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Priceline.com Reports Financial Results for 4th Quarter and Full-Year 2007

Gross travel bookings increase 62% year over year; International gross travel bookings grow 113%

NORWALK, Conn.--(BUSINESS WIRE)--Feb. 14, 2008--Priceline.com Incorporated (Nasdaq: PCLN) today reported its financial results for the 4th quarter and full-year 2007. Gross travel bookings for the 4th quarter, which refers to the total dollar value, inclusive of all taxes and fees, of all travel services purchased by consumers, rose 62% year-over-year to $1.2 billion.

Priceline.com had GAAP revenues in the 4th quarter of $334.9 million, a 28.8% increase over a year ago. Priceline.com's GAAP gross profit for the 4th quarter was $160.2 million, a 60.9% increase from the prior year. Priceline.com had GAAP net income for the 4th quarter of $32.9 million or $0.68 per diluted share, which compares to $13.2 million or $0.33 per diluted share in the same period a year ago.

Priceline.com reported pro forma revenues in the 4th quarter of $334.9 million, a 28.8% increase over a year ago. Pro forma gross profit for the 4th quarter was $160.6 million, an increase of 60.7% over the same period in the prior year. Pro forma net income in the fourth quarter was $0.96 per diluted share, an increase of 65.5% over a year ago. First Call analyst consensus for the 4th quarter 2007 was $0.84 per diluted share. The section below entitled "Non-GAAP Financial Measures" provides a definition and information about the use of pro forma financial measures in this press release and the attached financial and statistical supplement reconciles pro forma financial information with priceline.com's financial results under GAAP.

For full-year 2007, priceline.com's gross travel bookings were $4.8 billion, a 45.5% increase over 2006. Full-year 2007 GAAP revenues were $1.41 billion, a 25.5% increase over a year ago. Priceline.com's GAAP gross profit for 2007 was $639.4 million, a 59.4% increase from the prior year. Priceline.com had GAAP net income for 2007 of $155.5 million or $3.42 per diluted share, which compares to $72.5 million or $1.68 per diluted share a year ago. Priceline.com reported pro forma revenues for the full-year 2007 of $1.39 billion, a 24.0% increase over a year ago. Pro forma gross profit for 2007 was $621.2 million, an increase of 54.9% over the prior year. Pro forma net income for 2007 was $4.04 per diluted share, a 99.0% increase over a year ago.

"Priceline's gross bookings growth momentum continued in the fourth quarter with international growth accelerating to 113.0% year-over-year and the domestic growth rate increasing sequentially to 24.2% led by increasing retail airline ticket bookings," said Jeffery H. Boyd, priceline's President and Chief Executive Officer. "Internationally, we believe that our wide geographic reach, new market initiatives and extensive inventory are providing sustained impetus for growth. We believe that in the United States, our value positioning and brand promotion through offline and online channels is driving above-category growth rates in an uncertain economic environment."

During 2007, priceline.com achieved several strategic milestones that included:

    --  The elimination of booking fees on published-price domestic
        and international airfares. This means that, in most cases,
        priceline.com customers pay less for their tickets than they
        do at other major full-service online travel reservation
        services, including Expedia, Travelocity and Orbitz.

    --  The acquisition of Agoda.com, an Asian online hotel
        reservation service. Agoda offers hotel properties in
        Australia, China, Japan, India, Thailand, South Korea,
        Singapore, Indonesia, the Philippines, New Zealand and several
        other countries. In addition, Agoda offers hotels in Europe,
        the Americas, the Middle East and Africa. Agoda's services are
        offered in 12 languages. Agoda contributed $13.4 million to
        the fourth quarter international gross bookings metric for the
        two-month period following the acquisition.

    --  The signing of participation agreements and extensions with
        several major airlines. In October, American Airlines - the
        world's largest airline - signed an exclusive agreement to
        provide priceline.com with Name Your Own Price(R) fares.
        JetBlue also signed an agreement to provide priceline.com with
        full access to its published fares, schedules and inventories.

    --  The addition of exclusive Zagat Survey reviews and information
        for hotels, restaurants and attractions in the United States
        and select international locations. The Zagat information,
        combined with traveler reviews provided by priceline.com
        customers, covers over 600 cities and thousands of hotels and
        restaurants.

    --  Priceline.com added a group hotel booking service where
        customers can book 10 to 1,000 rooms at specially discounted
        prices. Priceline.com's Name Your Own Price(R) hotel service,
        which previously allowed customers to book up to four hotel
        rooms, was also expanded to accommodate up to nine rooms at a
        time.

Looking forward, Mr. Boyd said, "We believe that Priceline is well-positioned as we enter 2008 to continue building out our global hotel business with new inventory and geographies and mining the synergies available when we build links among our regional businesses in the United States, Europe and Asia. While we are concerned with how continued economic distress could negatively affect our markets in both the U.S. and internationally, we believe our services are relatively more attractive to suppliers and consumers in times of economic difficulty and our recent results in 2008 support that thesis and the guidance we are providing for the year."

