TABLE OF CONTENTS

Proxy Summary 6 Option Exercises and Stock Vested 60 Corporate Governance Highlights 9 Table Organizational Changes 9 Employment Contracts, Termination of 61 Employment and Change in Control Arrangements CORPORATE GOVERNANCE 13 Potential Payments Upon a Change in 66 Proposal 1 Election of Directors 14 Control and/or Termination Nomination and Election Process 16 2019 CEO Pay Ratio 69 Board Evaluations 18 Equity Compensation Plan Information 70 Nominees for Election as Directors 19 Non-Employee Director Compensation 71 Retiring Directors 25 and Benefits Our Governance Framework 26 Compensation Committee Interlocks 74 Our Board's Role in Company Strategy 28 and Insider Participation Board’s Role in Risk Oversight 29 Compensation Risk Assessment 74 Director Orientation and Continuing 30 Certain Relationships and Related 74 Education Transactions Board Committees 30 Proposal 2 Advisory Vote to Approve 75 2019 Executive Compensation Director Independence 32 Board Practices and Procedures 34 AUDIT MATTERS 77 Sustainability 35 Report of the Audit Committee of the 78 Security Ownership of Certain Beneficial 37 Board of Directors Owners and Management Auditor Independence 80 Proposal 3 Ratification of Selection of 81 EXECUTIVE COMPENSATION 39 Independent Registered Public Compensation Discussion and Analysis 40 Accounting Firm Executive Summary 40 Philosophy and Objectives 43 STOCKHOLDER PROPOSALS 83 Benchmarking and Target 45 Proposal 4 Stockholder Proposal – 84 Compensation Right of Stockholders to Act by Written Measuring Performance 46 Consent 2019 Executive Officer Compensation 47 Board of Directors Statement in 85 Program Opposition to Proposal 4 2019 Named Executive Officer 49 2021 Stockholder Proposals 87 Compensation & Performance How We Make Compensation Decisions 52 OTHER MATTERS 89 Executive Officers 54 Annual Meeting Information 90 Key Governance Matters 55 Compensation Committee Report 56 APPENDICES 93 Summary Compensation Table 57 Appendix A Unaudited Reconciliation of 94 GAAP to Non-GAAP Financial Grants of Plan-Based Awards Table 58 Information Outstanding Equity Awards at 2019 59 Appendix B Form of Proxy Card 97 Fiscal Year-End Table LETTER FROM THE PRESIDENT AND CHIEF EXECUTIVE OFFICER

Dear Fellow Stockholder APRIL 24, 2020

We are facing an unprecedented global pandemic. I well as setting up the company to be optimally believe the COVID-19 virus will impact global travel more positioned in the post-crisis era. We have a strong than the 9/11 terror attacks, the SARS epidemic and the balance sheet but, given the unpredictability of 2008-2009 Global Financial Crisis combined. COVID-19, cash is ever-more critical. We have been Furthermore, it is not possible to predict the trajectory of working to reduce costs, such as lowering marketing the virus nor its long-term impact on the travel industry spend to match the decrease in demand and we intend with any degree of certainty. to be especially mindful of our cash levels and cash management efforts throughout the crisis. Our absolute number one priority is the health and safety of our colleagues, customers and partners. Our crisis While we are all hopeful that the virus can be contained management teams have been working across the world soon throughout the world, we are planning for with governments and world health organizations to extended headwinds in 2020. Nevertheless, we will do all ensure we have policies in place that support and we can to support our colleagues, customers, partners protect all of them. As Corona virus-related regulations and the global travel ecosystem so that when people are and policies change rapidly, we are working to adapt our ready to travel again, Booking Holdings is there to make products and services to the continuously changing it easier for everyone to experience the world. circumstances. When we emerge from this global pandemic, our world Our 2019 results seem like a distant memory in light of and our industry will undoubtedly be different, but travel the new reality, however I would like to recap our will remain fundamental to people’s lives. We truly performance because it highlights our global scale and believe that travel makes the world a better place and, the strength of our core business pre-crisis, which we even if not today, the world will travel again. believe serves as a foundation to help us weather the I want to thank our employees all over the world who current storm. We booked 845 million room nights for are putting forward extraordinary efforts during this time. the year, 11% more than 2018 – equating to an average I want to thank our customers for inspiring us to do what of 2.3 million nights each day. We also produced strong we do. We will continue to be there for you to support year-over-year growth across our key financial metrics you in this crisis. I want to thank our partners for all that including revenue, net income and adjusted EBITDA. they do to make travel experiences wonderful for Our revenue of $15.1 billion was up 4% (7% on a millions of people every year. Lastly, I want to thank our constant currency basis); our net income of $4.9 billion Board of Directors for their tremendous support, was up 22%; and our adjusted EBITDA of $5.9 billion continued leadership and guidance. We know these days was up 2% (6% on a constant currency basis). (See are extremely challenging for everyone, but we believe Appendix A for a reconciliation of non-GAAP financial brighter days will come. measures to GAAP financial measures). During 2019, we made progress in key initiatives including expanding the Booking.com payment platform, Sincerely, growing our alternative accommodations business, and making strides towards our long-term vision to deliver the connected trip. These efforts are part of our long-term strategy, but for the immediate, foreseeable Glenn D. Fogel future, our focus will remain on doing whatever we can President and Chief Executive Officer to support our employees, customers and partners, as April 24, 2020

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 3 Dear Stockholder: APRIL 24, 2020

You are cordially invited to attend the 2020 Annual please mark, sign, date and return your proxy card in the Meeting of Stockholders (the “Annual Meeting”) of enclosed envelope as soon as possible or vote by calling Booking Holdings Inc. to be held at 11:00 a.m. Eastern the toll-free telephone number or by going online as Time on Thursday, June 4, 2020. described in the instructions included in your proxy card. Your stock will be voted in accordance with the After careful consideration and in light of the safety instructions you have given in your proxy card. You may concerns resulting from the COVID-19 pandemic, the attend the Annual Meeting and vote through the virtual Board of Directors has determined that it is in the best meeting platform, even if you have previously returned interests of the public, our stockholders and our your proxy card or voted by telephone or by internet, by employees to conduct this year's Annual Meeting in a following the instructions included in the proxy virtual meeting format with no physical meeting location. statement. All stockholders who attend the meeting will You may attend the virtual Annual Meeting at be required to provide their 16-digit control number www.virtualshareholdermeeting.com/BKNG2020. To ask provided on their proxy card to vote or ask questions. questions and vote at the Annual Meeting, you will need We hope you are able to join us on June 4. the 16-digit control number that appears on your Notice of Internet Availability of Proxy Materials, on the proxy card or on the instructions that accompanied the proxy Sincerely, materials. This booklet includes the Notice of Annual Meeting and proxy statement. The proxy statement provides information about Booking Holdings in addition to describing the business we will conduct at the meeting. Jeffery H. Boyd We hope you will be able to attend the Annual Meeting. Chairman of the Board Whether or not you plan to attend the Annual Meeting, April 24, 2020

IMPORTANT A proxy card is enclosed. We urge you to complete and mail the card promptly in the enclosed envelope, which requires no postage if mailed in the United States. Alternatively, you may vote by calling the toll-free telephone number or by going online as described in the instructions included with your proxy card. Any stockholder attending the Annual Meeting may vote on all matters that are considered, in which case the signed and mailed proxy or prior vote by telephone or online will be revoked. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain from the record holder a proxy issued in your name to obtain a 16-digit control number. IT IS IMPORTANT THAT YOU VOTE YOUR STOCK

4 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 800 Connecticut Avenue Norwalk, CT 06854 NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

The Board of Directors of RECORD DATE The Board of Directors fixed the close of business on April 9, 2020 as the Booking Holdings Inc. record date for identifying those stockholders entitled to notice of, and to (the “Company”) vote at, the Annual Meeting and at any adjournment or postponement of the Annual Meeting. is soliciting your proxy WE WILL BE VOTING ON THE FOLLOWING MATTERS: for the 2020 Annual 1. To elect twelve directors to hold office until the next annual meeting of Meeting of Stockholders. stockholders and until their respective successors are elected and qualified; 2. To approve on an advisory basis the 2019 compensation paid by the Company to its named executive officers; 3. To ratify the selection of Deloitte & Touche LLP as the independent registered public accounting firm of the Company for the fiscal year ending December 31, 2020; THURSDAY, JUNE 4, 2020 4. To consider and vote upon a non-binding stockholder proposal 11:00 a.m. Eastern Time requesting the right of stockholders to act by written consent; and

www.virtualshareholdermeeting.com 5. To transact such other business as may properly come before the /BKNG2020 meeting or any adjournment or postponement of the meeting. Even if you have given your proxy, you may still vote on the virtual meeting platform if you attend the Annual Meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain from the record holder a proxy issued in your name to obtain a 16-digit control number.

At the Meeting: To attend the Annual Meeting, visit www.virtualshareholdermeeting.com/BKNG2020 and if you wish to vote or ask questions during the Annual Meeting, you must have the 16-digit control number included on your proxy card or Notice of Internet Availability of Proxy Materials. Online: You may vote by going online as described in the instructions included with your proxy card. Telephone: You may vote by calling the toll-free telephone number as described in the instructions included with your proxy card. Mail: Complete, date, sign and return the enclosed proxy card and return it in the enclosed postage prepaid envelope (if mailed in the United States).

April 24, 2020 By Order of the Board of Directors

This proxy statement and our 2019 Annual Report are also available on our website Stephen Sonne at ir.bookingholdings.com/financial- Corporate Secretary information/annual-reports. Norwalk, Connecticut

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 5 PROXY SUMMARY

To assist you in reviewing our 2019 performance, we would like to call your attention to the following information, including key elements of our proxy statement and Annual Report on Form 10-K. The following description is only a summary. Before voting and for more complete information about these topics, please review our Annual Report on Form 10-K for the year ended December 31, 2019 and the complete proxy statement. About Booking Holdings

Our mission is to make it easier for everyone to experience the world

Booking Holdings is the world’s leading provider of online travel and related services, provided to customers and partners in over 230 countries and territories through six primary consumer-facing brands. Collectively, Booking Holdings operates in more than 40 languages across Europe, North America, South America, the Asia-Pacific region, the Middle East and Africa. We connect consumers wishing to make travel reservations with providers of travel services around the world through our online platforms. We offer these services through six primary consumer-facing brands:

Ground Accommodations Transportation Flights Restaurants Activities Meta Search

*

* Available in select cities.

Forbes Fortune Fast Company Rankings include: World's Most Rankings include: World's Most Indexed by Fast Company as a Innovative Companies, World's Best Admired Companies and Future World's Most Innovative Company Employers, World's Best Employers 50 Companies Best Positioned for Women and World's Best for Growth Employers for Diversity

230+ 40+ 29.4M listings COUNTRIES AND TERRITORIES LANGUAGES HOTELS, HOMES, APARTMENTS AND OTHER UNIQUE PLACES TO STAY

6 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT PROXY SUMMARY

Our 2019 Performance

2019 was a solid year for Booking Holdings Inc. (the “Company,” “Booking Holdings,” “we,” “our” or “us”). In 2019, we operated the largest, most profitable global online travel business in the world, with a 2019 operating margin of 35.5% as a percentage of revenues. In 2019, our net income grew 21.7% to $4.9 billion and we generated $4.9 billion of cash from operating activities. We are particularly proud of having achieved above-market growth while maintaining industry-leading profitability. During 2019, Booking.com, our largest brand, added approximately 400,000 accommodations to its reservation services, including approximately 376,000 homes, apartments and other unique places to stay, and, as of March 31, 2020, had approximately 2,607,000 directly bookable hotels and other places to stay available through its platforms representing more than 29.4 million reported listings (units potentially available for booking as reported to us by the property). Further, we were pleased to announce that we had 6.3 million reported listings of alternative accommodations as of December 31, 2019. In 2019, we recorded revenue of $3.1 billion from alternative accommodations and alternative accommodations were nicely profitable and grew faster than our core accommodation business. Although in many respects we achieved good financial results in 2019, we did not meet the financial goals we set for ourselves, as discussed in more detail below in the Compensation Discussion and Analysis beginning on page 40.

