Item 16. Form 10-K Summary.

None.

Signatures

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

			BOOKING HOLDINGS INC.
			By:			/s/ Glenn D. Fogel
						Name:			Glenn D. Fogel
						Title:			Chief Executive Officer and President
						Date:			February 22, 2024

Power of Attorney

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Glenn D. Fogel, David I. Goulden, and Peter J. Millones, and each of them severally, his or her true and lawful attorney-in-fact with power of substitution and resubstitution to sign in his or her name, place and stead, in any and all capacities, to do any and all things and execute any and all instruments that such attorney may deem necessary or advisable under the Securities Exchange Act of 1934 and any rules, regulations and requirements of the Securities and Exchange Commission in connection with this Annual Report on Form 10-K and any and all amendments hereto, as fully and for all intents and purposes as he or she might do or could do in person, and hereby ratifies and confirms all said attorneys-in-fact and agents, each acting alone, and his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature						Title						Date
/s/ Robert J. Mylod Jr.						Director, Chair of the Board						February 22, 2024
Robert J. Mylod Jr.
/s/ Glenn D. Fogel						Director, Chief Executive Officer and President						February 22, 2024
Glenn D. Fogel
/s/ David I. Goulden						Executive Vice President and Chief Financial						February 22, 2024
David I. Goulden						Officer (Principal Financial Officer)
/s/ Susana D'Emic						Chief Accounting Officer and Controller						February 22, 2024
Susana D'Emic						(Principal Accounting Officer)
/s/ Mirian Graddick-Weir						Director						February 22, 2024
Mirian Graddick-Weir
/s/ Kelly Grier						Director						February 22, 2024
Kelly Grier
/s/ Wei Hopeman						Director						February 22, 2024
Wei Hopeman
/s/ Charles H. Noski						Director						February 22, 2024
Charles H. Noski
/s/ Larry Quinlan						Director						February 22, 2024
Larry Quinlan
/s/ Nicholas J. Read						Director						February 22, 2024
Nicholas J. Read
/s/ Thomas E. Rothman						Director						February 22, 2024
Thomas E. Rothman
/s/ Sumit Singh						Director						February 22, 2024
Sumit Singh
/s/ Lynn Vojvodich Radakovich						Director						February 22, 2024
Lynn Vojvodich Radakovich
/s/ Vanessa A. Wittman						Director						February 22, 2024
Vanessa A. Wittman

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

			Page No.
Report of Independent Registered Public Accounting Firm (PCAOB ID: 34)			69
Consolidated Balance Sheets at December 31, 2023 and 2022			72
Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021			73
Consolidated Statements of Comprehensive Income for the years ended December 31, 2023, 2022, and 2021			74
Consolidated Statements of Changes in Stockholders' (Deficit) Equity for the years ended December 31, 2023, 2022, and 2021			75
Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022, and 2021			76
Notes to Consolidated Financial Statements			77

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Booking Holdings Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Booking Holdings Inc. and subsidiaries (the "Company") as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive income, changes in stockholders' (deficit) equity, and cash flows for each of the three years in the period ended December 31, 2023, including the related notes and the schedule listed in the Index at Item 15 (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, 2023 and 2022, and the results of its operations and its cash flows, for each of the three years in the period ended December 31, 2023, 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, 2023, 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 22, 2024, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Revenue - Refer to Notes 2 and 3 to the financial statements

Critical Audit Matter Description

Substantially all of the Company’s revenue is generated by providing online travel reservation services, which principally allow travelers to book travel reservations with travel service providers through the Company’s platforms. Revenue consists of a significant volume of low-dollar transactions utilizing multiple custom systems.

We identified revenue as a critical audit matter as the majority of the processes to calculate and record revenue are highly automated, rely on a number of custom systems, and involve interfacing significant volumes of data across multiple systems. Given the complex information technology (IT) environment, this required the involvement of professionals with expertise in IT to identify, test, and evaluate the revenue data flows, the revenue systems and the automated controls.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the Company's revenue transactions included the following, among others:

• With the assistance of our IT specialists, we:

–Identified the systems used to calculate and record revenue transactions.

–Tested the general IT controls over each of these systems, including testing of user access controls, change management controls, and IT operations controls.

–Performed testing of system interface controls and automated controls within the relevant revenue streams.

• We tested business process controls to reconcile the various systems to the Company's general ledgers.

• We performed detail transaction testing by agreeing the amounts recognized to source documents and testing the mathematical accuracy of the recorded revenue.

Goodwill - Refer to Notes 2 and 11 to the financial statements

Critical Audit Matter Description

The Company's evaluation of goodwill impairment involves the comparison of the fair value of each of the Company's reporting units to its carrying value. 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). With respect to the income approach, management makes significant estimates and assumptions related to forecasts of future performance, including revenues, operating margins, and discount rates.

Given the significant judgments made by management to estimate the fair value of the OpenTable and KAYAK reporting unit, performing audit procedures to evaluate the reasonableness of management's estimates and assumptions related to selection of the discount rates and forecasts of future revenues and operating margins required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the forecasts of future revenues and operating margins and the selection of the discount rates for the OpenTable and KAYAK reporting unit included the following, among others:

• We tested the effectiveness of controls over goodwill impairment evaluation, including those over the forecasts and the selection of the discount rates.

• We evaluated management's ability to accurately forecast by comparing actual results in previous years to management’s historical forecasts.

• We evaluated the reasonableness of management’s forecasts of future revenues and operating margins by comparing management’s forecasts with:

–Historical revenues and operating margins.

–Internal communications to management and the Board of Directors.

–Forecasted information within analyst, economist and industry reports of the Company and selected companies in its peer group.

• We considered the impact of industry and market conditions on management's forecasts.

• With the assistance of our fair value specialists, we evaluated the discount rates, including testing the underlying source information and the mathematical accuracy of the calculations and developing a range of independent estimates and comparing those to the discount rates selected by management.

• We evaluated the reasonableness of management's forecasts of future cash flows and discount rates utilized in the income approach fair value calculation by comparing the income approach fair value to the market approach fair values.

Commitments and Contingencies - Competition and Consumer Protection Reviews and Other Matters - Refer to Note 16 to the financial statements

Critical Audit Matter Description

The Company has been the subject of an open investigation with Comisión Nacional de los Mercados y la Competencia in Spain (the "CNMC") as to whether certain practices by Booking.com may produce adverse effects for hotels and other online travel companies. The Company recorded a loss contingency of 486 million Euros ($530 million) in the consolidated statement of operations for the year ended December 31, 2023. The related liability is included in "Accrued expenses and other current liabilities" in the consolidated balance sheet as of December 31, 2023.

Given the significant judgment made by management to determine both the likelihood and the estimated amount of a loss related to such matters, performing audit procedures to evaluate management's accounting for and disclosure of the loss contingency related to the CNMC matter involved challenging and subjective auditor judgment, including the need to involve professionals in our firm with expertise in Spanish competition law.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the loss contingency related to the CNMC matter included the following, among others:

• We tested the effectiveness of internal controls related to management’s review of the loss contingency and approval of the accounting treatment and related disclosures.

• With the involvement of a professional in our firm with expertise in Spanish competition law, we:

–Inquired of the Company’s internal legal counsel to understand the legal merits and the basis for the Company’s conclusion specific to the likelihood of loss and the estimate of potential loss or range of loss.

–Requested and received written responses from internal and external legal counsel.

–Obtained and evaluated management’s evaluation of the loss contingency, including making inquiries of management to evaluate and corroborate our understanding of information obtained from internal and external legal counsel.

–Read the draft decision from the CNMC and the related response from the Company.

–Evaluated whether the Company’s disclosures were consistent with our testing.

/s/ DELOITTE & TOUCHE LLP

Stamford, Connecticut

February 22, 2024

We have served as the Company’s auditor since 1997.

Booking Holdings Inc.

CONSOLIDATED BALANCE SHEETS

(In millions, except share and per share data)

						December 31,
						2023						2022
ASSETS
Current assets:
Cash and cash equivalents						$	12,107					$	12,221
Short-term investments (Available-for-sale debt securities: Amortized cost of $580 and $176, respectively)						576						175
Accounts receivable, net (Allowance for expected credit losses of $137 and $117, respectively)						3,253						2,229
Prepaid expenses, net						644						477
Other current assets						454						696
Total current assets						17,034						15,798
Property and equipment, net						784						669
Operating lease assets						705						645
Intangible assets, net						1,613						1,829
Goodwill						2,826						2,807
Long-term investments (Includes available-for-sale debt securities: Amortized cost of $576 at December 31, 2022)						440						2,789
Other assets, net						940						824
Total assets						$	24,342					$	25,361
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities:
Accounts payable						$	3,480					$	2,507
Accrued expenses and other current liabilities						4,635						3,244
Deferred merchant bookings						3,254						2,223
Short-term debt						1,961						500
Total current liabilities						13,330						8,474
Deferred income taxes						258						685
Operating lease liabilities						599						552
Long-term U.S. transition tax liability						515						711
Other long-term liabilities						161						172
Long-term debt						12,223						11,985
Total liabilities						27,086						22,579
Commitments and contingencies (see Note 16)
Stockholders' (deficit) equity:
Common stock, $0.008 par value, Authorized shares: 1,000,000,000 Issued shares: 64,048,000 and 63,780,528, respectively						—						—
Treasury stock: 29,650,351 and 25,917,558 shares, respectively						(41,426)						(30,983)
Additional paid-in capital						7,175						6,491
Retained earnings						31,830						27,541
Accumulated other comprehensive loss						(323)						(267)
Total stockholders' (deficit) equity						(2,744)						2,782
Total liabilities and stockholders' (deficit) equity						$	24,342					$	25,361

See Notes to Consolidated Financial Statements.

Booking Holdings Inc.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except share and per share data)

						Year Ended December 31,
						2023						2022						2021
Merchant revenues						$	10,936					$	7,193					$	3,696
Agency revenues						9,414						9,003						6,663
Advertising and other revenues						1,015						894						599
Total revenues						21,365						17,090						10,958
Operating expenses:
Marketing expenses						6,773						5,993						3,801
Sales and other expenses						2,744						1,986						979
Personnel, including stock-based compensation of $530, $404, and $370, respectively						3,294						2,465						2,314
General and administrative						1,555						766						522
Information technology						655						526						412
Depreciation and amortization						504						451						421
Other operating expenses						5						(199)						13
Total operating expenses						15,530						11,988						8,462
Operating income						5,835						5,102						2,496
Interest expense						(897)						(391)						(334)
Other income (expense), net						543						(788)						(697)
Income before income taxes						5,481						3,923						1,465
Income tax expense						1,192						865						300
Net income						$	4,289					$	3,058					$	1,165
Net income applicable to common stockholders per basic common share						$	118.67					$	76.70					$	28.39
Weighted-average number of basic common shares outstanding (in 000's)						36,140						39,872						41,042
Net income applicable to common stockholders per diluted common share						$	117.40					$	76.35					$	28.17
Weighted-average number of diluted common shares outstanding (in 000's)						36,530						40,052						41,362

See Notes to Consolidated Financial Statements.

Booking Holdings Inc.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In millions)

						Year Ended December 31,
						2023						2022						2021
Net income						$	4,289					$	3,058					$	1,165
Other comprehensive loss, net of tax
Foreign currency translation adjustments						(63)						(111)						(57)
Net unrealized gains (losses) on available-for-sale securities						7						(12)						31
Total other comprehensive loss, net of tax						(56)						(123)						(26)
Comprehensive income						$	4,233					$	2,935					$	1,139

See Notes to Consolidated Financial Statements.

Booking Holdings Inc.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' (DEFICIT) EQUITY

FOR THE YEARS ENDED DECEMBER 31, 2023, 2022, and 2021

(In millions, except share data)

						Common Stock												Treasury Stock												Additional Paid-in Capital						Retained Earnings						Accumulated Other Comprehensive Loss						Total
						Shares (in 000's)						Amount						Shares (in 000's)						Amount
Balance, December 31, 2020						63,406						$	—					(22,447)						$	(24,128)					$	5,851					$	23,288					$	(118)					$	4,893
Net income						—						—						—						—						—						1,165						—						1,165
Foreign currency translation adjustments, net of tax						—						—						—						—						—						—						(57)						(57)
Net unrealized gains on available-for-sale securities, net of tax						—						—						—						—						—						—						31						31
Conversion of debt						—						—						—						—						(86)						—						—						(86)
Exercise of stock options and vesting of restricted stock units and performance share units						178						—						—						—						5						—						—						5
Repurchase of common stock						—						—						(71)						(162)						—						—						—						(162)
Stock-based compensation and other stock-based payments						—						—						—						—						389						—						—						389
Balance, December 31, 2021						63,584						$	—					(22,518)						$	(24,290)					$	6,159					$	24,453					$	(144)					$	6,178
Cumulative effect of adoption of accounting standards update						—						—						—						—						(96)						30						—						(66)
Net income						—						—						—						—						—						3,058						—						3,058
Foreign currency translation adjustments, net of tax						—						—						—						—						—						—						(111)						(111)
Net unrealized losses on available-for-sale securities, net of tax						—						—						—						—						—						—						(12)						(12)
Exercise of stock options and vesting of restricted stock units and performance share units						197						—						—						—						7						—						—						7
Repurchase of common stock						—						—						(3,400)						(6,693)						—						—						—						(6,693)
Stock-based compensation and other stock-based payments						—						—						—						—						421						—						—						421
Balance, December 31, 2022						63,781						$	—					(25,918)						$	(30,983)					$	6,491					$	27,541					$	(267)					$	2,782
Net income						—						—						—						—						—						4,289						—						4,289
Foreign currency translation adjustments, net of tax						—						—						—						—						—						—						(63)						(63)
Net unrealized gains on available-for-sale securities, net of tax						—						—						—						—						—						—						7						7
Exercise of stock options and vesting of restricted stock units and performance share units						267						—						—						—						134						—						—						134
Repurchase of common stock						—						—						(3,732)						(10,443)						—						—						—						(10,443)
Stock-based compensation and other stock-based payments						—						—						—						—						550						—						—						550
Balance, December 31, 2023						64,048						$	—					(29,650)						$	(41,426)					$	7,175					$	31,830					$	(323)					$	(2,744)

See Notes to Consolidated Financial Statements.

