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•	Expedia.com®, a leading full service online travel company with localized sites in 33 countries;

•	Hotels.com®, a global lodging expert operating 89 localized websites in 39 languages with its award winning Hotels.com® Rewards loyalty program;

•	Orbitz Worldwide, including leading U.S. travel websites Orbitz.com and CheapTickets.com, as well as ebookers, a full service travel brand with websites in seven European countries;

•	Expedia® Affiliate Network ("EAN"), a global B2B brand that powers the hotel business of leading airlines, top consumer brands, online travel agencies and thousands of other partners through its API and template solutions;

•	trivago®, a leading online hotel metasearch platform with sites in 55 countries worldwide;

•	HomeAway®, a global online marketplace for the vacation rental industry, which also includes the VRBO, VacationRentals.com and BedandBreakfast.com brands, among others;

•	Egencia®, a leading corporate travel management company;

•	Travelocity®, a leading online travel brand in the U.S. and Canada delivering customer service when and where our customers need it with the Customer 1st Guarantee;

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•	Hotwire®, inspiring spontaneous travel through Hot Rate® deals;

•	Expedia® Media Solutions, the advertising sales division of Expedia, Inc. that builds media partnerships and enables brand advertisers to target a highly-qualified audience of travel consumers;

•	Wotif Group, a leading portfolio of travel brands including Wotif.com®, Wotif.co.nz, lastminute.com.au®, lastminute.co.nz and travel.com.au®;

•	Classic Vacations®, a top luxury travel specialist;

•	CarRentals.com™, a premier online car rental booking company with localized sites in 13 countries;

•	Expedia Local Expert®, a provider of online and in-market concierge services, activities, experiences and ground transportation in over a thousand destinations worldwide; and

•	Expedia® CruiseShipCenters®, a provider of exceptional value and expert advice for travelers booking cruises and vacations through its network of over 230 retail travel agency franchises across North America.

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•	online and traditional travel agencies, wholesalers and tour operators,

•	travel suppliers, including hotels and airlines,

•	large online portal and search websites,

•	travel metasearch websites,

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•	corporate travel management service providers,

•	mobile platform travel applications,

•	social media websites,

•	eCommerce websites and group buying websites, and

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•	Alternative accommodation websites.

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•	Significant changes in oil prices;

•	Continued air carrier and hotel chain consolidation;

•	Reduced access to discount airfares;

•	Travel-related strikes or labor unrest, bankruptcies or liquidations;

•	Increased incidents of actual or threatened terrorism;

•	Periods of political instability or geopolitical conflict, resulting in additional restrictions on travel or travelers becoming concerned about safety issues;

•	Natural disasters or events such as severe weather conditions, volcanic eruptions, hurricanes or earthquakes;

•	Travel-related accidents or the grounding of aircraft due to safety concerns; and

•	Health-related risks, such as the Ebola, H1N1, SARs and avian flu outbreaks.

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•	Diversion of management’s attention or other resources from our existing businesses, for example during 2016, we expended significant resources in the integration of Orbitz Worldwide, Inc.;

•	Difficulties and expenses in assimilating the operations, products, technology, privacy protection systems, information systems or personnel of the acquired company;

•	Use of cash resources and incurrence of debt and contingent liabilities in funding acquisitions, including with regard to future payment obligations in connection with put/call rights, may limit other potential uses of our cash, including stock repurchases, dividend payments and retirement of outstanding indebtedness;

•	Amortization expenses related to acquired intangible assets and other adverse accounting consequences, including changes in fair value of contingent consideration;

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Expected and unexpected costs incurred in pursuing acquisitions, including identifying and performing due diligence on potential acquisition targets that may or may not be successful, if unsuccessful could result in unexpected litigation or regulatory exposure, unfavorable accounting treatment, unexpected increases in taxes due, a loss of anticipated tax benefits or other adverse effects on our business, operating results or financial condition;

•	Impairment of relationships with employees, suppliers, customers, vendors and affiliates of our business and the acquired business;

•	The assumption of known and unknown debt and liabilities of the acquired company;

•	Failure of the acquired company to achieve anticipated traffic, transactions, revenues, earnings or cash flows or to retain key management or employees;

•	Failure to generate adequate returns on our acquisitions and investments, or returns in excess of alternative uses of capital;

•	Failure to properly and timely integrate acquired companies and their operations, reducing our ability to achieve, among other things, anticipated returns on our acquisitions through cost savings and other synergies;

•	Entrance into markets in which we have no direct prior experience and increased complexity in our business;

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•	Challenges relating to the structure of an investment, such as governance, accountability and decision-making conflicts that may arise in the context of a joint venture or majority ownership investment;

•	Impairment of goodwill or other intangible assets such as trademarks or other intellectual property arising from our acquisitions;

•	Costs associated with litigation or other claims arising in connection with the acquired company;

•	Increased or unexpected costs or delays to obtain governmental approvals for acquisitions;

•	Increased competition amongst potential acquirers for acquisition targets could result in a material increase in the purchase price for such targets or otherwise limit our ability to consummate acquisitions; and

•	Adverse market reaction to acquisitions or investments or failure to consummate such transactions.