GROSS TRAVEL BOOKINGS ROOM NIGHTS (BILLIONS) (MILLIONS) $92.7 $96.4 844.9 759.8 $81.2 +13.9% 673.1 +19.5% $68.1 CAGR 556.6 CAGR $55.5 $50.3 432.3 346.0

2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Performance Performance We achieved year-over-year gross bookings growth of 4.0% We continue to be the largest online accommodation (8% on a constant currency basis (i.e., using 2018 exchange reservation service in the world based on room nights rates)). Gross bookings is a common operating and statistical booked. Room nights booked grew 11.2% in 2019 to 845 metric used in the travel industry representing the total U.S. million. Over the three-year period from 2017 to 2019, we had Dollar value, generally inclusive of all taxes and fees, of all 2.3 billion room nights booked. From a multi-year travel services purchased by consumers through our online perspective, we have achieved significant growth, with a travel reservation businesses, net of cancellations. Over the 70.6% increase in room nights booked over the 2017-2019 three-year period from 2017 to 2019, we had gross travel three-year period as compared to the 2014-2016 three-year bookings of $270.4 billion. From a multi-year perspective, period. we have achieved significant growth, with a 55.5% increase in gross bookings over the 2017-2019 three-year period as compared to the 2014-2016 three-year period.

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 7 PROXY SUMMARY

REVENUE* ADJUSTED EBITDA ** (BILLIONS) (BILLIONS) $14.5 $15.1 $5.7 $5.9 $12.4 +14.7 % $4.9 +12.3% $10.3 CAGR $4.1 CAGR $3.5 $7.6 $8.6 $3.3

2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Performance Performance Total revenues grew 3.7% (7% on a constant-currency basis) We had Adjusted EBITDA growth of 2.2% in 2019 versus the in 2019. From a multi-year perspective, we have achieved prior year. From a multi-year perspective, we achieved significant growth, with a 58.7% increase in revenue (or significant growth, with a 51.0% increase in Adjusted EBITDA gross profit for years prior to 2018*), over the 2017-2019 over the 2017-2019 three-year period as compared to the three-year period as compared to the 2014-2016 three-year 2014-2016 three-year period. period.

Stockholder Return

Our operating and financial performance has resulted in STOCK PRICE AS OF DECEMBER 31, significant returns to stockholders. Our stock price increased from $1,466.06 on December 31, 2016 to $2,053.73 on December 31, 2019, representing a 40.1% increase over that three-year period. Through the repurchase of shares of our $2053.7 common stock, we returned approximately $8.2 billion to $1737.7 $1722.4 +12.5% stockholders in 2019 and approximately $16.0 billion over $1466.1 the 2017-2019 three-year period, representing 108% of the $1274.9 CAGR $1140.2 cash generated by operating activities during that three-year period.

2014 2015 2016 2017 2018 2019 $8.2 $16.0 billion billion RETURNED TO RETURNED TO STOCKHOLDERS IN 2019 STOCKHOLDERS OVER THE 2017-2019 THREE-YEAR PERIOD

* As a result of the new revenue recognition accounting standard that began in 2018, total revenues reported in 2018 and 2019 are comparable to gross profit reported in previous years. For more information, see Note 2 to the Consolidated Financial Statements of our 2019 Annual Report. ** See Appendix A to this proxy statement for a reconciliation of non-GAAP financial measures and the rationale for the use of non-GAAP financial measures.

8 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT PROXY SUMMARY

Corporate Governance Highlights

We strive to maintain strong corporate governance practices that are both stockholder friendly and designed to protect and grow long-term stockholder value. Management regularly engages with our largest stockholders and encourages all stockholders to contact us about any concerns they have. Our corporate governance practices include:

● Lead Independent Director; ● Majority voting in director elections; ● Stockholder-approved proxy access; ● Annual director elections (i.e., no classified board); ● No super-majority voting provisions; ● Stock ownership guidelines for directors and executive officers; ● Stockholders can call special meetings; ● No poison pill/rights plan; ● Annual “say-on-pay” vote; ● Long-standing practice of prohibiting hedging or pledging of stock by directors and executive officers; ● Disclosure of director and executive officer 10b5-1 Plans; and ● 11 of 13 current directors are independent.

Organizational Changes

In 2019, we added two new independent directors, Ms. Wei Hopeman and Ms. Vanessa Wittman. These two accomplished women bring valuable skills, experience and insight onto our Board. We also look forward to the addition of Mr. Bob van Dijk to our Board should he be elected at the Annual Meeting. With the addition of Mr. van Dijk, Ms. Nancy Peretsman and Mr. James Guyette are retiring from our Board as of the Annual Meeting, and we express our deep appreciation for their many years of outstanding service to the Company and its stockholders. In June 2019, Mr. Glenn Fogel, the Company's President and Chief Executive Officer, took on the additional role of Chief Executive Officer of our largest brand, Booking.com. Ms. Gillian Tans, the prior Chief Executive Officer of Booking.com, transitioned to the position of Chairwoman of Booking.com.

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 9 PROXY SUMMARY

Our Board

Committee Memberships* Age (as Nominating and of Director Corporate Other Public Current Directors 3-31-20) Since Independent Audit Compensation Governance Directorships Timothy M. Armstrong 49 2013   0 Jeffery H. Boyd (Chairman) 63 2001 1 Glenn D. Fogel 58 2017 0 Mirian M. Graddick-Weir 65 2018  Chair 1 Wei Hopeman 50 2019   0 Robert J. Mylod, Jr. (Chairman as of 53 2017 2 Annual Meeting)   Charles H. Noski (Lead Independent 67 2015 Chair 2 Director as of Annual Meeting)  Nicholas J. Read 55 2018   1 Thomas E. Rothman 65 2013   0 Lynn M. Vojvodich 52 2016   2 Vanessa A. Wittman 52 2019   0 Retiring Directors James M. Guyette (Lead Independent 74 2003 Chair 0 Director)   Nancy B. Peretsman 66 1999   0 Number of Meetings in 2019 11 7 3 New Nominee Bob van Dijk 47 N/A  2** * Reflects current committee composition. As of the Annual Meeting: Ms. Wittman will become Chair of the Audit Committee; Mr. Noski will become Chair of the NCG Committee and remain on the Audit Committee; Dr. Graddick-Weir will join the Audit Committee and remain the Chair of the Compensation Committee; Mr. Rothman will leave the Audit Committee and join the NCG Committee; and Ms. Vojvodich will join the Compensation Committee and remain on the NCG Committee. ** Mr. van Dijk serves on the boards of Naspers Limited and Prosus N.V. Naspers is a non-U.S. company publicly-traded on the Johannesburg Stock Exchange and Prosus is a non-U.S. majority-owned, publicly-traded subsidiary of Naspers, primarily traded on the EuroNext Exchange in Amsterdam. Our Corporate Governance Principles generally limit sitting CEOs of public companies from being on more than 2 public company boards, including ours. However, the NCG Committee has waived this limit with respect to Mr. van Dijk because his service on Prosus' board is part of his responsibilities as CEO of Naspers, its parent company, and therefore (a) the responsibilities of board membership on these affiliated companies are overlapping and (b) under these circumstances the NCG Committee believes that his membership on Naspers' and Prosus' boards will not impair Mr. van Dijk's ability to devote the necessary time and attention to his service on our Board. In addition, our Board of Directors (the “Board”) exhibits a strong mix of desired attributes, including business experience, tenure, age, diversity and independence. Ten of our current directors have joined our Board since January 2013, including nine current independent directors, and we have a new independent nominee up for election to the Board at the Annual Meeting.

10 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT PROXY SUMMARY

Board Gender Diversity* Tenure* 3 SHORT TERM FINANCIAL EXPERTS < 4 YEARS 7 ON THE AUDIT COMMITTEE* MEDIUM TERM 4 12 8 4-9 YEARS 4 WOMEN MEMBERS MEN LONG TERM 1 > 9 YEARS 57years AVERAGE AGE

Director Qualifications

LEADERSHIP FINANCE GLOBAL BUSINESS 9 8 12

HUMAN RESOURCES INTERNET / E-COMMERCE SALES AND MARKETING 1 7 4

TRAVEL 3

* Immediately following the Annual Meeting assuming all nominees are elected.

Executive Compensation Highlights

We believe strongly in pay for performance. As a result, we design our compensation programs so that we must achieve outstanding performance for our executive officers to achieve above-market compensation, including through the combination of below-market salaries and the potential for a high level of variable, “at risk” performance-driven compensation. We believe that we have developed a highly effective compensation program that has resulted in strong performance for many years. The program is substantially performance based, combines short-term and long-term elements and is based on metrics that promote both stockholder value creation and short-term and long-term executive accountability. See Compensation Discussion and Analysis beginning on page 40 for more information about our compensation programs and philosophy.

We do: We do not: Tie pay to performance. Provide change in control severance tax gross-ups and do have a policy against future such arrangements. Use “double triggers” in our severance agreements and Permit stock option repricing without stockholder approval. equity awards. Have significant stock ownership guidelines. Provide significant executive-only perquisites. Have a clawback policy. Permit hedging or pledging of our stock by our directors and executive officers. Conduct an annual risk assessment of our executive compensation program. Cap the bonus pool from which senior executives’ individual cash bonuses are paid. Conduct an annual stockholder engagement process. Conduct formal executive succession planning.

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 11 PROXY SUMMARY

2019 2019 2019 2019 Stock Incentive All Other 2019 Total 2019 Name and Principal Position Salary Bonus Awards Payment Compensation Compensation Glenn D. Fogel $ 750,000 — $ 14,000,605 $ 0 $ 17,921 $ 14,768,526 President and Chief Executive Officer David I. Goulden $ 600,000 — $ 4,499,460 $ 0 $ 8,739 $ 5,108,199 Executive Vice President and Chief Financial Officer Peter J. Millones $ 530,000 — $ 4,499,460 $ 0 $ 8,790 $ 5,038,250 Executive Vice President and General Counsel Gillian Tans $ 335,871 $ 1,119,570 $ 10,500,268 $ 0 $ 0 $ 11,955,709 Chairwoman, Booking.com

Annual Meeting Information Summary

DATE AND TIME LOCATION RECORD DATE Thursday, June 4, 2020 Virtual Meeting April 9, 2020 11:00 a.m., www.virtualshareholdermeeting.com/BKNG2020 local (Eastern) time For more information about attending the meeting, see How to Attend the Annual Meeting on page 91.

Voting Procedures

All stockholders are cordially invited to attend the virtual Annual Meeting. Whether or not you expect to attend the meeting, please complete, date, sign and return the enclosed proxy card as promptly as possible to ensure your representation at the meeting. A return envelope (which is postage prepaid if mailed in the United States) is enclosed for that purpose. Alternatively, you may vote by calling the toll-free telephone number or by going online as described in the instructions included with your proxy card. Even if you have submitted your proxy card, you may still vote through our virtual meeting platform if you attend the meeting. Please note, however, that if your shares are held of record by a broker, bank or other nominee and you wish to vote at the meeting, you must obtain from the record holder a proxy issued in your name to obtain a 16-digit control number.

Voting Matters

The following proposals will be voted upon at the Annual Meeting and are described in more detail in this proxy statement. Our Board recommends that you vote as follows on each such proposal:

Proposals Board Vote Recommendation More Information Election of Directors The Board of Directors recommends that you vote FOR each of the Board Page 14 (Proposal 1) of Directors’ nominees. Advisory Vote to Approve 2019 The Board of Directors recommends that you vote FOR the approval on Page 75 Executive Compensation an advisory basis of our 2019 executive compensation. (Proposal 2) Ratification of Independent The Board of Directors recommends that you vote FOR ratification of Page 81 Auditor (Proposal 3) Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020. Stockholder Proposal Requesting The Board of Directors recommends that you vote AGAINST this Page 84 the Right of Stockholders to Act non-binding stockholder proposal requesting the right of stockholders to by Written Consent (Proposal 4) act by written consent.

