issuer.

As of February 22, 2022, the market prices of Meituan's shares, DiDi's ADSs, and Grab's shares decreased by 24%, 15%, and 27%, respectively, as compared to their respective market prices on December 31, 2021.

During the year ended December 31, 2020, we sold our investments in government and corporate debt securities other than our investments in Trip.com Group convertible senior notes (see Note 5 to the Consolidated Financial Statements).

Our investments in Trip.com Group convertible senior notes are more sensitive to the equity market price volatility of Trip.com Group's American Depositary Shares ("ADSs") than changes in interest rates.

The estimated fair value of our Trip.com Group convertible senior notes will likely increase as the market price of Trip.com Group's ADSs increases and will likely decrease as the market price of Trip.com Group's ADSs falls.

The estimated fair value of the Company's debt in excess of the outstanding principal amount at December 31, 2019 primarily relates to the conversion premium on the convertible senior notes.

Our international business represents a substantial majority of our financial results.

However, for the year ended December 31, 2020, movements in foreign currency exchange rates had little to no impact on our performance metrics and financial results.

net assets of the Euro functional currency subsidiary, the amount of the Euro-denominated debt that is designated as a hedge and fluctuations in foreign currency exchange rates.

In periods prior to the second quarter of 2020, we also entered into foreign currency derivative contracts to hedge translation risks from short-term foreign currency exchange rate fluctuations for the Euro, British Pound Sterling and certain other currencies versus the U.S. Dollar.

Since the first quarter of 2020, we have not entered into such derivative instruments as the impact of the COVID-19 pandemic on our operating results are highly uncertain.

Due to the impact of the COVID-19 pandemic (see Note 2 to the Consolidated Financial Statements) on the business of the investee and the estimated decline in the value of our investment, we recorded a significant impairment charge related to our investment in a private company during the three months ended March 31, 2020 (see Notes 5 and 6 to the Consolidated Financial Statements).

The COVID-19 pandemic has [removed: had a profound] [added: continued to profoundly] impact [removed: on] our business, employees, partners, [removed: communities] [added: consumers, communities,] and stockholders.

[removed: As a result, our] [added: Our] mission to make it easier for everyone to experience the world remains unchanged.

We seek to empower people to cut through travel barriers, such as money, time, [removed: language] [added: language,] and overwhelming options, so they can use our services to easily and confidently get where they want to go, stay where they want to stay, dine where they want to dine, pay how they want to [removed: pay] [added: pay,] and experience what they want to experience.

[removed: Through one or more of] [added: We connect consumers wishing to make travel reservations with travel service providers around the world through] our [removed: brands,] [added: online platforms, which allow] consumers [removed: can:] [added: to:] book a broad array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, [removed: hostels] [added: hostels,] and other [removed: properties);] [added: alternative and traditional accommodations properties) and a flight to their destination;] make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a [removed: flight, cruise,] vacation package, [removed: tour] [added: tour, activity,] or [removed: activity.][added: cruise.]

Consumers can also use our meta-search services to easily compare travel reservation information, such as [removed: airline ticket, hotel reservation] [added: flight, hotel,] and rental car [removed: reservation information,] [added: reservations,] from hundreds of online travel platforms at once.

In addition, we offer [removed: various] other services to consumers and partners, such as [removed: certain] travel-related insurance products and restaurant management services to restaurants.

We offer these services through six primary consumer-facing brands: Booking.com, Priceline, agoda, Rentalcars.com, [removed: KAYAK] [added: KAYAK,] and OpenTable.

[removed: While historically our brands operated on a largely independent basis and many of them focused on a particular service (e.g., accommodation reservations) or geography,] [added: At the same time,] we continue to increase the collaboration, [removed: cooperation] [added: cooperation,] and interdependency among our brands in our efforts to provide consumers with the [removed: best and] most comprehensive [added: and value-oriented] services.

We [removed: also] [added: continue to] seek to maximize the benefits of our scale by sharing resources and technological [removed: innovations, co-developing new services and coordinating activities in key markets] [added: innovations] among our [removed: brands.][added: brands and co-developing new services.]

[removed: Similarly,] [added: supported by our Rentalcars.com brand, and] hotel reservations available through Booking.com are also generally available through agoda and Priceline.

The following table shows the key services [removed: offered] [added: we offer] to [removed: consumers by our primary brands:][added: consumers:]

[removed: ][added: ]

[added: The results of our business outside of the U.S. consist of the results of Booking.com, agoda, and Rentalcars.com in their entirety, and the parts of the KAYAK and OpenTable businesses located outside the U.S.] This classification is independent of where the consumer resides, where the consumer is physically located while using our services or the location of the travel service provider or restaurant.

[removed: A significant majority of our revenues, including] [added: We earn] a significant majority of our [removed: international revenues, is earned in connection with] [added: revenues from] facilitating accommodation reservations.

Our common stock is listed on the NASDAQ Global Select Market under the symbol "BKNG." We refer to our company and all of our subsidiaries and brands collectively as "Booking Holdings," the "Company," "we," [removed: "our"] [added: "our,"] or "us."

We also earn revenues from [removed: credit card processing rebates and customer processing fees,] advertising services, restaurant [removed: reservations and restaurant management services,] [added: reservations,] and various other services, such as travel-related [removed: insurance.][added: insurance products and restaurant management services for restaurants.]

For the year ended December 31, [removed: 2020,] [added: 2021,] we had revenues of [removed: $6.8] [added: $11.0] billion, which we classify as "agency" revenues, "merchant" [removed: revenues] [added: revenues,] and "advertising and other" revenues.

Agency revenues consist almost entirely of travel reservation [removed: commissions.][added: commissions from our accommodation, rental car, and airline reservation services.]

- Merchant revenues are derived from [removed: travel-related] transactions where we facilitate payments from travelers for the [removed: service] [added: services] provided, generally at the time of booking.

Merchant revenues include travel reservation commissions and transaction net revenues (i.e., the amount charged to travelers less the amount owed to travel service [removed: providers) in connection with our merchant reservation services;] [added: providers);] credit card processing rebates and customer processing fees; and ancillary fees, including travel-related insurance revenues.

We aim to [removed: achieve our mission to make it easier for everyone to experience the world through] [added: demonstrate] global leadership in online travel and restaurant reservation and related services [removed: by striving to:][added: by:]

- [removed: provide] [added: providing] consumers with the [removed: best] [added: most comprehensive] choices and prices at any time, in any place, on any device;

- [removed: make] [added: making] it easy for people to find, book, pay [removed: for] [added: for,] and experience their travel desires; [removed: and]

- [removed: provide] [added: offering] platforms, [removed: tools] [added: tools,] and insights to our business partners to help them be [removed: successful.][added: successful; and]

We focus on relentless innovation and execution and a commitment to serve both consumers and [removed: our travel service provider and restaurant] partners with unmatched service and best-in-class [removed: digital] technology.

As travel demand returns, we [removed: plan to continue] [added: expect] to [removed: participate broadly in] [added: benefit from] this online growth by expanding our service offerings and markets.

[removed: We believe that offering] [added: - Provide the best consumer experience. Offering] consumers an outstanding online experience is essential [removed: for] [added: to] our [removed: future] success.

[removed: To accomplish this, we] [added: We] focus on providing consumers with: (a) intuitive, easy-to-use online travel and restaurant reservation and search services; (b) a [removed: continually improving] [added: comprehensive] selection of accommodations, other travel offerings, restaurants and payment [removed: options through our services;] [added: options;] (c) informative and useful content, such as pictures, accommodation and restaurant [removed: details] [added: details, reviews,] and [removed: reviews;] [added: sustainability information;] and (d) excellent customer service.

Our goal is to make travel easy, [removed: frictionless] [added: frictionless,] and personal and to offer consumers the most value, the most trusted brands, the most personalized [removed: experience] [added: experience,] and the most extensive, [removed: varied] [added: varied,] and comprehensive travel service selection in every geography.

Further, we endeavor to provide excellent customer service in a variety of ways, including through [removed: our] call centers and online platforms and the use of chatbots and other technologies, so that consumers can be confident that booking reservations through us will be a positive experience.

Although [removed: we spent much of 2020 navigating] the challenges of the COVID-19 [removed: pandemic,] [added: pandemic persisted in 2021,] we continue to innovate and invest in our services in order to emerge from the pandemic in a strong position to meet the needs of consumers and [removed: our travel service provider and restaurant] partners.

We [removed: continue to] seek to grow our business through innovation [removed: by, among other things,] [added: by] providing a best-in-class user experience with intuitive, easy-to-use online platforms (i.e., websites and mobile apps) [removed: to ensure that we are meeting the needs of online consumers while aiming to exceed their expectations.][added: and building stronger relationships with our customers and partners.]