Forward Guidance

For full-year 2008, priceline said that it expects to generate approximately $7.0 to $7.3 billion in gross travel bookings. Priceline.com said that it expects pro forma EBITDA of $300 to $325 million and to earn approximately $4.80 to $5.10 of pro forma net income per diluted share for full-year 2008.

Priceline.com said it was targeting the following for 1st quarter 2008:

    --  Year over year increases in gross travel bookings of
        approximately 60 - 65%.

    --  Year over year increases in international gross travel
        bookings of approximately 85 - 90%.

    --  Year over year increase in revenue of approximately 30%.

    --  Year over year increase in pro forma gross profit of
        approximately 55 - 60%.

    --  Pro forma net income of between $0.50 and $0.60 per diluted
        share.

    Pro forma guidance for the 1st quarter and full-year 2008:

    --  excludes non-cash amortization expense of acquisition-related
        intangibles,

    --  excludes non-cash stock-based compensation expense,

    --  excludes option payroll tax expense,

    --  excludes non-cash income tax expense and reflects the impact
        on income taxes of the pro forma adjustments,

    --  includes the additional impact on minority interest expense of
        the pro forma adjustments described above,

    --  includes the anti-dilutive impact of the "Conversion Spread
        Hedges" (see "Non-GAAP Financial Measures" below) on
        outstanding diluted common shares outstanding, and

    --  includes the dilutive impact of additional shares of unvested
        restricted stock, restricted stock units and performance share
        units because pro forma net income has been adjusted to
        exclude stock-based compensation.

When aggregated, the foregoing adjustments as well as depreciation expense are expected to increase pro forma EBITDA over GAAP operating income by approximately $80 million for the full year 2008.

In addition, the foregoing adjustments are expected to increase pro forma net income over GAAP net income by approximately $17 million for the 1st quarter 2008 and $78 million for full-year 2008. On a per share basis, the Company estimates GAAP net income of approximately $0.16 to $0.26 per diluted share for the 1st quarter 2008 and approximately $3.25 to $3.55 for full-year 2008.

Information About Forward-Looking Statements

This press release may contain forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict; therefore, actual results may differ materially from those expressed, implied or forecasted in any such forward-looking statements. Expressions of future goals and similar expressions including, without limitation, "goal," "believe(s)," "intend," "expect(s)," "will," "may," "should," "could," "plan(s)," "anticipate(s)," "estimate(s)," "predict(s)," "potential," "target(s)," or "continue," reflecting something other than historical fact are intended to identify forward-looking statements. The following factors, among others, could cause the Company's actual results to differ materially from those described in the forward-looking statements:

-- adverse changes in general market conditions for leisure and other travel services as a result of, among other things, decreased consumer spending, general economic downturn, terrorist attacks, natural disasters or adverse weather, the bankruptcy or insolvency of a major airline, or the outbreak of an epidemic or pandemic disease;

-- adverse changes in the Company's relationships with airlines and other product and service providers and vendors which could include, without limitation, the withdrawal of suppliers from the priceline.com system (either priceline.com's "retail" or "opaque" services, or both) and/or the loss or reduction of global distribution fees;

-- the effects of increased competition;

-- a change by a major search engine to its search engine algorithms that negatively affects the search engine ranking of the company or its 3rd party distribution partners;

    -- fluctuations in foreign exchange rates;

    -- our ability to expand successfully in international markets;

    -- the ability to attract and retain qualified personnel;

-- difficulties integrating recent or future acquisitions, such as the 4th quarter 2007 acquisition of Agoda, including ensuring the effectiveness of the design and operation of internal controls and disclosure controls of acquired businesses;

-- the occurrence of an external or internal security breach of our systems or other Internet based systems involving personal customer information, credit card information or other sensitive data;

-- systems-related failures and/or security breaches, including without limitation, any security breach that results in the theft, transfer or unauthorized disclosure of customer information, or the failure to comply with various state laws applicable to the company's obligations in the event of such a breach; and

--legal and regulatory risks;

For a detailed discussion of these and other factors that could cause the Company's actual results to differ materially from those described in the forward-looking statements, please refer to the Company's most recent Form 10-Q, Form 10-K and Form 8-K filings with the Securities and Exchange Commission. Unless required by law, the Company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

Pro forma EBITDA represents GAAP operating income excluding depreciation and amortization expense and the pro forma adjustments described below.

Pro forma revenue, pro forma gross profit, pro forma EBITDA, pro forma net income and pro forma net income per share are "non-GAAP financial measures," as such term is defined by the Securities and Exchange Commission, and may differ from non-GAAP financial measures used by other companies. Priceline.com believes that pro forma revenue, pro forma gross profit, pro forma EBITDA, pro forma net income and pro forma net income per share that exclude certain non-cash or non-recurring income or expense items are useful for analysts and investors to evaluate priceline.com's future on-going performance because they enable a more meaningful comparison of priceline.com's projected cash earnings and performance with its historical results from prior periods. These pro forma metrics, in particular pro forma EBITDA and pro forma net income, are not intended to represent funds available for priceline.com's discretionary use and are not intended to represent or to be used as a substitute for operating income, net income or cash flows from operations data as measured under GAAP. The items excluded from these pro forma metrics, but included in the calculation of their closest GAAP equivalent, are significant components of consolidated statements of income and must be considered in performing a comprehensive assessment of overall financial performance. Pro forma financial information is adjusted for the following items:

 -- Cash expenses associated with the settlement of the 2000
     securities litigation and cash benefit associated with the
     favorable resolution of litigation related to credit card
     processing costs are excluded because of the non-recurring nature
     of the settlements.