12 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE

Proposal 1 Election of Directors 14 Director Qualifications 14 Director Tenure 16 Nomination and Election Process 16 Identifying Director Candidates 16 Who Can Recommend Candidates? 17 Evaluating Director Candidates 17 Board Evaluations 18 Nominees for Election as Directors 19 Retiring Directors 25 Our Governance Framework 26 Leadership Structure 26 Other Select Corporate Governance Policies and Practices 27 Our Board's Role in Company Strategy 28 Our Strategy 28 Board’s Role in Risk Oversight 29 Director Orientation and Continuing Education 30 Board Committees 30 Audit Committee 30 Compensation Committee 31 Nominating and Corporate Governance Committee 32 Director Independence 32 The Guidelines 32 Applying the Guidelines 33 Independence Assessment 33 Board Practices and Procedures 34 Communications with the Board of Directors 34 Board of Director Attendance 34 Attendance at Annual Meetings 34 Compensation-related Corporate Governance 34 Sustainability 35 Diversity & Inclusion 35 Environment 36 Community 36 Customer Privacy & Data Protection 36 Security Ownership of Certain Beneficial Owners and Management 37

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 13 CORPORATE GOVERNANCE Proposal 1 Election of Directors

Proposal 1 Election of Directors

The Board currently consists of thirteen directors, with no vacancies, and the term of all of the directors expires at the Annual Meeting. After years of dedicated service on the Board, Mr. James Guyette and Ms. Nancy Peretsman are retiring from the Board, effective as of the Annual Meeting, and are therefore not standing for re-election. In addition, the Company has nominated a new director nominee, Mr. Bob van Dijk. As a result, effective as of the Annual Meeting, the Board has fixed the number of directors constituting the entire Board at twelve directors with no vacancies. If elected at the Annual Meeting, each of the twelve director nominees listed below will hold office for a one-year term until the 2021 annual meeting of stockholders and until his or her successor has been duly elected and qualified, or until his or her earlier death, resignation or removal. Unless otherwise instructed, the persons named as proxies on the accompanying proxy card will vote shares represented by properly executed proxies for the twelve nominees named herein. The proxies solicited by this proxy statement may not be voted for more than twelve nominees. With respect to the election of directors, a majority of votes cast means that the number of shares cast “for” a nominee’s election exceeds the number of “withhold” votes for that nominee. With respect to Proposal 1, votes cast does not include abstentions or broker non-votes, and therefore, abstentions and broker non-votes will not affect the outcome of the vote. Holders of common stock may not cumulate their votes in the election of directors. Although the Board anticipates that the twelve nominees will be available to serve as directors on our Board and each person nominated has agreed to serve if elected, if any of them should be unwilling or unable to serve, the proxies will be voted for the election of such substitute nominee or nominees as may be designated by the Board.

The Board of Directors recommends a vote FOR each of the Board’s nominees.

Director Qualifications

We believe that our directors should possess high personal and professional ethics and integrity, and be committed to representing the long-term interests of our stockholders. We endeavor to have a Board representing a range of experiences at policy-making levels in business and in areas that are relevant to the global nature of our operations and our long-term strategy, including growth on a global scale. As a result, the Board and the Nominating and Corporate Governance Committee (“NCG Committee”) believe that, in light of our business, strategy and structure, the following are key areas of experience, qualifications and skills that should be represented on the Board:

Leadership experience. The Board believes that directors with experience in significant leadership positions over an extended period, especially chief executive officer positions, provide us and the Board with special insights. These individuals generally possess extraordinary leadership qualities and the ability to identify and develop those qualities in others. They demonstrate a practical understanding of organizations, processes, strategy, risk management and the methods to drive change and growth.

Finance experience. The Board believes that an understanding of finance, financial statements and financial reporting processes is important for our directors. We generally measure our operating and strategic performance by reference to financial targets. In addition, accurate financial reporting and effective auditing are critical to our success.

Global experience. Our future success depends, in part, on our ability to continue to grow our businesses outside the United States. In 2019, approximately 90% of our consolidated revenues were generated by our international businesses. As a result, the Board believes it is important that it include directors with a global business perspective and significant international business experience.

14 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 15    Election of Election Directors     Proposal 1 Sales and Sales Marketing Travel HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 |        Internet/ E-Commerce BOOKING  Human Resources             Global Business Board seeks to have directors with experience internet Board seeks in or e-commerce to have directors with experience         The The Board have directors seeks to significantwith sales and marketing As our grow to business continues the number, and locations and our diversity of The Board that believes directors having with into the travelinsight industry and and the Board when considering and the Board the nomination of the current nominees. We continue to          it in the industries in which believes that havingit we operate is important directors experienced the the Board’s ability to oversee management. Leadership Finance the complementary skills, experience and qualifications to guide our company. Our 2020 board skills and our qualifications to the complementary skills, experience guide company. Our board 2020 to provide insight and advice to managementadditional our as highly onbusiness is dependent experience is increasingly important to our is increasingly important experience success. businesses because businesses because for our success and experience Travel Industry experience. important related industries is evaluateto help the Board management. our and oversee strategy employees continues to grow, the Board believes that directors with human resources (including continuesemployees people believes that directors and the Board to grow, with human resources (including culture) experience. Internet/E-Commerce experience. Sales and Marketing effective marketing. Human Resources Human Resources experience. Graddick-Weir the matrix against our articulated strategy so that it can director nominees as an serve the matrix against our strategyeffective tool for identifying articulated so that it can is forth is set below. following that skills matrix areas of each identified were particularly qualifications andshows experience, with skills Lynn Vojvodich M. Wittman A. Vanessa Thomas Rothman Thomas E. Bob Dijk van Robert J.Mylod, Robert Jr. H.Noski Charles J.Read Nicholas Mirian Mirian M. Wei Hopeman Jeffery H. Boyd Glenn Fogel D. Timothy Armstrong M. who collectively have nominee by the NCG Committee The evaluate matrix CORPORATE GOVERNANCE Nomination and Election Process

Director Tenure

The evaluation of director nominees, including each DIRECTOR TENURE* nominee’s independence from management, by the NCG 7 Committee and the Board also takes into account director tenure. Although re-nomination of incumbent directors is not 3.3 years automatic, the NCG Committee believes that Board continuity AVERAGE facilitates effective and efficient leadership, risk management TENURE

78 56 34 12 8 0 67 45 23 and oversight and that the knowledge and understanding of 4 01 our business gained over years of service are important attributes to consider when determining nominees for election to the Board. The NCG Committee and the Board also believe that deliberate and planned Board refreshment is 1 beneficial to the Board and our company, and we have a robust and continuous refreshment process in place. The Short Medium Long NCG Committee and the Board believe that the current mix of < 4 years 4-9 years > 9 years directors reflects an appropriate mix of short-, medium- and long-tenured directors. With the addition of Mr. van Dijk and * As of immediately following the Annual Meeting the retirement of Mr. Guyette and Ms. Peretsman, in each case as of the Annual Meeting, we anticipate having ten new independent directors since January 1, 2013 and an average tenure of our independent directors of 3.3 years.

Nomination and Election Process

The NCG Committee identifies, evaluates and recommends director candidates to the Board.

Identifying Director Candidates

As set forth in the Company’s Corporate Governance Principles, the NCG Committee primarily uses the following criteria to identify and recommend nominees for election or appointment to the Board:

● the highest personal and professional ethics and integrity; ● relevant business, professional or managerial skills and experience (including team-building and communication skills) useful to the oversight of our business;

● demonstrated leadership skills through involvement in business, professional, charitable or civic affairs; ● current knowledge of the markets and communities in which we do business and in our industry or other industries relevant to our business;

● ability and willingness to commit adequate time to fulfilling Board and committee duties and responsibilities; ● ability and willingness to exercise independent judgment, ask probing questions and express tough opinions; ● expertise, skills, knowledge, experience and personality that fit well with those of other directors and potential directors in building a Board that is effective, collegial and responsive to our needs and stockholder interests; and

● the characteristics to contribute to the Board’s diversity of viewpoints, background, experience and other demographics (such as racial and gender diversity). The NCG Committee does not set specific minimum qualifications that nominees must meet in order for the NCG Committee to recommend them to the Board, but rather believes that each nominee should be evaluated based on his or her individual merits, taking into account our needs and the overall composition of the Board. The NCG Committee’s policy is to consider diversity, which it views broadly in terms of viewpoints, backgrounds, experience, gender, race and ethnic or national origin, as a factor in nominating persons for election or appointment to the Board. The NCG Committee is committed to actively seeking out highly qualified women and individuals from minority groups to include in the pool from which Board nominees are chosen.

16 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 17 so and Election Process and Election Nomination HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING Candidates? who wish to submit potential candidates by the NCG Committee for electionfor consideration at to nominate persons for election to our Board at our 2021 annual meeting of stockholders may nominatedo at ourto persons for election annual to our 2021 stockholders may meeting Board of 87. current directors for nomination for re-election to the Board, the NCG Committee takes into account the takes into Committee the NCG Board, tothe for for nomination current re-election directors Director Candidates the chairperson of the NCG Committee, or his or the chairperson into a discussion with her of the NCG Committee, or his thatdesignee, enters nominee. Stockholder Communications Policy (available on our corporate website (www.bookingholdings.com)). In addition, (available (www.bookingholdings.com)). addition, Policy on Stockholder Communications In our corporate website on page Stockholders Other Board members and members of management Outside consultants may be employed be Outside to help identify candidates employed may consultants performance of each director. Underperforming directors may be asked to leave the Board or may not be re-nominated for may not be re-nominated Board or asked to leave the may be director. directors Underperforming performance of each and needs and challenges Board in light of our current of the composition Committee NCG also reviews the election. The among other individuals considering, after or remove be appropriate to add it may and determines whether ofthe Board, those experience. skills, judgment, tenure and background, age, of independence, and issues for need expertise specific things, the 2021 Stockholder in accordance and the procedures with statement in 2021 described in this proxy under ourrequired By-laws Proposals our 2021 do soannual meeting in accordance ofwith in this proxy statement the procedures described stockholders may and in our Evaluating Members Committee the NCG of discuss and evaluate in detail, possible candidates and suggest individuals to explore in more depth. toward Once a candidate is identified whom the NCG Committee wants to seriously consider and move nomination, When considering Our Corporate Governance Principles require that consideration to potential the NCG Committee give appropriate by candidates recommended manner as other potential stockholders in the same identified candidates the NCG by Committee. Stockholders Who Can Recommend Who Can stockholders who wish ● ● ● CORPORATE GOVERNANCE Board Evaluations

Board Evaluations

We conduct an annual evaluation process to assess the performance of our Board and Board committees, which includes:

Questionnaires administered by an independent third party. Evaluations focus on Board and 1 committee composition and process, leadership, the Board’s and committees’ access to Questionnaire information and management, Board and committee culture and e ectiveness, and open-ended questions designed to elicit open feedback.

Assessment reporting: the third party administrator creates evaluation reports of information 2 gathered, including scoring trends, priority graphs and a concise view of the Board’s evaluation Assessment of performance, highlighting areas of strength and areas for improvement based on statistical reporting scores and Board member comments.

3 One-on-one evaluation: the Lead Independent Director meets with each director to discuss One-on-one matters such as individual performance, Board and committee e ectiveness and any areas for evaluation improvement or best practices.

4 Board summary and feedback: Board and committees review the evaluation reports, discuss Board summary output and evaluation process annually and implement any necessary action items along with and feedback management.