As a result, [added: we continue to execute against] our long-term strategy [removed: is] to build a seamless offering of multiple elements of travel, which we refer to as the "Connected Trip." We believe that through innovation and the utilization of emerging technologies such as artificial intelligence, the Connected Trip will simplify and improve all aspects of the travel experience, [removed: including:] [added: including] discovery, planning, booking, [added: paying,] coordinating itineraries among travel service providers, [removed: automatic rescheduling/rebooking, etc. For example, if a traveler’s flight is delayed, we envision that ultimately the Connected Trip will not only alert the traveler, but also automatically arrange for a late arrival at the hotel, change a dinner reservation] and [removed: alert companion diners, reschedule the airport transfer, find a later connecting flight, etc. We believe that such a system will benefit both the traveler and the travel service provider or restaurant, as well as provide a compelling and differentiated service offering for consumers that will drive enhanced loyalty and frequency over time.][added: automatic rescheduling.]

- [removed: Partnering] [added: Partner] with travel service [removed: providers, restaurants] [added: providers] and [removed: OTCs.] [added: restaurants.] We aim to establish mutually beneficial relationships with travel service providers and restaurants around the world.

We believe that travel service providers and restaurants benefit from participating in our services by increasing their distribution channels, [removed: demand] [added: demand, profile] and [added: reputation, and] inventory utilization in an efficient and cost-effective manner.

Travel service providers and restaurants benefit from our [removed: well-known] [added: trusted] brands and marketing efforts, expertise in offering an excellent consumer [removed: experience through our platforms] [added: experience,] and ability to offer their inventory in markets and to consumers that [removed: the travel service provider or restaurant] [added: they] may otherwise be unable or unlikely to [removed: reach.][added: reach, for instance due to language or payments services we are able to offer on their behalf.]

- [removed: Operating] [added: Operate] multiple brands. We [removed: employ a strategy of operating] [added: operate] multiple brands, which [removed: we believe] allows us [removed: the opportunity] to offer our services in ways that appeal to different consumers, pursue [removed: different] [added: distinct] marketing and business strategies, encourage experimentation and [removed: innovation, provide different service offerings and focus on different markets.]

[removed: At the same time, we are continuing] [added: We continue] to increase the collaboration, [removed: cooperation] [added: cooperation,] and interdependency among our brands [removed: in our efforts] to provide consumers with the [removed: best and] most comprehensive [removed: services.][added: services and maximize the benefits of our scale.]

[removed: As we deem appropriate given the shape and speed of recovery from the COVID-19 pandemic, we intend to] [added: We] invest resources to support organic growth by all our brands, whether through increased marketing, geographic expansion, technological [removed: innovation] [added: innovation,] or increased access to accommodations, [added: flights,] rental cars, restaurants, [removed: airline tickets] or other services.

- [removed: Investing] [added: Invest] in profitable and sustainable growth. We seek to offer online services that meet the needs and the expectations of consumers, travel service [removed: providers] [added: providers,] and restaurants and that we believe will result in [added: mutual] long-term profitability and growth.

We were encouraged to see the distribution of vaccines and the development of other medical interventions to COVID-19 during 2021, but the emergence of new variants continues to make the shape and timing of a recovery uncertain.

We remain confident that over time there will be a strong recovery for travel demand globally, and are focused on executing on our key strategic priorities so we emerge from this period in a position of strength.

As we continue our efforts to make our brands the most trusted and convenient platforms for consumers and partners, we have taken important actions in 2021 including:

- expanding and enhancing our flight product at Booking.com, which is a key component of our Connected Trip vision;

- entering into an agreement to acquire Etraveli Group in November and completing our acquisition of Getaroom in December;

- increasing our internal collaboration efforts;

- continuing to build out our payments platform and payments capabilities across the Company; and

- launching new product features to make travel more sustainable and inclusive.

For example, when a traveler books an accommodation through Booking.com, we may offer relevant rental car or airport transfer transportation services

For example, a reservation made through Booking.com (which is domiciled in the Netherlands) at a hotel in New York by a consumer in the United States is part of the results of our businesses outside of the U.S. During the year ended December 31, 2021, the revenues from our businesses outside of the U.S. (the substantial majority of which is generated by Booking.com) represented approximately 87% of our consolidated revenues.

Our Business Model

We derive substantially all of our revenues from providing online travel reservation services, which facilitate online travel purchases between travel service providers (which we generally refer to as "partners") and travelers (which we generally refer to as "consumers").

Our Strategy

- operating our business sustainably and supporting sustainable travel choices by our consumers and partners.

Although new variants of COVID-19 continue to make the shape and timing of recovery uncertain, we believe the global online travel and dining industries will gradually return to pre-pandemic levels and consumer purchasing will continue to shift from traditional offline to online channels.

We believe that our continued work to build out our payments capabilities across the Company helps to remove some of the friction in the booking process and enables us to offer additional value for travelers.

For example, if a traveler’s flight is delayed, we envision that ultimately the Connected Trip will not only alert the traveler, but also automatically arrange for a late arrival at the hotel, change a dinner reservation and alert companion diners, reschedule the car arranged for airport transfer, find a later connecting flight, offer one-click rebooking and payment for any other changes, and manage other impacts from the delayed flight.

We believe offering travelers a compelling flight product alongside our other travel products is a key component of our Connected Trip vision.

In 2021, we made progress in building out a flight offering at Booking.com, including expanding into 34 countries by the end of the year.

We expect that these developments will benefit our travelers, travel service providers, and restaurant partners, as well as provide a compelling and differentiated service offering that will drive enhanced loyalty and frequency over time.

innovation, provide numerous service offerings, and focus on specific markets or geographies.

In 2021, we continued to scale our flight offerings to more markets, and offer payments solutions to more customers and partners.

For instance, in December 2021, we completed the acquisition of Getaroom, a business-to-business distributor of hotel rooms, which in conjunction with our Priceline business we expect to increase value for both hotel and affiliate partners, and in November 2021, we entered into an agreement to acquire European-based flights booking provider Etraveli Group.

In 2021, Booking.com significantly expanded its flight offering to 34 markets and in-destination tours and activities to more than 840 cities around the world.

We have established widely used and recognized e-commerce brands through marketing and promotional campaigns, particularly strategic use of performance marketing spend, which can be variable based on travel demand, and which saw increased volatility during the COVID-19 pandemic.

meet evolving stakeholder expectations, and support business innovation and growth.

If regulators were to presume that we are a gatekeeper under the Digital Markets Act as currently proposed and we are not successful in rebutting that presumption, we would be subject to additional rules and regulations not applicable to all our competitors and our business could be harmed.

We are modernizing our technology by building new applications with modern development tools and application programming interfaces and moving certain systems and data to public cloud infrastructure.

Prior to the COVID-19 pandemic, our gross bookings were generally similar in the first three quarters of the year and higher than in the fourth quarter.

However, we would generally recognize revenue from these bookings when the travel begins (at "check-in"), and accommodation check-ins in Europe and North America are generally highest in the third quarter during those regions' peak summer travel season and lowest in the first quarter.

In addition to the typical seasonality effects on our business, our quarterly results and quarterly year-over-year growth rates can be impacted by:

- The length of the booking window (the average time between the booking of a travel reservation and when the travel begins), which impacts the relationship between our gross bookings (recognized at the time of booking) and our revenues (recognized at the time of check-in);

- The level of acceleration or deceleration in the gross bookings growth rate.

For example, our operating margins are typically negatively impacted in the near term from gross bookings and related variable marketing expense growth acceleration, as revenue growth is typically less impacted by accelerating gross bookings growth in the near term.

Any such acceleration would positively impact revenue growth in subsequent periods as a portion of the revenue recognized from such gross bookings will occur in future quarters.

Conversely, in periods where our gross bookings growth rate substantially decelerates, our operating margins typically benefit; and

- The date on which certain holidays (e.g., Easter and Ramadan) fall.

The COVID-19 pandemic impacted the booking window and seasonality of our business in 2020 and 2021.

As the travel market recovers from the impact of the COVID-19 pandemic, we expect to see periods of gross bookings growth rate acceleration, which will likely result in periods where our operating margins are negatively impacted due to the timing difference of when marketing expense is recorded and when revenue is recognized.

The COVID-19 pandemic has significantly shifted the ways and from where people work and we are committed to adapting to achieve our human capital management goals.

Although there was a significant decline in our business in 2020 as a result of the COVID-19 pandemic, we remain confident that the travel industry will recover when travelers feel safe to travel once again.

In the beginning of the crisis, our priorities included the health and safety of our employees and stabilizing our business from the immediate shock of the pandemic by working with customers and partners to address unprecedented levels of cancellations.

We also took numerous actions in response to the pandemic, including steps to increase our financial liquidity, reduce costs, restructure our operations to address our near- to medium-term business expectations and ensure we are well-positioned to capture travel demand when it returns so we can emerge from this crisis on a strong footing and work on extending our leadership position.

While the timing of the recovery of the travel industry remains uncertain, we believe that demand for our services will return when government restrictions are lifted and people are confident it is once again safe to travel.

We connect consumers wishing to make travel reservations with providers of travel services around the world through our online platforms.

For example, Booking.com, the world’s leading brand for booking online accommodation reservations (based on room nights booked), offers rental car and other ground transportation services, flights, tours and activities, restaurant reservations and other services, many of which are supported by our other

brands.