 -- Cash benefit associated with the refund by the Internal Revenue
     Service of excise taxes paid on merchant airline tickets is
     excluded because of its non-recurring nature.

 -- Amortization expense of acquisition-related intangibles is
     excluded from pro forma gross profit, pro forma EBITDA and pro
     forma net income because it does not impact cash earnings.

 -- Stock-based compensation expense and the non-cash expense
     associated with the payment of preferred stock dividends are
     excluded from pro forma EBITDA and pro forma net income because
     they do not impact cash earnings and are reflected in earnings
     per share through increased share counts.

 -- Option payroll tax expense is excluded because the expense is
     driven primarily by stock option exercise activity and the market
     price of priceline.com's common stock and often shows volatility
     unrelated to operating results.

 -- The restructuring charge, net is excluded because it can impact
     comparability of earnings with historical results from prior
     periods.

 -- Income tax expense is adjusted for the tax impact of certain of
     the pro forma adjustments described above and to exclude tax
     expense recorded where no actual tax payments are owed because of
     available net operating loss carry forwards.

    In addition, pro forma income tax expense is adjusted to exclude
     the non-cash tax benefit from reversing a portion of
     priceline.com's deferred tax asset valuation allowance. This
     benefit amounted to $47.9 million in 3rd quarter 2007 and $28.1
     million in 3rd quarter 2006. Further, pro forma net income for
     2007 excludes the non- recurring $3.6 million income tax benefit
     resulting from the recognition of foreign capital allowance carry
     forwards in 4th quarter 2007. Pro forma net income for 3rd
     quarter 2007 and 4th quarter 2006 excludes non-cash income tax
     benefits of $1.2 million and $3.0 million, respectively, related
     to the impact on deferred taxes of enacted reductions in certain
     international statutory tax rates.

 -- Minority interest is adjusted for the impact of certain of the pro
     forma adjustments described above.

 -- Finally, for calculating pro forma net income per share:

      -- net income is adjusted for the impact of the pro forma
       adjustments described above

      -- fully diluted share count is adjusted to include the anti-
       dilutive impact of priceline.com's "Conversion Spread Hedges"
       related to priceline.com's convertible securities that increase
       the effective conversion price of the 0.50% convertible notes
       due 2011 and 0.75% convertible notes due 2013 from their stated
       $40.38 conversion price to an effective conversion price of
       $50.47 per share. Under GAAP, the anti-dilutive impact of the
       Conversion Spread Hedges is not reflected on the outstanding
       diluted share count until the end of the hedge when shares are
       delivered.

      -- fully diluted share count in 2006 is adjusted to exclude the
       impact of EITF 04-08 ("Effect of Contingently Convertible Debt
       on Diluted Earnings per Share"), because the common stock that
       underlie priceline.com's 1.0% convertible notes due 2011 and
       priceline.com's 2.25% convertible notes due 2025 were not
       issuable because our common stock did not trade above the
       respective contingent conversion prices.

      -- All common stock warrants and unvested shares of restricted
       common stock, restricted stock units and performance share
       units are included in the calculation of pro forma net income
       per share because pro forma net income has been adjusted to
       exclude our preferred stock dividend and stock-based
       compensation expense.

The presentation of this financial information should not be considered in isolation or as a substitute for the financial information prepared and presented in accordance with generally accepted accounting principles in the United States. The attached financial and statistical supplement reconciles pro forma financial information with priceline.com's financial results under GAAP.

About Priceline.com(R) Incorporated

Priceline.com Incorporated (Nasdaq: PCLN) provides online travel services in 22 languages in over 60 countries in Europe, North America, Asia, the Middle East and Africa. Priceline.com operates Booking.com, a leading international online hotel reservation service, priceline.com, a leading U.S. online travel service for value-conscious leisure travelers, and Agoda.com, an Asian online hotel reservation service.

Priceline.com believes that Booking.com is Europe's largest and fastest growing hotel reservation service, with a network of affiliated Web sites. Booking.com operates in over 60 countries in 16 languages and offers its customers access to over 41,000 participating hotels worldwide.

In the U.S., priceline.com gives customers more ways to save on their airline tickets, hotel rooms, rental cars, vacation packages and cruises than any other Internet travel service. In addition to getting great published prices, leisure travelers can narrow their searches using priceline.com's TripFilter advanced search technology, create packages to save even more money, and take advantage of priceline.com's famous Name Your Own Price(R) service, which can deliver the lowest prices available.