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•	Delays or unanticipated costs in implementing the transition, which may delay or negate any expected benefits;

•	Supplier or traveler disruption similar to or worse than disruptions associated with previous business model and platform migrations;

•	Market research that indicated higher than expected price elasticity for travelers in increasingly transparent markets such as HomeAway’s market and for HomeAway’s suppliers more broadly;

•	Suppliers and travelers may not adopt HomeAway’s new payment structures as expected or at all, or may choose to transact with competitors;

•	Execution risk associated with launching a new business initiative that HomeAway did not have prior experience in;

•	Failure to implement or expand HomeAway’s technology, systems and network infrastructure in light of additional payment processing and reporting complexity, or failure to do so at a reasonable cost;

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•	Higher cost of traffic reducing cost per view effectiveness and reducing HomeAway’s ability to spend at the desired return on investment;

•	Increased risk of fraud; and

•	Additional potential tax exposures.

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•	Currency exchange restrictions or costs and exchange rate fluctuations, and the risks and costs inherent in hedging such exposures;

•	Exposure to local economic or political instability and threatened or actual acts of terrorism;

•	Compliance with U.S. and Non-U.S. regulatory laws and requirements relating to anti-corruption, antitrust or competition, economic sanctions, data content and privacy, consumer protection, employment and labor laws, health and safety, and advertising and promotions;

•	Compliance with additional U.S. laws applicable to U.S. companies operating internationally;

•	Differences, inconsistent interpretations and changes in U.S. and non-U.S. laws and regulations, including tax laws and regulations;

•	Weaker enforcement of our contractual and intellectual property rights;

•	Lower levels of credit card usage and increased payment and fraud risk;

•	Longer payment cycles, and difficulties in collecting accounts receivable;

•	Preferences by local populations for local providers;

•	Restrictions on, or adverse tax and other consequences related to repatriation of cash, the withdrawal of non-U.S. investments, cash balances and earnings, as well as restrictions on our ability to invest in our operations in certain countries;

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•	Financial risk arising from transactions in multiple currencies;

•	Slower adoption of the internet as an advertising, broadcast and commerce medium in those markets as compared to the United States;

•	Our ability to support new technologies, including mobile devices, that may be more prevalent in international markets;

•	Difficulties in attracting and retaining qualified employees in international markets, as well as managing staffing and operations due to increased complexity, distance, time zones, language and cultural differences; and

•	Uncertainty regarding liability for services and content, including uncertainty as a result of local laws and lack of precedent.

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•	Quarterly variations in our operating and financial results;

•	Operating and financial results that vary from the expectations of securities analysts and investors, including failure to deliver returns on technology or emerging market marketing investments;

•	Changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors;

•	Rating agency credit rating actions or pronouncements;

•	Reaction to our earnings releases and conference calls, or presentations by executives at investor and industry conferences;

•	Worldwide macro-economic conditions and fluctuations in currency exchange rates;

•	Changes in our capital or governance structure;

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•	Changes in market valuations of other internet or online service companies;

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•	Changes in search industry dynamics, such as key word pricing and traffic, or other changes that negatively affect our ability to generate traffic to our websites;

•	Announcements of dividends or changes in the amount or frequency of our dividends;

•	Announcements of technological innovations or new services by us or our competitors;

•	Announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments;

•	Loss of a major travel supplier, such as an airline, hotel or car rental chain;

•	Changes in the status of our intellectual property rights;

•	Lack of success in the expansion of our business model geographically;

•	Significant claims or proceedings against us or adverse developments or decisions in pending proceedings;

•	Significant security breaches;

•	Additions or departures of key personnel;

•	Rumors or public speculation about any of the above factors; and

•	Price and volume fluctuations in the stock markets in general.

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•	Increasing our vulnerability to general adverse economic and industry conditions;

•	Requiring us to dedicate a portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of cash flow to fund working capital, capital expenditures, acquisitions and investments and other general corporate purposes;

•	Making it difficult for us to optimally capitalize and manage the cash flow for our businesses;

•	Limiting our flexibility in planning for, or reacting to, changes in our businesses and the markets in which we operate;

•	Placing us at a competitive disadvantage compared to our competitors that have less debt; and

•	Limiting our ability to borrow additional funds or to borrow funds at rates or on other terms we find acceptable.

