Expedia Group's chief executive officer and finance head have resigned following a disagreement with the online travel company's board over its business outlook, Chairman Barry Diller said on Wednesday. Billionaire Diller, who also chairs Expedia's former parent IAC / InterActiveCorp, said he will oversee the executive leadership team with Vice President Peter Kern until the board finds a replacement.
"Ultimately, senior management and the board disagreed on strategy," Chairman Barry Diller said in a statement, adding that the company's reorganization plan launched earlier this year led to disappointing third-quarter results and a "lacklustre" near-term outlook.
"The board disagreed with that outlook, as well as the departing leadership's vision for growth, strongly believing the company can accelerate growth in 2020," Diller said.
Diller, 77, also said he would buy additional shares Expedia In a show of "faith and commitment to the company's long-term future."
The company's shares, which have lost about 12 percent this year, rose by about 8 percent to $ 107.04 after the surprise resignation of CEO Mark Okerstrom and CFO Alan Pickerill. The stock closed 6.2 percent higher at $ 105.56.
"It raises the question – what did the board members see in the business of levers and opportunities for terms and opportunities for 2020 that the management didn't see?" Said Davidson analyst Tom White.
The Seattle-based company has been facing increasing competition from Airbnb and Booking.com as well as Google, which is eating into its search traffic. Expedia is also pumping money into its own vacation rental business Vrbo.
"(It was) definitely out of the blue. … I guess (Diller) felt the change had to be made," said Benchmark company analyst Daniel Kurnos.
"I would think he would find the right people to run it, but he certainly has a very impressive resume," Kurnos said.
© Thomson Reuters 2019