Priceline.com also operates the following travel websites: Travelweb.com, Lowestfare.com, RentalCars.com and BreezeNet.com. Priceline.com also has a personal finance service that offers home mortgages, refinancing and home equity loans through an independent licensee. Priceline.com licenses its business model to independent licensees, including priceline mortgage and certain international licensees.

                      priceline.com Incorporated
                     CONSOLIDATED BALANCE SHEETS
                             (unaudited)
           (In thousands, except share and per share data)

                                             December 31, December 31,
ASSETS                                           2007         2006
                                             ------------ ------------

 Current assets:
     Cash and cash equivalents               $   385,359  $   423,577
     Restricted cash                               1,350        2,459
     Short-term investments                      122,499        7,983
     Accounts receivable, net of allowance
      for doubtful accounts of $2,266 and
      $1,651, respectively                        70,712       48,536
     Prepaid expenses and other current
      assets                                      33,080       20,534
                                             ------------ ------------
       Total current assets                      613,000      503,089

 Long-term investments                             2,451            -
 Property and equipment, net                      27,088       21,691
 Intangible assets, net                          182,748      152,925
 Goodwill                                        287,159      226,707
 Deferred taxes                                  218,519      179,392
 Other assets                                     19,891       21,844
                                             ------------ ------------

       Total assets                          $ 1,350,856  $ 1,105,648
                                             ============ ============

LIABILITIES AND STOCKHOLDERS' EQUITY

 Current liabilities:
     Accounts payable                        $    47,708  $    49,032
     Accrued expenses and other current
      liabilities                                 59,589       46,872
     Deferred merchant bookings                   17,750        4,768
     Convertible debt                            569,796            -
                                             ------------ ------------
       Total current liabilities                 694,843      100,672

 Deferred taxes                                   46,502       39,714
 Other long-term liabilities                      13,368       11,885
 Minority interest                                17,036       22,486
 Convertible debt                                      -      568,865
                                             ------------ ------------
       Total liabilities                         771,749      743,622
                                             ------------ ------------


 Series B mandatorily redeemable preferred
  stock, $0.01 par value, 80,000 authorized
  shares; $1,000 liquidation value per
  share; 80,000 shares issued and 0 and
  13,470 shares outstanding, respectively              -       13,470
                                             ------------ ------------

 Stockholders' equity:
    Common stock, $0.008 par value,
     authorized 1,000,000,000 shares,
    45,117,685, and 43,215,712 shares
     issued, respectively                            346          331
    Treasury stock, 6,646,408 and 6,603,050
     shares, respectively                       (489,106)    (486,468)
    Additional paid-in capital                 2,124,029    2,070,379
    Accumulated deficit                       (1,106,506)  (1,262,033)
    Accumulated other comprehensive income        50,344       26,347
                                             ------------ ------------
       Total stockholders' equity                579,107      348,556
                                             ------------ ------------

    Total liabilities and stockholders'
     equity                                  $ 1,350,856  $ 1,105,648
                                             ============ ============
                      priceline.com Incorporated
                CONSOLIDATED STATEMENTS OF OPERATIONS
                             (unaudited)
                (In thousands, except per share data)


                          Three Months Ended     Twelve Months Ended
                             December 31,           December 31,
                         --------------------- -----------------------
                            2007       2006       2007        2006
                         ---------- ---------- ----------- -----------

Merchant revenues,
 including $18,592
 excise tax refund in
 2007                    $ 226,693  $ 204,649  $1,002,824  $  904,169
Agency revenues            105,768     54,301     398,246     213,900
Other revenues               2,392      1,121       8,339       5,034
                         ---------- ---------- ----------- -----------
     Total revenues        334,853    260,071   1,409,409   1,123,103

Cost of merchant
 revenues                  174,701    160,554     769,997     722,004
Cost of agency revenues          -          -           -           -
Cost of other revenues           -          -           -           -
                         ---------- ---------- ----------- -----------
     Total costs of
      revenues             174,701    160,554     769,997     722,004
                         ---------- ---------- ----------- -----------

Gross profit               160,152     99,517     639,412     401,099
                         ---------- ---------- ----------- -----------

Operating expenses:
  Advertising - Offline      6,935      6,869      35,963      31,831
  Advertising - Online      43,434     26,908     172,676     113,822
  Sales and marketing       11,131     10,624      47,158      42,119
  Personnel, including
   stock-based
   compensation of
   $5,494, $4,651,
   $16,253, $14,928,
   respectively             30,885     22,552     102,992      79,421
  General and
   administrative,
   including net cost of
   litigation settlement
   of $55,350 in 2007,
   and option payroll
   taxes of $148, $95,
   $909, $368,
   respectively              8,943      8,950      91,837      28,587
  Information technology     4,373      2,559      13,779       9,749
  Depreciation and
   amortization             10,439      8,479      37,072      33,449
  Restructuring charge,
   net                           -          -           -         135
                         ---------- ---------- ----------- -----------