18 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 19 positions as positions as Travel forElection as Directors Nominees Sales and Sales Marketing HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING Internet/ E-Commerce Human Resources Directors

as

Global Business Election sales and histo marketing sales the gained from direct consumer industry as and interactive positions

served as and Executive President,2000to GeneralSecretary Counsel our as Vice January served from 2000. to us,President,GeneralMr. Counsel Prior was Secretary joining Vice Boyd and Executive of and CEO of the dtx company, Chief Executive Officer of Oath and AOL and his CEOformer Executive Oath at of dtx company,his and Chief of positions Officer and the and AOL ABC/ESPN Internet Ventures. Mr. Armstrong serves the InternetVentures.Mr.ofArmstrong Wheelson ABC/ESPN Up, boards aviation company, an and ABC/ESPN InternetVentures; and ABC/ESPN corporate experience his and his leadership from gained Health Plans, Health Inc. Executive Officer. for Finance

Oxford JEFFERY H. BOYD, CHAIRMAN DIRECTOR QUALIFICATIONS successful his as Presidentthe and Mr. experience from and tenure long brings our to board extensive Boyd Chief CAREER HIGHLIGHTS theon BoardsinceOctober as served Chairman our our Mr. 2001, has of Board Boyd since 2013and January as Interim served June our Mr.the Chief Chairman ourJanuary Boyd to 2018. as Executive Board of from 2017 April2016 December Executive Presidentand PresidentExecutive from and to and 2016 our Chief Officer as was December PresidentMr.and 2002ExecutiveBoyd until our 2013. November Co-Chief Officer from Officer August from He 2002August and 2000 to Officer 2002 2002. November November from Operating Chief to previously Founder company. and a asset and software Mr. the BrandFolder, digital management management brand is Armstrong Chairman Trustees Greenwich ofalso of the at Academy serves trustee and Olympic USA a as and Para-OlympicFoundation. Mr. Armstrong Mr. the experience, and brings to Armstrong in board extensive internet expertise background global businesses, Google TIMOTHY M. ARMSTRONG DIRECTOR QUALIFICATIONS Founder and CEO of the dtx company and Chief Executive Officer ofOath Founder and AOL. Officer CEOof dtxcompany and Executive and Chief the CAREER HIGHLIGHTS Mr. Founder he CEOconsumerenablementof dtxis company,company Armstrong and a to the direct Officer the and Executive established of as Chairman Chief in served 2009 2018,Mr.2019. Armstrong From to thewellas CEO Oathportfolio, AOL)as (Verizon’s of afterVerizon’s brand including Yahoo! and AOL media President,Americas as of in 2015. Operations and served acquisition AOL Mr. From Armstrong 2009, 2000 to Senior Presidentof and Inc. President joining of Vice Mr. Sales Google Vice Before as Google, served Armstrong Strategic and Director for Snowball.com Starwave’s Partnerships as Marketingof at and and Integrated Sales Disney’s October 2016)

None None Age 63 Age 49 Leadership

(since Committees Committees Independent Other Current Other Current Compensation The Home Depot The Home Director since: 2013 Director since: Director since: 2001 Director since: Public Directorships:

Public Directorships: Nominees Set at informationforth below is biographical the as Marchof 31, 2020 nominated for electionfor each person to the Board Annual Meeting. CORPORATE GOVERNANCE Nominees for Election as Directors

GLENN D. FOGEL – CHIEF EXECUTIVE OFFICER AND PRESIDENT

DIRECTOR QUALIFICATIONS

Mr. Fogel gained his qualifications through service as our President and Chief Executive Officer; his previous service as our Head of Worldwide Strategy and Planning, responsible for global corporate strategy, worldwide Age 58 mergers and acquisitions, business development initiatives and strategic alliances, helping lead us during a long Director since: 2017 period of sustained global growth; and his previous position as an investment banker focused on the air transportation industry. Committees None CAREER HIGHLIGHTS Other Current Mr. Fogel has served as our Chief Executive Officer and President since January 2017 and the Chief Executive Public Directorships: Officer of Booking.com since June 2019. Previously, he served as our Head of Worldwide Strategy and None Planning from November 2010 to December 2016 and as our Executive Vice President, Corporate Development, from March 2009 to December 2016. Mr. Fogel joined us in February 2000. Prior to that, he was a trader at a global asset management firm and prior to that was an investment banker specializing in the air transportation industry. Mr. Fogel is a member of the New York State Bar (retired).

MIRIAN M. GRADDICK-WEIR

DIRECTOR QUALIFICATIONS

Dr. Graddick-Weir brings to the board global business experience having served as a senior executive of two, large global businesses and on the board of directors of another; extensive experience in human resources Age 65 through her positions at AT&T and Merck. Director since: 2018 CAREER HIGHLIGHTS Committees Dr. Graddick-Weir, Ph.D., was the Executive Vice President of Human Resources at Merck & Co., Inc. from 2008 Compensation (Chair) until November 2018, where she led human resources for one of the leading pharmaceutical companies in the world. Dr. Graddick-Weir served as Senior Vice President of Human Resources of Merck from September 2006 Other Current to January 2008. Prior to joining Merck, she served as Executive Vice President of Human Resources and Public Directorships: Employee Communications of AT&T from 2004 to 2006 and served as its Executive Vice President of Human Yum! Brands, Inc. (since 2012) Resources from 1999 to 2004. Dr. Graddick-Weir was responsible for the design, planning and administration of all Human Resources functions, including compensation, benefits, recruiting and training, for AT&T’s 47,000 employees. She joined AT&T in 1981. She currently serves as Chairman of Yum! Brands' nominating and corporate governance committee and as a member of its management planning and development and executive/finance committees.

Global Human Internet/ Sales and Leadership Finance Travel Business Resources E-Commerce Marketing

20 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 21 Travel forElection as Directors Nominees for Jefferies forCo. and & a as Sales and Sales Marketing HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING serves as Redfin’s ofserves the Chairman on Redfin’s as board and Internet/ E-Commerce Human Resources Global Business of the nominating and corporate governance committee from 2012 until 2017. Mr. Mylod served as a the and2017. Mr. as of from corporate nominating until served committee Mylod 2012 governance of Michigan and an M.B.A. from the University of Chicago Graduate Schoolof andGraduate the ofofBusiness. an Michigan Chicago from University M.B.A. of Annox Capital a of of publicAnnox Management, and board member several private companies technology banking and financial services, and served on EverBank’s compensation the EverBank’s and committee as services, on served compensation and and banking financial Group. From 1999 to 2011, Mr. Mylod held several roles with Fromseveral 1999 Head2011, Mr. held us, of roles Chairman, to with Mylod including Vice Worldwide to 2017, and on its nominating and corporate governance committee from 2015 and 2017. its also and governance from 2017, to on He nominating serves corporate committee to period ofsustainedglobal period growth. focused on investing in fintech companies on infintech focused around investing world, andManaging companies Head the Director Asia former of various positions with our company overour company with during years,includingchief officer, lead positions 12 a various financial helping us Finance CAREER HIGHLIGHTS a Mr. the Partner Annox Management, private is firm Mylod Managing he of inCapital investment that founded 2013. and on the board of directors of several privately held companies. Mr. Mylod received an incompanies.on English boardMr. the of received of A.B. privatelyheld the from Mylod directors several University long Strategy Planning, and Prior and joining Stonington was PrincipalFinancial Officer. Chief to us, at Mylod a Mr. investment Mylod Partners, privateequity Mr. firm. currently a Chairman audit servesas its of He committee. audit memberand Dropbox’s of committee a as its as member the served a of and board 2017, Between Mylod 2015 April committee. Mr. October compensation of of a facilitates directors buying selling Autobytel, that company the 2017, and of online.From2001until cars as member the directors served EverBank, a a of board of Mr. Mylod of U.S. savings providing and bank online mobile Chairman member the directors Novocure,from of board a of company,treatmentof and its committee, cancer on audit 2012 Mr. Mylod brings to the board significant finance and investment experience as theas founderand Mr. the finance managing brings to Mylod board significant and experience investment partner ROBERT J. MYLOD, JR. ROBERT J. DIRECTOR QUALIFICATIONS for Citi Ventures and various banking andThe forCiti private banking at androles, Goldman various banker Ventures equity technology including Sachs Ms. Hopeman brings experience from her positions as co-founderand Partner capitalas brings experience Managing of her venture positions Ms.Hopeman from a firm CAREER HIGHLIGHTS a capitalis Managing of firm Ventures, on venture inMs.Hopeman a fintech Partner Arbor focused investing aroundthe which served companies co-founded world, 2014,Ms.Hopeman she as in From2010to 2014. Managing and ofAsia Director Ventures.PriorCitiHead in time Ventures, for Citi to spent various Ms. Hopeman China other Representative and equity includingas Chief banking private roles, the WEI HOPEMAN WEI DIRECTOR QUALIFICATIONS at banker Group. TheGoldmantechnology Sachs

None Redfin Age 53 Age 50 Leadership Dropbox Corporate (since 2014) Committees (since 2014) (since Governance Committees Other Current Other Current Compensation Nominating and Nominating Director since: 2017 Director since: Director since: 2019 since: Director Public Directorships: Public Directorships: CORPORATE GOVERNANCE Nominees for Election as Directors

CHARLES H. NOSKI

DIRECTOR QUALIFICATIONS

Mr. Noski brings to the board expertise through his senior leadership roles at large public, global companies, including as Chief Financial Officer of AT&T Corporation and Bank of America Corporation and as a director of Age 67 Wells Fargo & Company, Hewlett Packard Enterprise and a former director of Microsoft Corporation and other Director since: 2015 public companies, and service as a partner at one of the world’s largest public accounting firms.

Committees CAREER HIGHLIGHTS Audit (Chair) In 2012, Mr. Noski retired as a Vice Chairman of Bank of America Corporation, to which he was named after Other Current previously serving as that company’s Executive Vice President and Chief Financial Officer. Prior to this, Mr. Noski Public Directorships: served as Chief Financial Officer, Corporate Vice President and as a member of the board of directors of Wells Fargo & Northrop Grumman Corporation. Prior to Northrop Grumman, he was Vice Chairman of the board of directors Company (since 2019) and Chief Financial Officer of AT&T Corporation. Before that, Mr. Noski led Hughes Electronics Corporation in Hewlett Packard various senior executive roles, including as Vice Chairman and as President and Chief Operating Officer. Mr. Enterprise Noski began his career at Deloitte & Touche LLP where he was named Partner. In 2019, Mr. Noski was elected (since 2020) to the board of directors of Wells Fargo & Company, and currently serves as Chairman of the Wells Fargo board, chairs its audit committee and is a member of its governance and nominating committee. In 2020, Mr. Noski was elected to the Hewlett Packard Enterprise board. From 2003 to 2019, Mr. Noski served as a member of the board of directors of Microsoft Corporation and was the Chairman of Microsoft’s audit committee and a member of its finance and governance and nominating committees. Mr. Noski was also Chairman of the board of trustees of the Financial Accounting Foundation from 2016 to 2019 and a former member of the board of directors of the National Association of Corporate Directors. In addition, Mr. Noski served as a member of the board of directors of Avon Products, Inc. from 2012 to 2018.

NICHOLAS J. READ

DIRECTOR QUALIFICATIONS

Mr. Read brings to the board extensive finance and executive experience, including as Chief Executive Officer, Chief Financial Officer and other executive positions of a global telecommunications company, and is also a Age 55 chartered management accountant. Director since: 2018 CAREER HIGHLIGHTS Committees Mr. Read has served as Chief Executive Officer of Vodafone Group Plc since October 2018 and as a member of Audit its board of directors since 2014. Prior to becoming its Chief Executive Officer, Mr. Read served as Group Chief Other Current Financial Officer of Vodafone Group Plc since April 2014. Since joining Vodafone in 2001, Mr. Read has held a Public Directorships: variety of senior roles, including Chief Financial Officer and Chief Executive Officer of Vodafone Limited, the Vodafone Group Plc U.K. operating company. Prior to becoming Group Chief Financial Officer, Mr. Read served as Regional Chief (since 2014) Executive Officer for Africa, Middle East and Asia Pacific for five years and was a board member of the Vodafone publicly-traded subsidiaries Vodacom, Safaricom and Vodafone Qatar and Vodafone’s joint ventures VHA in Australia and Indus Towers in India. Prior to joining Vodafone, he held senior global finance positions with United Business Media Plc and Federal Express Worldwide. Mr. Read is a Fellow Chartered Management Accountant and a Chartered Global Management Accountant, with a BA (Hons) in Accounting and Finance.