Our business is driven primarily by international results, which consist of the results of Booking.com, agoda and Rentalcars.com and the international businesses of KAYAK and OpenTable.

For example, a reservation made through Booking.com at a hotel in New York by a consumer in the United States is part of our international results.

During the year ended December 31, 2020, our international business (the substantial majority of which is generated by Booking.com) represented approximately 88% of our consolidated revenues.

The Booking Holdings Business Model

We derive substantially all of our revenues from enabling consumers to make travel service reservations.

Substantially all merchant revenues are derived from transactions where travelers book accommodation reservations or rental car reservations.

The Booking Holdings Strategy

We believe that as the COVID-19 pandemic subsides, people feel confident traveling and dining out and government restrictions are lifted, the global online travel and dining industries will recover and, after some period of higher growth through the recovery, continue to grow as they did before the COVID-19 pandemic as consumer purchasing shifts from traditional offline channels to interactive online channels, including mobile channels.

- Providing the best consumer experience.

In addition, we have commercial relationships with other OTCs, such as Didi Chuxing (the leading ride hailing service in China) and Grab Holdings Inc. ("Grab") (the leading ride hailing company in Southeast Asia), whereby the customers of one company will have access to the services of the other.

For example, through the Booking.com app, a Booking.com customer traveling in Southeast Asia can book a local ride arranged by Grab.

While we reduced the size of our workforce in response to the COVID-19 pandemic, we are preparing the business to capture more travel demand as it develops during the recovery and over the long term.

We continue to seek to maximize the benefits of our scale by sharing resources and technological innovations among our brands, co-developing new services and coordinating activities in key markets among our brands.

Booking.com has expanded its offerings beyond accommodations to better help consumers experience the world.

For example, Booking.com offers in-destination tours and activities in more than 140 cities around the world, as well as flight, rental car and restaurant reservation services.

OpenTable does business primarily in the United States.

We have established widely used and recognized e-commerce brands through marketing and promotional campaigns.

Historically, our marketing expenses increased significantly, however, we experienced more moderate growth rates in recent years, and since the COVID-19 pandemic, our marketing expenses have declined significantly.

In addition, Amazon has experimented with online travel in the past and continues to experiment in this area, such as by partnering with travel companies to offer its customers travel products, including a partnership with Booking.com to provide travel deals to Amazon Prime users in certain countries.

- online travel search and price comparison services (generally referred to as "meta-search" services);

- online restaurant reservation services; and

Any such violations could also result in prohibitions on our ability to offer our

Many other jurisdictions continually propose and consider enacting similar or other data protection laws.

Although we take steps to mitigate the effects of any loss or reduction in

In recent years, and prior to the COVID-19 pandemic, the majority of our gross bookings are generated in the first half of the year, as consumers plan and reserve their spring and summer vacations in Europe and North America.

However, we generally recognize revenue from these bookings when the travel begins (at "check-in"), which can be in a quarter other than when the associated reservations are booked.

The first quarter of the year was typically our lowest level of profitability and highest level of volatility in earnings growth rates due to these seasonal timing factors.

The COVID-19 pandemic impacted seasonality in 2020; for example, we witnessed a higher share of travel being booked during the second and third quarters as well as a higher share of stays during the third quarter than in prior years.

We expect that the length of the booking window will be volatile and difficult to predict throughout the duration of the COVID-19 pandemic.

Future changes in the length of the booking window will affect the degree to which our gross bookings and revenues occur in the same period and, as a result, whether our gross bookings growth rates and revenue growth rates converge or diverge.

In the past year, the COVID-19 pandemic has had a significant impact on our workforce and our human capital management.

As a result of the COVID-19 pandemic, we made the difficult decision to restructure our workforce to align our total cost structure with our expectations of reduced near- to medium-term market demand for travel and restaurant reservation services.

Although we took various steps to maintain jobs and reduce the need for workforce reductions, including participating in various wage assistance programs, our total workforce decreased by approximately 23% year-over-year as of December 31, 2020 primarily due to a combination of our restructuring actions and attrition.

A description of any material legal proceedings to which we are a party is included in [Note [removed: 16](#i39652d4b334f476baed8a809ea102b26_205)] [added: 16](#i015825ada6294a89a879c0e0c854ff74_181)] to our Consolidated Financial Statements included in this Annual Report on Form 10-K for the year ended December 31, [removed: 2020,] [added: 2021,] and is incorporated into this Item 3 by reference thereto.

For the fiscal year ended: December 31, [removed: 2020][added: 2021]

| Title of Each Class: | | | | | | Trading Symbol | | | | | | Name of Each Exchange on which Registered: | | | [added: | | |]

| Common Stock par value $0.008 per share | | | | | | BKNG | | | | | | The NASDAQ Global Select Market | | | [added: | | |]

| 0.800% Senior Notes Due 2022 | | | | | | BKNG 22A | | | | | | The NASDAQ Stock Market LLC | | | [added: | | |]

| 2.150% Senior Notes Due 2022 | | | | | | BKNG 22 | | | | | | The NASDAQ Stock Market LLC | | | [added: | | |]

| 2.375% Senior Notes Due 2024 | | | | | | BKNG 24 | | | | | | The NASDAQ Stock Market LLC | | | [added: | | |]

| 1.800% Senior Notes Due 2027 | | | | | | BKNG 27 | | | | | | The NASDAQ Stock Market LLC | | | [added: | | |]

The aggregate market value of common stock held by non-affiliates of Booking Holdings Inc. at June 30, [removed: 2020] [added: 2021] was approximately [removed: $65.0] [added: $89.7] billion based upon the closing price reported for such date on the NASDAQ Global Select Market.

For purposes of this disclosure, shares of common stock held by executive officers and directors of Booking Holdings Inc. on June 30, [removed: 2020] [added: 2021] have been excluded because such persons may be deemed to be affiliates of Booking Holdings Inc. This determination of affiliate status is not necessarily a conclusive determination for other purposes.

The number of outstanding shares of Booking Holdings Inc.’s common stock was [removed: 40,961,796] [added: 40,887,702] at February [removed: 17, 2021.][added: 16, 2022.]

The information required by Part III of this Annual Report on Form 10-K, to the extent not set forth in this Form 10-K, is incorporated herein by reference from Booking Holdings Inc.'s definitive proxy statement relating to its annual meeting of stockholders to be held on June [removed: 3, 2021,] [added: 9, 2022,] to be filed with the Securities and Exchange Commission within 120 days after the end of Booking Holdings Inc.'s fiscal year ended December 31, [removed: 2020.][added: 2021.]

Booking Holdings Inc. Annual Report on Form 10-K for the Year Ended December 31, [removed: 2020] [added: 2021] Index

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| [Item [removed: 12.](#i39652d4b334f476baed8a809ea102b26_76)] [added: 12.](#i015825ada6294a89a879c0e0c854ff74_79)] | | | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#i39652d4b334f476baed8a809ea102b26_76)] [added: Matters](#i015825ada6294a89a879c0e0c854ff74_79)] | | | [removed: [70](#i39652d4b334f476baed8a809ea102b26_76)] [added: [64](#i015825ada6294a89a879c0e0c854ff74_79)] | | |

| [Item [removed: 13.](#i39652d4b334f476baed8a809ea102b26_79)] [added: 13.](#i015825ada6294a89a879c0e0c854ff74_82)] | | | [Certain Relationships and Related Transactions, and Director [removed: Independence](#i39652d4b334f476baed8a809ea102b26_79)] [added: Independence](#i015825ada6294a89a879c0e0c854ff74_82)] | | | [removed: [70](#i39652d4b334f476baed8a809ea102b26_79)] [added: [64](#i015825ada6294a89a879c0e0c854ff74_82)] | | |

| [Item [removed: 14.](#i39652d4b334f476baed8a809ea102b26_82)] [added: 14.](#i015825ada6294a89a879c0e0c854ff74_85)] | | | [Principal Accountant Fees and [removed: Services](#i39652d4b334f476baed8a809ea102b26_82)] [added: Services](#i015825ada6294a89a879c0e0c854ff74_85)] | | | [removed: [70](#i39652d4b334f476baed8a809ea102b26_82)] | | |

| [Item [removed: 15.](#i39652d4b334f476baed8a809ea102b26_88)] [added: 15.](#i015825ada6294a89a879c0e0c854ff74_91)] | | | [Exhibits and Financial Statement [removed: Schedules](#i39652d4b334f476baed8a809ea102b26_88)] [added: Schedules](#i015825ada6294a89a879c0e0c854ff74_91)] | | | [removed: [70](#i39652d4b334f476baed8a809ea102b26_88)] [added: [64](#i015825ada6294a89a879c0e0c854ff74_91)] | | |

| [Item [removed: 16.](#i39652d4b334f476baed8a809ea102b26_91)] [added: 16.](#i015825ada6294a89a879c0e0c854ff74_94)] | | | [Form 10-K [removed: Summary](#i39652d4b334f476baed8a809ea102b26_91)] [added: Summary](#i015825ada6294a89a879c0e0c854ff74_94)] | | | [removed: [74](#i39652d4b334f476baed8a809ea102b26_91)] [added: [68](#i015825ada6294a89a879c0e0c854ff74_94)] | | |

| [Consolidated Financial [removed: Statements](#i39652d4b334f476baed8a809ea102b26_97)] [added: Statements](#i015825ada6294a89a879c0e0c854ff74_100)] | | | | | | [removed: [77](#i39652d4b334f476baed8a809ea102b26_97)] [added: [71](#i015825ada6294a89a879c0e0c854ff74_100)] | | |

These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict, including the Risk Factors identified in Part I, Item 1A of this Annual Report; therefore, our actual results could differ materially from those expressed, [removed: implied] [added: implied,] or forecast in any such forward-looking statements.