     Total operating
      expenses             116,140     86,941     501,477     339,113
                         ---------- ---------- ----------- -----------

Operating income            44,012     12,576     137,935      61,986

Other income (expense):
  Interest income,
   including $3,346 of
   interest on excise
   tax refund in 2007        5,398      4,991      25,776      11,312
  Interest expense          (2,851)    (2,457)    (10,412)     (7,060)
  Other                     (1,414)      (450)     (3,276)       (606)
                         ---------- ---------- ----------- -----------
     Total other income      1,133      2,084      12,088       3,646
                         ---------- ---------- ----------- -----------

Earnings before income
 taxes, equity in income
 (loss) of investees and
 minority interests         45,145     14,660     150,023      65,632
Income tax benefit
 (expense)                 (11,228)      (889)     12,059      12,388
Equity in income (loss)
 of investees and
 minority interests         (1,055)      (539)     (5,000)     (3,554)
                         ---------- ---------- ----------- -----------
Net income                  32,862     13,232     157,082      74,466
Preferred stock dividend         -          -      (1,555)     (1,927)
                         ---------- ---------- ----------- -----------

Net income applicable to
 common stockholders     $  32,862  $  13,232  $  155,527  $   72,539
                         ========== ========== =========== ===========

Net income applicable to
 common stockholders per
 basic common share      $    0.86  $    0.37  $     4.13  $     1.88
                         ========== ========== =========== ===========

Weighted average number
 of basic common shares
 outstanding                38,082     36,166      37,671      38,650
                         ========== ========== =========== ===========

Net income applicable to
 common stockholders per
 diluted common share    $    0.68  $    0.33  $     3.42  $     1.68
                         ========== ========== =========== ===========

Weighted average number
 of diluted common
 shares outstanding         48,350     40,936      45,504      44,722
                         ========== ========== =========== ===========
                      priceline.com Incorporated
      RECONCILIATION OF GAAP TO PRO FORMA FINANCIAL INFORMATION
                             (unaudited)
                (In thousands, except per share data)


                           Three Months Ended        Year Ended
                              December 31,          December 31,
                           ------------------- -----------------------
RECONCILIATION OF GAAP TO
 PRO FORMA REVENUE           2007      2006       2007        2006
                           --------- --------- ----------- -----------

    GAAP Revenue           $334,853  $260,071  $1,409,409  $1,123,103

(a) Airline excise tax
     refund                       -         -     (18,592)     (1,600)

                           --------- --------- ----------- -----------
    Pro Forma Revenue      $334,853  $260,071  $1,390,817  $1,121,503
                           ========= ========= =========== ===========

                           Three Months Ended        Year Ended
                              December 31,          December 31,
                           ------------------- -----------------------
RECONCILIATION OF GAAP TO
 PRO FORMA GROSS PROFIT      2007      2006       2007        2006
                           --------- --------- ----------- -----------

    GAAP Gross Profit      $160,152  $ 99,517  $  639,412  $  401,099

(a) Airline excise tax
     refund                       -         -     (18,592)     (1,600)
(b) Amortization of
     acquired intangible
     assets in Cost of
     revenues                   428       428         428       1,481

                           --------- --------- ----------- -----------
    Pro Forma Gross Profit $160,580  $ 99,945  $  621,248  $  400,980
                           ========= ========= =========== ===========

                           Three Months Ended        Year Ended
                              December 31,          December 31,
                           ------------------- -----------------------
RECONCILIATION OF GAAP TO
 PRO FORMA NET INCOME        2007      2006       2007        2006
                           --------- --------- ----------- -----------

    GAAP Net Income        $ 32,862  $ 13,232  $  155,527  $   72,539

(a) Airline excise tax
     refund                       -         -     (18,592)     (1,600)
(b) Amortization of
     acquired intangible
     assets in Cost of
     revenues                   428       428         428       1,481
(b) Amortization of
     acquired intangible
     assets in
     Depreciation and
     amortization             6,853     5,893      25,177      23,206
(c) Favorable litigation
     settlement related to
     credit card
     processing fees         (1,190)        -      (1,190)          -
(d) Stock-based
     compensation             5,494     4,651      16,253      14,928
(e) Securities litigation
     settlement, net of
     insurance
     contribution               (15)        -      55,350           -
(e) Stock-based
     compensation payroll
     taxes                      148        95         909         368
(f) Impact from favorable
     state franchise tax
     determination                -         -           -      (1,671)
(g) Accrued interest
     income on excise tax
     refund                       -         -      (3,346)          -
(h) Restructuring charge,
     net                          -         -           -         135
(i) Adjustments for the
     tax impact of certain
     of the pro forma
     adjustments and
        to exclude non-
         cash income taxes    1,719    (1,774)    (48,730)    (28,051)
(j) Impact on minority
     interests of other
     pro forma adjustments     (107)      (97)       (881)     (1,211)
(k) Impairment charge
     related to equity
     investment in
     pricelinemortgage.com        -         -           -       1,094
(h) Preferred stock
     dividend                     -         -       1,555       1,927