Global Human Internet/ Sales and Leadership Finance Travel Business Resources E-Commerce Marketing

22 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 23 Travel (emeritus), and forElection as Directors Nominees Sales and Sales Marketing HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | non-U.S. majority-owned, publicly-traded BOOKING 1982 1987. Rothmanfrom serves to a Mr. as Internet/ E-Commerce Human Resources Global Business forthe Samuel Company 1989 1994. RothmanGoldwyn from to also Mr. an as served associate Officer one world. investorsinof Officer the of largesttechnology the general management positions with eBay and Schibsted. Previously, Mr. van Dijkwas Mr.entrepreneureBay Schibsted.van in Previously, an management with and general positions as President of Twentieth Century FoxProductionPresidentof Century from as to Twentieth In 1995 Mr. 2000. founded1994, Rothman media. entities. From entities. February RothmanSeptember 2013 was to of Mr. Productions. 2015, Chairman TriStar served as President of Fox Searchlight Pictures. Prior to that, he served as PresidentofWorldwide as FoxPriorthat, Searchlightserved President of as Pictures. to served he Finance also a memberalso ofBrown of a boards the Institute (CalArts), University the of Arts California the and was appointed by President Obama and confirmed by the U.S. Senate as U.S.Senate member the Council a and the as of National of President by was Obama confirmed by appointed body National forthe Arts, governing for the Endowment Arts. the the He his at a online acquisitionson products. began and career McKinsey with focus and financial mergers media. Mr. van Dijk brings extensive leadership, global business and Internet/E-Commerce experience as Chief Mr. as Dijk brings extensive global and van leadership, business Internet/E-Commerce experience Executive and then partner with Frankfurt, Kurnit, Klein & Selz, a law firm, and partner a Frankfurt, then Klein with Selz, law Kurnit, & BOB VAN DIJK DIRECTOR QUALIFICATIONS CAREER HIGHLIGHTS a of Naspers, andthe global Officer technology group as Executive Chief internet served Mr. Dijk has van since Executive 2014. ofSeptember2019, investor, assumedChief the of Officer role a In he additional Prosus, of subsidiary to Naspers.Officer Naspers, From2013 he owned until promoted of Executive Chief majority was in Mr. van served eCommerce. also CEO he Dijk CEOhas of Allegro Transaction Group as and served Global several CAREER HIGHLIGHTS ofMr. has since Sony MarchChairman Rothman as served 2015, Group Pictures Entertainment Picture Motion he oversees where Pictures,with TriStar along Columbia Pictures, and PicturesAnimation, Imageworks Sony other member of the board of directors of the Sundance Institute and the American Film Institute, both emeritus. both Institute He the Institute, emeritus. member the and directors American Film the of board of of Sundance is Mr. companies; bringsleadership to has globalboardextensivemedia Rothman executive and of the pictures, and and career motion andtelevision demonstrated programs long successful financing marketing a other and company subsidiary Inc., Chairman Mr.media FoxEntertainmentRothman Group as Previously, a of served 2012. from its to and Officer 2005 2005 as Chairman of Executive Chief Corp. 2000to and News from 2000to Group January FoxAugust Film andfrom Presidentof Century 2000, as Twentieth Mr. Rothman served served THOMAS E. ROTHMAN THOMAS DIRECTOR QUALIFICATIONS Production

his on service our Board. believes that his membership on Naspers' and Prosus' boards will not impair Mr. van Dijk's ability to the time devote necessary on not impairand believes that his Naspers' and Prosus' boards Mr. membership van Dijk's to will ability of Naspers primarily traded on the Our EuroNext Exchange in Amsterdam. Corporate Governance Principles generally limit sitting a publicly-traded Johannesburgcompany a non-U.S. on the Stock Exchange and Prosus is (a) affiliated are (a) the board responsibilities of membership on overlapping and (b) these companies under these circumstances the NCG public companies from being on more than 2 public company boards, including ours. However, the including this public companies than 2 public company NCG from being ours. However, Committee waived boards, has on more (a NV* (a of Naspers) of of with respect to Mr. van Dijk because his service on Prosus' board is part of Naspers, company, with respect to Mr. as CEO of its parent part of his responsibilities and van Dijk because his on service Prosus' board is Audit None None Age 47 Age 65 Leadership Committees Committees therefore Naspers is subsidiary attention to limit Committee CEOs Other Current Other Current Prosus Naspers LTD* majority-owned Director since: N/A Director Director since: 2013 Director since: Public Directorships: Public Directorships: subsidiary * CORPORATE GOVERNANCE Nominees for Election as Directors

LYNN M. VOJVODICH

DIRECTOR QUALIFICATIONS

Ms. Vojvodich brings to the board extensive experience, expertise and background in internet marketing and sales, including from her former position as Chief Marketing Officer of Salesforce as well as prior experience in Age 52 senior marketing positions at large, global organizations and experience working with start-up and Director since: 2016 growth-stage technology companies.

Committees CAREER HIGHLIGHTS Nominating and Corporate Ms. Vojvodich is an advisor to start-up and growth-stage technology companies. She served as Executive Vice Governance President and Chief Marketing Officer of Salesforce from 2013 to February 2017. Before joining Salesforce, Ms. Vojvodich was a partner at Andreessen Horowitz, a leading venture capital firm, where she helped Other Current companies build their go-to-market strategies. Previously, she was the Chief Marketing Officer at Terracotta Public Directorships: Dell Technologies Inc., a leader in in-memory and cloud-enabling technology. Ms. Vojvodich has also served in various roles at (since 2019) organizations including Bain & Company and Microsoft. Ms. Vojvodich has served as a member of the board of Ford Motor directors of Dell Technologies since April 2019, Ford Motor Company since April 2017 and Figma, a Company cloud-based design software company, since December 2019. Ms. Vojvodich began her career as a mechanical (since 2017) engineer in a hard hat working on the design and construction of Gulfstream jets and offshore oil structures.

VANESSA A. WITTMAN

DIRECTOR QUALIFICATIONS

Ms. Wittman brings to the board extensive finance and executive experience, including as Chief Financial Officer of global internet and technology companies Oath, Dropbox and Motorola Mobility, CFO of Marsh & Age 52 McLennan Companies and as a board member of several private and public technology and retail companies. Director since: 2019 CAREER HIGHLIGHTS Committees Ms. Wittman has been the Chief Financial Officer of Glossier, an online beauty product company, since April Audit 2019. She previously served as Chief Financial Officer of Oath, a subsidiary of Verizon, during 2018. Ms. Wittman Other Current served as Chief Financial Officer of Dropbox from 2015 to 2016 and as Chief Financial Officer of Motorola Public Directorships: Mobility, a subsidiary of Google, from 2012 to 2014. From 2008 to 2012, Ms. Wittman served as Executive Vice None President and Chief Financial Officer of Marsh & McLennan Companies, a global professional services firm. Prior to Marsh & McLennan, Ms. Wittman held a number of other senior finance roles during her career. Ms. Wittman currently serves on the board of directors of Impossible Foods Inc., a sustainable foods company, and is the audit committee chair. From 2014 to 2019, Ms. Wittman was a member of the board of directors of Ulta Beauty, a cosmetics and beauty supply retailer, and served on its audit committee. She also served as a member of the board of directors of Sirius XM Holdings from 2011 to 2018.

Global Human Internet/ Sales and Leadership Finance Travel Business Resources E-Commerce Marketing

24 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 25 Travel Retiring Directors Retiring serves as managing servesas Sales and Sales Marketing HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING Internet/ E-Commerce Human Resources Global Business of the directors PrivateBancorp, Inc., of he the board of directors of where on board served of from at and Rolls-Royce United Airlines. at an bank is advisor consumercompanies. leading at investment and an and to internet, media media and joiningmedia consumer companies. Allen to Co., at Prior & Peretsman was Ms. Salomon Brothers Guyette served as a member of the board of directors of Rolls-Royce plc from 1997 until May 2015, and Mayfrom 2015, until was member Guyette 1997 a of as served boardof of the plc directors Rolls-Royce Finance over one hundred small, high growth businesses and served as growth to of and over world’shundredsmall, advisor largestbusinesses as many the served one high directors a ofof She directors the elected member Arts SciencesTeach America. was American Academy of and For former director of a global distribution system and has extensive experience in sales and inmarketing sales his director from former of extensive andglobal has system a experience distribution internet, 1989 until thewas in2017. until company sold 1989 investment was headedManagingthe practice 1995, media and she banking a 1983 to worldwide where from ofPrinceton serves Trustee 1995. Ms.Peretsmanis University, Vice Emeritus as to Director an 1990 from aforAdvancedStudy is member Institute the boardChairman the and trusteesof National of of board of The of Ms. Peretsman has brought to the brought to board extensive Ms.Peretsmanhas expertise currently finance she as NANCY B. PERETSMAN NANCY DIRECTOR QUALIFICATIONS director CAREER HIGHLIGHTS a AllenMs.Peretsmanis & Managing LLC, at investment with she Company Director an bank, been which has since 1995. Duringher associated tenure Allen provided Company, advice has Ms. Peretsman capital at & and to JAMES M. GUYETTE JAMES DIRECTOR QUALIFICATIONS chief to officer of aerospace,leading defense, as supplier executive global a Mr. multinational served Guyette marine energy a andand is markets former of director includinga two public companies, multinational other at ofthirty the experience largestone airlines, public Guyette years' world’s is company. approximately Mr. has a CAREER HIGHLIGHTS Executive Rolls-Royce Chairman, a Chief of Officer North America as Inc., President and Mr. served Guyette the aerospace,defense, supplier and power to global world-leading marine of energy systems from markets, 1997 Marketing May Prior joining and ExecutivePresidentto - Mr. 2015. to was Rolls-Royce, Vice Guyette 30 years. nearly Planning otherwhere a alsoseniorroles for United of Airlines, over held he number Mr. Chairman in 2017. positions

Directors

Leadership Retiring CORPORATE GOVERNANCE Our Governance Framework

Our Governance Framework

We and our Board operate under corporate governance principles that are designed to maximize long-term stockholder value, align the interests of the Board and management with those of our stockholders and promote high ethical conduct among our directors and employees. A copy of our Corporate Governance Principles is available on our corporate website (www.bookingholdings.com) under the tab “For Investors.” Our Corporate Governance Principles include the following:

A majority of the Board must consist of independent directors. See Director Independence beginning on page 32. The NCG Committee will concur annually on a CEO succession plan. See Nominating and Corporate Governance Committee on page 32. The Board and each committee of the Board can hire its own outside advisors. The independent directors will have at least two regularly scheduled meetings each year, which are generally held in conjunction with regularly scheduled Board meetings. The Compensation Committee, meeting without our CEO present, will evaluate our performance and the performance of our CEO and will recommend to the Board the compensation of our CEO. We maintain stock ownership guidelines for directors and executive officers. See Stock Ownership Guidelines on page 55 and Non-Employee Director Stock Ownership Guidelines on page 73. A Lead Independent Director is appointed if the Chairperson is not independent or as the Board deems appropriate. See Leadership Structure on page 26.

Leadership Structure

Mr. Boyd has been serving as Chairman of our Board since January 2013 and, as a result of the Board's continual evaluation of the leadership and composition of the Board, will step down from the Chairman position as of the Annual Meeting and remain as a member of the Board. Mr. Mylod will take on the role of Chairman of the Board as of the Annual Meeting. In light of Mr. Mylod's previous experience as an executive of our Company and the resulting familiarity with our operations, the Board believes Mr. Mylod will provide an important connection between the Board's non-executive directors and management as well as provide valuable support to the Company's Chief Executive Officer. The Board does not have a policy regarding the separation of the roles of Chief Executive Officer and Chairman of the Board as the Board believes that it is in our best interests and those of our stockholders to make that determination from time to time based on our needs and those of the Board. The Board has determined that separation of the roles of Chief Executive Officer and Chairman is currently in our best interests and those of our stockholders. Although Mr. Mylod is an independent director, the Board has determined that it is in the Company's best interest to maintain the position of Lead Independent Director. Following Mr. Guyette's retirement from the Board as of the Annual Meeting, Mr. Noski will serve as the Company's Lead Independent Director. The responsibilities of the Lead Independent Director can be found on our corporate website (www.bookingholdings.com) under the tab “For Investors.”

26 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 27 on page 73.