Booking Holdings Inc.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

						Year Ended December 31,
						2023						2022						2021
OPERATING ACTIVITIES:
Net income						$	4,289					$	3,058					$	1,165
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization						504						451						421
Provision for expected credit losses and chargebacks						330						232						109
Deferred income tax benefit						(478)						(257)						(445)
Net losses on equity securities						131						963						569
Stock-based compensation expense and other stock-based payments						530						404						376
Operating lease amortization						161						156						178
Unrealized foreign currency transaction losses (gains) related to Euro-denominated debt						163						(46)						(135)
Loss on early extinguishment of debt						—						—						242
Gain on sale and leaseback transaction						—						(240)						—
Other						5						38						71
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable						(1,330)						(1,228)						(1,002)
Prepaid expenses and other current assets						155						(217)						6
Deferred merchant bookings and other current liabilities						2,742						3,718						1,539
Long-term assets and liabilities						142						(478)						(274)
Net cash provided by operating activities						7,344						6,554						2,820
INVESTING ACTIVITIES:
Purchase of investments						(12)						(768)						(17)
Proceeds from sale and maturity of investments						1,840						32						508
Additions to property and equipment						(345)						(368)						(304)
Acquisitions, net of cash acquired						—						—						(1,185)
Proceeds from sale and leaseback transaction						—						601						—
Other investing activities						3						(15)						—
Net cash provided by (used in) investing activities						1,486						(518)						(998)
FINANCING ACTIVITIES:
Proceeds from the issuance of long-term debt						1,893						3,621						2,015
Payments on maturity and redemption of debt						(500)						(1,880)						(3,068)
Payments for repurchase of common stock						(10,377)						(6,621)						(163)
Proceeds from exercise of stock options						134						7						5
Other financing activities						(59)						(24)						(28)
Net cash used in financing activities						(8,909)						(4,897)						(1,239)
Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents						(37)						(40)						(13)
Net (decrease) increase in cash and cash equivalents and restricted cash and cash equivalents						(116)						1,099						570
Total cash and cash equivalents and restricted cash and cash equivalents, beginning of period						12,251						11,152						10,582
Total cash and cash equivalents and restricted cash and cash equivalents, end of period						$	12,135					$	12,251					$	11,152
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid during the period for income taxes						$	1,789					$	600					$	735
Cash paid during the period for interest						$	842					$	380					$	318

See Notes to Consolidated Financial Statements.

Booking Holdings Inc.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BUSINESS DESCRIPTION

Booking Holdings Inc. ("Booking Holdings" or the "Company") seeks to make it easier for everyone to experience the world by providing consumers, travel service providers, and restaurants with leading travel and restaurant online reservation and related services. The Company offers its services through five primary consumer-facing brands: Booking.com, Priceline, Agoda, KAYAK, and OpenTable, which allow consumers to: book a broad array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, hostels, and other alternative and traditional accommodations properties) and a flight to their destinations; make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a vacation package, tour, activity, or cruise. Consumers can also use the Company's meta-search services to easily compare travel reservation information, such as flight, hotel, and rental car reservations from hundreds of online travel platforms at once. In addition, the Company offers other services to consumers, travel service providers and restaurants, such as travel-related insurance products and restaurant management services. The Company's portfolio of brands are organized into four operating segments which are aggregated into one reportable segment based on the similarity in economic characteristics, other qualitative factors, and the objectives and principles of Accounting Standards Codification ("ASC") 280, Segment Reporting.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company's Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries, including acquired businesses from the dates of acquisition. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP") requires management to make estimates and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results may differ significantly from those estimates. The estimates underlying the Company's Consolidated Financial Statements relate to, among other things, the valuation of goodwill and other long-lived tangible and intangible assets, the valuation of investments in private companies, income taxes, contingencies, stock-based compensation, the allowance for expected credit losses (also referred to as provision for bad debts or provision for uncollectible accounts), chargeback provisions, and the accrual of obligations for incentive programs.

Impact of COVID-19

The Company's financial results and prospects are almost entirely dependent on facilitating the sale of travel-related services. The COVID-19 pandemic, since its outset in 2020, and the resulting implementation of travel restrictions by governments around the world resulted in a significant decline in travel activities and consumer demand for travel related services, in 2020 in particular. Even though there have been improvements in the economic and operating conditions for the Company's business since the outset of the pandemic, the Company cannot predict the long-term effects of the pandemic on its business or the travel and restaurant industries as a whole.

Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

There are three levels of inputs to valuation techniques used to measure fair value:

Level 1: Quoted prices in active markets that are accessible by the Company at the measurement date for identical assets and liabilities.

Level 2: Inputs that are observable, either directly or indirectly. Such prices may be based upon quoted prices for identical or comparable securities in active markets or inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available.

Cash and Cash Equivalents

Cash and cash equivalents consists primarily of cash and highly liquid investment grade securities with an original maturity of three months or less. Cash equivalents are recognized based on settlement date. See Note 20 for information related to restricted cash and cash equivalents.

Investments

Debt Securities

The Company has classified its investments in debt securities as available-for-sale securities. Preferred stock that is either mandatorily redeemable or redeemable at the option of the investor is considered a debt security for accounting purposes and is reported at estimated fair value with the aggregate unrealized gains and losses, net of tax, reflected in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The fair value of these investments is based on the specific quoted market price of the securities or comparable securities at the balance sheet dates. Unobservable inputs are also used when little or no market data is available. See Note 6 for information related to fair value measurements.

If the amortized cost basis of an available-for-sale security exceeds its fair value and if the Company has the intention to sell the security or it is more likely than not that the Company will be required to sell the security before recovery of the amortized cost basis, an impairment is recognized in the Consolidated Statements of Operations. If the Company does not have the intention to sell the security and it is not more likely than not that the Company will be required to sell the security before recovery of the amortized cost basis and the Company determines that the decline in fair value below the amortized cost basis of an available-for-sale security is entirely or partially due to credit-related factors, the credit loss is measured and recognized as an allowance for expected credit losses along with the related expense in the Consolidated Statements of Operations. The allowance is measured as the amount by which the debt security's amortized cost basis exceeds the Company's best estimate of the present value of cash flows expected to be collected.

The Company's investments in marketable debt securities are recognized based on the trade date. The cost of marketable debt securities sold is determined using a first-in and first-out method. The Company's investments in debt securities are assessed for classification in the Consolidated Balance Sheets as short-term or long-term at the individual security level. Classification as short-term or long-term is based on the maturities of the securities, as applicable, and the Company's expectations regarding the timing of sales and redemptions. Investments of a strategic nature that have been made for the purpose of affiliation or potential business advantage or in connection with a commercial relationship are included in "Long-term investments" in the Consolidated Balance Sheets, except in situations where the Company expects the investment to be realized in cash, redeemed, or sold within one year.

Equity Securities

Equity securities are reported as "Long-term investments" in the Consolidated Balance Sheets and include equity investments with readily determinable fair values and equity investments without readily determinable fair values. Equity investments with readily determinable fair values are reported at estimated fair value with changes in fair value recognized in "Other income (expense), net" in the Consolidated Statements of Operations. The Company holds investments in equity securities of private companies, over which the Company does not have the ability to exercise significant influence or control. 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.

Accounts Receivable from Customers and Allowance for Expected Credit Losses

Accounts receivable is reported net of expected credit losses. The Company estimates lifetime expected credit losses upon recognition of the financial assets. The Company identifies the relevant risk characteristics of its customers and the related receivables and prepayments, which include the following: size, type (alternative accommodations vs. hotels) or geographic location of the customer, or a combination of these characteristics. Receivables with similar risk characteristics have been grouped into pools. For each pool, the Company considers the historical credit loss experience, current economic conditions, supportable forecasts of future economic conditions, and any recoveries in assessing the lifetime expected credit losses. Other key factors that influence the expected credit loss analysis include customer demographics, payment terms offered in the normal course of business to customers, the nature of competition, and industry-specific factors that could impact the Company's receivables. Additionally, external data and macroeconomic conditions are considered. This is assessed at each balance sheet date based on the Company's specific facts and circumstances.

Property and Equipment, Net

Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets or, when applicable, the lease term related to leasehold improvements, whichever is shorter.

Website Costs and Internal-use Software

Acquisition costs and certain direct development costs associated with website and internal-use software are capitalized and include external direct costs of services and payroll costs for employees devoting time to the software projects principally related to platform development, including support systems, software coding, designing system interfaces, and installation and testing of the software. These costs are recorded as property and equipment and are generally amortized beginning when the asset is substantially ready for use. Costs incurred for enhancements that are expected to result in additional features or functionalities are capitalized and amortized over the estimated useful life of the enhancements. Costs incurred during the preliminary project stage, as well as maintenance and training costs, are expensed as incurred.

Cloud Computing Arrangements

The Company utilizes various third-party computer systems and third-party service providers, including global distribution systems ("GDSs") and computerized central reservation systems of the accommodation, rental car, and airline industries in connection with providing some of its services. The Company uses both internally-developed systems and third-party systems to operate its services, including transaction processing, order management, and financial and accounting systems. Implementation costs incurred in a hosting arrangement that is a service contract are capitalized and amortized over the term of the hosting arrangement. The capitalized implementation costs are reported as "Prepaid expenses, net" or "Other assets, net" in the Company's Consolidated Balance Sheets, as appropriate. The related amortization expenses are reported in "Information technology" expenses in the Company's Consolidated Statements of Operations.

Leases

The Company determines if an arrangement is a lease, or contains a lease, when a contract is signed. The Company determines if a lease is an operating or finance lease and records a lease asset and a lease liability upon lease commencement, which is the date when the underlying asset is made available for use by the lessor. The Company has operating leases for office space, and data centers. For office space and data centers, the Company has elected to combine the fixed payments to lease the asset and any fixed non-lease payments (such as maintenance or utility charges) when determining its lease payments. The Company's finance leases are mainly for computer equipment.

The Company uses its incremental borrowing rate as its discount rate to determine the present value of its remaining lease payments to calculate its lease assets and lease liabilities because the rate implicit in the lease is not readily determinable. The incremental borrowing rate approximates the rate the Company would pay to borrow in the currency of the lease payments on a collateralized basis for the weighted-average life of the lease. Operating lease assets also include any prepaid lease payments and lease incentives received prior to lease commencement.

The Company recognizes operating lease costs and the amortization of finance lease assets on a straight-line basis over the lease term. The interest component of a finance lease is recognized using the effective interest method over the lease term. Certain of the Company's lease agreements include rent payments which are adjusted periodically based on an index or rate. Any change in payments due to such adjustments are recognized as variable lease expense as they are incurred. Variable lease expense also includes costs for property taxes, insurance, and services provided by the lessor which are charged based on usage or performance (such as maintenance or utility charges).

Most leases have one or more options to renew beyond their initial term. The exercise of renewal options, mainly for office space and data centers, is at the Company's discretion and are included in the determination of the lease term for accounting purposes if they are reasonably certain to be exercised.

Business Combinations, Goodwill, and Intangible Assets

The Company accounts for acquired businesses using the acquisition method of accounting. The consideration transferred is allocated to the assets acquired and liabilities assumed based on their respective values at the acquisition date. The excess of the consideration transferred over the net of the amounts allocated to the identifiable assets acquired and liabilities assumed is recognized as goodwill. The Company generally recognizes and measures contract assets and contract liabilities in a business combination at amounts consistent with those recorded by the acquired business.

Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination. Goodwill is not subject to amortization and is tested for impairment on an annual basis and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. The Company tests goodwill at a reporting unit level. The fair value of the reporting unit is compared to its carrying value, including goodwill. Fair values are determined using a combination of standard valuation techniques, including an income approach (discounted cash flows) and market approaches (e.g., earnings before interest, taxes, depreciation, and amortization ("EBITDA") multiples of comparable publicly traded companies) and based on market participant assumptions. A goodwill impairment loss is measured at the amount by which a reporting unit's carrying amount exceeds its fair value, not to exceed the carrying amount of goodwill. See Note 11 for additional information.

Intangible assets are carried at cost and amortized on a straight-line basis over their estimated useful lives.

Impairment of Long-lived Assets

The Company reviews long-lived assets, including intangible assets and operating lease assets, whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The assessment of possible impairment is based upon the Company's ability to recover the carrying value of the assets from the estimated undiscounted future net cash flows, before interest and taxes, of the related asset group. The amount of impairment loss, if any, is measured as the excess of the carrying value of the asset over the present value of estimated future cash flows, using a discount rate commensurate with the risks involved and based on assumptions representative of market participants.

Foreign Currency Translation

The functional currency of the Company's subsidiaries is generally the respective local currency. For operations outside of the U.S., assets and liabilities are translated into U.S. Dollars at the rate of exchange existing at the balance sheet date. Income statement amounts are translated at monthly average exchange rates applicable for the period. Translation gains and losses are included as a component of "Accumulated other comprehensive loss" in the Company's Consolidated Balance Sheets. Foreign currency transaction gains and losses are included in "Other income (expense), net" in the Company's Consolidated Statements of Operations.

Derivatives

Derivatives not Designated as Hedges

As a result of the Company's operations outside of the U.S., it is exposed to various market risks that may affect its consolidated results of operations, cash flows, and financial position. These market risks include, but are not limited to, fluctuations in foreign currency exchange rates. For the Company's operations outside of the U.S., the primary foreign currency exposures are in Euros and British Pounds Sterling, the currencies in which the Company conducts a significant portion of its business activities. As a result, the Company faces exposure to adverse movements in foreign currency exchange rates as the financial results of its operations outside of the U.S. are translated from local currencies into U.S. Dollars upon consolidation. Additionally, foreign currency exchange rate fluctuations on transactions denominated in currencies other than the functional currency of an entity result in gains and losses that are reflected in net income.

The Company may enter into derivative instruments to hedge certain net exposures of nonfunctional currency denominated assets and liabilities and the volatility associated with translating earnings for its operations outside of the U.S. into U.S. Dollars, even though it does not elect to apply hedge accounting or hedge accounting does not apply. These contracts are generally short-term in duration. Certain of the Company's derivative instruments have master netting arrangements, which reduce credit risk by permitting net settlement of transactions with the same counterparty. The Company is exposed to the risk that counterparties to derivative instruments may fail to meet their contractual obligations. The Company regularly reviews its credit exposure and assesses the creditworthiness of its counterparties. The Company reports the fair value of its derivative assets and liabilities on a gross basis in the Consolidated Balance Sheets in "Other current assets" and "Accrued expenses and other current liabilities," respectively. Unless designated as hedges for accounting purposes, gains and losses resulting from changes in the fair value of derivative instruments are recognized in "Other income (expense), net" in the Consolidated Statements of Operations in the period that the changes occur and are classified within "Net cash provided by operating activities" or "Net cash used in financing activities," as appropriate, in the Consolidated Statements of Cash Flows. See Note 6 for additional information related to these derivative instruments.

Derivatives Designated as Cash Flow Hedges

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

Non-derivative Instrument Designated as Net Investment Hedge

The foreign currency transaction gains or losses on the Company's Euro-denominated debt are measured based upon changes in spot rates. The foreign currency transaction gains or losses on the Euro-denominated debt that is designated as a hedging instrument for accounting purposes are recorded in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument are recognized in "Other income (expense), net" in the Consolidated Statements of Operations. See Notes 12 and 14 for additional information related to the net investment hedge.

Revenue Recognition

Online travel reservation services

Substantially all of the Company's revenues are generated by providing online travel reservation services, which principally allows travelers to book travel reservations with travel service providers through the Company's platforms. While the Company generally refers to a consumer that books travel reservation services on the Company's platforms as its customer, for accounting purposes, the Company's customers are the travel service providers and, in certain merchant transactions, the travelers. The Company's contracts with travel service providers give them the ability to market their reservation availability without transferring to the Company the responsibility to deliver the travel services. Therefore, the Company's revenues are presented on a net basis in the Consolidated Statements of Operations. These contracts include payment terms and establish the consideration to which the Company is entitled, which includes either a commission or a margin on the travel transaction. Revenue is measured based on the expected consideration specified in the contract with the travel service provider, considering the effects of factors such as discounts and other sales incentives. Estimates for sales incentives are based on historical experience, current trends, and forecasts, as applicable. Coupons are recorded as a reduction of the transaction price, generally at the time they are redeemed. The local occupancy taxes, general excise taxes, value-added taxes, sales taxes, and other similar taxes ("travel transaction taxes"), if any, collected from travelers are reported on a net basis in revenues in the Consolidated Statements of Operations.