                           --------- --------- ----------- -----------
    Pro Forma Net Income   $ 46,192  $ 22,428  $  182,460  $   83,145
                           ========= ========= =========== ===========

                           Three Months Ended        Year Ended
                              December 31,          December 31,
                           ------------------- -----------------------
RECONCILIATION OF GAAP TO
 PRO FORMA NET INCOME PER
 DILUTED COMMON SHARE        2007      2006       2007        2006
                           --------- --------- ----------- -----------

    GAAP Weighted average
     number of diluted
     common shares
     outstanding             48,350    40,936      45,504      44,722

(l) Adjustment for
     Conversion Spread
     Hedges                    (844)      (17)     (1,202)          -
(m) Adjustment for
     warrants and
     restricted stock           842       539         855       1,188
(n) Adjustment for impact
     of EITF 04-08 on
     Convertible debt             -    (2,601)          -      (4,971)

                           --------- --------- ----------- -----------
    Pro Forma Weighted
     average number of
     diluted common shares
     outstanding             48,348    38,857      45,157      40,939
                           ========= ========= =========== ===========

    Net income applicable
     to common
     stockholders per
     diluted common share
(o)    GAAP                $   0.68  $   0.33  $     3.42  $     1.68
                           ========= ========= =========== ===========

       Pro Forma           $   0.96  $   0.58  $     4.04  $     2.03
                           ========= ========= =========== ===========


(a) Airline excise tax refund is recorded in Merchant Revenue.
(b) Amortization of acquired intangible assets is recorded in Cost of
     revenues and Depreciation and amortization.
(c) Favorable litigation settlement related to credit card processing
     fees is recorded in Sales and marketing.
(d) Stock-based compensation is recorded in Personnel expense.
(e) Securities litigation settlement and stock-based compensation
     payroll taxes are recorded in General and administrative expense.
(f) Non-recurring impact of favorable state franchise tax
     determination is recorded in General and administrative expense.
(g) Accrued interest income on airline excise tax refund is recorded
     in Interest income.
(h) Restructuring charge and Preferred stock dividend are recorded in
     those respective expense line items.
(i) Adjustments for the tax impact of certain of the pro forma
     adjustments and to exclude non-cash income taxes are recorded in
     Income tax benefit (expense).
(j) Impact on minority interests of other pro forma adjustments are
     recorded in Equity in income (loss) of investees and minority
     interests.
(k) Impairment charge related to equity investment in
     pricelinemortgage.com is recorded in Equity in income (loss) of
     investees and minority interests.
(l) Reflects the impact of the Conversion Spread Hedges that increase
     the effective conversion price of the Convertible Senior Notes
     due September 30, 2011 and the Convertible Senior Notes due
     September 30, 2013 from their stated $40.38 conversion price to
     an effective conversion price of $50.47 per share. Under GAAP,
     the anti-dilutive impact of the Conversion Spread Hedges is not
     reflected on the outstanding diluted share count until the end of
     the hedge when shares are delivered.
(m) All common stock warrants and shares of restricted common stock
     restricted stock units and performance share units are included
     in the calculation of pro forma net income per share because pro
     forma net income has been adjusted to exclude our preferred stock
     dividend and stock-based compensation expense.
(n) Excludes the dilutive impact of convertible debt pursuant to EITF
     04-08 for convertible debt because the common stock underlying
     the convertible debt was not issuable since our common stock did
     not trade above the contingent conversion prices.
(o) Net income amounts used to calculate GAAP diluted earnings per
     share in 2006 are adjusted to add back interest expense on
     convertible senior notes and preferred stock dividend in periods
     where the underlying shares are included in GAAP weighted average
     number of diluted common shares outstanding.
priceline.com Incorporated
----------------------------------------------------------------------
Statistical Data
In thousands
(Unaudited)


    Gross Bookings                  1Q06     2Q06     3Q06     4Q06
    ----------------------------  -------- -------- -------- --------

    Domestic                      $474,007 $570,757 $504,752 $423,275
    International**                272,814  356,593  398,416  319,136
                                  -------- -------- -------- --------
       Total                      $746,821 $927,350 $903,168 $742,410

    Agency                        $480,506 $609,284 $600,406 $491,070
    Merchant**                     266,315  318,066  302,762  251,340
                                  -------- -------- -------- --------
       Total                      $746,821 $927,350 $903,168 $742,410

    Year/Year Growth
    ----------------------------
       Domestic                       8.3%    16.0%    13.1%    11.9%
       International                279.4%   360.0%   141.7%   101.4%
        excluding F/X impact        313.8%   361.5%   131.8%    86.3%


       Agency                        98.6%   128.7%    74.9%    51.6%
       Merchant                      -0.6%     5.0%    13.0%    18.1%

       Total                         46.5%    62.8%    47.8%    38.3%


    Units Sold                      1Q06     2Q06     3Q06     4Q06
    ----------------------------  -------- -------- -------- --------