Governance Framework Our HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING Independent Director with adefined responsibilities, Independent Director setof Policies and Practices Policies The Board has implemented, and our stockholders have approved, an annual have approved, an implemented,and our stockholders The Board has Board Practices Board Leadership and Procedures - Communications Practices Structure and with Non-Employee Directorand Non-Employee on page 55 Stock Ownership Guidelines Stockholders have the opportunitythe Board fortoelectionindividualsnominate to have the Stockholders

Neither our certificate of incorporation nor our By-Laws contain any supermajority voting norour By-Laws contain any supermajority of incorporation our certificate Neither Compensation.

majority vote standard in uncontested elections of directors, which means that directors are directors that which means of directors, standard in uncontested elections majority vote The Board has adopted stock ownership guidelines for executive officers and non-employee officers and guidelines for executive adoptedBoard stock ownership has The Since January 2013, we havehad a we Lead Since January 2013,

havea on executive compensation, which means that stockholders havethe opportunity stockholders compensation,which means that on executive provide to Executive Provisions.

do not have a classified board of directors. All directors are elected by the stockholders each year. the stockholders elected by directors are All of directors. board have a do not classified We INDEPENDENT DIRECTOR on

major stockholders. See major stockholders. provide all stockholders an opportunity to debate and vote on matters outside the annual meeting cycle. annual meeting mattersoutside the stockholders an opportunity on provide all debatetoand vote We to the NCG Committee regarding the performance of directors and new candidates to join the candidates and join ofBoard; the new directors regarding to performance to NCG Committee the stockholders, on where case-by-case be ifrequested formajor and a appropriate, basis available by with stockholders; and and communication such consultation direct directly the advisorsand whoreport authorize to retention Board. outside consultants the of call, agenda set the for and sessions andthe directors; executive meetings lead of independent Board's Chairperson, approvetogether the agenda the set and Chief with in Board the with consultation Executive Officer; timeto deems the or and consultChief he from with necessary time as Board Chairperson appropriate, the and of flow the Executive quantity that timeliness the of to quality, as Officer management from information directors perform necessary independent effectively; to duties their is for the Executive Committee the provide of input Chief the and Officer regarding performance the to Compensation have adopted a code of ethics that we refer to as our “Code of Conduct” and we require all directors and all directors we require Conduct” and “Code of asreferto our we aof ethics that have adopted code CHARLES H. NOSKI (AS OF THE ANNUAL MEETING) OF THE ANNUAL H. NOSKI (AS CHARLES LEAD ● ● ● ● ● ● If important matters arise between annual meetings of stockholders, our certificate of incorporation provides incorporation provides certificate of of stockholders, our Ifannual meetings important matters arise between At each annual meeting of stockholders, stockholders have the ability to vote on important matters that are are important matters that vote on to ability havethe of stockholders, stockholders meeting Ateach annual Vote do not have a stockholder rights plan, sometimes referred to as aas to pill.” plan, sometimes referred “poison havea stockholder rights do not We Stock Ownership Guidelines by our stockholders at our 2015 annual meeting, our proxy access By-Law provides that: ourBy-Law provides accessproxyannual meeting, our 2015 ourstockholders at by We (including officers) to adhere to it in discharging their work-related responsibilities. A copy of our Code of Conduct Code of copyof our A work-related responsibilities. it in discharging their adhere to (including officers) to our By-Laws and Delaware law and,in accordance law statement. and Delaware includenomineesin our proxy toour By-Laws, our By-Laws with among other things, if requested and whenif requested and direct among other things, availabilityforconsultation and appropriate, ensuring on our executive compensation practices on an annual basis. an annual compensation practices on on our executive Board Directors for of more details. continuously for at least3 years, continuously for at stockholders’ meeting. an annual our Board for election at 25% of nomineestoforup statementincludein our proxy can any stockholder or group of stockholders holding at least 3% of our outstanding common stock, our least 3% of holding at stockholders of any stockholder or group do not: do: stockholder advisory vote provisions. No Supermajority Voting No Classified Board. directors. See directors. Rights Plan. Stock Ownership Guidelines. Lead Independent Director. including, the Annual Advisory feedback Majority Vote Standard. Proxy Access and Nominees. Stockholder As approved Special Meetings. Board or stockholders Officer, the Chief Executive (if any), the the Board Vice Chairman of Board, the the the Chairman of that aa call If properly called, our shares may stockholders. least25% of meeting of special of special meeting holding at stockholders would a unless theyresignation support of tender their to cast. of votes receive the required majority pursuant to Annual Meetings. Code of Ethics. directors. of our of all electionincluding the annual the meeting, presented at employees communication with is available on our corporate website (www.bookingholdings.com) under the tab “For Investors.” tab (www.bookingholdings.com) under the corporate website available on our is ● ● ● We We Other Select Corporate Governance Other Select Corporate Role of the Lead Role of Director Independent CORPORATE GOVERNANCE Our Board's Role in Company Strategy

Our Board's Role in Company Strategy

The Board is elected by and accountable to the stockholders and is responsible for our strategic direction and oversight of management.

is to make it easier for provide consumers with the best choices and prices at any time, in everyone to experience any place, on any device; the world. We aim to OUR achieve our mission through make it easy for people to find, book, pay for and experience their MISSION global leadership in online travel desires; and travel and restaurant reservation and related provide platforms, tools and insights to our business partners to services by striving to: help them be successful.

Our Strategy

We focus on relentless innovation and execution and a commitment to serve both consumers and our travel service provider and restaurant partners with unmatched service and best-in-class digital technology. The global online travel and dining categories continue to grow as consumer purchasing shifts from traditional offline channels to interactive online channels, including mobile channels. Our strategy is to continue to participate broadly in this online growth by expanding our service offerings and markets. We aim to be the world leader in online travel and restaurant reservation and related services by: 1 2 3 4

LEVERAGING TECHNOLOGY PARTNERING WITH TRAVEL OPERATING MULTIPLE INVESTING IN TO PROVIDE CONSUMERS SERVICE PROVIDERS AND BRANDS THAT PROFITABLE AND WITH THE BEST EXPERIENCE RESTAURANTS TO OUR COLLABORATE WITH SUSTAINABLE GROWTH MUTUAL BENEFIT EACH OTHER

The Board is a key partner with management in formulating our strategy and oversees management’s implementation of our strategy. The Board and management, including our executive officers and the chief executive officers of our primary brands, meet annually in a day-long session to, among other things, review the state of the markets in which we operate, analyze our competitive position, measure our performance against our strategy and evaluate and adjust our strategy as deemed necessary or appropriate. While management takes the lead in preparing background materials and proposes the going-forward strategic direction for Booking Holdings, the Board plays an active role in evaluating, adjusting and approving our strategy. In particular, our Chairman and Lead Independent Director work closely with management in advance of the meeting to prepare and approve the agenda for the meeting and to consult on the strategy to be proposed by management. Between these annual strategy meetings, management reports to the Board regularly, typically in connection with each regular meeting of the Board, on our implementation of the strategy and our progress toward reaching our strategic goals, and the Board discusses with management whether adjustments should be made in light of any changed circumstances, whether with respect to us, our markets, our competitors or otherwise. In addition, the Board meets regularly in executive session without management where, among other things, it discusses our performance and the continued viability of our strategy.

28 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 29 Oversight the the Board’s Role in Risk Board’s management with management HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | derivative instruments; risk tolerance designed to maximize tolerance risk actively managementencourages to with members of with members BOOKING and technology risks to discuss these risks, risk risks, risk these to discuss risks and technology on page 74 for information on the page risk assessment. compensation on Board and each committee; reporting; outside experts in these areas. our experts in these for of outside management responsible Members Oversight

governance practices; and governance privacy, data privacy, protection,security duties of duties theBoard and aligning strategicwithandaligning objectives an appropriate levelof Risk without other members of management present, to report on their areas ofon their areas members present,toreport responsibility. without other of management success. success.

audit and compliance functions also meet with the Audit Committee regularly, including in executive in executive with including also meet Committee regularly, andcompliance functions audit Audit the our Company, the effectiveness of our security measures and other related matters, aswellmatters, other related our Company, and theeffectiveness of as our security measures CompensationAssessment Risk Audit Committee has established a regular practice ofCommittee hasmeeting establishedaregular practice Audit with committee tasked or risk risksareproperly managed management-level ensuring has a Company

in the development, improvement and review of our global compliance program, including our Code of of our Code improvement and review program, including development, our global compliance the Conduct. risks related to compensation programs; and and tocompensation programs; related risks executiveofficers, to those applicable and practices, including to our named our compensation policies incentivize undesiredthey whether risk-taking. determine we that Boardwith ensuring tothecompositionour Board, including have members related of risks tenureourbusiness judgment, availability,ability to effectivelyoversee skills, and appropriate experience, and fulfill the risk assessment and processes generally; assessment and risk control overfinancial internal activities,related to hedging and usemanagement investments of risk data to privacy, processes related assessment and protectionandsecurity;and risk legal,regulatory and compliance risks.operational, business continuity, general our corporate

The business The responsibility for with periodically meeting internal sessions mitigated Oversees: See Oversees: Oversees: companiesas well other at learnedfrom incidents practices, lessons best activities and efforts, management as at ● ● ● ● ● ● ● ● ● ● by our internal audit function and overseen by primarily our Audit Committee. These key risks are identified across the organization from multiple from regions multiple identifiedThese key risks are in a process and functions, organization across the into ongoing business processes across the organization. The Board into ongoing business across processes the organization. The Role

activities include the identification and assessment of the key risks facing us among the universe of include businessactivities and assessment of the identification the key risks facing us among will report the full Board Board’s and will to The report as appropriate. of each committee’s role is one oversight, is an for opportunities requiringevolving process to further enterprise embed systematic us continuallyto look that management is responsible for executing our risk management policies. The oversight ofthat management risk within the is responsible for executing our risk management policies. The These reviews include These reviews include updates throughout the year from and regions the businesses, functions from which the COMMITTEE

are also responsible for the oversight of certain risks. (e.g., strategic, operational, financial, privacy and data security protection, and technology, and (e.g., strategic, operational, regulatory and financial, privacylegal, and data Board reviewand Audit Committee these risks leastat on an annual basis have been identifiedafter they and assessed by Board actively and risk assessment is involved in risk. efforts to mitigate and committed risk to Our management's

MANAGEMENT NOMINATING AND CORPORATE GOVERNANCE COMMITTEE AUDIT COMPENSATION COMMITTEE The key risks Depending or, may be presented to the full committee to a arise. on risk, if appropriate, Board of the update the the Board, which risk management management. The Board, ormanagement. The Board, a committee of the Board, regularly reviews the initiatives placeput in to mitigate the effects of these risks. Board’s The management organization recognizing continue to develop this process. In addition Board’s role to the in enterprise risk management, ofvarious committees the Board risks compliance risks). undertaken generally CORPORATE GOVERNANCE Director Orientation and Continuing Education

Director Orientation and Continuing Education

Our new directors participate in our robust director orientation program. Our director orientation program includes in-depth sessions devoted to director fiduciary obligations, our Company's strategy and operations and introductions to key members of management, among other topics. Additionally, orientation topics are tailored based on the director's committee membership and could include a deeper dive on relevant issues such as our compensation program for members of the Compensation Committee, as an example. We encourage our directors to attend seminars and other corporate governance or director workshops to further develop their expertise or otherwise stay abreast of issues relevant to their service on the Board. Our policy is to reimburse directors for the costs of attending such programs. In addition, our Board and Board committees regularly invite outside experts to present to them on a variety of topics, which have included corporate governance trends and best practices and areas of risk management, such as cybersecurity and privacy issues.

Board Committees

Our Board has three standing committees: an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee. Each committee has a written charter, a copy of which is available on our corporate website (www.bookingholdings.com) under the tab “For Investors.” The tables below provide current membership for each Board committee. Following the Annual Meeting, Ms. Wittman will become Chair of the Audit Committee; Mr. Noski will become Chair of the NCG Committee and remain on the Audit Committee; Dr. Graddick-Weir will join the Audit Committee and remain the Chair of the Compensation Committee; Mr. Rothman will leave the Audit Committee and join the NCG Committee; and Ms. Vojvodich will join the Compensation Committee and remain on the NCG Committee.

Audit Committee

The Audit Committee’s responsibilities include, among other things: MEMBERS ● overseeing and reviewing our consolidated financial statements, accounting practices and related internal controls; ● Charles H. Noski (Chair) Nicholas J. Read ● overseeing our relationship with our independent registered public accounting firm, ● including making all decisions relating to appointing, compensating, evaluating and ● Thomas E. Rothman retaining the independent registered public accounting firm; ● Vanessa A. Wittman ● overseeing our internal audit function;

● establishing procedures for the submission, receipt and treatment of complaints or 11 Eleven meetings in 2019 concerns regarding accounting or auditing matters; Report Page 78 ● reviewing and approving all related party transactions (defined as transactions required to be disclosed by Item 404 of the U.S. Securities and Exchange Commission (the "SEC") Regulation S-K); and "Audit Committee Financial Experts": acting as our primary risk oversight committee, including by overseeing our compliance ● ● Charles H. Noski program and risk management efforts generally (including with respect to privacy and ● Nicholas J. Read data security), as well as our major financial risk exposures. See Board’s Role in Risk ● Vanessa A. Wittman Oversight on page 29 for additional details. The Board has determined that each member of the Audit Committee is an independent director based on The Nasdaq Stock Market’s listing rules and that each member of the Audit Committee also satisfies the additional independence requirements of the SEC for members of audit committees.