•	Borrow money, and guarantee or provide other support for indebtedness of third parties including guarantees;

•	Pay dividends on, redeem or repurchase our capital stock;

•	Enter into certain asset sale transactions, including partial or full spin-off transactions;

•	Enter into secured financing arrangements;

•	Enter into sale and leaseback transactions; and

•	Enter into unrelated businesses.

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(1)	On May 22, 2015, we completed the sale of our 62.4% ownership stake in eLong, Inc. We recognized an after tax gain of $395 million (or $509 million pre-tax gain) during 2015.

(2)

On December 20, 2011, we completed the spin-off of TripAdvisor. Immediately prior to the spin-off, we effected a one-for-two reverse stock split. In order to complete the spin-off, we were required to redeem the $400 million principal of our 8.5% senior notes due 2016, which were legally extinguished in the first quarter of 2012. Accordingly, the related debt extinguishment losses was presented in discontinued operations for 2012.

(3)

On December 16, 2016, our majority-owned subsidiary, trivago, completed its IPO. In conjunction with the IPO, Expedia and trivago's founders entered into an Amended and Restated Shareholders' Agreement under which the original put/call rights were no longer effective and, as such, we reclassified the redeemable non-controlling interest into non-redeemable non-controlling interest on the consolidated balance sheet. See NOTE 12 — Redeemable Non-controlling Interests in the notes to consolidated financial statements for further information.

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•	It requires us to make an assumption because information was not available at the time or it included matters that were highly uncertain at the time we were making the estimate; and

•	Changes in the estimate or different estimates that we could have selected may have had a material impact on our financial condition or results of operations.

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City of San Diego, California Litigation. On December 12, 2016, the California Supreme Court affirmed the Court of Appeals’ decision, concluding that the defendant online travel companies do not operate hotels, and therefore they are not liable for hotel taxes. As a result of this decision, the California Court of Appeals has lifted the stays for the City of Los Angeles Litigation and City of San Diego Litigation and these cases will proceed in light of this decision. While not part of the court’s reasoning for its decision, the court commented that under the San Diego ordinance hotel taxes would be due on amounts that hotels require online travel companies to charge consumers under specific contractual rate parity clauses.

•	Nassau County, New York Litigation. On December 2, 2016, the court granted the defendant online travel companies’ motion for summary judgment and rejected Nassau County’s attempt to tax the amounts the defendants charge for their services.

•	State of Kentucky Litigation. The parties reached a settlement and, on January 31, 2017, the court entered an order dismissing the case.

•	State of Indiana Litigation. On December 20, 2016, the Indiana Tax Court held that tax assessments against Orbitz were issued in error as a matter of law.

•	Minnesota Cities Litigation. The parties reached a settlement and, on January 11, 2017, the court dismissed the appeals filed by certain Expedia companies, thereby ending the case.

•	State of Maine Litigation. The parties have reached a settlement in principle.

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(1)	trivago, which is comprised of a hotel metasearch business that differs from our transaction-based websites, does not have associated gross bookings or revenue margin. However, third-party revenue from trivago is included in revenue used to calculate total revenue margin.

(2)

Gross bookings from HomeAway, our online marketplace for the vacation rental industry acquired in December 2015, are also currently excluded from the above total gross bookings. Revenue from HomeAway is included in revenue used to calculate total revenue margin. We have been in the process of determining comparable on-platform gross bookings and plan to begin disclosing this metric along with the historical comparable information in the first quarter of 2017.

(3)	Includes results for eLong through its disposal on May 22, 2015.

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(1)	Includes third-party revenue from trivago as well as our transaction-based websites.

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(1)	Amount excludes transaction costs.

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(1)	Our 7.456% Notes, 5.95% Notes, 2.5% Notes, 4.5% Notes, and 5.0% Notes include interest payments through maturity in 2018, 2020, 2022, 2024, and 2026 respectively, based on the stated fixed rates. For the 2.5% Notes, the December 31, 2016 Euro exchange rate was used to convert the Euro 650 million to U.S. Dollars and calculate the related U.S. Dollar interest payments.

(2)	The operating leases are for office space and related office equipment. We account for these leases on a monthly basis. Certain leases contain periodic rent escalation adjustments and renewal options. Operating lease obligations expire at various dates with the latest maturity in 2026.

(3)	Our purchase obligations represent the minimum obligations we have under agreements with certain of our vendors and marketing partners. These minimum obligations are less than our projected use for those periods. Payments may be more than the minimum obligations based on actual use.

(4)

Guarantees and LOCs are commitments that represent funding responsibilities that may require our performance in the event of third-party demands or contingent events. We use our stand-by LOCs primarily for certain regulatory purposes as well as to secure payment for hotel room transactions to particular hotel properties. Of the outstanding balance of our stand-by LOCs, $19 million directly reduces the amount available to us from our revolving credit facility. The LOC amounts in the above table represent the amount of commitment expiration per period. In addition, we provide a guarantee to the aviation authorities of certain foreign countries to protect against potential non-delivery of our packaged travel services sold within those countries. These countries hold all travel agents and tour companies to the same standard. Our guarantees also include bonds relating to tax assessments that we are contesting and certain surety bonds related to various company performance obligations.