Unless required by law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future [removed: events] [added: events,] or otherwise.

| 0.100% Senior Notes Due 2025 | | | | | | BKNG 25 | | | | | | The NASDAQ Stock Market LLC | | | | | |

| 0.500% Senior Notes Due 2028 | | | | | | BKNG 28 | | | | | | The NASDAQ Stock Market LLC | | | | | |

| | | | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [PART I](#i015825ada6294a89a879c0e0c854ff74_13) | | | | | | [1](#i015825ada6294a89a879c0e0c854ff74_13) | | |

| [PART II](#i015825ada6294a89a879c0e0c854ff74_34) | | | | | | [36](#i015825ada6294a89a879c0e0c854ff74_34) | | |

| [Item 6.](#i015825ada6294a89a879c0e0c854ff74_40) | | | [\[Reserved\]](#i015825ada6294a89a879c0e0c854ff74_40) | | | [38](#i015825ada6294a89a879c0e0c854ff74_40) | | |

| [Item 9](#i015825ada6294a89a879c0e0c854ff74_1610)[C](#i015825ada6294a89a879c0e0c854ff74_1610)[.](#i015825ada6294a89a879c0e0c854ff74_1610) | | | [Disclosure Regarding Foreign Jurisdictions that Prevent Inspections](#i015825ada6294a89a879c0e0c854ff74_1610) | | | [64](#i015825ada6294a89a879c0e0c854ff74_1610) | | |

| [PART IV](#i015825ada6294a89a879c0e0c854ff74_88) | | | | | | [64](#i015825ada6294a89a879c0e0c854ff74_88) | | |

| [Signatures](#i015825ada6294a89a879c0e0c854ff74_97) | | | | | | [69](#i015825ada6294a89a879c0e0c854ff74_97) | | |

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| [PART I](#i39652d4b334f476baed8a809ea102b26_13) | | | | | | [1](#i39652d4b334f476baed8a809ea102b26_13) | | |

| [PART II](#i39652d4b334f476baed8a809ea102b26_34) | | | | | | [38](#i39652d4b334f476baed8a809ea102b26_34) | | |

| [Item 6.](#i39652d4b334f476baed8a809ea102b26_40) | | | [Selected Financial Data](#i39652d4b334f476baed8a809ea102b26_40) | | | [40](#i39652d4b334f476baed8a809ea102b26_40) | | |

| [PART IV](#i39652d4b334f476baed8a809ea102b26_85) | | | | | | [70](#i39652d4b334f476baed8a809ea102b26_85) | | |

| [Signatures](#i39652d4b334f476baed8a809ea102b26_94) | | | | | | [75](#i39652d4b334f476baed8a809ea102b26_94) | | |

Other than the office building for the future headquarters of Booking.com that is currently under construction in the Netherlands (see the section "Building Construction" within Note 16 to our Consolidated Financial Statements for more details, which is incorporated into this Item 2 by reference thereto), we did not own any real estate at December 31, [removed: 2020.][added: 2021.]

Expectations for the ways and places in which employees work have shifted dramatically as a result of the COVID-19 pandemic.

As our brand companies have considered hybrid and flexible work-from-home policies for the longer term, we expect to make changes to our facilities requirements in the future.

Due to the impact of the COVID-19 pandemic on our business volumes, we took actions to reduce the size of our workforce to optimize efficiency and reduce costs.

As a result of such actions, we have made and expect to make further changes to our facilities requirements.

At February [removed: 17, 2021,] [added: 16, 2022,] there were approximately [removed: 157] [added: 140] shareholders of record of Booking Holdings Inc.'s common stock.

Our revolving credit facility includes a covenant that restricts us from declaring or making any cash distribution or repurchasing any of our shares (with certain exceptions including in connection with tax withholding related to shares issued to employees) unless (i) prior to the delivery of financial statements for the three months ending June 30, 2022, we have at least $6.0 billion of liquidity on a pro forma [removed: basis] [added: basis, based on unrestricted cash, cash equivalents, short-term investments] and [added: unused capacity under this revolving credit facility and] (ii) after the delivery of financial statements for the three months ending June 30, 2022, we are in compliance on a pro forma basis with the maximum leverage ratio covenant then in effect.

The following graph shows the total stockholder return through December 31, [removed: 2020] [added: 2021] of an investment of $100 in cash on December 31, [removed: 2015] [added: 2016] for our common stock and an investment of $100 in cash on December 31, [removed: 2015] [added: 2016] for (i) the NASDAQ Composite Index, (ii) the Standard and Poor's 500 [removed: Index] [added: Index,] and (iii) the Research Data Group ("RDG") Internet Composite Index.

[removed: ][added: ]

The following table sets forth information relating to repurchases of our equity securities during the three months ended December 31, [removed: 2020:][added: 2021:]

| October 1, [removed: 2020] [added: 2021] — | | | | | | — | | | (1) | | | N/A | | | | | | — | | | | | | $ | 10,420,229,500 | | | | | (1) | | |

| November 1, [removed: 2020] [added: 2021] — | | | | | | — | | | (1) | | | N/A | | | | | | — | | | | | | $ | 10,420,229,500 | | | | | (1) | | |

| December 1, [removed: 2020] [added: 2021] — | | | | | | — | | | (1) | | | N/A | | | | | | — | | | | | | $ | 10,420,229,500 | | | | | (1) | | |

| Total | | | | | | [removed: 2,480] [added: 1,783] | | | | | | $ | [removed: 1,952.24] [added: 2,362.64] | | | | | — | | | | | | $ | 10,420,229,500 | | | | | | | |

At December 31, 2021, we were in compliance with the minimum liquidity covenant.

| 2016 | | | | | | 100.00 | | | | | | 100.00 | | | | | | 100.00 | | | | | | 100.00 | | |

| 2017 | | | | | | 118.53 | | | | | | 129.64 | | | | | | 121.83 | | | | | | 151.38 | | |

| 2018 | | | | | | 117.49 | | | | | | 125.96 | | | | | | 116.49 | | | | | | 150.63 | | |

| 2019 | | | | | | 140.08 | | | | | | 172.17 | | | | | | 153.17 | | | | | | 200.37 | | |

| 2020 | | | | | | 151.92 | | | | | | 249.51 | | | | | | 181.35 | | | | | | 312.97 | | |

| 2021 | | | | | | 163.65 | | | | | | 304.85 | | | | | | 233.41 | | | | | | 330.56 | | |

| October 31, 2021 | | | | | | 28 | | | (2) | | | $ | 2,383.02 | | | | | N/A | | | | | | N/A | | | | | | | | |

| November 30, 2021 | | | | | | 998 | | | (2) | | | $ | 2,478.32 | | | | | N/A | | | | | | N/A | | | | | | | | |

| December 31, 2021 | | | | | | 757 | | | (2) | | | $ | 2,209.38 | | | | | N/A | | | | | | N/A | | | | | | | | |

| 2015 | | | | | | 100.00 | | | | | | 100.00 | | | | | | 100.00 | | | | | | 100.00 | | |

| 2016 | | | | | | 114.99 | | | | | | 108.87 | | | | | | 111.96 | | | | | | 104.75 | | |

| 2017 | | | | | | 136.30 | | | | | | 141.13 | | | | | | 136.40 | | | | | | 157.67 | | |

| 2018 | | | | | | 135.10 | | | | | | 137.12 | | | | | | 130.42 | | | | | | 156.03 | | |

| 2019 | | | | | | 161.08 | | | | | | 187.44 | | | | | | 171.49 | | | | | | 207.10 | | |

| 2020 | | | | | | 174.69 | | | | | | 271.64 | | | | | | 203.04 | | | | | | 318.18 | | |

| October 31, 2020 | | | | | | 249 | | | (2) | | | $ | 1,698.37 | | | | | N/A | | | | | | N/A | | | | | | | | |

| November 30, 2020 | | | | | | 1,940 | | | (2) | | | $ | 1,988.07 | | | | | N/A | | | | | | N/A | | | | | | | | |

| December 31, 2020 | | | | | | 291 | | | (2) | | | $ | 1,930.59 | | | | | N/A | | | | | | N/A | | | | | | | | |

The table above does not include adjustments in the three months ended December 31, 2020 to previously withheld share amounts (reduction of 26 shares) that reflect changes to the estimates of employee tax withholding obligations.