30 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 31 Committees Board Seven meetings in 2019 Report Page 56 7 (Chair) Timothy M. Armstrong James M. Guyette Robert J. Mylod, Jr. Mirian M. Graddick-Weir Mirian M. Graddick-Weir MEMBERS ● ● ● ● HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING or recommending to the Board for determination, the for determination, of our to the Board or recommending compensation Compensation among other Committee’s things: responsibilities include, on page 29 details for additional than the CEO, which is the responsibility of and NCG Committee); the RiskOversight overseeing risksRolein related to compensation programs. .See Board’s directors; making to the Board respect to the adoption incentiverecommendations with of and equity-based plans;compensation plans reviewing and approving succession for senior plans personnel (othermanagement administering employee benefit including incentive plans plans compensation and equity-based plans; for non-employee Board for approval compensation plans recommending to the chief executive officer; chief executive officer; reviewing and approving the compensation of our other executiveofficers; setting, The Board has determined that each member of the Compensation Committee is an Compensation Committee is the each member of that Board has determined The Thealso meets StockMarket’s and Nasdaq listing rules director based on The independent Compensation membership on the requirements for Stock Market’sNasdaq additional authority to appoint and dismiss its Committee has the Compensation Committee. The These advisors their compensation. approve consultants and and compensation advisors Compensation Committee has Committee. The Compensation report directly to the Mercer reports its outside compensation consultant. While as LLC (“Mercer”) retained Mercer Mercer to authorized CompensationCommittee,to the Compensation Committee the compensation planningwith respect to the workwith management communicate and process. The Compensation Committee Compensation ● ● ● ● ● ● ● CORPORATE GOVERNANCE Director Independence

Nominating and Corporate Governance Committee

The NCG Committee is instrumental in our efforts to ensure that the Board is comprised MEMBERS of directors with the necessary skills and experience to effectively oversee our business. The NCG Committee actively and regularly evaluates the composition of the Board, ● James M. Guyette (Chair) including the skills and experience of directors, in light of our changing business needs Wei Hopeman and challenges and takes the lead in identifying needed changes, whether with respect to ● adding directors with certain skills, experience or other desirable traits, planning for ● Nancy B. Peretsman director retirements, ensuring an appropriate mix of short-, medium- and long-tenured Lynn M. Vojvodich directors or for any other reason. When the need for a new director arises, the NCG ● Committee has the primary responsibility of seeking, identifying and qualifying director Three meetings in 2019 candidates. The NCG Committee also oversees the establishment and implementation of 3 our corporate governance standards, practices and policies. The written charter of the NCG Committee provides, among other things, that it shall:

● identify individuals believed to be qualified to become Board members, consistent with criteria approved by the Board (which are set forth in our Corporate Governance Principles and the NCG Committee’s charter and which are described above in Nomination and Election Process - Identifying Director Candidates on page 16), and to select, or recommend to the Board, the nominees to stand for election as directors at the annual meeting of stockholders;

● identify and recommend that the Board appoint Board members qualified to fill vacancies on any committee of the Board (including the NCG Committee);

● assess whether candidates to join the Board would be “independent” under the listing rules of The Nasdaq Stock Market;

● establish procedures to receive prompt notification of changes in a director’s circumstances that may affect his or her qualifications or independence as a director and review such information and make recommendations as deemed appropriate;

● regularly evaluate and, as appropriate, recommend to the Board any modifications or enhancements to the Board’s Corporate Governance Principles, and review and consider the effectiveness of the Corporate Governance Principles at least once a year;

● review and concur on a succession plan for selecting a successor to the Chief Executive Officer, both in emergency situations and in the ordinary course of business;

● at least annually, review our Code of Conduct and Stockholder Communications Policy and their effectiveness and, if appropriate, make recommendations for Board approval for enhancements thereto; and

● design a process for the Board to conduct a self-evaluation at least annually. The Board has determined that each member of the NCG Committee is an independent director based on The Nasdaq Stock Market’s listing rules. The NCG approved and recommended to our Board the twelve director nominees standing for election at the Annual Meeting.

Director Independence

The Guidelines

Our independence guidelines outlined in the Corporate Governance Principles conform to the independence requirements in the Nasdaq Stock Market’s listing rules and the rules of the SEC. As the NCG Committee and the Board apply these guidelines to make independence recommendations and determinations, as applicable, all relevant known facts and circumstances are considered.

32 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 33 Director Independence Director HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | involved in decision to purchase services involvedto in decision purchase services involvedto in decision purchase services involvedto in decision purchase an executive officeranofDropbox executive officeranofHPE executive BOOKING both business our and business Dell’s and independencethresholds below Nasdaq the both business our and business HPE's and independencethresholds below Nasdaq the involved in purchaseof insurance our the productwas a insurance purchased through thewhoidentifiedand broker recommended provider to were relative premiums small insurance both business our and business Chubb’s and independencethresholds below Nasdaq the not or transactions the interesttransactions no in the material the small in to amounts were relative question both business our and business Vodafone’s and the independence below Nasdaq thresholds or transactions the interesttransactions no in the material the small in to amounts were relative question both business our and businessand Sony’s independencethresholds below Nasdaq the not or transactions the interesttransactions no in the material the small in to amounts were relative question not no no inthe and involvement material interest transactions the small in to amounts were relative question both business our and and business Dropbox's independencethresholds below Nasdaq the no no inthe and involvement material interest transactions the small in to amounts were relative question were Ms.Peretsmannorherhusband neither not not Independence Determination Independence ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● ● of telecommunications services of products computer and software Primary Type of Transaction/ Primary Type Relationship/Arrangement Holdingsbetween Booking Organization and of orservices products course Ordinary purchase of products insurance of services advertising of products office Boardmember course Ordinary purchase Director Relationship to Organization a is board member Chairmancourse Ordinary purchase Boardmember course Ordinary purchase Boardmember course Ordinary purchase that were in connection withconsidered and the independence recommendations of The Nasdaq Stock Market, the SEC and our Corporate Governance Principles. The table Market, Nasdaq of Stock below The the SEC and our Corporate Governance The Principles. Chubb Limited member Family Sony Pictures Entertainment Picture Motion Group Enterprise the Guidelines that organization's consolidated gross revenues in a single fiscal year for the relevant period. No director had any take be affiliated, into account as well as betweenrelationships the us and companies with which directors may Ms. Peretsman Mr. Read Vodafone CEO/DirectorMr. Rothman course Ordinary purchase Ms.Vojvodich Dell Director Organization Mr. Mylod Dropbox Mr. NoskiPackard Hewlett Independence Assessment All described of the transactions above were entered into at length in arm’s the ordinary course of business. Aggregate payments each ofdid not ofexceed the greater the organizations, to four fiscal years, $200,000in each of the last or 5 percent of summarizes the relationships summarizes the relationships In connection with the Board In the Board NCG Committee’sand the connection with determination of both independence, and the NCG Committee the Board specific requirements Applying determinations. CORPORATE GOVERNANCE Board Practices and Procedures

direct or indirect material interest in the transactions or received any direct personal benefit from any of these transactions, relationships, or arrangements. Therefore: ● For 2019, the NCG Committee recommended to the Board, and the Board determined, that each of the directors elected at the 2019 annual meeting of stockholders, other than Messrs. Boyd (the Chairman of our Board and our former Executive Chairman and former Chief Executive Officer and President) and Fogel (our current President and Chief Executive Officer), was an “independent director” based on The Nasdaq Stock Market’s listing rules, the rules of the SEC and our Corporate Governance Principles; and

● For 2020, the NCG Committee recommended to the Board, and the Board determined, that each of the nominees for election to the Board at the Annual Meeting is an "independent director" based on The Nasdaq Stock Market's listing rules, the rules of the SEC and our Corporate Governance Principles, other than Messrs. Boyd and Fogel.

Board Practices and Procedures

Communications with the Board of Directors

Stockholders may contact any of our directors, a committee of the Board, non-employee or independent directors as a group, or the Board as a whole by writing to them c/o Office of the General Counsel, Booking Holdings Inc., 800 Connecticut Avenue, Norwalk, Connecticut 06854. Stockholders should indicate how many shares of our common stock they own as of the date of their communication. Communications received in this manner will be handled in accordance with procedures developed and approved by the Board, including a majority of our independent directors. The procedures provide that in general, communications to the Board will be initially reviewed and logged by our General Counsel and then periodically, and at least quarterly, forwarded to the Lead Independent Director and/or the chairperson of the NCG Committee.

Board of Director Attendance

Regular meetings of the Board are generally held six times per year and special meetings are scheduled when necessary. The Board held six meetings in 2019. For 2019, all directors attended at least 75% of the meetings of the Board and the Board committees of which they were members held while they were serving on the Board and any such committees.

Attendance at Annual Meetings

We expect directors to attend our annual meetings of stockholders. All thirteen current members of the Board attended our 2019 annual meeting of stockholders.

Compensation-related Corporate Governance

See Key Governance Matters on page 55 for our various compensation related corporate governance policies and practices, including, among other things, policies regarding compensation clawbacks, 10b5-1 plans and hedging and pledging of securities.

34 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 35 Sustainability everyone for are women of employees easier it make HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | to our employee benefit plans generally BOOKING 28% >52% mission are women leadership team of extended our our of extension maintain a workplace that and the different cultures embraces natural a 33% is of directors of are directors women as of the Annual Meeting of Annual as the experience, gender, race and ethnic or national origin and other demographics. experience, gender, race and ethnic or national responsibility operate more than 300 offices in over 75 countries and territories offices operate more 75 countriesas of December 31,than 300 in over and territories 2019. We support and abide by the laws and regulations that govern our employment practices and We support and by the laws abide and regulations that govern our employment from minority groups to include in the pool from which Board nominees nominees from minority groups are chosen. This to include in the pool from which Board world.

corporate the to

tolerance and common ground as people broaden their horizons, are introduced to other people and & Inclusion to diversity continues throughout our Company. at https://www.bookingholdings.com/corporate-responsibility/. viewpoints, backgrounds, experience, gender, race and ethnic or national origin, as viewpoints, backgrounds,a factor in recommending experience, gender, race and ethnic or national to reflect the dynamic populations of our customers and the destinations we help work dynamic together to populations people visit reflect the as we of our customers and the destinations we Holdings as a Best a as Best Holdings for to the Board. or NCG Committee is committed for election The appointment to actively seeking highly qualifiedout Employer for Diversity

approach Forbes rankedBooking Forbes experience

our company, our stockholders, our customers and our employees are benefited by us having a diverse Board, diverse commitment to diversity begins top withat the our NCG Committee’s policy to consider diversity, views broadly which it

prohibit unlawful discrimination of any We have implemented a variety of type. policies to foster an work inclusive Our We are committed to sustainable sustainability tourism, efforts improve that global business will and stewards, create further inclusive services tech and programs for employees our industry and customers and protect customer diversity, privacy, mission act including, as among others. initiatives responsible For more environmental information, to please refer to our promote corporate social responsibility web page available and report to keeping with the global nature of our Company, naturewe keeping with ofthe global our Company, commitment gender re-assignment surgery, include: benefits for infertility treatment, parentalgender-neutral domestic partners and paid leave. practices of our diverse employees and is consistent with our Code of Conduct, which is available on our website practices ofat our diverse employees and is consistent with our Code of Conduct, which is available on our website www.bookingholdings.com. environment. For example, while the specifics can vary by brand, in the United environment. States vary by For example, while the specifics brand, the United can in leadership and a diverse workforce. As a result, we seek leadership to achieve a diverse businessseek and a diverse environment that ofa result, we workforce. As includes people different viewpoints, backgrounds, women and individuals In we Our persons We benefit a highly diverse extendedfrom leadership team and workforce. With more than 26,000 employees representing more thanwe 150 nationalities, to make it easier for everyone to experience the world. We world. to make it easier for everyone to experience our believe the We that travel, business, helps increaseand therefore understanding,

We aspire in terms of Sustainability Diversity cultures, have new live. We experiences, increasealso believe their knowledge and grow to appreciate the world in which we that CORPORATE GOVERNANCE Sustainability

Environment

As a company that encourages people to experience the unique places the world has to offer, we believe that we must model environmental stewardship and responsibility at every turn — starting with our own business. Across the world, our brands are focused on conserving energy, reducing water consumption and decreasing waste.

In 2019, KAYAK and OpenTable employees founded the Global Green Team, which is now part of their combined Corporate Social Responsibility program, Do Good, with the goal of reducing the carbon footprint at work and aligning green practices across offices. Among other initiatives, the Green Team led concerted efforts to turn off laptops and screens at the end of the workday and to increase timed lighting to reduce energy use.