Revenues for online travel reservation services are recognized at a point in time when the Company has completed its post-booking services and the travelers begin using the arranged travel services. These revenues are classified into two categories:

• Merchant revenues are derived from travel-related transactions where the Company facilitates payments from travelers for the services provided, generally at the time of booking. Merchant revenues are derived from transactions where travelers book accommodation, rental car, airline reservations, and other travel related services. Merchant revenues include travel reservation commissions and transaction net revenues (i.e., the amount charged to travelers less the amount owed to travel service providers) in connection with the Company's merchant reservations services; credit card processing rebates and customer processing fees; and ancillary fees, including travel-related insurance revenues.

• Agency revenues are derived from the Company's commissions on travel-related transactions where the Company does not facilitate payments from travelers for the services provided.

Advertising and Other Revenues

Advertising and other revenues are primarily recognized by KAYAK and OpenTable. KAYAK recognizes advertising revenue primarily by sending referrals to online travel companies ("OTCs") and travel service providers and from advertising placements on its platforms. Revenue related to referrals is recognized when a consumer clicks on a referral placement or upon completion of the travel. Revenue for advertising placements is recognized based upon when a consumer clicks on an advertisement or when KAYAK displays an advertisement. OpenTable recognizes revenues for reservation fees when diners are seated through its online restaurant reservation service and subscription fees for restaurant management services on a straight-line basis over the contractual period in accordance with how the service is provided.

Incentive Programs

The Company provides various incentive programs such as referral bonuses, rebates, credits, and discounts. In addition, the Company offers loyalty programs where participating consumers may be awarded loyalty points on current transactions that can be redeemed in the future. The estimated value of the incentives granted and the loyalty points expected to be redeemed is generally recognized as a reduction of revenue at the time they are granted.

Deferred Merchant Bookings

Cash payments received from travelers in advance of the Company completing its performance obligations are included in "Deferred merchant bookings" in the Company's Consolidated Balance Sheets and are comprised principally of amounts estimated to be payable to travel service providers as well as the Company's estimated future revenue for its commission or margin and fees. The amounts are mostly subject to refunds for cancellations. The Company expects to complete its performance obligations generally within one year from the reservation date. The increase in the Deferred Merchant Booking balance during the year ended December 31, 2023 was principally due to the increase in business volumes.

Marketing Expenses

The Company's advertising expenses are reported in "Marketing expenses" in the Consolidated Statements of Operations. Marketing expenses consist of performance marketing expenses and brand marketing expenses. These expenses consist primarily of the costs of: (1) search engine keyword purchases; (2) affiliate programs; (3) referrals from meta-search websites; and (4) online and offline brand marketing. Performance marketing expenses are expenses generally measured by return on investment or an increase in bookings over a specified time period and are recognized as incurred. Brand marketing expenses are expenses incurred to build brand awareness over a specified time period. These expenses consist primarily of television advertising and online video and display advertising (including the airing of the Company's television advertising online), as well as other marketing expenses such as public relations and sponsorships. Brand marketing expenses are generally recognized as incurred with the exception of advertising production costs, which are deferred and expensed the first time the advertisement is displayed or broadcast.

Sales and Other Expenses

Sales and other expenses are generally variable in nature and consist primarily of: (1) credit card and other payment processing fees associated with merchant transactions; (2) fees paid to third parties that provide call center and other customer services; (3) digital services taxes and other similar taxes (4) chargeback provisions and fraud prevention expenses associated with merchant transactions; (5) provisions for expected credit losses, primarily related to accommodation commission receivables and prepayments to certain customers; and (6) customer relations costs.

Personnel Expenses

Personnel expenses consist of compensation to the Company's personnel, including salaries, bonuses, and stock-based compensation, payroll taxes, and employee health and other benefits.

Stock-Based Compensation

Stock-based compensation expense related to performance share units, restricted stock units and stock options is recognized based on fair value on a straight-line basis over the respective requisite service periods and forfeitures are accounted for when they occur. The fair value on the grant date of performance share units and restricted stock units is determined based on the number of units granted and the quoted price of the Company's common stock. For performance share units with market conditions, the effect of the market condition is also considered in the determination of fair value on the grant date using Monte Carlo simulations. The fair value of employee stock options is determined using the Black-Scholes model.

The Company records stock-based compensation expense for performance-based awards using its estimate of the probable outcome at the end of the performance period (i.e., the estimated performance against the performance targets or performance goals, as applicable). The Company periodically adjusts the cumulative stock-based compensation expense recorded when the probable outcome for these performance-based awards is updated based upon changes in actual and forecasted operating results or expected achievement of performance goals, as applicable.

The benefits of tax deductions in excess of recognized compensation costs are recognized in the Consolidated Statements of Operations as a discrete item when an option exercise or a vesting and release of shares occurs. Excess tax benefits are presented as operating cash flows and cash payments for employee statutory tax withholding related to vested stock awards are presented as financing cash flows in the Consolidated Statements of Cash Flows.

General and Administrative Expenses

General and administrative expenses consist primarily of fees for certain outside professionals, occupancy and office expenses, certain travel transaction taxes, and personnel-related expenses such as travel, relocation, recruiting, and training expenses.

Information Technology Expenses

Information technology expenses consist primarily of: (1) software license and system maintenance fees; (2) cloud computing costs and outsourced data center costs; (3) payments to contractors; and (4) data communications and other expenses associated with operating the Company's services.

Income Taxes

The Company accounts for income taxes under the asset and liability method. The Company records the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the Consolidated Balance Sheets, as well as operating loss and tax credit carryforwards. Deferred taxes are classified as non-current in the Consolidated Balance Sheets.

The Company records deferred tax assets to the extent it believes these assets will more likely than not be realized. The Company regularly reviews its deferred tax assets for recoverability considering historical profitability, projected future taxable income, the expected timing of the reversals of existing temporary differences, the carryforward periods available for tax reporting purposes, and tax planning strategies. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the period in which related temporary differences become deductible. In determining the future tax consequences of events that have been recognized in the financial statements or tax returns, significant judgments, estimates, and interpretation of statutes are required.

Deferred taxes are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date of such change.

The Company recognizes liabilities when it believes that uncertain positions may not be fully sustained upon audit by the tax authorities. Liabilities recognized for uncertain tax positions are based on a two-step approach for recognition and measurement. First, the Company evaluates the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit based on its technical merits. Second, the Company measures the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. Interest and penalties attributable to uncertain tax positions, if any, are recognized as a component of income tax expense.

The Company accounts for taxes on global intangible low-taxed income ("GILTI") introduced by the U.S. Tax Cuts and Jobs Act (the "Tax Act") as period costs. See Note 15 for further details related to income taxes.

Government Grants and Other Assistance

The Company recognizes government grants in the financial statements when it is probable that the grant will be received and the Company will comply with the conditions of the grant. Government grants are recorded as a reduction in the related operating expense or the cost of the asset that they are intended to defray. The government grants received by the Company during the COVID-19 pandemic have principally been granted to defray personnel costs and were subsequently returned to the respective governments. See Note 20 for information related to government grants and other assistance.

Contingencies

Loss contingencies (other than income tax-related contingencies) arise from actual or possible claims and assessments and pending or threatened litigation that may be brought against the Company by individuals, governments or other entities. Based on the Company's assessment of loss contingencies at each balance sheet date, a loss is recorded in the financial statements if it is probable that an asset has been impaired or a liability has been incurred and the amount of the loss can be reasonably estimated.

Reclassification

In the Consolidated Statements of Operations for the years ended December 31, 2022 and 2021, the Company has reclassified certain indirect taxes, primarily digital services taxes, between "General and administrative" expenses and "Sales and other expenses" to conform to the presentation in the Consolidated Statement of Operations for the year ended December 31, 2023. The current presentation of "Sales and other expenses" reflects the aggregation of costs that are generally more likely to vary based on changes in revenues. These reclassifications did not affect previously reported Revenue, Operating income, Income before income taxes, or Net income in the Consolidated Statements of Operations for the years ended December 31, 2022 and 2021. See Note 21 for additional information on the impact of the reclassification by quarter.

The following table presents the impact of the reclassifications on the Company's Consolidated Statements of Operations (in millions):

						Year Ended December 31,
						2022						2021
Sales and other expenses (Prior presentation)						$	1,818					$	881
Reclassifications						168						98
Sales and other expenses (New presentation)						$	1,986					$	979
General and administrative (Prior presentation)						$	934					$	620
Reclassifications						(168)						(98)
General and administrative (New presentation)						$	766					$	522

Recent Accounting Pronouncements Adopted

Accounting for Convertible Instruments and Contracts in an Entity's Own Equity

On January 1, 2022, the Company adopted the new accounting standards update relating to convertible instruments and contracts in an entity's own equity. Compared to legacy U.S. GAAP, the accounting standards update reduces the number of accounting models for convertible debt instruments, requires fewer embedded conversion features to be separately recognized from the host contract, and amends certain guidance to reduce form-over-substance-based accounting conclusions. Under the updated guidance, upon the initial recognition of convertible debt, the Company presents the entire amount attributable to the debt as a liability. The initial carrying amount of the convertible debt liability is reduced by any direct and incremental issuance costs paid to third parties that are associated with the convertible debt issuance. No amount attributable to the debt is initially recognized within equity unless the instrument is issued at a substantial premium. In calculating diluted earnings per share, the accounting standards update also requires the use of the if-converted method for the Company's convertible debt.

The Company adopted the accounting standards update on a modified retrospective basis applied to the 0.75% convertible senior notes due May 2025 (see Note 12) resulting in an increase of $30 million to "Retained earnings" as of January 1, 2022. The significant corresponding balance sheet changes as of that date were an increase of $86 million to "Long-term debt" and decreases of $96 million to "Additional paid-in capital" and $21 million to "Deferred income taxes." For the Company's convertible debt, interest expense for the periods beginning on January 1, 2022 is reflected in the financial statements using interest rates that are closer to the coupon interest rate of the debt rather than the higher imputed interest expense that resulted from the separation of conversion features required by legacy U.S. GAAP. See Note 8 for additional information on net income per share calculations.

Other Recent Accounting Pronouncements

Improvements to Income Tax Disclosures

In December 2023, the Financial Accounting Standards Board (“FASB”) issued an accounting standards update related to income taxes that requires companies to provide additional information on the rate reconciliation and additional disclosures about taxes paid. The update requires disclosure of additional categories of information in the tax rate reconciliation table about federal, state and foreign income taxes and more details about certain items that meet a quantitative threshold. Income taxes paid (net of refunds received) are required to be disclosed disaggregated by federal (national), state and foreign taxes and also by jurisdiction based on a quantitative threshold. The update is effective for annual financial statements beginning with the fiscal year 2025. The Company is currently evaluating the impact of the accounting standards update on its Consolidated

Financial Statements.

Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued an accounting standards update that requires companies to provide disclosures of significant segment expenses and other segment items. Disclosures about a reportable segment’s profit or loss and assets that are currently required annually will have to be provided in interim periods also. In addition, companies with a single reportable segment have to provide all the disclosures required by ASC 280, Segment Reporting, including the significant segment expense disclosures. The update is effective for annual financial statements beginning with the fiscal year 2024 and for interim financial statements beginning with the quarter ending March 31, 2025. The Company is currently evaluating the impact of the accounting standards update on its Consolidated Financial Statements.

3. REVENUE

Disaggregation of Revenue

Revenue by Type of Service

Approximately 89%, 89%, and 87% of the Company's revenues for the years ended December 31, 2023, 2022, and 2021, respectively, relate to online accommodation reservation services. Revenues from all other sources of online travel reservation services and advertising and other revenues each individually represent less than 10% of the Company's total revenues for each year. The majority of the Company's merchant revenues and substantially all of its agency revenues are from Booking.com's accommodation reservations.

Revenue by Geographic Area

See Note 17 for the information related to revenue by geographic area.

Incentive Programs

At December 31, 2023 and 2022, liabilities of $149 million and $143 million, respectively, were included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets for incentives granted to consumers, including referral bonuses, rebates, credits, discounts, and loyalty programs.

4. STOCK-BASED COMPENSATION

The Company's 1999 Omnibus Plan, as amended and restated effective June 3, 2021, (the "1999 Plan") is the primary stock compensation plan from which broad-based employee, non-employee director, and consultant equity awards may be made. At December 31, 2023, there were approximately one million shares of common stock available for future grants under the 1999 Plan.

Stock-based compensation issued under the plans generally consists of restricted stock units, performance share units, and stock options. Performance share units and restricted stock units are payable in shares of the Company's common stock upon vesting. The Company issues shares of its common stock upon the exercise of stock options. The tax benefit related to stock-based compensation was $52 million, $40 million, and $37 million for the years ended December 31, 2023, 2022, and 2021, respectively.

In 2021, the Company modified the performance-based awards granted in 2018 and 2019 to its executive officers to adjust the number of shares to be issued, subject to other vesting conditions. The modification, in aggregate, resulted in additional stock-based compensation expense of $40 million, which was recognized over the remaining requisite service periods for the performance-based awards.

Restricted Stock Units and Performance Share Units

The Company makes broad-based grants of restricted stock units that generally vest during a period of one- to three-years, subject to certain exceptions for terminations other than for "cause," for "good reason," or on account of death or disability. The Company grants performance share units to executives and certain other employees, which generally vest at the end of a three-year period (with the exception of certain shorter-term performance share units), subject to certain exceptions for terminations other than for "cause," for "good reason," or on account of death or disability. The number of shares that ultimately vest depends on achieving certain performance metrics, performance goals, stock price increase and/or relative total shareholder return, as applicable, by the end of the performance period, assuming there is no accelerated vesting for, among other things, a termination of employment under certain circumstances.

Restricted stock units and performance share units granted by the Company during the years ended December 31, 2023, 2022, and 2021 had an aggregate grant-date fair value of $586 million, $490 million, and $421 million, respectively. Restricted stock units and performance share units that vested during the years ended December 31, 2023, 2022, and 2021 had an aggregate fair value at vesting of $459 million, $400 million, and $395 million, respectively. At December 31, 2023, there was $698 million of estimated total future stock-based compensation expense related to unvested restricted stock units and performance share units to be recognized over a weighted-average period of 1.8 years.