(5)	Excludes $221 million of unrecognized tax benefits for which we cannot make a reasonably reliable estimate of the amount and period of payment.

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(1)	Gross accounts receivable was $24 million, of which $1 million was estimated to be uncollectible.

(2)	Acquired definite-lived intangible assets primarily consist of supplier relationships, customer relationships and developed technology assets with average lives ranging from less than one to ten years and a weighted average useful life of 5.2 years.

(3)	Acquired indefinite-lived intangible assets primarily consist of trade names and trademarks.

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(1)	Gross accounts receivable was $157 million, of which $7 million was estimated to be uncollectible.

(2)	Acquired definite-lived intangible assets primarily consist of customer relationship assets, developed technology assets and partner relationship assets with estimated useful lives ranging from less than one to ten years with a weighted average life of 6.0 years.

(3)	Acquired indefinite-lived intangible assets primarily consist of trade names and trademarks.

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(1)	Acquired definite-lived intangible assets primarily consist of customer relationship, reacquired right and supplier relationship assets and have estimated useful lives of between four and ten years with a weighted average life of 5.8 years.

(2)	Includes cash acquired of $41 million.

(3)	The total purchase price includes noncash consideration of $99 million related to an equity method investment, which is currently consolidated upon our acquisition of a controlling interest, as discussed above, with the remainder paid in cash during the period.

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(1)	Acquired definite-lived intangible assets primarily consist of supplier contracts and customer relationships and have estimated useful lives of between less than one year and 10 years with a weighted average life of 7.8 years.

(2)	Includes cash acquired of $36 million.

(1)	Includes cash and cash equivalents of approximately $74 million.

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(1)	Includes stock-based compensation and amortization of intangible assets of approximately $20 million and $17 million for 2015 and 2014, which are included within Corporate & Eliminations in NOTE 19 — Segment Information.

(2)	The year ended December 31, 2015 includes the pre-tax gain of $509 million related to the gain on sale.

(3)	The year ended December 31, 2015 includes the after-tax gain of $395 million related to the gain on sale.

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(1)

At December 31, 2016, project in progress included approximately $38 million of project construction costs that were incurred by the landlord as property and equipment, net with a related construction financing obligation in other long-term liabilities pursuant to build-to-suit lease guidance. The building assets will begin depreciating when the costs incurred related to the build out of the office space are complete and ready for their intended use, which is expected to be in 2018.

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(1)	Net of discounts and debt issuance costs. Excludes debt acquired in the HomeAway acquisition included within accrued expenses and other current liabilities as of December 31, 2015. For further information, see NOTE 3 — Acquisitions and Other Investments.

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(1)	Approximately 682 million Euro as of December 31, 2016 and 644 million Euro as of December 31, 2015.

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(1)	As of our adoption of the new share-based payment accounting standard in 2016, we no longer include a forfeiture rate in our vested and expected to vest calculation unless necessary for a performance condition award.

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(1)	Amount excludes transaction costs.

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(1)

Foreign currency translation adjustments, net of tax, includes foreign currency transaction gains at December 31, 2016 of $16 million ($25 million before tax) and foreign currency transaction losses at December 31, 2015 of $1 million ($2 million before tax) associated with our 2.5% Notes. The 2.5% Notes are Euro-denominated debt designated as hedges of certain of our Euro-denominated net assets. See NOTE 2 — Significant Accounting Policies for more information. The remaining balance in currency translation adjustments excludes income taxes as a result of our current intention to indefinitely reinvest the earnings of our international subsidiaries outside of the United States.

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(1)	Includes results since our acquisition of HomeAway on December 15, 2015.

(2)	Includes results through our disposal of eLong on May 22, 2015.

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(1)	Charges to other accounts primarily relates to amounts acquired through acquisitions and net translation adjustments.

(1)	During the fourth quarter of 2016, we recognized a $33 million impairment charge related to indefinite lived intangible assets.

(2)	Earnings per share is computed independently for each of the quarters presented. Therefore, the sum of the quarterly earnings per share may not equal the total computed for the year.

(3)	During the fourth quarter of 2015, we recognized $23 million related to restructuring and related reorganization charges.

(4)

In March 2016, the FASB issued new guidance related to accounting for share-based payments. We elected to early adopt the new guidance in the second quarter of 2016, which required us to reflect any adjustments as of January 1, 2016. The primary impact of adoption was the recognition of excess tax benefits in our provision for income taxes rather than additional paid-in capital for all periods in 2016.

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(1)	Includes results through our disposal of eLong on May 22, 2015.

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