Expedia shares jumped more than 8% on Friday as markets cheered the online travel agency beating quarterly profit estimates, even as it joined other travel companies in warning of softer demand ahead.

Expedia has benefited from a sustained rise in international travel as tourists flock to destinations in the Middle East and Europe, but expects demand to taper off as high borrowing costs and sticky inflation choke consumer spending.

Domestic travel in the United States has been pressured since the start of the year as more Americans hesitate to spend on travel in the face of an uncertain economic outlook.

"In response to the recent slowdown, EXPE reduced FY24 bookings guidance to 4% year-on-year, which is down from the prior outlook for mid- to high-single-digits and represents a third straight guide-down," Jefferies analysts said in a note.

Rival Booking and short-term rentals platform Airbnb are also among the travel companies that have warned consumers are waiting longer to book vacations and growing cautious about spending.

Piper Sandler analyst Thomas Champion attributed the post-results surge in stocks to investors viewing the guidance as conservative, while Jefferies analysts said they had expected Expedia's stock to rally "after disappointing prints from ABNB/BKNG lowered expectations."

"We think concerns around weak consumer spending could provide a tough backdrop for shares in the near term," Morningstar analyst Dan Wasiolek said in a note to clients.

  - Reuters