Online travel agency Orbitz Worldwide Inc reported better-than-expected quarterly results, helped by growth in its non-air revenue, and raised its full-year revenue outlook, sending its shares up as much as 36 percent.
In the third quarter, total value of its bookings rose 1 percent to $2.85 billion, driven by a 31 percent rise in international bookings.
Revenue from Orbitz's non-air business -- which includes standalone hotel, vacation package, advertising and media -- rose about 8 percent to $139 million.
However, bookings at the company's domestic business, which contributes about 70 percent of total revenue, fell 4 percent, marking a steep decline from the 12 percent growth it posted in the year-ago period.
They are facing a little bit of challenges on air tickets, which is somewhat similar to what Expedia Inc had. So that is kind of weighing the results, offset by strong hotel growth, Wedbush Securities analyst Edward Woo said.
Larger rival Expedia last week posted a better-than-expected profit, but its domestic booking disappointed, hurt by a spike in airline ticket prices, which hindered demand for leisure travelers.
Woo said, overall, both the results indicate that the travel industry continues to be healthy.
Orbitz's European hotel business, ebookers, would continue to do well as long as the economy both in Europe and the United States does not completely disintegrate, he said.
Orbitz, which also competes with Priceline, raised its 2011 revenue forecast to $760-$764 million from its prior view of $752-$762 million.
The company's shares touched a near two-month high of $2.58 in morning trade on the New York Stock Exchange. (Reporting by Bijoy Koyitty in Bangalore; Editing by Don Sebastian, Maju Samuel)