The following table summarizes the activity in restricted stock units and performance share units for employees and non-employee directors during the year ended December 31, 2023:

						Restricted Stock Units												Performance Share Units
						Shares						Weighted-average Grant-date Fair Value						Shares						Weighted-average Grant-date Fair Value
Unvested at December 31, 2022 (1)						280,460						$2,070						143,702						$2,294
Granted (2)						169,409						$2,640						51,941						$2,679
Vested						(141,115)						$2,032						(30,151)						$2,327
Performance shares adjustment (3)																		74,776						$2,577
Forfeited						(17,350)						$2,330						(7,242)						$2,267
Unvested at December 31, 2023						291,404						$2,404						233,026						$2,467

(1) Excludes 14,087 performance share units awarded during the years ended December 31, 2022 and 2021 for which the grant date under ASC 718, Compensation - Stock Compensation, was not established as of December 31, 2022. Among other conditions, for the grant date to be established, a mutual understanding is required to be reached between the Company and the employee of the key terms and conditions of the award, including the performance targets. The performance targets for each of the annual performance periods under the award are set at the beginning of the respective year.

(2) Includes 9,688 performance share units awarded during the year ended December 31, 2022 and 2021 for which the grant date under ASC 718 was established during the year ended December 31, 2023.

(3) Probable outcome for performance-based awards is updated based upon changes in actual and forecasted operating results or expected achievement of performance goals, as applicable, and the impact of modifications.

Stock Options

The following table summarizes the activity for stock options during the year ended December 31, 2023:

Employee Stock Options									Number of Shares						Weighted-average Exercise Price									Aggregate Intrinsic Value (in millions)									Weighted-average Remaining Contractual Term (in years)
Balance, December 31, 2022									120,813									$	1,408								$	73					7.3
Exercised (1)									(95,228)									$	1,408								$	124
Forfeited									(62)									$	1,411
Balance, December 31, 2023									25,523									$	1,411								$	55					6.4
Exercisable at December 31, 2023									25,523									$	1,411								$	55					6.4

(1) The stock options exercised during the year ended December 31, 2023 primarily consist of stock options granted to certain employees in May 2020 that vested in March 2023. No stock options were granted to the executive officers of the Company.

5. INVESTMENTS

The following table summarizes the Company's investments by major security type at December 31, 2023 (in millions):

						Cost						Gross Unrealized Gains /Upward Adjustments						Gross Unrealized Losses /Downward Adjustments						Carrying Value
Short-term investments:
Debt securities:
International government securities						$	63					$	—					$	—					$	63
U.S. government securities (1)						152						—						(1)						151
Corporate debt securities						365						—						(3)						362
Total short-term investments						$	580					$	—					$	(4)					$	576
Long-term investments:
Equity securities:
Equity securities with readily determinable fair values						$	715					$	—					$	(404)					$	311
Equity securities of private companies						78						259						(208)						129
Total equity securities						793						259						(612)						440
Total long-term investments						$	793					$	259					$	(612)					$	440

(1) Includes investments in U.S. municipal bonds.

The following table summarizes the Company's investments by major security type at December 31, 2022 (in millions):

						Cost						Gross Unrealized Gains /Upward Adjustments						Gross Unrealized Losses /Downward Adjustments						Carrying Value
Short-term investments:
Debt securities:
International government securities						$	13					$	—					$	—					$	13
U.S. government securities (1)						131						—						(1)						130
Corporate debt securities						32						—						—						32
Total short-term investments						$	176					$	—					$	(1)					$	175
Long-term investments:
Debt securities:
International government securities						$	63					$	—					$	(1)					$	62
U.S. government securities (1)						147						—						(3)						144
Corporate debt securities						366						—						(7)						359
Total debt securities						576						—						(11)						565
Equity securities:
Equity securities with readily determinable fair values						1,165						1,352						(446)						2,071
Equity securities of private companies						78						259						(184)						153
Total equity securities						1,243						1,611						(630)						2,224
Total long-term investments						$	1,819					$	1,611					$	(641)					$	2,789

(1) Includes investments in U.S. municipal bonds.

The Company's investment policy seeks to preserve capital and maintain sufficient liquidity to meet operational and other needs of the business. The Company's investments in available-for-sale debt securities at December 31, 2023 and 2022, had investment grade credit quality ratings. At December 31, 2023 and 2022, investments in international government securities principally included debt securities issued by the governments of Germany, France, Norway, Canada, and Sweden. At December 31, 2022, the Company’s long-term investments in available-for-sale debt securities had maturity dates between 1 and 2 years.

Equity securities with readily determinable fair values at December 31, 2023 include the Company's investments in DiDi Global Inc. ("DiDi") and Grab Holdings Limited ("Grab"), with fair values of $155 million and $143 million, respectively. At December 31, 2022, equity securities with readily determinable fair values included the Company's investments in Grab, DiDi, and Meituan, with fair values of $136 million, $125 million, and $1.8 billion, respectively. During the year ended December 31, 2023, the Company sold its entire investment in Meituan for $1.7 billion, resulting in a loss of $149 million included in "Other income (expense), net" in the Consolidated Statement of Operations for the year ended December 31, 2023. The cost basis of the Company's investment in Meituan was $450 million. Equity securities with readily determinable fair values are included in "Long-term investments" in the Consolidated Balance Sheets. Net unrealized gains (losses) related to these investments included in "Other income (expense), net" in the Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021 were as follows (in millions):

						Year Ended December 31,
						2023						2022						2021
DiDi						$	30					$	(70)					$	(205)
Grab						7						(165)						101
Meituan						—						(526)						(731)

The Company invested $200 million in preferred shares of Grab Holdings Inc. Prior to the business combination transaction involving Grab Holdings Inc., Grab and Altimeter Growth Corp. (the "Grab Transaction"), the Company's investment in Grab was classified as a debt security for accounting purposes with the aggregate unrealized gains and losses, net of tax reflected in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. In December 2021, the Company's investment in preferred shares were converted to Class A ordinary shares of Grab and such ordinary shares began publicly trading on the NASDAQ Stock Market. As a result, the Company's investment was classified as equity securities with readily determinable fair values and the aggregate unrealized gains of $265 million was reclassified from "Accumulated other comprehensive loss" in the Consolidated Balance Sheet to "Other income (expense), net" in the Consolidated Statement of Operations for the year ended December 31, 2021 (see Note 14).

The Company invested $500 million in preferred shares of DiDi. As a result of DiDi's initial public offering in 2021, the Company's investment was converted to Class A ordinary shares and classified as equity securities with readily determinable fair values. In June 2022, DiDi delisted its American Depository Shares ("ADSs") from the New York Stock Exchange. The shares are currently trading in the over-the-counter market with trade prices publicly reported by OTC Markets Group Inc.

The Company's investments in equity securities of private companies at December 31, 2023 and 2022, includes $51 million originally invested in Yanolja Co., Ltd. ("Yanolja"). A new round of funding and certain other transactions in the equity securities of Yanolja were completed in October 2021. As a result of these observable transactions, the Company recorded an unrealized gain of $255 million in "Other income (expense), net" in the Consolidated Statement of Operations for the year ended December 31, 2021 that resulted in an adjusted carrying value of $306 million as of December 31, 2021. The Company evaluated its investment in Yanolja for impairment as of June 30, 2023 and 2022 and recognized impairment charges of $24 million and $184 million during the years ended December 31, 2023 and 2022, respectively (see Note 6). The carrying value of the Company's investment in Yanolja was $98 million and $122 million as of December 31, 2023 and 2022, respectively.

6. FAIR VALUE MEASUREMENTS

Financial assets and liabilities measured at fair value on a recurring basis at December 31, 2023 and nonrecurring fair value measurements are categorized below based on the level of inputs to the valuation techniques used to measure fair value (see Note 2) (in millions):

						Level 1						Level 2						Level 3						Total
Recurring fair value measurements
ASSETS:
Cash equivalents and restricted cash equivalents:
Money market fund investments						$	10,871					$	—					$	—					$	10,871
Certificates of deposit						97						—						—						97
Short-term investments:
International government securities						—						63						—						63
U.S. government securities						—						151						—						151
Corporate debt securities						—						362						—						362
Long-term investments:
Equity securities						311						—						—						311
Derivatives:
Foreign currency exchange derivatives						—						62						—						62
Total assets at fair value						$	11,279					$	638					$	—					$	11,917
LIABILITIES:
Foreign currency exchange derivatives						$	—					$	36					$	—					$	36
Nonrecurring fair value measurements
Investment in equity securities of a private company (1)						$	—					$	—					$	98					$	98

(1) During the year ended December 31, 2023, the Company's investment in Yanolja was written down to its estimated fair value (see Note 5).

Financial assets and liabilities measured at fair value on a recurring basis at December 31, 2022 and nonrecurring fair value measurements are categorized below based on the level of inputs to the valuation techniques used to measure fair value (see Note 2) (in millions):

						Level 1						Level 2						Level 3						Total
Recurring fair value measurements
ASSETS:
Cash equivalents and restricted cash equivalents:
Money market fund investments						$	11,483					$	—					$	—					$	11,483
Certificates of deposit						60						—						—						60
Short-term investments:
International government securities						—						13						—						13
U.S. government securities						—						130						—						130
Corporate debt securities						—						32						—						32
Long-term investments:
International government securities						—						62						—						62
U.S. government securities						—						144						—						144
Corporate debt securities						—						359						—						359
Equity securities						2,071						—						—						2,071
Derivatives:
Foreign currency exchange derivatives						—						65						—						65
Total assets at fair value						$	13,614					$	805					$	—					$	14,419
LIABILITIES:
Foreign currency exchange derivatives						$	—					$	26					$	—					$	26
Nonrecurring fair value measurements
Investment in equity securities of a private company (1)						$	—					$	—					$	122					$	122

(1) During the year ended December 31, 2022, the Company's investment in Yanolja was written down to its estimated fair value (see Note 5).

Investments

See Note 5 for additional information related to the Company's investments.

The valuation of the Company's investments in debt securities is considered a "Level 2" valuation because the Company has access to quoted prices for identical or comparable securities, but does not have visibility into the volume and frequency of trading for this investment. A market approach is used for recurring fair value measurements and the valuation techniques use inputs that are observable, or can be corroborated by observable data, in an active marketplace.

Investments in private companies measured using Level 3 inputs

The Company's investments measured using Level 3 inputs primarily consist of investments in privately-held companies. Fair values of privately-held securities are estimated using a variety of valuation methodologies, including both market and income approaches. The Company uses valuation techniques appropriate for the type of investment and the information available about the investee as of the valuation date to determine fair value. Recent financing transactions in the investee are generally considered the best indication of the enterprise value and therefore used as a basis to estimate fair value. However, based on a number of factors, such as the proximity in timing to the valuation date or the volume or other terms of these financing transactions, the Company may also use other valuation techniques to supplement this data, including the income approach. When a financing transaction occurs and represents fair value, the Company also uses the calibration process, as appropriate, when estimating fair value on subsequent measurement dates. Calibration is the process of using observed transactions in the investee company's own instruments to ensure that the valuation techniques that will be employed to value the investee company investment on subsequent measurement dates begin with assumptions that are consistent with the original observed transaction as well as any more recent observed transactions in the instruments issued by the investee company.

As of June 30, 2023 and 2022, the Company evaluated its investment in Yanolja for impairment using a combination of the market approach and the income approach in estimating the fair value of the investment as of those dates, and recognized impairment charges. The market approach estimates value using prices and other relevant information generated by market transactions involving comparable companies. The income approach estimates value based on the expectation of future cash flows that a company will generate. These future cash flows are discounted to their present values using a discount rate based on a company's weighted-average cost of capital adjusted to reflect the risks inherent in its cash flows. The key unobservable inputs and ranges used for the June 2023 impairment evaluation, primarily using the income approach, include the weighted average cost of capital (10.5%-14.5%) and the terminal EBITDA multiple (14x-16x). The key unobservable inputs and ranges used for the June 2022 impairment evaluation include, for the market approach, percentage decrease in the calibrated EBITDA multiple (36%) and for the income approach, the weighted average cost of capital (10%-14%) and the terminal EBITDA multiple (14x-16x). Significant changes in any of these inputs in isolation would result in significantly different fair value measurements. A change in the assumption used for EBITDA multiples would result in a directionally similar change in the fair value, and a change in the assumption used for weighted average cost of capital would result in a directionally opposite change in the fair value.

The determination of the fair values of investments, where the Company is a minority shareholder and has access to limited information from the investee, reflects numerous assumptions that are subject to various risks and uncertainties, including key assumptions regarding the investee's expected growth rates and operating margin, as well as other key assumptions with respect to matters outside of the Company's control, such as discount rates and market comparables. It requires significant judgments and estimates and actual results could be materially different than those judgments and estimates utilized in the fair value estimate. Future events and changing market conditions may lead the Company to re-evaluate the assumptions reflected in the valuation which may result in a need to recognize additional impairment charges.

Derivatives

In the normal course of business, the Company is exposed to the impact of foreign currency fluctuations. The Company mitigates these risks by following established risk management policies and procedures, including the use of derivatives. The Company enters into foreign currency forward contracts to hedge its exposure to the impact of movements in foreign currency exchange rates on its transactional balances denominated in currencies other than the functional currency. The Company does not use derivatives for trading or speculative purposes.

The Company's derivative instruments are valued using pricing models. Pricing models take into account the contract terms as well as multiple inputs where applicable, such as interest rate yield curves, option volatility, and foreign currency exchange rates. The valuation of derivatives is considered "Level 2" fair value measurement. The Company's derivative instruments are typically short-term in nature. The Company reports the fair values of its derivative assets and liabilities on a gross basis in the Consolidated Balance Sheets in "Other current assets" and "Accrued expenses and other current liabilities," respectively.

As of December 31, 2023 and 2022, the Company did not designate any derivatives as hedges for accounting purposes. Gains and losses resulting from changes in the fair values of derivative instruments are recognized in "Other income (expense), net" in the Consolidated Statements of Operations in the period that the changes occur and cash flow impacts, if any, are classified within "Net cash provided by operating activities" or "Net cash used in financing activities," as appropriate, in the Consolidated Statements of Cash Flows.

The table below provides estimated fair values and notional amounts of foreign currency exchange derivatives outstanding at December 31, 2023 and 2022 (in millions). The notional amount of a foreign currency forward contract is the contracted amount of foreign currency to be exchanged and is not recorded in the balance sheet.

			December 31,
			2023						2022
Estimated fair value of derivative assets			$	62					$	65
Estimated fair value of derivative liabilities			36						26
Notional amount:
Foreign currency purchases			$	4,907					$	2,870
Foreign currency sales			4,200						2,682

The effect of foreign currency exchange derivatives recorded in "Other income (expense), net" in the Consolidated Statements of Operations for the years ended December 31, 2023, 2022, and 2021 is as follows (in millions):

			Year Ended December 31,
			2023						2022						2021
Losses on foreign currency exchange derivatives			$	106					$	52					$	30

Derivatives designated as cash flow hedges

In March 2021, the Company entered into reverse treasury lock agreements with certain financial institutions, with an aggregate notional amount of $1.8 billion and expiration date of March 31, 2021, to hedge the risk of changes in the cash flows related to the planned redemption, in April 2021, of the Senior Notes due April 2025 (the "April 2025 Notes") and the Senior Notes due April 2027 (the "April 2027 Notes") attributable to changes in the underlying U.S. treasury notes' interest rates. The Company designated the reverse treasury lock agreements as cash flow hedges. As of March 31, 2021, the Company recognized unrealized losses of $15 million in "Accumulated other comprehensive loss" in the Consolidated Balance Sheet. In April 2021, the Company settled the reverse treasury lock agreements for an aggregate amount of $15 million and also redeemed the April 2025 Notes and the April 2027 Notes. The cash flows related to the reverse treasury lock agreements are classified within "Net cash used in financing activities" in the Consolidated Statement of Cash Flows. During the three months ended June 30, 2021, the Company reclassified the losses on the cash flow hedges from "Accumulated other comprehensive loss" in the Consolidated Balance Sheet to "Other income (expense), net" in the Consolidated Statement of Operations, concurrently with the recognition of the losses upon early extinguishment of the April 2025 Notes and the April 2027 Notes (see Note 12).