On November 19, 2020, the SEC issued final rules to amend Regulation S-K.

These changes are effective for annual filings for the first fiscal year ending on or after August 9, 2021 and early adoption is permitted.

We elected to adopt the amendments to Item 301 of Regulation S-K in their entirety, which removed the requirement to furnish selected financial data for each of the last five fiscal years.

The following Consolidated Financial Statements of the Company and the report of our independent registered public accounting firm are filed as part of this Annual Report on Form 10-K (See Part IV, Item 15, Exhibits and Financial Statement Schedules): Consolidated Balance Sheets at December 31, [removed: 2020] [added: 2021] and [removed: 2019;] [added: 2020;] Consolidated Statements of Operations, Consolidated Statements of Comprehensive Income, Consolidated Statements of Changes in Stockholders' [removed: Equity] [added: Equity,] and Consolidated Statements of Cash Flows for the years ended December 31, [added: 2021,] 2020, [removed: 2019] and [removed: 2018;] [added: 2019;] Notes to the Consolidated Financial Statements; and Report of Independent Registered Public Accounting Firm.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, we include a report of our management's assessment of the design and effectiveness of our internal controls over financial reporting for the year ended December 31, [removed: 2020.][added: 2021.]

Based on our evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2020.][added: 2021.]

*Changes in Internal Controls.* No change in our internal control over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f)) occurred during the three months ended December 31, [removed: 2020] [added: 2021] that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

We have audited the internal control over financial reporting of Booking Holdings Inc. and subsidiaries (the "Company") as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, [removed: 2020,] [added: 2021,] of the Company and our report dated February [removed: 24, 2021,] [added: 23, 2022,] expressed an unqualified opinion on those financial statements.

On December 30, 2021, we acquired Getaroom and its related accounts are included in our Consolidated Financial Statements beginning on the acquisition date.

The scope of our assessment of internal control over financial reporting excludes Getaroom, which represents, excluding goodwill and intangibles, less than 1% of our consolidated total assets as of December 31, 2021.

In connection with the initiative to integrate and upgrade certain global financial systems and processes, we are in the early stages of a multi-year phased migration in fiscal 2022.

This change is part of a cross-brand initiative to implement SAP’s S4/HANA and select supporting systems.

We expect the system implementations and process changes to impact our internal control over financial reporting.

Management will assess changes to internal controls as part of management’s annual evaluation of internal control over financial reporting.

As described in Management's Report on Internal Control Over Financial Reporting, management excluded from its assessment the internal control over financial reporting at Getaroom, which was acquired on December 30, 2021 and whose financial statements constitute, excluding goodwill and intangibles, less than 1% of total assets of the consolidated financial statement amounts as of December 31, 2021.

Accordingly, our audit did not include the internal control over financial reporting at Getaroom.

February 23, 2022

February 24, 2021

PART III

None.

PART III

Information required by Part III, Item 10 will be included in our Proxy Statement relating to our [removed: 2021] [added: 2022] annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, [removed: 2020,] [added: 2021,] and is incorporated herein by reference.

Information required by Part III, Item 11 will be included in our Proxy Statement relating to our [removed: 2021] [added: 2022] annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, [removed: 2020,] [added: 2021,] and is incorporated herein by reference.

Information required by Part III, Item 12 will be included in our Proxy Statement relating to our [removed: 2021] [added: 2022] annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, [removed: 2020,] [added: 2021,] and is incorporated herein by reference.

Information required by Part III, Item 13 will be included in our Proxy Statement relating to our [removed: 2021] [added: 2022] annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, [removed: 2020,] [added: 2021,] and is incorporated herein by reference.

Information required by Part III, Item 14 will be included in our Proxy Statement relating to our [removed: 2021] [added: 2022] annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, [removed: 2020,] [added: 2021,] and is incorporated herein by reference.

The following Consolidated Financial Statements of the Company and the report of our independent registered public accounting firm are filed as part of this Annual Report on Form 10-K: Consolidated Balance Sheets at December 31, [removed: 2020] [added: 2021] and [removed: 2019;] [added: 2020;] Consolidated Statements of Operations, Consolidated Statements of Comprehensive Income, Consolidated Statements of Changes in Stockholders' Equity and Consolidated Statements of Cash Flows for the years ended December 31, [added: 2021,] 2020, [removed: 2019] and [removed: 2018;] [added: 2019;] Notes to the Consolidated Financial Statements; and Report of Independent Registered Public Accounting Firm.

In reviewing the agreements included as exhibits to this Annual Report on Form 10-K, please remember they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure [removed: information about the Company or the other parties to the agreements.]

| [3.1](http://www.sec.gov/Archives/edgar/data/1075531/000107553118000008/ex32restatedcertificateofi.htm)(a) | | | Restated Certificate of Incorporation of the [removed: Registrant.] [added: Company.] | | |

| 4.1 | | | Reference is hereby made to Exhibits [removed: 3.1] [added: 3.1, 3.2,] and [removed: 3.2.] [added: 3.3.] | | |

| [4.2](http://www.sec.gov/Archives/edgar/data/1075531/0001047469-99-010235.txt)(c) | | | Specimen Certificate for [removed: Registrant's] [added: the Company's] Common Stock. | | |

| [removed: [4.3](http://www.sec.gov/Archives/edgar/data/1075531/000110465914062261/a14-19426_1ex99d2.htm)(d)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_1.htm)[3](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_1.htm)(d)] | | | Indenture, dated as of [removed: August 20,] [added: September 23,] 2014, between the [removed: Registrant] [added: Company] and [removed: American Stock Transfer &] [added: Deutsche Bank] Trust [removed: Company, LLC] [added: Company Americas,] as Trustee. | | |

| [removed: [4.4](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_1.htm)(e)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000104746917005098/a2232922zex-4_1.htm)[4](http://www.sec.gov/Archives/edgar/data/1075531/000104746917005098/a2232922zex-4_1.htm)(e)] | | | Indenture, dated as of [removed: September 23, 2014,] [added: August 8, 2017,] between the [removed: Registrant] [added: Company] and [removed: Deutsche] [added: U.S.] Bank [removed: Trust Company Americas,] [added: National Association,] as [removed: Trustee.] [added: trustee.] | | |

| [removed: [4.5](http://www.sec.gov/Archives/edgar/data/1075531/000104746917005098/a2232922zex-4_1.htm)(f)] [added: [4.3](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-8.htm)[1](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-8.htm)(dd)] | | | Indenture, dated as of [removed: August 8, 2017,] [added: April 14, 2020,] between [removed: the Company] [added: Booking Holdings Inc.] and U.S. Bank National Association, as trustee. | | |

| [removed: [4.6](http://www.sec.gov/Archives/edgar/data/1075531/000110465914067490/a14-21234_1ex4d1.htm)(g)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465914067490/a14-21234_1ex4d1.htm)[5](http://www.sec.gov/Archives/edgar/data/1075531/000110465914067490/a14-21234_1ex4d1.htm)(f)] | | | Form of 2.375% Senior Note due 2024. | | |

| [removed: [4.7](http://www.sec.gov/Archives/edgar/data/1075531/000110465914068530/a14-21505_1ex4d1.htm)(h)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465914068530/a14-21505_1ex4d1.htm)[6](http://www.sec.gov/Archives/edgar/data/1075531/000110465914068530/a14-21505_1ex4d1.htm)(g)] | | | Officers' Certificate, dated September 23, 2014, for the 2.375% Senior Notes due 2024. | | |

| [removed: [4.8](http://www.sec.gov/Archives/edgar/data/1075531/000110465915015804/a15-5077_5ex4d1.htm)(i)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465915015804/a15-5077_5ex4d1.htm)[7](http://www.sec.gov/Archives/edgar/data/1075531/000110465915015804/a15-5077_5ex4d1.htm)(h)] | | | Form of 1.800% Senior Note due 2027. | | |

| [removed: [4.9](http://www.sec.gov/Archives/edgar/data/1075531/000110465915016716/a15-5856_1ex4d1.htm)(j)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465915016716/a15-5856_1ex4d1.htm)[8](http://www.sec.gov/Archives/edgar/data/1075531/000110465915016716/a15-5856_1ex4d1.htm)(i)] | | | Officers' Certificate, dated March 3, 2015, for the 1.800% Senior Notes due 2027. | | |

| [removed: [4.10](http://www.sec.gov/Archives/edgar/data/1075531/000110465915019192/a15-6140_5ex4d1.htm)(k)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465915019192/a15-6140_5ex4d1.htm)[9](http://www.sec.gov/Archives/edgar/data/1075531/000110465915019192/a15-6140_5ex4d1.htm)(j)] | | | Form of 3.650% Senior Note due 2025. | | |