    Airline Tickets                    728      821      666      588
       Year/Year Growth              -2.6%     4.1%    -2.0%     0.9%

    Hotel Room-Nights                4,153    4,995    5,238    4,265
       Year/Year Growth              62.5%    82.5%    49.7%    43.7%

    Rental Car Days                  1,621    2,000    2,044    1,789
       Year/Year Growth              26.8%    30.3%    20.8%    36.1%


                                    1Q06     2Q06     3Q06     4Q06
                                  -------- -------- -------- --------

    Revenue                       $241,914 $307,651 $313,467 $260,071
       Year/Year Growth               3.7%    15.4%    21.1%    27.5%

    Gross Profit                   $72,231 $105,804 $123,547  $99,517
       Year/Year Growth              25.2%    62.2%    54.4%    53.3%



    Gross Bookings             1Q07      2Q07       3Q07       4Q07
    ------------------------ -------- ---------- ---------- ----------

    Domestic                 $478,812   $547,787   $602,205   $525,571
    International**           519,679    687,124    788,478    679,760
                             -------- ---------- ---------- ----------
       Total                 $998,491 $1,234,911 $1,390,683 $1,205,331

    Agency                   $710,528   $919,260 $1,042,619   $912,698
    Merchant**                287,963    315,651    348,064    292,633
                             -------- ---------- ---------- ----------
       Total                 $998,491 $1,234,911 $1,390,683 $1,205,331

    Year/Year Growth
    ------------------------
       Domestic                  1.0%      -4.0%      19.3%      24.2%
       International            90.5%      92.7%      97.9%     113.0%
        excluding F/X impact    74.5%      79.6%      83.4%      89.9%


       Agency                   47.9%      50.9%      73.7%      85.9%
       Merchant                  8.1%      -0.8%      15.0%      16.4%

       Total                    33.7%      33.2%      54.0%      62.4%


    Units Sold                 1Q07      2Q07       3Q07       4Q07
    ------------------------ -------- ---------- ---------- ----------

    Airline Tickets               639        687        819        790
       Year/Year Growth        -12.2%     -16.3%      23.0%      34.4%

    Hotel Room-Nights           5,955      7,242      7,964      6,616
       Year/Year Growth         43.4%      45.0%      52.0%      55.1%

    Rental Car Days             2,003      2,278      2,338      2,002
       Year/Year Growth         23.6%      13.9%      14.4%      11.9%


                               1Q07      2Q07       3Q07       4Q07
                             -------- ---------- ---------- ----------

    Revenue                  $301,389   $355,880   $417,287   $334,853
       Year/Year Growth         24.6%      15.7%      33.1%      28.8%

    Gross Profit             $119,717   $157,211   $202,331   $160,152
       Year/Year Growth         65.7%      48.6%      63.8%      60.9%



Gross Bookings represent the total dollar value of travel booked,
 inclusive of taxes and fees.
** Includes $13.4 million of gross bookings from Agoda since
 acquisition on November 6, 2007.
priceline.com Incorporated
----------------------------------------------------------------------
Orbitz Related Data
In thousands
(Unaudited)

RECONCILIATION OF GAAP TO PRO FORMA DOMESTIC GROSS PROFIT(a)

                          Three Months Ended     Twelve Months Ended
                         --------------------- -----------------------
                             December 31,           December 31,
                            2007       2006       2007        2006
                         ---------- ---------- ----------- -----------
    GAAP Domestic Gross
     Profit              $  60,262  $  52,801  $  276,493  $  223,542

(b) Airline excise tax
     refund                      -          -     (18,592)     (1,600)
(c) Amortization of
     acquired intangible
     assets in Cost of
     revenues                  428        428         428       1,481

                         ---------- ---------- ----------- -----------
    Pro Forma Domestic
     Gross Profit        $  60,689  $  53,229  $  258,329  $  223,423
                         ========== ========== =========== ===========


RECONCILIATION OF PRO FORMA DOMESTIC GROSS PROFIT TO PRO FORMA
 DOMESTIC GROSS PROFIT EXCLUDING ORBITZ

                          Three Months Ended     Twelve Months Ended
                         --------------------- -----------------------
                             December 31,           December 31,
                            2007       2006       2007        2006
                         ---------- ---------- ----------- -----------
    Pro Forma Domestic
     Gross Profit        $  60,689  $  53,229  $  258,329  $  223,423

    Orbitz Related Gross
     Profit                      -     (3,695)          -     (19,518)

                         ---------- ---------- ----------- -----------
    Pro Forma Domestic
     Gross Profit
     Excluding Orbitz    $  60,689  $  49,533  $  258,329  $  203,905
                         ========== ========== =========== ===========


RECONCILIATION OF DOMESTIC GROSS TRAVEL BOOKINGS TO DOMESTIC GROSS
 TRAVEL BOOKINGS EXCLUDING ORBITZ

                          Three Months Ended     Twelve Months Ended
                         --------------------- -----------------------
                             December 31,           December 31,
                              2007       2006        2007        2006
                         ---------- ---------- ----------- -----------
    Domestic Gross
     Bookings            $ 525,571  $ 423,274  $2,154,375  $1,972,791