Other Financial Assets and Liabilities

At December 31, 2023 and 2022, the Company's cash consisted of bank deposits. Cash equivalents principally include money market fund investments and certificates of deposit and their carrying value generally approximates the fair value as they are readily convertible to known amounts of cash. Other financial assets and liabilities, including restricted cash, accounts payable, accrued expenses, and deferred merchant bookings, are carried at cost which approximates their fair values because of the short-term nature of these items. Accounts receivable and other financial assets measured at amortized cost are carried at cost less an allowance for expected credit losses to present the net amount expected to be collected (see Note 7). See Note 12 for the estimated fair value of the Company's outstanding senior notes, including the estimated fair value of the Company's convertible senior notes.

7. ACCOUNTS RECEIVABLE AND OTHER FINANCIAL ASSETS

Accounts receivable in the Consolidated Balance Sheets at December 31, 2023 and 2022 includes receivables from customers of $1.9 billion and $1.5 billion, respectively, and receivables from payment processors and networks of $1.3 billion and $730 million, respectively. The remaining balance principally relates to receivables from marketing affiliates. The Company's receivables are short-term in nature. In addition, the Company had prepayments to certain customers of $10 million and $29 million, included in "Prepaid expenses, net," and $16 million and $5 million, included in "Other assets, net" in the Consolidated Balance Sheets at December 31, 2023 and 2022, respectively. The amounts mentioned above are stated on a gross basis, before deducting the allowance for expected credit losses.

Significant judgments and assumptions are required to estimate the allowance for expected credit losses and such assumptions may change in future periods, particularly the assumptions related to the business prospects and financial condition of customers and marketing affiliates, including the impact of the COVID-19 pandemic, macroeconomic conditions, inflationary pressures, potential recession, and the Company's ability to collect the receivable or recover the prepayment.

The following table summarizes the activity of the allowance for expected credit losses on receivables (in millions):

			Year Ended December 31,
			2023						2022						2021
Balance, beginning of year			$	117					$	101					$	166
Provision charged to earnings			169						130						48
Write-offs and adjustments			(152)						(110)						(107)
Foreign currency translation adjustments			3						(4)						(6)
Balance, end of year			$	137					$	117					$	101

In addition to the allowance for expected credit losses on receivables, the Company recorded an allowance for expected credit losses on prepayments to certain customers, which are included in "Prepaid expenses, net" and "Other assets, net" in the Consolidated Balance Sheets, of $17 million and $23 million at December 31, 2023 and 2022, respectively.

8. NET INCOME PER SHARE

The Company computes basic net income per share by dividing net income applicable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income per share is based upon the weighted-average number of common and common equivalent shares outstanding during the period. Only dilutive common equivalent shares that decrease the net income per share are included in the computation of diluted net income per share.

Common equivalent shares related to stock options, restricted stock units, and performance share units are calculated using the treasury stock method. Performance share units are included in the weighted-average common equivalent shares based on the number of shares that would be issued if the end of the reporting period were the end of the performance period, if the result would be dilutive.

The Company's convertible senior notes have net share settlement features requiring the Company, upon conversion, to settle the principal amount of the debt for cash and the conversion premium for cash or shares of the Company's common stock, at the Company's option. If the conversion prices for the convertible senior notes exceed the Company's average stock price for the period, the convertible senior notes generally have no impact on diluted net income per share. For periods prior to January 1, 2022, the treasury stock method was used for convertible senior notes in the calculation of diluted net income per share. Following the adoption of the accounting standards update on January 1, 2022 (see Note 2), the if-converted method is used for all periods after that date.

A reconciliation of the weighted-average number of shares outstanding used in calculating diluted net income per share is as follows (in thousands):

			Year Ended December 31,
			2023						2022						2021
Weighted-average number of basic common shares outstanding			36,140						39,872						41,042
Weighted-average dilutive stock options, restricted stock units and performance share units			228						151						209
Assumed conversion of convertible senior notes			162						29						111
Weighted-average number of diluted common and common equivalent shares outstanding			36,530						40,052						41,362

9. PROPERTY AND EQUIPMENT, NET

Property and equipment, net at December 31, 2023 and 2022 consist of the following (in millions):

			December 31,												Estimated Useful Lives (years)
			2023						2022
Capitalized software			$	1,096					$	900					1 to 7 years
Computer equipment			608						758						2 to 4 years
Leasehold improvements			228						277						Up to 15 years
Office equipment, furniture and fixtures			71						58						1 to 7 years
Total			2,003						1,993
Less: Accumulated depreciation			(1,219)						(1,324)
Property and equipment, net			$	784					$	669

Depreciation expense was $282 million, $227 million, and $259 million for the years ended December 31, 2023, 2022, and 2021, respectively. Additions to capitalized software during the years ended December 31, 2023, 2022, and 2021 were $229 million, $217 million, and $191 million, respectively.

10. LEASES

The Company has operating and finance leases for office space, data centers, and computer equipment.

The Company recognized the following related to its leases in its Consolidated Balance Sheets (in millions):

												December 31,
						Classification in Consolidated Balance Sheets						2023						2022
Operating lease assets						Operating lease assets						$	705					$	645
Operating lease liabilities:
Current operating lease liabilities						Accrued expenses and other current liabilities						$	152					$	125
Non-current operating lease liabilities						Operating lease liabilities						599						552
Total operating lease liabilities												$	751					$	677

Finance lease assets						Property and equipment, net						$	70					$	52
Finance lease liabilities:
Current finance lease liabilities						Accrued expenses and other current liabilities						$	34					$	21
Non-current finance lease liabilities						Other long-term liabilities						34						32
Total finance lease liabilities												$	68					$	53

The Company recognized the following costs related to its leases in its Consolidated Statements of Operations (in millions):

												Year Ended December 31,
						Classification in Consolidated Statements of Operations						2023						2022						2021
Finance lease cost						Depreciation and amortization						$	28					$	9					$	3
Operating lease cost						General and administrative and Information technology						180						160						185
Variable lease cost						General and administrative and Information technology						82						45						46
Other						General and administrative and Interest expense						(4)						(5)						(3)
Total lease cost												$	286					$	209					$	231

As of December 31, 2023, the future lease payments for operating and finance leases are as follows (in millions):

						Operating Leases						Finance Leases
2024						$	176					$	36
2025						156						30
2026						96						5
2027						81						—
2028						61						—
Thereafter						320						—
Total future lease payments						890						71
Less: Imputed interest						(139)						(3)
Total lease liabilities						$	751					$	68

Supplemental cash flow information related to operating and finance leases is as follows (in millions):

						Year Ended December 31,
						2023						2022						2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases						$	172					$	175					$	186
Financing cash flows from finance leases						31						9						2
Operating lease assets obtained in exchange for new operating lease liabilities						200						392						162
Finance lease assets obtained in exchange for new finance lease liabilities						44						50						8

"Operating lease amortization" presented in the operating activities section of the Consolidated Statements of Cash Flows reflects the portion of the operating lease cost from the amortization of the operating lease assets.

At December 31, 2023 and 2022 the weighted-average lease term and discount rate for operating and finance leases are as follows:

						December 31,
						2023						2022
Operating leases:
Weighted-average remaining lease term						8.7 years						9.8 years
Weighted-average discount rate						4.0		%				3.2		%
Finance leases:
Weighted-average remaining lease term						2.1 years						2.7 years
Weighted-average discount rate						3.1		%				2.0		%

In September 2016, the Company signed a turnkey agreement to construct a building for Booking.com's headquarters in the Netherlands and acquired a land lease upon signing the turnkey agreement. During the year ended December 31, 2022, the construction of the building was completed and the Company entered into a sale and leaseback transaction whereby the Company transferred ownership of the building and the acquired lease rights to a subsidiary of Deka Immobilien Investment GmbH for an aggregate consideration of approximately $601 million. The Company concurrently entered into an agreement to lease the building from the purchaser for an initial term of 16.5 years, with up to five renewal options of five years each. The initial annual base rent under the lease was $26 million, which will increase annually based on the consumer price index, subject to a specified ceiling. The lease commenced in December 2022 and has been classified by the Company as an operating lease. The Company recognized a gain of $240 million on the sale and leaseback transaction, which was recorded in "Other operating expenses" in the Consolidated Statement of Operations for the year ended December 31, 2022.

11. GOODWILL AND INTANGIBLE ASSETS

A substantial portion of the Company's intangible assets and goodwill relates to the acquisitions of KAYAK, OpenTable, and Getaroom. See Note 18 for additional information related to the acquisition of Getaroom in December 2021.

Goodwill

The changes in the balance of goodwill for the years ended December 31, 2023 and 2022 consist of the following (in millions):

			Year Ended December 31,
			2023						2022
Balance, beginning of year			$	2,807					$	2,887
Foreign currency translation adjustments and other adjustments (1)			19						(80)
Balance, end of year (2)			$	2,826					$	2,807

(1) During the year ended December 31, 2022, measurement period adjustments relating to the acquisition of Getaroom resulted in a decrease to goodwill of $38 million.

(2) The balance of goodwill as of December 31, 2023 and 2022 is stated net of cumulative impairment charges of $2 billion.

At September 30, 2023, the Company performed its annual goodwill impairment test and concluded that there was no impairment of goodwill.

Intangible Assets

The Company's intangible assets consist of the following (in millions):

			December 31, 2023																		December 31, 2022
			Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Gross Carrying Amount						Accumulated Amortization						Net Carrying Amount						Amortization Period
Trade names			$	1,812					$	(911)					$	901					$	1,806					$	(812)					$	994					3 - 20 years
Supply and distribution agreements			1,402						(759)						643						1,386						(658)						728						3 - 20 years
Other intangible assets			330						(261)						69						330						(223)						107						Up to 20 years
Total intangible assets			$	3,544					$	(1,931)					$	1,613					$	3,522					$	(1,693)					$	1,829

Amortization expense for intangible assets was $222 million, $224 million, and $162 million for the years ended December 31, 2023, 2022, and 2021, respectively.

The estimated future annual amortization expense for the Company's intangible assets at December 31, 2023 is as follows (in millions):

2024			$	222
2025			214
2026			180
2027			170
2028			169
Thereafter			658
			$	1,613

12. DEBT

Revolving Credit Facility

In May 2023, the Company entered into a five-year unsecured revolving credit facility with a group of lenders. The revolving credit facility extends a revolving line of credit of up to $2 billion to the Company and provides for the issuance of up to $80 million of letters of credit, as well as up to $100 million of borrowings on same-day notice, referred to as swingline loans. Other than the swingline loans, which are available only in U.S. Dollars, the revolving loans and the letters of credit are available in U.S. Dollars, Euros, Pounds Sterling, and any other currency agreed to by the administrative agent and each of the lenders. The revolving credit facility contains a maximum leverage ratio covenant, compliance with which is a condition to the Company's ability to borrow.

Borrowings under the revolving credit facility will bear interest at a rate determined by reference to benchmark rates plus an applicable spread (ranging from 0% to 1.375%) based on the Company's leverage or credit rating at the time of the borrowing. Undrawn balances available under the revolving credit facility are subject to commitment fees at the applicable rate determined by reference to the Company's leverage or credit rating.

Upon entering into this new revolving credit facility, the Company terminated the $2 billion five-year revolving credit facility entered into in August 2019. At December 31, 2023 there were no borrowings outstanding and $18 million of letters of credit issued under the new revolving credit facility. At December 31, 2022, there were no borrowings outstanding and $14 million of letters of credit issued under the prior revolving credit facility.

Outstanding Debt

Outstanding debt consists of the following (in millions):

						December 31, 2023												December 31, 2022
						Outstanding Principal Amount												Carrying Value (1)						Outstanding Principal Amount												Carrying Value (1)
2.75% Senior Notes due March 2023 (2)						$	—											$	—					$	500											$	500
2.375% (€1 Billion) Senior Notes due September 2024 (3)						1,105												1,104						1,067												1,064
3.65% Senior Notes due March 2025						500												499						500												499
0.1% (€950 Million) Senior Notes due March 2025						1,050												1,048						1,014												1,011
0.75% Convertible Senior Notes due May 2025 (3)						862												857						863												854
3.6% Senior Notes due June 2026						1,000												998						1,000												997
4.0% (€750 Million) Senior Notes due November 2026						828												825						800												797
1.8% (€1 Billion) Senior Notes due March 2027						1,105												1,103						1,067												1,065
3.55% Senior Notes due March 2028						500												499						500												498
0.5% (€750 Million) Senior Notes due March 2028						828												825						800												797
3.625% (€500 Million) Senior Notes due November 2028						552												549						—												—
4.25% (€750 Million) Senior Notes due May 2029						828												823						800												794
4.625% Senior Notes due April 2030						1,500												1,492						1,500												1,491
4.5% (€1 Billion) Senior Notes due November 2031						1,105												1,098						1,067												1,060
4.125% (€1.25 Billion) Senior Notes due May 2033						1,381												1,367						—												—
4.75% (€1 Billion) Senior Notes due November 2034						1,105												1,097						1,067												1,058
Total outstanding debt						$	14,249											$	14,184					$	12,545											$	12,485
Short-term debt						1,967												1,961						500												500
Long-term debt						$	12,282											$	12,223					$	12,045											$	11,985

(1) The carrying values differ from the outstanding principal amounts due to unamortized debt discounts and debt issuance costs of $65 million and $60 million as of December 31, 2023 and 2022, respectively.

(2) Included in "Short-term debt" in the Consolidated Balance Sheet as of December 31, 2022.

(3) Included in "Short-term debt" in the Consolidated Balance Sheet as of December 31, 2023.

Fair Value of Debt

At December 31, 2023 and 2022, the estimated fair value of the outstanding debt was approximately $15.2 billion and $12.4 billion, respectively, and was considered a "Level 2" fair value measurement (see Note 2). The fair values were estimated based upon actual trades at the end of the reporting period or the most recent trade available as well as the Company's stock price at the end of the reporting period. The estimated fair value of the Company's debt in excess of the outstanding principal amount at December 31, 2023 primarily relates to the conversion premium on the convertible senior notes due in May 2025. As of December 31, 2022, the outstanding principal amount of the Company's debt exceeds the fair value of debt mainly due to the increase in interest rates partially offset by the conversion premium on the convertible senior notes due in May 2025.