| [removed: [4.11](http://www.sec.gov/Archives/edgar/data/1075531/000110465915019590/a15-6763_1ex4d1.htm)(l)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465915019590/a15-6763_1ex4d1.htm)[10](http://www.sec.gov/Archives/edgar/data/1075531/000110465915019590/a15-6763_1ex4d1.htm)(k)] | | | Officers' Certificate, dated March 13, 2015, for the 3.650% Senior Notes due 2025. | | |

| [removed: [4.12](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_2.htm)(e)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_2.htm)[1](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_2.htm)(d)] | | | Form of 2.15% Senior Note due 2022. | | |

| [removed: [4.13](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_3.htm)(e)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_3.htm)[2](http://www.sec.gov/Archives/edgar/data/1075531/000104746915008969/a2226734zex-4_3.htm)(d)] | | | Officers' Certificate, dated November 25, 2015, for the 2.15% Senior Notes due 2022. | | |

| [removed: [4.14](http://www.sec.gov/Archives/edgar/data/1075531/000110465916122663/a16-11950_1ex4d1.htm)(m)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000110465916122663/a16-11950_1ex4d1.htm)[3](http://www.sec.gov/Archives/edgar/data/1075531/000110465916122663/a16-11950_1ex4d1.htm)(l)] | | | Form of 3.600% Senior Note due 2026. | | |

| [removed: [4.15](http://www.sec.gov/Archives/edgar/data/1075531/000110465916122663/a16-11950_1ex4d2.htm)(m)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000110465916122663/a16-11950_1ex4d2.htm)[4](http://www.sec.gov/Archives/edgar/data/1075531/000110465916122663/a16-11950_1ex4d2.htm)(l)] | | | Officers' Certificate, dated May 23, 2016, for the 3.600% Senior Notes due 2026. | | |

| [removed: [4.16](http://www.sec.gov/Archives/edgar/data/1075531/000110465917015831/a17-8134_1ex4d1.htm)(n)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000110465917015831/a17-8134_1ex4d1.htm)[5](http://www.sec.gov/Archives/edgar/data/1075531/000110465917015831/a17-8134_1ex4d1.htm)(m)] | | | Form of 0.800% Senior Note due 2022. | | |

| [removed: [4.17](http://www.sec.gov/Archives/edgar/data/1075531/000110465917015831/a17-8134_1ex4d2.htm)(n)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000110465917015831/a17-8134_1ex4d2.htm)[6](http://www.sec.gov/Archives/edgar/data/1075531/000110465917015831/a17-8134_1ex4d2.htm)(m)] | | | Officers' Certificate, dated March 10, 2017, for the 0.800% Senior Notes due 2022. | | |

| [removed: [4.18](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d1.htm)(o)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d1.htm)[7](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d1.htm)(n)] | | | Form of 2.750% Senior Note due 2023. | | |

| [removed: [4.19](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d3.htm)(o)] [added: [4.1](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d3.htm)[8](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d3.htm)(n)] | | | Officers' Certificate, dated August 15, 2017, with respect to the 2.750% Senior Notes due 2023. | | |

| [removed: [4.20](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d2.htm)(o)] [added: [4.](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d2.htm)[19](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d2.htm)(n)] | | | Form of 3.550% Senior Note due 2028. | | |

| [removed: [4.21](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d4.htm)(o)] [added: [4.2](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d4.htm)[0](http://www.sec.gov/Archives/edgar/data/1075531/000110465917052057/a17-20224_1ex4d4.htm)(n)] | | | Officers' Certificate, dated August 15, 2017, with respect to the 3.550% Senior Notes due 2028. | | |

| [removed: [4.22](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex423.htm)(gg)] [added: [4.2](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex423.htm)[1](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex423.htm)(ff)] | | | Description of the Company's Common Stock Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [removed: [4.23](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex424.htm)(gg)] [added: [4.2](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex424.htm)[2](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex424.htm)(ff)] | | | Description of the Company's 0.800% Senior Notes due 2022 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [removed: [4.24](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex425.htm)(gg)] [added: [4.2](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex425.htm)[3](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex425.htm)(ff)] | | | Description of the Company's 2.150% Senior Notes due 2022 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [removed: [4.25](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex426.htm)(gg)] [added: [4.2](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex426.htm)[4](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex426.htm)(ff)] | | | Description of the Company's 2.375% Senior Notes due 2024 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [removed: [4.26](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex427.htm)(gg)] [added: [4.2](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex427.htm)[5](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000011/bkng1231201910kex427.htm)(ff)] | | | Description of the Company's 1.800% Senior Notes due 2027 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [removed: [4.27](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-1.htm)(ee)] [added: [4.3](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-4.htm)[0](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-4.htm)(dd)] | | | Form of [removed: 4.100%] [added: 0.750% Convertible] Senior Note due 2025. | | |

| [removed: [4.28](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-5.htm)(ee)] [added: [4.](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-7.htm)[29](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-7.htm)(dd)] | | | Officer’s Certificate, dated April 13, 2020, with respect to the [removed: 4.100%] [added: 4.625%] Senior Notes due [removed: 2025.] [added: 2030.] | | |

| [removed: [4.29](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-2.htm)(ee)] [added: [4.](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-3.htm)[28](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-3.htm)(dd)] | | | Form of [removed: 4.500%] [added: 4.625%] Senior Note due [removed: 2027.] [added: 2030.] | | |

| [removed: [4.30](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-6.htm)(ee)] [added: [4.33](https://www.sec.gov/Archives/edgar/data/1075531/000110465921033367/tm218924d1_ex4-3.htm)(o)] | | | [removed: Officer’s] [added: Officers'] Certificate, dated [removed: April 13, 2020,] [added: March 8, 2021,] with respect to the [removed: 4.500%] [added: 0.100%] Senior Notes due [removed: 2027.] [added: 2025.] | | |

| [removed: [4.31](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-3.htm)(ee)] [added: [4.32](https://www.sec.gov/Archives/edgar/data/1075531/000110465921033367/tm218924d1_ex4-1.htm)(o)] | | | Form of [removed: 4.625%] [added: 0.100%] Senior Note due [removed: 2030.] [added: 2025.] | | |

| [removed: [4.32](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-7.htm)(ee)] [added: [4.35](https://www.sec.gov/Archives/edgar/data/1075531/000110465921033367/tm218924d1_ex4-4.htm)(o)] | | | [removed: Officer’s] [added: Officers'] Certificate, dated [removed: April 13, 2020,] [added: March 8, 2021,] with respect to the [removed: 4.625%] [added: 0.500%] Senior Notes due [removed: 2030.] [added: 2028.] | | |

| [removed: [4.33](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-4.htm)(ee)] [added: [4.34](https://www.sec.gov/Archives/edgar/data/1075531/000110465921033367/tm218924d1_ex4-2.htm)(o)] | | | Form of [removed: 0.750% Convertible] [added: 0.500%] Senior Note due [removed: 2025.] [added: 2028.] | | |

| [removed: [10.1](http://www.sec.gov/Archives/edgar/data/1075531/000107553118000031/amendedandrestated1999plan.htm)(p)+] [added: [10.1](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000036/amended1999omnibusplanex991.htm)(b)+] | | | Booking Holdings Inc. 1999 Omnibus Plan (As Amended and Restated Effective June [removed: 7, 2018).] [added: 3, 2021).] | | |

| [removed: [10.2](http://www.sec.gov/Archives/edgar/data/1075531/000110465911013305/a11-7614_1ex10d3.htm)(q)+] [added: [10.2](http://www.sec.gov/Archives/edgar/data/1075531/000110465911013305/a11-7614_1ex10d3.htm)(p)+] | | | Form of Restricted Stock Unit Agreement for awards under the 1999 Omnibus Plan to non-employee directors. | | |

| [removed: [10.3](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000027/exhibit101.htm)(hh)+] [added: [10.3](https://www.sec.gov/Archives/edgar/data/1075531/000107553120000027/exhibit101.htm)(gg)+] | | | Form of Restricted Stock Unit Agreement for awards under the 1999 Omnibus Plan. | | |

| [removed: [10.4](http://www.sec.gov/Archives/edgar/data/1075531/000107553118000017/ex9912018formpsu.htm)(r)+] [added: [10.4](http://www.sec.gov/Archives/edgar/data/1075531/000107553118000017/ex9912018formpsu.htm)(q)+] | | | 2018 Form of Performance Share Unit Agreement under the 1999 Omnibus Plan. | | |

information about the Company or the other parties to the agreements.

