David Goulden: Yes, Alex let me take that. So yes, I mean as you called out in the prepared remarks there are two factors that are causing us to take the guidance to take rates to call our number down a little bit from where we were before. And actually, both of kind of what I call good things happening within the business. So the first is that the business is growing faster and the booking window has steel on gate compared to where we thought we’d be this year which means that we’re not going to get all the benefit from timing recovery this year. Some of that timing recovery will be delayed into next year. So that we should get back as a positive that piece of the reduction will get back as positive next year. The fact that flight is growing faster than we expect is also putting a little bit of pressure on margin.
But as Glenn said, that’s a good thing as well because we are building out more capabilities and more opportunities to work with our customers across connected transactions. So those are the two main dynamics, one of which we will get back in terms of the timing recovery, which we thought would happen this year will now happen more likely over two years.
Alex Brignall: Okay. That’s really helpful David. Thank you. As a follow-up, one of the things that’s obviously changed is that some of your marketing dollars, which come below the revenue line have turned into merchandising dollars above the revenue line. And so it seems really like that revenue line is very, very hard to model. If we were to think of things in terms of EBITDA divided by gross bookings, is there any meaningful reason why your core business or the accommodation business outside of payments and flights and all of the sort of businesses that dilute that bigger should not see a return to pre-COVID profitability if not improvement if you increase direct mix. So if I just think accommodation EBITDA divided by gross bookings is there any reason why that should be less profitable in the future than it was before COVID.
David Goulden: That’s obviously a different way of looking at the EBITDA margins than we do but you’re right obviously some of the contra revenue because of merchandising impacting the revenue line. The diet mix will obviously help overcome pressures in the accommodation business. Obviously, it seems like alternatives become slightly bigger seeing Asia becomes slightly bigger. So I think when we’ve talked about the long-term model for the business, assume that the core accommodations business can get back to in the rough region where it was 2019-ish and then the impact on EBITDA margins in the overall business will be driven by the mix of some of the newer businesses will become quite large in terms of particularly payments and flights neither which were a major factor in 2019.
What I would point to is as I step back further and say what we’ve committed to for our long-term more, which I think is very important compared to 2019 is we have a business that is larger on the top line and the bottom line and growing faster the top line and the bottom line than it did in 2019. And that I think is the overall commitment that we’ve made that we’re very convinced will stick to that I think will help drive your thinking about the overall model.
Alex Brignall: So I guess it’s crucial to think of the additional businesses as incremental to your core business.
David Goulden: That’s the last way to think about building the model out to look at our future EBITDA, yes.
Alex Brignall: Thank you very much.
Operator: Your next question comes from the line of Ron Josey with Citigroup. Your line is open.
Ron Josey: Great. Thanks for taking the question. And really helpful to hear all the stats and see everything go as well this quarter. Glenn, I wanted to take you back maybe a year ago, we talked about growing bookings share of annual spend per customer. And as we see direct bookings increases to increase the connected trips rise, AI trip planners launch, just talk to us about the progress of just gaining share of that annual spend per customer. Any updated goals there? Thank you.
Glenn Fogel: So Ron, let me try, understand the question. You’re saying the annual spend per customer is that, right?
Ron Josey: So percentage share of travel spend. Yes. I think we talked about getting like 25% a year ago or something.
Glenn Fogel: Yes right. So clearly part of the issue is that our customers, I’m happy about this, they don’t always use us. Sometimes they use a competitor. And we see that. We see that unfortunately more than I’d like. Part of it is not having a product that they want. That’s one thing, which we’re building out as we talked a little bit about. And the other thing is post things that there’s — they go for example internationally will go for this brand and by domestic on that one. The key thing for us is to develop that loyalty that the reason that somebody really thinks that they will come to us for any travel will come to us. So part of it is bring all this together with the connected trip. Bring it all together with payment, developing the more we learn about the customer with their permission of course and then providing them with the — what they may want more than anyone else.