Convertible Senior Notes

In April 2020, the Company issued $863 million aggregate principal amount of convertible senior notes due in May 2025 with an interest rate of 0.75% (the "May 2025 Notes"). The Company paid $19 million in debt issuance costs during the year ended December 31, 2020 related to the issuance. The May 2025 Notes are convertible, subject to certain conditions, into the Company's common stock at a conversion price of $1,886.44 per share. The May 2025 Notes are convertible, at the option of the holder, prior to November 1, 2024, upon the occurrence of specific events, including but not limited to a change in control, or if the closing sales price of the Company's common stock for at least 20 trading days in the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is more than 130% of the conversion price in effect for the notes on the last trading day of the immediately preceding quarter. In the event that all or substantially all of the Company's common stock is acquired on or prior to the maturity of the May 2025 Notes in a transaction in which the consideration paid to holders of the Company's common stock consists of all or substantially all cash, the Company would be required to make additional payments in the form of additional shares of common stock to the holders of the May 2025 Notes in an aggregate value ranging from $0 to $235 million depending upon the date of the transaction and the then current stock price of the Company. Starting on November 1, 2024, holders will have the right to convert all or any portion of the May 2025 Notes, regardless of the Company's stock price. The May 2025 Notes may not be redeemed by the Company prior to maturity. The holders may require the Company to repurchase the May 2025 Notes for cash in certain circumstances. Interest on the May 2025 Notes is payable on May 1 and November 1 of each year. If the note holders exercise their option to convert, the Company delivers cash to repay the principal amount of the notes and delivers shares of common stock or cash, at its option, to satisfy the conversion value in excess of the principal amount. Based on the closing sales prices of the Company's common stock for the prescribed measurement periods, the May 2025 Notes were convertible at the option of the holder starting the second calendar quarter of 2023 and continue to be convertible during the first calendar quarter of 2024. The May 2025 Notes are classified as "Short-term debt" in the Consolidated Balance Sheet as of December 31, 2023 and "Long-term debt" in the Consolidated Balance Sheet as of December 31, 2022. At December 31, 2023 and 2022, the estimated fair value of the May 2025 Notes was $1.6 billion and $1.2 billion, respectively, and was considered a "Level 2" fair value measurement (see Note 2).

In August 2014, the Company issued $1 billion aggregate principal amount of convertible senior notes due September 2021 with an interest rate of 0.9% (the "September 2021 Notes"). In September 2021, in connection with the maturity of these notes, the Company paid $1 billion to satisfy the aggregate principal amount due and paid an additional $86 million conversion premium in excess of the principal amount.

Prior to January 1, 2022, cash-settled convertible debt, such as the Company's convertible senior notes, were separated into debt and equity components at issuance and each component was assigned a value. The value assigned to the debt component was the estimated fair value, at the issuance date, of a similar bond without the conversion feature. The difference between the bond cash proceeds and this estimated fair value, representing the value assigned to the equity component, was recorded as a debt discount. Debt discount was amortized using the effective interest rate method over the period from the origination date through the stated maturity date. The Company estimated the borrowing rates at debt origination to be 4.10% for the May 2025 Notes, considering its credit rating and similar debt of the Company or comparable corporate issuers without the conversion feature. The yield to maturity was estimated at an at-market coupon priced at par. Debt discount after tax of $100 million ($130 million before tax) related to the May 2025 Notes less debt issuance costs allocated to the equity component was recorded in additional paid-in capital in the balance sheet at debt origination. On January 1, 2022, the Company adopted the new accounting standards update relating to convertible instruments (see Note 2). The adoption of the new accounting standards update resulted in a decrease of $26 million in "Interest expense" and an increase in "Income before income taxes" in the Consolidated Statement of Operations for the year ended December 31, 2022. For the year ended December 31, 2021, interest expense related to the convertible senior notes consisted primarily of the amortization of debt discount and debt issuance costs of $43 million. For the years ended December 31, 2023, 2022, and 2021, the weighted-average effective interest rate related to the convertible senior notes was 1.2%, 1.2%, and 3.8%, respectively.

Other Senior Notes

The following table summarizes the information related to other senior notes outstanding at December 31, 2023:

Other Senior Notes						Date of Issuance						Effective Interest Rate (1)						Timing of Interest Payments
2.375% Senior Notes due September 2024						September 2014						2.54		%				Annually in September
3.65% Senior Notes due March 2025						March 2015						3.76		%				Semi-annually in March and September
0.1% Senior Notes due March 2025						March 2021						0.30		%				Annually in March
3.6% Senior Notes due June 2026						May 2016						3.70		%				Semi-annually in June and December
4.0% Senior Notes due November 2026						November 2022						4.08		%				Annually in November
1.8% Senior Notes due March 2027						March 2015						1.86		%				Annually in March
3.55% Senior Notes due March 2028						August 2017						3.63		%				Semi-annually in March and September
0.5% Senior Notes due March 2028						March 2021						0.63		%				Annually in March
3.625% Senior Notes due November 2028						May 2023						3.74		%				Annually in November
4.25% Senior Notes due May 2029						November 2022						4.35		%				Annually in May
4.625% Senior Notes due April 2030						April 2020						4.72		%				Semi-annually in April and October
4.5% Senior Notes due November 2031						November 2022						4.57		%				Annually in November
4.125% Senior Notes due May 2033						May 2023						4.26		%				Annually in May
4.75% Senior Notes due November 2034						November 2022						4.81		%				Annually in November

(1) Represents the coupon interest rate adjusted for deferred debt issuance costs, premiums or discounts existing at the origination of the debt.

The proceeds from the issuance of the senior notes issued in May 2023 are available for general corporate purposes, including to repurchase shares of the Company's common stock.

A portion of the proceeds from the senior notes issued in November 2022 (the "November 2022 Notes") was used to repay $500 million on the maturity of the Senior Notes due March 2023 and $778 million on the maturity of the Senior Notes due November 2022. In addition, the Company paid the applicable accrued and unpaid interest relating to these senior notes. The remaining proceeds from the issuance of the November 2022 notes are available to be used for general corporate purposes.

In March 2022, the Company repaid $1.1 billion on the maturity of Senior Notes due March 2022. In addition, the Company paid the applicable accrued and unpaid interest relating to these senior notes.

In April 2021, the Company used the proceeds from the issuance of the senior notes issued in March 2021 to pay $1.1 billion and $868 million to redeem the April 2025 Notes and the April 2027 Notes, respectively. In addition, the Company paid the applicable accrued and unpaid interest relating to these senior notes. The Company recorded a loss, before tax, of $242 million in the Consolidated Statement of Operations for the year ended December 31, 2021, on the early extinguishment of these senior notes (see Note 6).

Interest expense related to other senior notes consists primarily of coupon interest expense of $409 million, $241 million, and $257 million for the years ended December 31, 2023, 2022, and 2021, respectively. Debt discount and debt issuance costs are amortized using the effective interest rate method over the period from the origination date through the stated maturity date. "Interest expense" in the Consolidated Statements of Operations also includes interest expense related to the Company's cash management activities (with related income recorded in "Other income (expense), net" in the Consolidated Statements of Operations).

Each of the Company's senior notes are unsecured and rank equally in right of payment with all of the Company's other senior unsecured notes.

The Company designates certain portions of the aggregate principal value of the Euro-denominated debt as a hedge of the foreign currency exposure of the net investment in certain Euro functional currency subsidiaries. For the years ended December 31, 2023 and 2022, the carrying value of the portion of Euro-denominated debt, designated as a net investment hedge, ranged from $3.1 billion to $8.4 billion and from $4.2 billion to $6.2 billion, respectively. The foreign currency transaction gains or losses on the Euro-denominated debt that is designated as a hedging instrument for accounting purposes are recorded in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The foreign currency transaction

gains or losses on the Euro-denominated debt that is not designated as a hedging instrument are recognized in "Other income (expense), net" in the Consolidated Statements of Operations.

13. TREASURY STOCK AND DIVIDENDS

At December 31, 2022, the Company had a total remaining authorization of $3.9 billion related to a program authorized by the Company's Board of Directors ("the Board") in 2019 to repurchase up to $15 billion of the Company's common stock. In the first quarter of 2023, the Board authorized an additional program to repurchase up to $20 billion of the Company's common stock. At December 31, 2023, the Company had a total remaining authorization of $13.7 billion to repurchase its common stock. The Company expects to complete the share repurchases under the remaining authorization by the end of 2026, assuming no major downturn in the travel market. Additionally, the Board has given the Company the general authorization to repurchase shares of its common stock withheld to satisfy employee withholding tax obligations related to stock-based compensation.

The following table summarizes the Company's stock repurchase activities during the years ended December 31, 2023, 2022, and 2021 (in millions, except for shares, which are reflected in thousands):

						Year Ended December 31,
						2023												2022												2021
						Shares						Amount						Shares						Amount						Shares						Amount
Authorized stock repurchase programs						3,660						$	10,249					3,320						$	6,526					—						$	—
General authorization for shares withheld on stock award vesting						72						194						80						167						71						162
Total						3,732						$	10,443					3,400						$	6,693					71						$	162

Stock repurchases of $40 million in December 2023 were settled in January 2024. Stock repurchases of $70 million in December 2022 were settled in January 2023. For the years ended December 31, 2023, 2022, and 2021, the Company remitted employee withholding taxes of $194 million, $165 million, and $163 million, respectively, to the tax authorities, which is different from the aggregate cost of the shares withheld for taxes for each year due to the timing in remitting the taxes. The cash remitted to the tax authorities is included in financing activities in the Consolidated Statements of Cash Flows.

Effective January 1, 2023, the Inflation Reduction Act of 2022 has mandated a 1% excise tax on share repurchases. Excise tax obligations that result from the Company's share repurchases are accounted for as a cost of the treasury stock transaction. As of December 31, 2023, the Company recorded an estimated excise tax liability of $96 million for stock repurchases during the year ended December 31, 2023, which is included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheet.

On January 25, 2024, the Board adopted a dividend policy pursuant to which the Company intends to pay quarterly cash dividends on its common stock. Declaration of dividends pursuant to the policy will be subject to the Board’s consideration of, among other things, the Company's financial performance, cash flows, capital needs, and liquidity. Pursuant to the dividend policy, on February 16, 2024 the Board declared a quarterly cash dividend of $8.75 per share of common stock, payable on March 28, 2024 to stockholders of record as of the close of business on March 8, 2024.

14. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS BY COMPONENT

The table below presents the changes in the balances of accumulated other comprehensive loss ("AOCI") by component for the years ended December 31, 2021, 2022, and 2023 (in millions):

						Foreign currency translation adjustments																														Unrealized losses on cash flow hedges (1)																		Net unrealized gains (losses) on available-for-sale securities																		Total AOCI, net of tax
			Foreign currency translation												Net investment hedges (2)												Total, net of tax						Before tax						Tax						Total, net of tax						Before tax						Tax						Total, net of tax
			Before tax						Tax (3)						Before tax						Tax
Balance, December 31, 2020						$	11					$	47					$	(184)					$	37					$	(89)					$	—					$	—					$	—					$	3					$	(32)					$	(29)					$	(118)
Other comprehensive (loss) income ("OCI") before reclassifications						(287)						20						275						(65)						(57)						(15)						4						(11)						265						(62)						203						135
Amounts reclassified to net income (4) (5)						—						—						—						—						—						15						(4)						11						(265)						93						(172)						(161)
OCI for the period						(287)						20						275						(65)						(57)						—						—						—						—						31						31						(26)
Balance, December 31, 2021						$	(276)					$	67					$	91					$	(28)					$	(146)					$	—					$	—					$	—					$	3					$	(1)					$	2					$	(144)
OCI for the period						(303)						26						219						(53)						(111)						—						—						—						(16)						4						(12)						(123)
Balance, December 31, 2022						$	(579)					$	93					$	310					$	(81)					$	(257)					$	—					$	—					$	—					$	(13)					$	3					$	(10)					$	(267)
OCI for the period						42						1						(139)						33						(63)						—						—						—						9						(2)						7						(56)
Balance, December 31, 2023						$	(537)					$	94					$	171					$	(48)					$	(320)					$	—					$	—					$	—					$	(4)					$	1					$	(3)					$	(323)

(1) Relates to the reverse treasury lock agreements entered in March 2021 that were designated as cash flow hedges and settled in April 2021 (see Note 6).

(2) Net investment hedges balance at December 31, 2023 and earlier dates presented above, includes accumulated net losses from fair value adjustments of $35 million ($53 million before tax) associated with previously settled derivatives that were designated as net investment hedges. The remaining balances relate to foreign currency transaction gains (losses) and related tax benefits (expenses) associated with the Company's Euro-denominated debt that is designated as a hedge of the foreign currency exposure of the net investment in certain Euro functional currency subsidiaries (see Notes 2 and 12).

(3) The tax benefits relate to foreign currency translation adjustments to the Company's one-time deemed repatriation tax liability recorded at December 31, 2017 and foreign earnings for periods after December 31, 2017 that are subject to U.S. federal and state income tax, resulting from the enactment of the Tax Act.

(4) The reclassified net gains (losses) on available-for-sale securities, before tax, are included in "Other income (expense), net" and the reclassified tax (expenses) benefits are included in "Income tax expense" in the Consolidated Statement of Operations. The cost of marketable debt securities sold is determined using a first-in and first-out method. For the year ended December 31, 2021, the reclassified tax expenses include a tax expense of $31 million, related to the redemption in December 2021 of the Company's investment of $500 million in Trip.com Group convertible senior notes.

(5) For the year ended December 31, 2021, amounts reclassified to net income includes a gain of $203 million ($265 million before tax) related to the Company's investment in Grab, which was reclassified from available-for-sale debt securities to equity securities with readily determinable fair values (see Note 5).

15. INCOME TAXES

The composition of pre-tax income (loss) for the years ended December 31, 2023, 2022, and 2021 is as follows (in millions):

			Year Ended December 31,
			2023						2022						2021
International			$	6,119					$	4,717					$	1,937
U.S.			(638)						(794)						(472)
Total			$	5,481					$	3,923					$	1,465

Provision for Income Taxes

The composition of income tax expense for the years ended December 31, 2023, 2022, and 2021 is as follows (in millions):

			Year Ended December 31,
			2023						2022						2021
Current income tax expense (benefit):
International			$	1,371					$	1,145					$	665
U.S. Federal			291						(8)						68
U.S. State			8						(15)						12
Current income tax expense (benefit):			1,670						1,122						745
Deferred income tax (benefit) expense:
International			(47)						(61)						(103)
U.S. Federal			(411)						(172)						(323)
U.S. State			(20)						(24)						(19)
Deferred income tax (benefit) expense			(478)						(257)						(445)
Income tax expense			$	1,192					$	865					$	300

Income tax liabilities of $1 billion and $880 million are included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets at December 31, 2023 and 2022, respectively.

U.S. Tax Reform

In December 2017, the Tax Act was enacted into law in the United States. The Tax Act made significant changes to U.S. federal tax law, including a one-time deemed repatriation tax on accumulated unremitted international earnings, to be paid over eight years. In 2023, the Company adjusted its income tax expense that was recorded during the year ended December 31, 2017 relating to the federal one-time deemed repatriation liability. This expense resulted from the closing of the 2017 and 2018 U.S federal income tax audits. Under the Tax Act, the Company's future cash generated by the Company's international operations can generally be repatriated without further U.S. federal income tax, but will be subject to U.S. state income taxes and international withholding taxes, which have been accrued by the Company. The Tax Act also introduced in 2018 a tax on 50% of GILTI, which is income determined to be in excess of a specified routine rate of return, and a base erosion and anti-abuse tax ("BEAT") aimed at preventing the erosion of the U.S. tax base. The Company has adopted an accounting policy to treat taxes on GILTI as period costs.