| [3.2](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000036/amendmenttocoi-writtencons.htm)(b) | | | Certificate of Amendment of the Restated Certificate of Incorporation, dated as of June 4, 2021. | | |

| [3](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000036/amendedby-lawsex32.htm)[.](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000036/amendedby-lawsex32.htm)[3](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000036/amendedby-lawsex32.htm)(b) | | | Amended and Restated By-Laws of Booking Holdings Inc., dated as of June 4, 2021. | | |

| [4.26](https://www.sec.gov/Archives/edgar/data/1075531/000107553122000008/descriptionof2025notes.htm) | | | Description of the Company's 0.100% Senior Notes due 2025 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [4.27](https://www.sec.gov/Archives/edgar/data/1075531/000107553122000008/descriptionof2028notes.htm) | | | Description of the Company's 0.500% Senior Notes due 2028 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. | | |

| [10.25](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000006/fogel2018and2019psuneoadju.htm)(ii)+ | | | Letter Amendment to 2018 PSU Award and 2019 PSU Award Agreements with Glenn D. Fogel dated January 28, 2021. | | |

| [10.26](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000006/goulden2018and2019psuneoad.htm)(ii)+ | | | Letter Amendment to 2018 PSU Award and 2019 PSU Award Agreements with David I. Goulden dated January 28, 2021. | | |

| [10.27](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000006/millones2018and2019psuneoa.htm)(ii)+ | | | Letter Amendment to 2018 PSU Award and 2019 PSU Award Agreements with Peter J. Millones dated January 28, 2021. | | |

| [10.28](https://www.sec.gov/Archives/edgar/data/1075531/000107553121000053/pisanoletteragreement.htm)(jj)+ | | | Letter Agreement, dated July 31, 2021, by and between the Company and Paulo Pisano. | | |

| [10.29](https://www.sec.gov/Archives/edgar/data/1075531/000107553122000008/booking-amendmentno3tocred.htm) | | | Amendment, dated as of December 22, 2021, to the Credit Agreement, dated as of August 14, 2019, by and among the Company, the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A., as administrative agent. | | |

| (jj) | | | Previously filed as an exhibit to the Quarterly Report on Form 10-Q filed on November 3, 2021 (File No. 1-36691) | | |

| [3.2](http://www.sec.gov/Archives/edgar/data/1075531/000107553119000054/by-laws2019.htm)(b) | | | Amended and Restated By-Laws of the Registrant. | | |

| [4.34](https://www.sec.gov/Archives/edgar/data/1075531/000110465920046353/tm2015100d6_ex4-8.htm)(ee) | | | Indenture, dated as of April 14, 2020, between Booking Holdings Inc. and U.S. Bank National Association, as trustee. | | |

| | | | | | | Date: | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Robert J. Mylod Jr. | | | | | | Director, Chairman of the Board | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Glenn D. Fogel | | | | | | Director, Chief Executive Officer and President | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ David I. Goulden | | | | | | Executive Vice President and Chief Financial | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Susana D'Emic | | | | | | Chief Accounting Officer and Controller | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Timothy M. Armstrong | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Mirian Graddick-Weir | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Bob van Dijk | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Wei Hopeman | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Charles H. Noski | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Nicholas J. Read | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Thomas E. Rothman | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Lynn M. Vojvodich | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| /s/ Vanessa A. Wittman | | | | | | Director | | | | | | February [removed: 24, 2021] [added: 23, 2022] | | |

| Report of Independent Registered Public Accounting Firm [added: (PCAOB ID: 34)] | | | [removed: [78](#i39652d4b334f476baed8a809ea102b26_100)] [added: [72](#i015825ada6294a89a879c0e0c854ff74_103)] | | |

| Consolidated Balance Sheets at December 31, [removed: 2020] [added: 2021] and [removed: 2019] [added: 2020] | | | [removed: [81](#i39652d4b334f476baed8a809ea102b26_103)] [added: [75](#i015825ada6294a89a879c0e0c854ff74_106)] | | |

| Consolidated Statements of Operations for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [82](#i39652d4b334f476baed8a809ea102b26_109)] [added: [76](#i015825ada6294a89a879c0e0c854ff74_112)] | | |

| Consolidated Statements of Comprehensive Income for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [83](#i39652d4b334f476baed8a809ea102b26_115)] [added: [77](#i015825ada6294a89a879c0e0c854ff74_118)] | | |

| Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [84](#i39652d4b334f476baed8a809ea102b26_118)] [added: [78](#i015825ada6294a89a879c0e0c854ff74_121)] | | |

| Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2020, 2019] [added: 2021, 2020] and [removed: 2018] [added: 2019] | | | [removed: [85](#i39652d4b334f476baed8a809ea102b26_121)] [added: [79](#i015825ada6294a89a879c0e0c854ff74_124)] | | |

| Notes to Consolidated Financial Statements | | | [removed: [86](#i39652d4b334f476baed8a809ea102b26_124)] [added: [80](#i015825ada6294a89a879c0e0c854ff74_127)] | | |

We have audited the accompanying consolidated balance sheets of Booking Holdings Inc. and subsidiaries (the "Company") as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] the related consolidated statements of operations, comprehensive income, changes in stockholders' equity, and cash flows for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] including the related notes (collectively, the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2020] [added: 2021] and [removed: 2019,] [added: 2020,] and the results of its operations and its cash flows, for each of the three years in the period ended December 31, [removed: 2020,] [added: 2021,] in conformity with accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, [removed: 2020,] [added: 2021,] based on criteria established in *Internal Control - Integrated Framework (2013)* issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 24, 2021,] [added: 23, 2022,] expressed an unqualified opinion on the Company's internal control over financial reporting.

Total revenues for the year ended December 31, [removed: 2020] [added: 2021] were [removed: $6.8] [added: $11.0] billion.

The total goodwill balance was [removed: $1.9] [added: $2.9] billion as of December 31, [removed: 2020.][added: 2021.]

A substantial portion of the Company's goodwill relates to the acquisitions of KAYAK in [removed: 2013 and] [added: 2013,] OpenTable in [removed: 2014.][added: 2014 and Getaroom in 2021.]

[removed: The] [added: As it related to the annual impairment test, the] Company estimated the fair values using a combination of standard valuation techniques, including an income approach (discounted cash flows) and market approaches (earnings before interest, taxes, depreciation, and amortization ("EBITDA") multiples of comparable publicly traded companies).

Due to the significant and negative financial impact of the COVID-19 [removed: pandemic,] [added: pandemic (see Note 2),] the Company [removed: recognized] [added: performed an interim period] goodwill impairment [removed: charges of $1.1 billion for the year ended December] [added: test at March] 31, 2020 [removed: for] [added: and recognized a goodwill impairment charge of $489 million related to] the OpenTable and KAYAK reporting [removed: unit,] [added: unit for the three months ended March 31, 2020, which is not tax-deductible,] resulting in an adjusted carrying value of goodwill for [removed: this reporting unit] [added: OpenTable and KAYAK] of [removed: $1.0] [added: $1.5] billion at [removed: December] [added: March] 31, 2020.

The Company has received [added: income] tax [added: and indirect tax] assessments relating to permanent establishment, transfer pricing matters, and/or value added taxes, including interest and penalties from French, [removed: Italian] [added: Italian,] and Turkish tax authorities in the amount of [removed: $537] [added: $616] million, [removed: $129 million] [added: $286 million,] and [removed: $103] [added: $61] million respectively.

The Company has recorded a liability of [removed: $61] [added: $57] million for France and a liability of [removed: $5][added: $20 million for Italy in]

[removed: million for Italy in] connection with these assessments.

- With the assistance of our [added: income] tax specialists, we evaluated management's analysis regarding the likelihood of sustaining its tax positions upon examination by the relevant tax authorities and, we evaluated management's estimate of the amount of tax benefit recognized.

| | | | | | | [added: 2021 | | | | | |] 2020 | | | | | | 2019 | | |

| Cash and cash equivalents | | | | | | $ | [added: 11,127 | | | | | $ |] 10,562 | | | | | $ | 6,312 | |

| Short-term investments (Available-for-sale debt securities: Amortized cost of [removed: $500] [added: $25] and [removed: $998,] [added: $500,] respectively) | | | | | | [removed: 501] [added: 25] | | | | | | [removed: 998] [added: 501] | | |

| Accounts receivable, net (Allowance for expected credit losses of [removed: $166] [added: $101] and [removed: $49,] [added: $166,] respectively) | | | | | | [removed: 529] [added: 1,358] | | | | | | [removed: 1,680] [added: 529] | | |

| Prepaid expenses, net (Allowance for expected credit losses of [removed: $22] [added: $29] and [removed: $6,] [added: $22,] respectively) | | | | | | [removed: 337] [added: 404] | | | | | | [removed: 479] [added: 337] | | |

| Other current assets | | | | | | [removed: 277] [added: 231] | | | | | | [removed: 364] [added: 277] | | |

| Total current assets | | | | | | [removed: 12,206] [added: 13,145] | | | | | | [removed: 9,833] [added: 12,206] | | |

In addition, the Company received an Italian Tax Audit Report which does not constitute a formal tax assessment; however, it recommends a VAT assessment of $175 million, plus interest and penalties.

In addition, the Company has disclosed reasonably possible losses related to VAT and certain other indirect taxes is approximately $22 million for France and $175 million for Italy.

- With the assistance of our indirect tax specialists, we assessed the reasonableness of the indirect tax contingent liability.

