Expedia Group (EXPE) said on September 22 that it is joining Muse, Meta Platforms’ new personal AI agent. On September 23, the stock fell 7.72% to $259.04, more than Booking Holdings’ 5.07% drop and close to Airbnb’s 7.56%, as investors weighed Muse’s ability to book flights and places to stay. The consumer discretionary sector fell by only about 1.5%, so the selling was concentrated in travel booking stocks.
The drop left Expedia 23.62% below its August peak. The company hasn’t reported a quarter since Muse launched on September 8, so its next investor relations materials will give the first read on whether the fear shows up in the numbers.
Expedia Drawdowns (TIKR)
Meta Runs Muse, and Expedia Is One of Its Connectors
Meta is the primary party here. AtMeta Connect on September 23, it listed Expedia among Muse’s connectors alongside retailers such as Walmart and Best Buy, and Meta’s Alexandr Wang called travel a breakout use case for the agent. Muse joins Expedia’s existing integrations with Google’s AI Mode, ChatGPT, Claude, and Amazon’s Alexa.
Expedia’s announcement did not explain how the integration will work or when it will go live. At launch,Skift’s testing found that Muse booked flights through a direct connection to Duffel but shopped for hotels by browsing consumer sites such as Expedia and Hotels.com. Skift warned that this browsing could raise suppliers’ costs without matching bookings.
Goldman Sachs has grouped Expedia and Booking with telecom, insurance, and streaming names in a basket of “consumer inertia” stocks at risk if agents make switching easier. Bloomberg Intelligence estimated that if agents take 5% to 10% of the travel, ride-hailing, and delivery business, the combined revenue loss could exceed $5 billion.
Gorin Is Fighting for the Booking, Even Inside the Agent
Ariane Gorin, CEO of Expedia Group, took up this scenario at Goldman Sachs’ Communacopia + Technology Conference on September 9, the day after Muse launched. She said two-thirds of Expedia’s consumer business comes direct. The rest comes from a number of places, and she said Expedia’s brands need to show up there as horizontal agents and chat assistants spread.
Gorin said that even if travelers end up chatting and booking inside an agent, “it’s still we want it to be with the Expedia brand or the Vrbo brand.” Her plan concedes the agent may own the conversation and fights for the transaction instead. The pitch rests on loyalty and service: Platinum members get flight price-drop protection paid back in OneKeyCash, and VrboCare promises in-trip help when something goes wrong.
Expedia has spent the past year testing agentic browsers and paid ads in ChatGPT. Gorin said AEO, an organic channel, “is small, but it’s still our fastest-growing channel.” Her team also learned that “just a chat interface purely with text is not always the best way to shop for travel,” as engagement in partner agents rose once Expedia added photos, descriptions, and multiple properties.
She was candid about the limits. Natural language search in Expedia’s own product is “not yet delivering better conversion,” and at theSkift Global Forum on September 23, she said she doubts most bookings will become end-to-end chat transactions. She added that AI tools have not lifted bookings so far, though they yield more than 60% more data on traveler intent.
A Lower Multiple, a Lawsuit and Layoffs, All Before the Muse Selloff
Expedia’sNTM EV/EBITDA multiple is 7.18x, down from 9.86x at the end of 2025 but close to the 7.02x it carried in mid-2025. Over the same stretch since December, analysts raised their 2026 revenue estimate from $15.64 billion to $16.20 billion.
Expedia NTM EV / EBITDA (TIKR)
Two company headlines came out on September 22. Plaintiffs’ counselannounced a wrongful-death lawsuit in King County Superior Court over a fatal fire at a Dominican Republic rental, alleging that Vrbo lists properties whose hosts disclosed they lack smoke detectors. The allegations are unproven.
Expedia alsofiled a WARN notice to cut 58 Seattle jobs, its first layoffs since January. Most coverage of the September 23 drop tied it to Muse rather than to either headline.
TIKR Advanced Model Analysis
Current Price: $259.04
Target Price (Mid): ~$447
Potential Total Return: ~73%
Annualized IRR: ~14% / year
Expedia Advanced Valuation Model (TIKR)
TIKR’s mid case, realized at the end of 2030, values Expedia at around $447 per share. That is a scenario built on stated assumptions, and because it is a 2030 figure, it doesn’t compare directly with the Street’s ~$339 mean target. We use the mid case because it already assumes theP/E ratio shrinks about 4% a year, which builds in a lasting discount.
Over the model’s forecast period, the mid case also assumes about 7% annual revenue growth, anet margin of about 19%, and earnings growth near 13% a year. We see B2B partners and advertising, where Expedia Group’s own ad revenue grew 13% in Q2, as the revenue drivers. The margin driver is marketing discipline plus the AI productivity Gorin cited, including 40% faster product and tech cycle times.
The primary risk is agents capturing the non-direct third of consumer demand, which would hit growth and the multiple together. If Expedia’s brands carry bookings made inside agents, earnings growth can outrun the shrinking multiple. If agents end up owning the booking, today’s discount is deserved, and the model is too generous.
Conclusion
Expedia reported Q3 2025 on November 6 after announcing that date on October 2, so a Q3 2026 date announcement would fit early October if the pattern holds. Q3 includes only about three weeks of Muse, which makes management’s fourth-quarter outlook the better tell.
A Q4 revenue guide with a midpoint at or above the Street’s roughly $3.73 billion, plus Q3 gross bookings inside the$32.2 billion to $32.8 billion guide, would suggest agents aren’t siphoning demand yet. A midpoint below that, or management tying consumer softness to AI channels, would suggest the September 23 selling was early rather than wrong.
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