Deferred Income Taxes

The Company utilized $309 million of its U.S. NOLs to reduce its U.S. federal tax liability for the deemed repatriation tax. After utilization of available NOLs, at December 31, 2023, the Company had U.S. federal NOLs of $353 million, the majority of which do not have an expiration date, and U.S. state NOLs of $259 million, which mainly begin to expire in years ending December 31, 2032 and forward. In addition, at December 31, 2023, the Company had $970 million of non-U.S. NOLs, the majority of which do not have an expiration date, and $45 million of U.S. research tax credit and foreign tax credit carryforwards available to reduce future tax liabilities.

The utilization of these NOLs and credits is dependent upon the Company's ability to generate sufficient future taxable income and the tax laws in the jurisdictions where the losses were generated. The Company periodically evaluates the likelihood of the realization of deferred tax assets, and reduces the carrying amount of these deferred tax assets by a valuation allowance to the extent it believes a portion will not be realized. The Company considers many factors when assessing the likelihood of future realization of the deferred tax assets, including its recent cumulative earnings experience by taxing jurisdiction, expectations of future income, tax planning strategies, the carryforward periods available for tax reporting purposes and other relevant factors.

The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities at December 31, 2023 and 2022 are as follows (in millions):

			December 31,
			2023						2022
Deferred tax assets:
Net operating loss carryforward — U.S.			$	89					$	95
Net operating loss carryforward — International			200						176
Accrued expenses			70						74
Stock-based compensation and other stock-based payments			47						36
Unrealized losses on investments			83						—
Foreign currency translation adjustments			66						83
Tax credits			39						35
Operating lease liabilities			20						29
Property and equipment			195						126
Other			16						7
Total deferred tax assets			825						661
Valuation allowance on deferred tax assets			(114)						(120)
Deferred tax assets, net			711						541
Deferred tax liabilities:
Intangible assets and other			(140)						(174)
Euro-denominated debt			(11)						(84)
State income tax on accumulated unremitted international earnings			(6)						(8)
Unrealized gains on investments			—						(202)
Operating lease assets			(19)						(26)
Installment sale liability			(118)						(119)
Deferred tax liabilities			(294)						(613)
Net deferred tax assets (liabilities) (1)			$	417					$	(72)

(1) Includes deferred tax assets of $675 million and $613 million at December 31, 2023 and 2022, respectively, included in "Other assets, net" in the Consolidated Balance Sheets.

The valuation allowance on deferred tax assets at December 31, 2023 includes $30 million related to international operations and $84 million primarily related to certain unrealized losses on equity securities. The valuation allowance on deferred tax assets at December 31, 2022 includes $29 million related to international operations and $91 million primarily related to certain unrealized losses on equity securities and Connecticut NOLs. The decrease in the valuation allowance is primarily related to deferred tax assets generated from certain unrealized losses on equity securities and Connecticut NOLs.

The Company does not intend to indefinitely reinvest its international earnings that were subject to U.S. taxation pursuant to the mandatory deemed repatriation or subject to U.S. taxation as GILTI.

Reconciliation of U.S. Federal Statutory Income Tax Rate to Effective Income Tax Rate

A significant portion of the Company's taxable earnings is generated in the Netherlands. According to Dutch corporate income tax law, income generated from qualifying innovative activities is taxed at a rate of 9% ("Innovation Box Tax") for periods beginning on or after January 1, 2021 rather than the Dutch statutory rate of 25%. Previously, the Innovation Box Tax rate was 7%. Effective January 1, 2022, the Netherlands corporate income tax rate increased from 25% to 25.8%. A portion of

Booking.com's earnings during the years ended December 31, 2023, 2022, and 2021 qualified for Innovation Box Tax treatment, which had a significant beneficial impact on the Company's effective tax rate for those years.

The effective income tax rate of the Company is different from the amount computed using the expected U.S. statutory federal rate of 21% for the years ended December 31, 2023, 2022, and 2021 as a result of the following items (in millions):

			Year Ended December 31,
			2023						2022						2021
Income tax expense at U.S. federal statutory rate			$	1,151					$	824					$	308
Adjustment due to:
Foreign rate differential			307						264						137
Innovation Box Tax benefit			(544)						(452)						(230)
Stock-based compensation			59						42						37
Federal GILTI			24						10						17
State income tax benefit			(9)						(31)						(6)
Valuation allowance			(4)						87						(19)
Uncertain tax positions			14						72						39
Fines and penalties			144						2						1
Other			50						47						16
Income tax expense			$	1,192					$	865					$	300

Uncertain Tax Positions

The following is a reconciliation of the total beginning and ending amount of unrecognized tax benefits (in millions):

			Year Ended December 31,
			2023						2022						2021
Unrecognized tax benefit — January 1			$	184					$	120					$	84
Gross increases — tax positions in current period			16						3						14
Gross increases — tax positions in prior periods			22						94						44
Gross decreases — tax positions in prior periods			(5)						(33)						(19)
Reduction due to lapse in statute of limitations			(3)						—						—
Reduction due to settlements during the current period			(147)						—						(3)
Unrecognized tax benefit — December 31			$	67					$	184					$	120

The decrease in unrecognized tax benefits, as well as gross interest and penalties, primarily relates to the settlement by Booking.com of certain French tax matters (see Note 16). The majority of unrecognized tax benefits are included in "Other assets, net" and "Other long-term liabilities" in the Consolidated Balance Sheet as of December 31, 2023. The amount of unrecognized tax benefits, if recognized, that would affect the effective tax rate are $47 million as of December 31, 2023. It is reasonably possible that the balance of gross unrecognized tax benefits could change over the next 12 months. As of December 31, 2023 and 2022, total gross interest and penalties accrued was $7 million and $43 million, respectively. See Note 16 for more information regarding tax contingencies.

The Company's major taxing jurisdictions include: the Netherlands, United States, Singapore, and United Kingdom. The statutes of limitations that remain open related to these major tax jurisdictions are: the Company's Netherlands returns for 2018 and forward, U.S. federal returns for 2020 and forward, Singapore returns from 2018 and forward, and U.K. returns for 2020 and forward.

16. COMMITMENTS AND CONTINGENCIES

Competition and Consumer Protection Reviews

Online travel platforms have been the subject of investigations or inquiries by national competition authorities ("NCAs") or other governmental authorities regarding competition law matters, consumer protection issues, or other areas of concern. The Company is and has been involved in many such investigations. For example, the Company is involved in investigations related to whether Booking.com's contractual parity arrangements with accommodation providers are anti-competitive because they require partners to provide Booking.com with rates, conditions, and availability at least as favorable as those offered to other OTCs or by the partner itself. To resolve certain of the parity-related investigations, the Company has from time to time made commitments regarding future business practices or activities, such as agreeing to narrow the scope of its parity clauses. These investigations have resulted in fines and the Company could incur additional fines and/or be restricted in certain of its business practices in the future.

In October 2022, the Comisión Nacional de los Mercados y la Competencia in Spain (the "CNMC") opened an investigation into whether certain practices by Booking.com may produce adverse effects for hotels and other OTCs. In January 2024, the CNMC notified Booking.com of its draft decision to impose a fine of 486 million Euros and to restrict certain business practices such as those relating to parity provisions and criteria that Booking.com can use to determine how to rank hotels in its display to customers. The amount of the draft fine is based on Booking.com’s historical revenues and it is possible the final amount may be increased when the decision is finalized, which is expected by July 2024. Booking.com does not agree with the rationale stated in the draft decision and certain of the restrictions sought to be imposed, and is continuing to engage with the CNMC prior to the decision being finalized. If the draft decision were to become final, Booking.com plans to challenge aspects of the fine, decision, and/or restrictions. Although the Company disagrees with the rationale stated in the draft decision, the Company accrued a loss of 486 million Euros ($530 million) related to it, which is included in "General and administrative" expenses in the Consolidated Statement of Operations for the year ended December 31, 2023. The related liability is included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheet as of December 31, 2023. In addition, in September 2017, the Swiss Price Surveillance Office opened an investigation into the level of commissions of Booking.com in Switzerland and the investigation is ongoing. If there is an adverse outcome and Booking.com is unsuccessful in any appeal, Booking.com may be required to make other commitments, such as reducing its commissions in Switzerland. In July 2023, the Polish Office of Competition and Consumer Protection opened an investigation into Booking.com's identification of private and professional hosts and its messaging in relation to obligations owed to consumers. If any of the investigations were to find that Booking.com practices violated the respective laws, Booking.com may face significant fines, restrictions on its business practices, and/or be required to make other commitments.

The Company is and has been involved in investigations or inquiries by NCAs or other governmental authorities involving consumer protection matters, including in the United Kingdom and the European Union. The Company has previously made certain voluntary commitments to competition authorities to resolve investigations or inquiries that have included showing prices inclusive of all mandatory taxes and charges, providing information about the effect of money earned on search result rankings on or before the search results page and making certain adjustments to how discounts and statements concerning popularity or availability are shown to consumers. In the future, it is possible new jurisdictions could engage the Company in discussions to implement changes to its business in those countries. The Company is unable to predict what, if any, effect any future similar commitments will have on its business, industry practices or online commerce more generally. To the extent that any other investigations or inquiries result in additional commitments, fines, damages or other remedies, the Company's business, financial condition, and results of operations could be harmed.

The Company is unable to predict how any current or future investigations or litigation may be resolved or the long-term impact of any such resolution on its business. For example, competition and consumer-law-related investigations, legislation, or issues could result in private litigation and the Company is currently involved in such litigation. More immediate results could include, among other things, the imposition of fines, payment of damages, commitments to change certain business practices, or reputational damage, any of which could harm the Company's business, results of operations, brands, or competitive position.

Tax Matters

Between December 2018 and August 2021, the Italian tax authorities issued assessments on Booking.com's Italian subsidiary totaling approximately 251 million Euros ($277 million) for the tax years 2013 through 2018, asserting that its transfer pricing policies were inadequate. The Company believes Booking.com has been and continues to be in compliance with Italian tax law. In September 2020, the Italian tax authorities approved the opening of a mutual agreement procedure ("MAP") between Italy and the Netherlands for the 2013 tax year and the Italian tax authorities subsequently approved the inclusion of

the tax years 2014 through 2018 in the MAP. Based on the Company's expectation that the Italian assessments for 2013 through 2018, and any transfer pricing assessments received for subsequent open years, will be settled through the MAP process, and after considering potential resolution amounts, 33 million Euros ($36 million) have been reflected in net unrecognized tax benefits, the majority of which is recorded to "Other assets, net" in the Consolidated Balance Sheet at December 31, 2023. This unrecognized tax benefit is partially offset by a deferred income tax benefit of 15 million Euros ($17 million). As of December 31, 2023, the Company made prepayments of 74 million Euros ($82 million) to the Italian tax authorities to forestall collection enforcement pending the appeal phase of the case. The payments do not constitute an admission that the Company owes the taxes and will be refunded (with interest) to the Company to the extent that the Company prevails. The payments are included in "Other assets, net" in the Consolidated Balance Sheets at December 31, 2023 and December 31, 2022.

In June 2021, the investigative arm of the Italian tax authorities issued a Tax Audit Report recommending that a formal tax assessment of 154 million Euros ($170 million), plus interest and penalties, be made on Booking.com BV for value-added taxes ("VAT") related to commissions charged to certain Italian accommodation providers from 2013 to 2019. In connection with the Tax Audit Report, the Genoa Public Prosecutor requested certain Booking.com tax information and related data. The Company is cooperating with regard to that request. While the Company continues to believe that Booking.com has been compliant with applicable VAT laws, in July 2023, the Company entered into an agreement with the Italian tax authorities and paid approximately 93 million Euros ($103 million) to settle the issues raised in the Tax Audit Report for the periods 2013 through 2022.

In December 2022, the Company entered into an agreement with the French tax authorities to settle all the income and

VAT assessments for the years 2006 through 2018 that were issued to Booking.com for a total amount of approximately

153 million Euros ($163 million). The settlement amount was reflected in unrecognized tax benefits as of December 31, 2022.

The Company is also involved in other tax-related audits, investigations, and litigation relating to income taxes, value-added taxes, travel transaction taxes (e.g., hotel occupancy taxes), withholding taxes, and other taxes. Any taxes or assessments in excess of the Company's tax provisions, including the resolution of any tax proceedings or litigation, could have a material adverse impact on the Company's results of operations, cash flows, and financial condition. In some cases, assessments may be significantly in excess of the Company's tax provisions, particularly in instances where the Company does not agree with the tax authority's assessment of how the tax laws may apply to the Company's business.

Other Matters

Beginning in 2014, Booking.com B.V. received several letters from the Netherlands Pension Fund for the Travel Industry (Reiswerk) ("BPF") claiming that it was required to participate in the mandatory pension scheme of the BPF with retroactive effect to 1999, which has a higher contribution rate than the pension scheme in which it is currently participating. BPF instituted legal proceedings and in 2016 the District Court of Amsterdam rejected all of BPF's claims. BPF appealed the decision to the Court of Appeal, and, in May 2019, the Court of Appeal also rejected all of BPF's claims, in each case by ruling that Booking did not meet the definition of a travel intermediary for purposes of the mandatory pension scheme. BPF then appealed to the Netherlands Supreme Court. In April 2021, the Supreme Court overturned the previous decision of the Court of Appeal and held that Booking.com B.V. met the definition of a travel intermediary for the purposes of the mandatory pension scheme. The Supreme Court ruled only on the qualification of Booking as a travel intermediary for the purposes of the mandatory pension scheme and did not rule on the various other defenses brought forward by the Company against BPF's claims. The Supreme Court referred the matter to another Court of Appeal to assess the other defenses brought forward by the Company. In January 2024, that Court of Appeal ruled that Booking.com B.V. is required to participate in the mandatory pension scheme of the BPF with retroactive effect to 1999. The Company is considering an appeal of the decision on various grounds, such as whether the court applied the proper legal criteria in assessing whether Booking.com B.V. falls within the scope of the mandatory pension scheme, and whether the statute of limitations may further reduce the retroactive period. Although the Company disagrees with the decision, it accrued a loss of 253 million Euros ($276 million), included in "Personnel" expenses in the Consolidated Statement of Operations for the year ended December 31, 2023. The related liability is included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheet as of December 31, 2023. Even in the event the Company pursues an appeal, on a go-forward basis, Booking.com B.V. expects to begin paying pension premiums to the BPF scheme or to increase contributions to employees under its existing pension scheme.

From time to time, the Company notifies the competent data protection authority, such as the Dutch data protection authority in accordance with its obligations under the General Data Protection Regulation, of certain incidental and accidental personal data security incidents. Should, for example, the Dutch data protection authority decide these incidents were the result of inadequate technical and organizational security measures or practices, it could decide to impose a fine.