    Orbitz Related Gross
     Bookings                    -    (25,583)          -    (140,471)

                         ---------- ---------- ----------- -----------
    Domestic Gross
     Bookings Excluding
     Orbitz              $ 525,571  $ 397,691  $2,154,375  $1,832,320
                         ========== ========== =========== ===========


RECONCILIATION OF DOMESTIC GROSS TRAVEL BOOKINGS EXCLUDING ORBITZ TO
 DOMESTIC NON-AIR GROSS TRAVEL BOOKINGS EXCLUDING ORBITZ

                          Three Months Ended     Twelve Months Ended
                         --------------------- -----------------------
                             December 31,           December 31,
                            2007       2006       2007        2006
                         ---------- ---------- ----------- -----------
    Domestic Gross
     Bookings Excluding
     Orbitz              $ 525,571  $ 397,691  $2,154,375  $1,832,320

    Air Gross Bookings
     Excluding Orbitz     (246,776)  (165,078)   (891,351)   (808,710)

                         ---------- ---------- ----------- -----------
    Domestic Non-Air
     Gross Bookings
     Excluding Orbitz    $ 278,796  $ 232,613  $1,263,024  $1,023,609
                         ========== ========== =========== ===========

(a) Includes domestic gross profit that is generated through gross
     bookings associated with intercompany arrangements between
     priceline.com and Booking.com.
(b) Airline excise tax refund is recorded in Merchant Revenue.
(c) Amortization of acquired intangible assets is recorded in Cost of
     revenues.
priceline.com Incorporated
----------------------------------------------------------------------
Estimated Impact of Share Price Movements on Weighted Average GAAP and
 Pro Forma Diluted Shares Outstanding
In millions
(Unaudited)


The following table is intended to demonstrate the estimated potential
 impact of share price movements on the number of equivalent shares
 included in the fully diluted share count used to calculate diluted
 earnings per share. Actual results are likely to differ due to the
 impact of option exercises, equity repurchases, issuances and
 forfeitures and any conversions of our convertible bonds. The table
 below is for illustrative purposes only; the company is unable to
 predict its future stock price and the company's stock could trade
 below or above the per share prices in the table below.


                                Estimated Weighted Average Number of
                                      Diluted Shares Outstanding
                               ---------------------------------------
                                  GAAP     Adjustments(1)   Pro Forma
                               ----------- --------------- -----------
                               1Q08  2008   1Q08    2008   1Q08  2008
                               ----- ----- ------- ------- ----- -----
Closing Share Price
 Assumption(2)          $50.00  46.2  43.7     0.3   (0.1)  46.6  43.6
                        $55.00  46.5  44.5     0.4    0.0   46.9  44.5
                        $60.00  46.7  45.1     0.4    0.1   47.1  45.2
                        $65.00  46.9  45.7     0.4    0.2   47.4  45.9
                        $70.00  47.2  46.2     0.5    0.3   47.6  46.5
                        $75.00  47.3  46.6     0.5    0.3   47.8  47.0
                        $80.00  47.5  47.0     0.5    0.4   48.1  47.4
                        $85.00  47.7  47.4     0.5    0.5   48.3  47.8
                        $90.00  47.9  47.7     0.6    0.5   48.4  48.2
                        $95.00  48.0  48.0     0.6    0.6   48.6  48.5
                       $100.00  48.2  48.2     0.6    0.6   48.8  48.8
                       $105.00  48.3  48.5     0.6    0.6   48.9  49.1
                       $110.00  48.4  48.7     0.7    0.7   49.1  49.4
                       $115.00  48.6  48.9     0.7    0.7   49.2  49.6
                       $120.00  48.7  49.1     0.7    0.7   49.4  49.8
                       $125.00  48.8  49.3     0.7    0.7   49.5  50.0
                       $130.00  48.9  49.4     0.7    0.8   49.6  50.2
                       $135.00  49.0  49.6     0.7    0.8   49.8  50.4
                       $140.00  49.1  49.7     0.8    0.8   49.9  50.5


(1) Reflects the anti-dilutive impact of the "Conversion Spread
 Hedges" and the dilutive impact of additional warrants and shares of
 unvested restricted stock and restricted stock units because pro
 forma net income has been adjusted to exclude preferred stock
 dividend and stock-based compensation.

(2) Estimated weighted average number of diluted shares outstanding is
 estimated as follows:
    1Q08: Uses actual daily share prices from Jan. 1, 2008 through
     Feb. 13, 2007, and the closing share price assumption from Feb.
     14, 2008 through Mar. 31, 2008.
    2008: Uses actual daily share prices from Jan. 1, 2008 through
     Feb. 13, 2008, and the closing share price assumption from Feb.
     14, 2008 through Dec. 31, 2008.

CONTACT: Priceline.com Incorporated
Press information:
Brian Ek, 203-299-8167
brian.ek@priceline.com

SOURCE: Priceline.com Incorporated

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