February 23, 2022

| | | | | | | 2021 | | | | | | 2020 | | |

| Short-term debt | | | | | | 1,989 | | | | | | 985 | | |

| Net income | | | | | | $ | 1,165 | | | | | $ | 59 | | | | | $ | 4,865 | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

| Balance, December 31, 2021 | | | 63,584 | | | | | | $ | — | | | | | (22,518) | | | | | | $ | (24,290) | | | | | $ | 6,159 | | | | | $ | 24,453 | | | | | $ | (144) | | | | | $ | 6,178 | |

| Net income | | | | | | $ | 1,165 | | | | | $ | 59 | | | | | $ | 4,865 | |

| Depreciation and amortization | | | | | | 421 | | | | | | 458 | | | | | | 469 | | |

| Impairment of goodwill | | | | | | — | | | | | | 1,062 | | | | | | — | | |

| Loss on early extinguishment of debt | | | | | | 242 | | | | | | — | | | | | | — | | |

2.

In response to the outbreak of the novel strain of the coronavirus, COVID-19 (the "COVID-19 pandemic"), as well as subsequent outbreaks driven by new variants of COVID-19, governments and businesses around the world have implemented, and continue to implement, a variety of restricted measures to reduce the spread of COVID-19.

The spread of new variants of COVID-19 has caused uncertainty as to when restrictions will be lifted, if additional restrictions may be initiated or reimposed, if there will be permanent changes to travel behavior patterns, and the timing of distribution and administration of COVID-19 vaccines and other medical interventions globally.

In 2021, based on its review of recent historical credit loss experience and stability in the economic conditions in certain markets, the Company revised its estimates of expected credit losses (see Note 7).

See Note 12 for additional information about the Company’s existing debt arrangements, including 1.7 billion Euros of debt issued in March 2021, payment of $2.0 billion in April 2021 to redeem certain Senior Notes issued in April 2020 and payment of $1.1 billion to satisfy the aggregate principal amount and the conversion premium in excess of the principal amount of the Convertible Senior Notes due September 2021.

The Company also participated in certain governmental assistance programs and received certain grants and other assistance.

In June 2021, the Company announced its intention to voluntarily return the government assistance received and completed the repayments by December 2021.

The Company repaid $107 million during the year ended December 31, 2021.

Reclassification

Investments of a strategic nature that have been made for the purpose of affiliation or potential business advantage or in connection with a

These investments, which do not have readily determinable fair values, are measured at cost less impairment, if any.

Such investments are also required to be measured at fair value as of the date of certain observable transactions for the identical or a similar investment of the same issuer.

*Derivatives not Designated as Hedges*

*Derivatives Designated as Cash Flow Hedges*

See Note 6 for information related to derivatives designated as cash flow hedges.

*Derivatives Designated as Net Investment Hedges*

Agency revenues consist almost entirely of travel reservation commissions from the Company's accommodation, rental car, and airline reservation services.

See Note 21 for information related to government grants and other assistance.

Accounting for Acquired Revenue Contracts with Customers in a Business Combination

In October 2021, the FASB issued a new accounting update that requires an acquirer to recognize and measure contract assets and contract liabilities in a business combination in accordance with ASC 606, *Revenue from Contracts with Customers*, rather than at fair value on the acquisition date as required under current U.S. GAAP.

The Company early adopted this update during the fourth quarter of 2021 and applied it retrospectively to all business combinations occurring on or after January 1, 2021.

The Company adopted this update on January 1, 2022 on a modified retrospective basis, which resulted in an increase of approximately $30 million to retained earnings.

For the Company’s convertible debt instruments, interest expense for the periods beginning after January 1, 2022 will be reflected in the financial statements using interest rates that typically are closer to the coupon interest rate of such instruments rather than a generally higher imputed interest expense that resulted from the separation of conversion features required by previous U.S. GAAP.

The accounting update also requires changes in the diluted earnings per share calculation in certain areas, including the use of the if-converted method instead of the treasury stock method which was permitted in certain situations under current U.S. GAAP.

See Note 8 for additional information on earnings per share.

Disclosures by Business Entities about Government Assistance

| | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| /s/ Jeffery H. Boyd | | | | | | Director | | | | | | February 24, 2021 | | |

| Jeffery H. Boyd | | | | | | | | | | | | | | |

In addition, the Company currently estimates that the reasonably possible loss related to VAT is approximately $24 million.

February 24, 2021

| Convertible debt | | | | | | 985 | | | | | | 988 | | |

| | | | | | | | | | | | | | | | | | | | | |

| Balance, December 31, 2017 | | | 62,689 | | | | | | $ | — | | | | | (14,217) | | | | | | $ | (8,699) | | | | | $ | 5,783 | | | | | $ | 13,939 | | | | | $ | 238 | | | | | $ | 11,261 | |

| Common stock issued in an acquisition | | | 52 | | | | | | — | | | | | | — | | | | | | — | | | | | | 110 | | | | | | — | | | | | | — | | | | | | 110 | | |

| Cumulative effect of adoption of accounting standard update | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (3) | | | | | | — | | | | | | (3) | | |

| Non-cash operating and financing activity for an acquisition (see Note 19) | | | | | | $ | — | | | | | $ | — | | | | | $ | 51 | |

| Non-cash investing and financing activity for an acquisition (see Note 19) | | | | | | $ | — | | | | | $ | — | | | | | $ | 59 | |

The Company offers its services through six primary consumer-facing brands: Booking.com, Priceline, agoda, Rentalcars.com, KAYAK and OpenTable.

In response to the outbreak of the novel strain of the coronavirus, COVID-19 (the "COVID-19 pandemic"), many governments around the world have implemented, and continue to implement, a variety of measures to reduce the spread of COVID-19, including travel restrictions and bans, instructions to residents to practice social distancing, curfews, quarantine advisories, including quarantine restrictions after travel in certain locations, shelter-in-place orders, required closures of non-essential businesses and additional restrictions on businesses as part of re-opening plans.

Further, these measures have materially adversely affected, and may further adversely affect, consumer sentiment and discretionary spending patterns and economies, and the Company’s workforce, operations and customers.

The Company’s results for the year ended December 31, 2020 have been materially and negatively impacted as compared to 2019 and 2018.

Due to the uncertain and rapidly evolving nature of current conditions around the world, the Company is unable to predict accurately the impact that the COVID-19 pandemic will have on its business going forward.

With the spread of COVID-19 to all major regions and the discovery of new variants of the coronavirus, the Company expects the COVID-19 pandemic and its effects to continue to have a significant adverse impact on its business for the duration of the pandemic, during any resurgence of the pandemic and during the subsequent economic recovery, which could be an extended period of time.

At September 30, 2020, the Company recorded an additional significant impairment charge to its goodwill (see Note 11).

If the Company’s credit ratings were to be downgraded, or financing sources were to ascribe higher risk to the Company's rating levels, the Company or its industry, the Company’s access to capital and the cost of any financing would be negatively impacted.

The extent of the effects of the COVID-19 pandemic on the Company’s business, results of operations, cash flows and growth prospects is highly uncertain and will ultimately depend on future developments.

These include, but are not limited to, the severity, extent and duration of the COVID-19 pandemic, including as a result of any new variants of COVID-19 and any resurgences of the pandemic, and its impact on the travel and restaurant industries and consumer spending more broadly.

The Company has participated in several of these programs, including the Netherlands' wage subsidy program and the United Kingdom's job retention scheme.

Change in Presentation and Reclassification

The Company elected to measure these investments at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer.

additional features or functionalities are capitalized and amortized over the estimated useful life of the enhancements.

On January 1, 2019, the Company adopted Accounting Standards Codification ("ASC") 842, *Leases*, using a modified retrospective method applied to all contracts as of January 1, 2019.

Therefore, for reporting periods beginning after December 31, 2018, the financial statements are prepared in accordance with the current lease standard and the financial statements for all periods prior to January 1, 2019 are presented under the previous lease standard ("ASC 840").

The Company's Consolidated Financial Statements reflect an acquired business starting at the date of the acquisition.

including goodwill.

Derivative Financial Instruments

On January 1, 2018, the Company adopted ASC 606, Revenue from Contracts with Customers, using a modified retrospective method applied to all contracts as of January 1, 2018.

The Company recorded a net increase to its retained earnings of $189 million, net of tax, as of January 1, 2018, due to the cumulative impact of adopting the current revenue recognition standard, with substantially all of the impact related to the Company’s online travel reservation services.

Under the current revenue recognition standard, the Company recognizes revenue for travel reservation services when the travel begins rather than when the travel is completed.

Agency revenues consist almost entirely of travel reservation commissions.

In the year ended December 31, 2019 and prior periods, the Company's marketing expenses were presented in the Consolidated Statements of Operations as "Performance marketing" and "Brand marketing" expenses.

In 2020, the Company changed the presentation of marketing expenses by combining "Performance marketing" and "Brand marketing" into "Marketing expenses" in the Consolidated Statement of Operations because of the increased convergence of performance marketing and brand marketing channels in areas including digital marketing and the Company's view of overall marketing expenditure as its investment in customer acquisition and retention.

The change in presentation had no impact on

operating income or net income.