The Company has been, is currently, and expects to continue to be, subject to legal proceedings and claims in the ordinary course of business, including claims of alleged infringement of third-party intellectual property rights. Such claims, even if not meritorious, could result in the expenditure of significant financial and managerial resources, divert management's attention from the Company's business objectives and adversely affect the Company's business, reputation, results of operations, financial condition, and cash flows.

The Company accrues for certain legal contingencies where it is probable that a loss has been incurred and the amount can be reasonably estimated. Such accrued amounts are not material to the Company's balance sheets and provisions recorded have not been material to the Company's results of operations or cash flows.

Other Contractual Obligations and Contingencies

The Company had $533 million and $452 million of standby letters of credit and bank guarantees issued on behalf of the Company as of December 31, 2023 and 2022, respectively, including those issued under the revolving credit facility. These are obtained primarily for regulatory purposes. See Note 12 for information related to letters of credit issued under the revolving credit facility.

Booking.com offers partner liability insurance that provides protection to certain accommodation partners ("home partners") in instances where a reservation has been made via Booking.com. The partner liability insurance may provide those home partners (both owners and property managers) coverage up to $1 million equivalent per occurrence, subject to limitations and exclusions, against third-party lawsuits claims for bodily injury, or third party personal property damage that occurred during a stay booked through Booking.com. Booking.com retains certain financial risks related to this insurance offering, which is underwritten by third party insurance companies.

17. GEOGRAPHIC INFORMATION

The Company's revenue from its businesses outside of the U.S. consists of the results of Booking.com, Agoda, and Rentalcars.com in their entirety and the results 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 the Company's 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 United States is part of the results of the Company's businesses outside of the U.S. The Company's geographic information on revenues is as follows (in millions):

			United States						Outside of the U.S.												Total Company
For the year ended:						The Netherlands						Other
December 31, 2023			$	2,327					$	17,014					$	2,024					$	21,365
December 31, 2022			2,205						13,428						1,457						17,090
December 31, 2021			1,434						8,678						846						10,958

The following table presents information on the Company's property and equipment (excluding capitalized software) and operating lease assets based on location of the assets at December 31, 2023 and 2022 (in millions):

			United States						Outside of the U.S.																		Total Company
						The Netherlands						United Kingdom						Other
December 31, 2023			$	127					$	476					$	209					$	229					$	1,041
December 31, 2022			143						445						125						213						926

18. ACQUISITIONS

In December 2021, the Company acquired all of the outstanding stock of Getaroom, a business-to-business distributor of hotel rooms, in a cash transaction for $1.3 billion ($1.2 billion, net of cash acquired).

The following table summarizes the allocation of the consideration transferred for the Getaroom acquisition.

			(in millions)
Current assets (1)			$	174
Identifiable intangible assets (2)			437
Goodwill (3)			982
Other non-current assets			11
Current liabilities			(199)
Deferred income taxes			(65)
Other non-current liabilities (4)			(44)
Total consideration			$	1,296

(1) Includes cash and restricted cash acquired of $116 million.

(2) Acquired definite-lived intangible assets consist of supply and distribution agreements with an estimated value of $311 million and weighted-average useful life of 10 years, technology assets with an estimated value of $118 million and weighted-average useful life of 4 years, trade names with an estimated value of $5 million and weighted-average useful life of 3 years and other intangible assets with an estimated value of $3 million and weighted-average useful life of 5 years.

(3) Goodwill, which is not tax deductible, reflects the synergies expected from combining the technology and expertise of Getaroom and Priceline.

(4) Includes liabilities of $39 million principally related to travel transaction taxes.

The allocation of the consideration transferred was completed and, compared to the preliminary allocation, resulted in a decrease to goodwill of $38 million, a decrease to deferred tax liabilities of $27 million, and increase to intangible assets of $14 million, and a net decrease to other assets and liabilities of $3 million.

Supplemental pro forma information has not been presented as the results of Getaroom are not material to the Company's results of operations.

19. OTHER INCOME (EXPENSE), NET

The components of other income (expense), net included the following (in millions):

			Year Ended December 31,
			2023						2022						2021
Interest and dividend income			$	1,020					$	219					$	16
Net losses on equity securities (1)			(131)						(963)						(569)
Foreign currency transaction (losses) gains (2)			(348)						(43)						111
Loss on early extinguishment of debt (3)			—						—						(242)
Other (4)			2						(1)						(13)
Other income (expense), net			$	543					$	(788)					$	(697)

(1) See Note 5 for additional information related to the net losses on equity securities and Note 6 for additional information related to impairments of an investment in equity securities.

(2) Foreign currency transaction (losses) gains include losses of $163 million and gains of $46 million and $135 million for the years ended December 31, 2023, 2022, and 2021, respectively, related to Euro-denominated debt and accrued interest that were not designated as net investment hedges (see Note 12).

(3) See Note 12 for additional information related to the loss on early extinguishment of debt.

(4) The amount for the year ended December 31, 2021 includes losses on reverse treasury lock agreements which were designated as cash flow hedges (see Note 6).

20. OTHER

Other Operating Expenses

During the year ended December 31, 2022, the Company entered into a sale and leaseback transaction related to Booking.com's headquarters building and recognized a gain of $240 million on the transaction, which was recorded in "Other operating expenses" in the Consolidated Statement of Operations for the year ended December 31, 2022 (see Note 10).

During the year ended December 31, 2022, the Company transferred certain customer service operations of Booking.com to Majorel Group Luxembourg S.A. resulting in a loss of $41 million included in "Other operating expenses" in the Consolidated Statement of Operations for the year ended December 31, 2022.

Government Grants and Other Assistance

During the year ended December 31, 2020 and the three months ended March 31, 2021, the Company participated in various government aid programs to help businesses during the COVID-19 pandemic and recognized, in the aggregate, government grants and other assistance benefits of $131 million, principally recorded as a reduction of "Personnel" expenses in the Consolidated Statements of Operations for the respective periods. In June 2021, in light of the improving booking trends in certain countries, the Company announced its intention to voluntarily return assistance received through various government aid programs and completed the repayments by December 31, 2021. For the year ended December 31, 2021 the Company recorded expenses of $137 million in the Consolidated Statement of Operations, principally in "Personnel" expenses, to reflect the voluntary repayment of such assistance. The Company repaid $107 million during the year ended December 31, 2021.

Terminated Acquisition

In November 2021, the Company entered into an agreement to acquire global flight booking provider Etraveli Group. The completion of the acquisition was subject to certain closing conditions, including regulatory approvals. In September 2023, the European Commission announced its decision to prohibit the acquisition and consequently a termination fee of 85 million Euros ($90 million) was paid by the Company in October 2023 and is recorded in "General and administrative" expenses in the Consolidated Statement of Operations for the year ended December 31, 2023.

Consolidated Statements of Cash Flows: Additional Information

Restricted cash and cash equivalents are restricted through legal contracts or regulations. The following table reconciles cash and cash equivalents and restricted cash and cash equivalents reported in the Consolidated Balance Sheets to the total amount shown in the Consolidated Statements of Cash Flows (in millions):

						December 31,
						2023						2022
As included in the Consolidated Balance Sheets:
Cash and cash equivalents						$	12,107					$	12,221
Restricted cash and cash equivalents (1)						28						30
Total cash and cash equivalents and restricted cash and cash equivalents as shown in the Consolidated Statements of Cash Flows						$	12,135					$	12,251

(1) Included in "Other current assets" in the Consolidated Balance Sheets and principally consist of amounts relating to the Company's travel-related insurance business.

Noncash investing activity related to additions to property and equipment, including stock-based compensation and accrued liabilities, was $50 million, $48 million, and $51 million for the years ended December 31, 2023, 2022, and 2021, respectively. See Note 13 for additional information on noncash financing activity related to the excise tax on share repurchases.

Benefit Plans

The Company maintains a defined contribution 401(k) savings plan covering certain U.S. employees. The Company also participates in certain defined contribution plans outside of the United States for which it provides contributions for eligible employees. The Company's contributions during the years ended December 31, 2023, 2022, and 2021 were $55 million, $40 million, and $32 million, respectively. In addition, "Personnel" expenses in the Consolidated Statement of Operations for the year ended December 31, 2023 includes an accrual of $276 million related to the Netherlands pension fund matter (see Note 16).

Accrued expenses and other current liabilities

Included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets at December 31, 2023 and 2022 are accrued liabilities of $587 million and $526 million, respectively, related to marketing expenses and $634 million and $518 million, respectively, related to personnel expenses. In addition, "Accrued expenses and other current liabilities" in the Consolidated Balance Sheet at December 31, 2023 includes an accrual of $276 million related to the Netherlands pension fund matter (see Note 16).

21. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

The Company has reclassified certain indirect taxes, primarily digital services taxes, between "General and administrative" expenses and "Sales and other expenses". See Note 2 for additional information. These reclassifications did not affect the previously reported quarterly Revenue, Operating income (loss), Income (loss) before income taxes, or Net income (loss) in the Unaudited Consolidated Statements of Operations. The following table presents the impact of the reclassifications by quarter on "Sales and other expenses" and "General and administrative" expenses in the Unaudited Consolidated Statements of Operations (in millions):

						Quarter ended																								Year ended
						March 31,						June 30,						September 30,						December 31,						December 31,
2023
Sales and other expenses (Prior presentation)						$	542					$	666					$	723					$	597					$	2,528
Reclassifications						28						51						84						53						216
Sales and other expenses (New presentation)						$	570					$	717					$	807					$	650					$	2,744
General and administrative (Prior presentation)						$	289					$	304					$	387					$	791					$	1,771
Reclassifications						(28)						(51)						(84)						(53)						(216)
General and administrative (New presentation)						$	261					$	253					$	303					$	738					$	1,555
2022
Sales and other expenses (Prior presentation)						$	339					$	465					$	540					$	474					$	1,818
Reclassifications						24						38						69						37						168
Sales and other expenses (New presentation)						$	363					$	503					$	609					$	511					$	1,986
General and administrative (Prior presentation)						$	158					$	207					$	262					$	307					$	934
Reclassifications						(24)						(38)						(69)						(37)						(168)
General and administrative (New presentation)						$	134					$	169					$	193					$	270					$	766

Booking Holdings Inc.

Schedule I - Condensed Financial Information of Parent (Booking Holdings Inc.)

CONDENSED BALANCE SHEETS

(In millions)

						December 31,
						2023						2022
ASSETS
Current assets:
Cash and cash equivalents						$	1,752					$	4,110
Receivables from subsidiaries						106						23
Other current assets						22						17
Total current assets						1,880						4,150
Loans receivable from subsidiaries						1,119						1,116
Investment in subsidiaries						10,294						11,651
Other assets						29						12
Total assets						$	13,322					$	16,929
LIABILITIES AND STOCKHOLDERS' (DEFICIT) EQUITY
Current liabilities:
Payables to subsidiaries						$	19					$	10
Accrued expenses and other current liabilities						336						207
Short-term debt						1,961						500
Total current liabilities						2,316						717
Loans payable to subsidiaries						1,404						1,290
Other long-term liabilities						123						155
Long-term debt						12,223						11,985
Total liabilities						16,066						14,147
Commitments and contingencies
Total stockholders' (deficit) equity						(2,744)						2,782
Total liabilities and stockholders' (deficit) equity						$	13,322					$	16,929

See Notes to Condensed Financial Statements.

Booking Holdings Inc.

Schedule I - Condensed Financial Information of Parent (Booking Holdings Inc.)

CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME

(In millions)

						Year Ended December 31,
						2023						2022						2021
Revenues						$	—					$	—					$	—
Operating expenses						299						225						201
Operating loss						(299)						(225)						(201)
Interest expense						(495)						(284)						(319)
Other income (expense), net						—						116						(121)
Equity in earnings (losses) of subsidiaries, net of tax						5,074						3,442						1,743
Income before income taxes						4,280						3,049						1,102
Income tax benefit						(9)						(9)						(63)
Net income						$	4,289					$	3,058					$	1,165
Other comprehensive loss, net of tax:
Foreign currency translation adjustments						(63)						(111)						(57)
Net unrealized gains (losses) on available-for-sale securities						7						(12)						31
Total other comprehensive loss, net of tax						(56)						(123)						(26)
Comprehensive income						$	4,233					$	2,935					$	1,139

See Notes to Condensed Financial Statements.

Booking Holdings Inc.

Schedule I - Condensed Financial Information of Parent (Booking Holdings Inc.)

CONDENSED STATEMENTS OF CASH FLOWS

(In millions)

						Year Ended December 31,
						2023						2022						2021
OPERATING ACTIVITIES:
Net cash provided by (used in) operating activities						$	6,464					$	3,695					$	(250)
INVESTING ACTIVITIES:
Proceeds from internal transfers of subsidiaries						—						174						522
Acquisitions						—						—						(1,296)
Dividends received						107						3,087						72
Other investing activities						(128)						(102)						(88)
Net cash (used in) provided by investing activities						(21)						3,159						(790)
FINANCING ACTIVITIES:
Proceeds from the issuance of long-term debt						1,893						3,621						2,015
Payments on maturity and redemption of debt						(500)						(1,880)						(3,068)
Payments for repurchase of common stock						(10,377)						(6,621)						(163)
Proceeds from exercise of stock options						134						7						5
Other financing activities						49						47						(115)
Net cash used in financing activities						(8,801)						(4,826)						(1,326)
Net (decrease) increase in cash and cash equivalents						(2,358)						2,028						(2,366)
Total cash and cash equivalents, beginning of period						4,110						2,082						4,448
Total cash and cash equivalents, end of period						$	1,752					$	4,110					$	2,082

See Notes to Condensed Financial Statements.

Booking Holdings Inc.

Schedule I - Condensed Financial Information of Parent (Booking Holdings Inc.)

NOTES TO CONDENSED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

These condensed parent company-only financial statements of Booking Holdings Inc. (the "Parent"), are prepared on a "parent company-only" basis and have been derived from and should be read in conjunction with the consolidated financial statements and related notes of Booking Holdings Inc. and subsidiaries included in Part IV, Item 15 of this Annual Report on Form 10-K (the "Consolidated Financial Statements"). Under a parent company-only presentation, investments in the parent's subsidiaries are accounted for under the equity method of accounting. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted.

2. DEBT

See Note 12 to the Consolidated Financial Statements for additional information on the 2023 revolving credit facility and information on the Parent's outstanding debt.

3. DIVIDENDS FROM SUBSIDIARIES

Cash dividends paid to the Parent by the subsidiaries were $7.3 billion, $7.3 billion, and $339 million for the years ended December 31, 2023, 2022, and 2021, respectively, and are classified within "Net cash provided by (used in) operating activities" or "Net cash (used in) provided by investing activities," as appropriate, in the Condensed Statements of Cash Flows.

4. GUARANTEES

The Parent had $389 million and $363 million of guarantees issued on behalf of the Parent's subsidiaries as of December 31, 2023 and 2022, respectively, which are primarily related to arrangements with payment processors and networks.

5. OTHER

In the Condensed Statement of Cash Flows for the year ended December 31, 2021, "Acquisitions" within the investing activities section include a loan of $500 million to a subsidiary in relation to an acquisition.