SAN FRANCISCO - Expedia (NASDAQ:EXPE) Group, Inc. (NASDAQ: EXPE) has announced a partnership with Wells Fargo (NYSE: NYSE:WFC) and Mastercard (NYSE: NYSE:MA) to introduce two co-branded credit cards, the One Key Card and One Key+ Card, enhancing its One Key loyalty program for U.S. travelers. The cards offer rewards and benefits designed to provide flexibility and savings for various travel-related purchases.
The collaboration marks the first anniversary of the One Key loyalty program in the U.S., aiming to make travel more rewarding. The new credit cards allow cardholders to earn OneKeyCash rewards on purchases across Expedia, Hotels.com, and Vrbo, as well as everyday spending. Cardholders can redeem these rewards for eligible hotels, vacation rentals, car rentals, activities, and flights.
The One Key Card, with no annual fee, offers a $400 OneKeyCash bonus after spending $1,000 in the first three months. Cardholders earn 3% in OneKeyCash on Expedia, Hotels.com, Vrbo, gas stations, grocery stores, and dining, and 1.5% on all other purchases. The card grants automatic Silver Tier status, with a path to Gold Tier upon reaching $15,000 in annual spending.
The One Key+ Card, with a $99 annual fee, provides a $600 OneKeyCash bonus after spending $3,000 in the first three months. It features a higher earn rate of 3% in OneKeyCash on the same categories as the One Key Card and 2% on all other purchases.
Cardholders instantly attain Gold Tier status and can progress to Platinum Tier after spending $30,000 annually. Additional perks include a $100 OneKeyCash anniversary bonus, a statement credit for Global Entry or TSA PreCheck, and no foreign transaction fees.
Both cards offer cell phone protection, trip cancellation and interruption coverage, auto rental collision damage waiver, and common carrier travel accident insurance. Mastercard World Elite benefits, such as advanced security features and emergency assistance, are also included.
Applications for both cards will open later this summer, with current Hotels.com cardholders transitioning to the new no-annual-fee One Key Card in September.
The announcement comes as consumer trends show a growing preference for travel experiences over material goods. Mastercard has expressed enthusiasm for the partnership, which aims to enhance loyalty benefits and provide consumers with more valuable travel opportunities.
The new cards are expected to deliver immediate customer value through instant discounts, enhanced perks, and accelerated rewards, according to Krista Phillips, EVP at Wells Fargo.
This news is based on a press release statement.
In other recent news, Expedia Group has been in the spotlight with several noteworthy developments. The company reported its first-quarter 2024 earnings, which led to mixed reactions from analysts. DA Davidson and TD (TSX:TD) Cowen lowered their price targets for Expedia, while Benchmark and BTIG reaffirmed their 'Buy' ratings, emphasizing the company's potential for growth.
Expedia Group's annual meeting of stockholders saw the re-election of its board and the approval of executive compensation. The company also introduced Romie, an AI-powered travel assistant, to enhance the customer experience and streamline operations.
Expedia has been expanding into new business areas, such as the Retail Media Network and the integration of social content through Travel Shops. BTIG highlighted the strong growth potential of Expedia's Business-to-Business (B2B) segment, which has been a significant contributor to the company's expansion.
Despite facing challenges such as competition losses against Airbnb (NASDAQ:ABNB) and Booking (NASDAQ:BKNG).com, Expedia has seen an increase in app downloads and traffic. The company's management is focused on rebuilding trust during a period of executive transition and amid a competitive marketing landscape. These are recent developments that investors should consider in their analysis of the company.
InvestingPro Insights
Expedia Group, Inc. (NASDAQ: EXPE) is reinforcing its focus on customer loyalty and value with the launch of its co-branded credit cards, a move that aligns with the company's strong financial performance metrics. According to the latest data from InvestingPro, Expedia boasts an impressive gross profit margin of 88.39% over the last twelve months as of Q1 2024, highlighting the company's efficiency in generating revenue. This is a key indicator of Expedia’s ability to convert sales into profit, which could bode well for the potential success of their new loyalty-enhancing credit cards.
The company's market capitalization stands at $17.05 billion, and it trades at a forward-looking P/E ratio of 14.0, which suggests that the stock is priced attractively relative to near-term earnings growth. This could catch the eye of value investors looking for growth potential at reasonable prices. Moreover, Expedia's share price has experienced a significant recovery over the past year, with a 10.93% total return, indicating a positive trend that may interest investors looking to capitalize on the company's growth trajectory.
For investors seeking deeper insights, InvestingPro provides several additional tips, including Expedia’s aggressive share buyback strategy and high shareholder yield, which could further influence investment decisions. With 19 analysts having revised their earnings expectations downwards for the upcoming period, it's essential for investors to stay informed about the company's future outlook. To access more exclusive tips and metrics, visit InvestingPro and consider using the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
As Expedia Group, Inc. continues to innovate within the travel industry, these financial insights and additional tips available on InvestingPro, which currently lists 12 more tips for EXPE, could help investors and analysts make more informed decisions.
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