You can find more information on our sustainability efforts with respect to the environment in the Environment section of our corporate social responsibility web page mentioned above.

Community

In line with our mission to make it easier for everyone to experience the world, we are focused on sustainable travel so that future travelers can encounter a world full of destinations still worth exploring. Booking.com’s Sustainability program supports innovation in the sustainable tourism space. Through Booking.com's accelerator program that identifies and empowers sustainable tourism start-ups, a robust global volunteer program and a fund that champions non-profit sustainable travel projects, we are supporting the long-term health of a variety of locations around the world. These programs demonstrate how we are focused on transforming the global travel experience into a powerful force for good.

Customer Privacy & Data Protection

We believe that managing privacy risk is a vital part of our responsibilities to our customers and our employees. We have built a comprehensive governance structure for managing these risks which we believe will ultimately build a competitive trust advantage for our Company. All of our brands are committed to protecting personal data by operating according to our Privacy Principles:

1 2 3 4 5 6

TRANSPARENCY PURPOSE CHOICE SECURITY INDIVIDUAL ACCOUNTABILITY RIGHTS

36 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT CORPORATE GOVERNANCE 37 * * * * * * * * * * * * * * * * * * 7.9% 5.6% 6.8% vested Percent

However, has be issued to be issued to and stock options that

purposes. of 0 0 0 112 127 524 524 524 524 870 2,711 1,217 and investment power with 5,439 3,824 9,549 the percentage ownership of (a) purposes (such shares will be 35,233 Shares beneficially owned 60,482 116,221 Number tax planning 2,776,848 2,286,674 3,248,805 purposes (such shares will purposes (such shares will not have the right to receive the shares Owners Certain Beneficial Owners andOwners Beneficial Certain Management HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | computing

tax planning restricted stock units or performance share of BOOKING tax planning tax planning proxy andin this statement; all (4) stock issuable (i) upon the exercise the director does if Security Ownership of Ownership Security the percentage ownership of any other person. Certain directors restricted stock unit awards for Beneficial common

vested deferred by Mr. Armstrong for computing deferred by Mr. Boyd for deferred by Mr. Noski for of been (l) been been March 31, 2020 and (ii) upon vesting of the rules of the SEC and includes sole or shared voting Certain

stock pursuant to the purpose of

board service, those shares are not included in the above table even though the director in accordance with termination of shares the receipt of which has shares the receipt of which has determined (c) vested (i) (f) (d) Ownership are not treated as outstanding for

(d) beneficial of than one ownership less percent. (h) ownership is Summary Compensation Table Compensation executive our officers in the Summary other named to securities, except as discussed in the footnotes below. Shares of such stock options, restricted stock units and/or performance share units for the purpose to Mr. of histo Mr. Armstrong 90 days after termination Board service). 2020. not include 755 vested shares the receipt of which has not include 567 vested not include 209 elected elected to defer receipt of shares of common more than 60 days after

Hopeman and Ms. Wittman were elected to the onHopeman and Ms. Wittman Board June 6, were elected to 2019.

currently exercisable or exercisable within 60 days after

Vanguard Group Does Represents in the ownership. economic the and bears shares risk of Does Ms. issued termination hisMr. of after Board Noski 90 days service). such person, but depending on the terms of the deferral program in place at the time of the deferral, until Beneficial respect Mr. Boyd 90 termination of his Boarddays after service). Does are units that vest by their terms within 60 days after March 31, 2020, are holding deemed to be outstanding and to be beneficially owned by the person have following forth informationtable sets known certain to withus respect to beneficial ownership of our common stock as

(j) (k) (b) (e) (g) (d) BlackRock, Inc. T. Rowe Associates,Inc. Price a executive as All group persons) and officers directors (15 (c) (e) * (a) (b) Jeffery H.Boyd Jeffery Timothy Armstrong M. Glenn Fogel D. Graddick-Weir MirianM. James Guyette M. Wei Hopeman Robert J. Mylod, Jr. CharlesH. Noski Nancy Peretsman B. Nicholas J. Read E. Thomas Rothman Bob Dijk van Vojvodich Lynn M. A.Wittman Vanessa Goulden I. David Gillian Tans Peter J. Millones The

Name of beneficial owner Name of Management

The of March 31, 2020 by (1) each person by usknown to be the beneficial moreowner of than 5% of our common stock; (2) andeach member of our Chief the Board each of our director nominees; (3) Officer,Executive our Chief Financial Officer and each of Security directors and of percentage owned shares executive officers on is based as a 40,930,202 shares outstanding group. The as of March 31, CORPORATE GOVERNANCE Security Ownership of Certain Beneficial Owners and Management

(f) Includes 521 shares held by a limited liability company of which Ms. Peretsman is a Manager. Does not include 1,072 vested shares the receipt of which has been deferred by Ms. Peretsman for tax planning purposes (such shares will be issued to Ms. Peretsman 90 days after termination of her Board service); and does not include 16,703 shares held by a foundation for which Ms. Peretsman serves as a trustee, of which Ms. Peretsman disclaims beneficial ownership. Allen & Company LLC disclaims beneficial ownership of the shares described in this note (f). (g) Does not include 755 vested shares the receipt of which has been deferred by Mr. Rothman for tax planning purposes (such shares will be issued to Mr. Rothman 90 days after termination of his Board service). (h) Mr. van Dijk is a non-incumbent nominee for election to the Board of Directors at the Annual Meeting. (i) Based solely on information provided in a Schedule 13G/A filed by The Vanguard Group (“Vanguard”) with the SEC on February 12, 2020. These securities are owned by Vanguard directly or through wholly-owned subsidiaries of Vanguard. Vanguard reported that it had sole voting power over 65,138 shares, shared voting power over 12,051 shares, sole dispositive power over 3,175,512 shares and shared dispositive power over 73,293 shares. Vanguard lists its address as 100 Vanguard Boulevard, Malvern, Pennsylvania 19355. (j) Based solely on information provided in a Schedule 13G/A filed by BlackRock, Inc. (“BlackRock”) with the SEC on February 5, 2020. These securities are owned by various institutional investors affiliated with BlackRock. BlackRock reported that it had sole voting power over 2,390,181 shares, shared voting power over 0 shares, sole dispositive power over 2,776,848 shares and shared dispositive power over 0 shares. BlackRock lists its address as 55 East 52nd Street, New York, New York 10055. (k) Based solely on information provided in a Schedule 13G/A filed by T. Rowe Price Associates, Inc. (“Price Associates”) with the SEC on February 14, 2020. Price Associates reported that it had sole voting power over 819,048 shares, shared voting power over 0 shares, sole dispositive power over 2,286,674 shares and shared dispositive power over 0 shares. For purposes of the reporting requirements of the Exchange Act, Price Associates is deemed to be a beneficial owner of such securities; however, Price Associates expressly disclaims beneficial ownership of such securities. Price Associates lists its address as 100 E. Pratt Street, Baltimore, Maryland 21202. (l) Consists of shares beneficially owned by all of our directors and executive officers, as a group. Does not include 3,358 vested shares of non-employee directors, the receipt of which has been deferred for tax planning purposes (because such shares will be issued 90 days after termination of such director’s Board service).

38 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION

Compensation Discussion and Analysis 40 Executive Summary 40 Philosophy and Objectives 43 Benchmarking and Target Compensation 45 Measuring Performance 46 2019 Executive Officer Compensation Program 47 2019 Named Executive Officer Compensation & Performance 49 How We Make Compensation Decisions 52 Executive Officers 54 Key Governance Matters 55 Compensation Committee Report 56 Summary Compensation Table 57 Grants of Plan-Based Awards Table 58 Outstanding Equity Awards at 2019 Fiscal Year-End Table 59 Option Exercises and Stock Vested Table 60 Employment Contracts, Termination of Employment and Change in Control Arrangements 61 Potential Payments Upon a Change in Control and/or Termination 66 2019 CEO Pay Ratio 69 Equity Compensation Plan Information 70 Non-Employee Director Compensation and Benefits 71 Compensation Committee Interlocks and Insider Participation 74 Compensation Risk Assessment 74 Certain Relationships and Related Transactions 74 Proposal 2 Advisory Vote to Approve 2019 Executive Compensation 75

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 39 EXECUTIVE COMPENSATION Compensation Discussion and Analysis

Compensation Discussion and Analysis This Compensation Discussion and Analysis (“CD&A”) describes our executive officer compensation program, provides information about the goals and the key elements of the program and explains the reasons behind the Compensation Committee’s executive officer compensation decisions. For 2019, our “named executive officers” were the following (titles are as of December 31, 2019):

Name Title Age* Executive Officer Since Glenn D. Fogel President and Chief Executive Officer(1) 58 2011 David I. Goulden Executive Vice President and Chief Financial Officer 60 2018 Peter J. Millones Executive Vice President and General Counsel 50 2001 Gillian Tans Chairwoman, Booking.com(2) 49 2015(2) (1) On June 26, 2019, Mr. Fogel took on the additional role of Chief Executive Officer of Booking.com. (2) On June 26, 2019, Ms. Tans changed roles from Chief Executive Officer of Booking.com to Chairwoman of Booking.com, a non-executive . officer position. See 2019 Named Executive Officer Compensation & Performance - Ms. Gillian Tans for a description of Ms. Tans' compensation arrangements for 2019. * Ages as of March 31, 2020.

The CD&A generally focuses on the 2019 compensation program applicable to our named executive officers (who were our only executive officers for purposes of Exchange Act Rule 3b-7 during 2019), however, specifics related to Ms. Tans are discussed separately (see 2019 Named Executive Officer Compensation & Performance – Ms. Gillian Tans). Where relevant to the CD&A, we refer to our named executive officers other than Ms. Tans as our “current executive officers." COVID-19

This CD&A summarizes the Company's compensation programs and results relative to the Company's 2019 performance, prior to the COVID-19 outbreak. Since the onset of the COVID-19 outbreak, the Company announced on March 23, 2020 that Glenn Fogel, the Company's Chief Executive Officer, several other members of senior management and the Board of Directors made the decision to forego their salaries during this time of crisis. The Compensation Committee is closely monitoring the COVID-19 outbreak and the significant impact the crisis is having on our business and compensation programs. What’s New in 2019

In 2019, the Compensation Committee added a new performance metric to the Annual Cash Incentive Bonus Plan that is based on revenue growth. The two metrics of the Annual Cash Incentive Bonus Plan are now Compensation EBITDA and Compensation Revenue and are discussed further below.

Executive Summary

Financial and Operating Performance Overall, 2019 was a solid year for Booking Holdings. In 2019, we operated the largest, most profitable global online travel business in the world, with a 2019 operating margin of 35.5% as a percentage of revenues. Based on room nights booked, which grew 11.2% in 2019 to 845 million, we were the largest online accommodation reservation service in the world. Given the size of our business, we are particularly proud to have achieved above-market growth while maintaining industry-leading profitability. We achieved year-over-year gross bookings (a common operating and statistical metric used in the travel industry representing the total U.S. Dollar value, generally inclusive of all taxes and fees, of all travel services purchased by consumers through our online travel reservation businesses, net of cancellations) growth of 4.0% (8% on a constant currency basis (i.e., using 2018 exchange rates)). In 2019, our net income grew 21.7% to $4.9 billion and we generated $4.9 billion of cash from operating activities. We were also able to achieve Adjusted EBITDA growth of 2.2% in 2019. Further, we were pleased to announce that we had 6.3 million reported listings of alternative accommodations as of December 31, 2019. In 2019, we recorded revenue of $3.1 billion from alternative accommodations and alternative accommodations were nicely profitable and grew faster than our core accommodation business. Although in many respects we achieved good financial results in 2019, we did not meet the financial goals we set for ourselves, as discussed in more detail below.

40 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 41 %

% CAGR CAGR +14.7 +12.3 Executive Summary Executive 2019 2019 $5.9 $15.1 2018 2018 $5.7 $14.5 2017 2017 $4.9 HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | $12.4 2016 2016 $4.1 $10.3 >15% WEREBOOKINGS BOOKING.COM’S OF GROSS PLATFORM PROCESSED ON ITS PAYMENT BOOKING 2015 2015 $3.5 $8.6 ADJUSTED EBITDA** (BILLIONS) REVENUE* (BILLIONS) 2014 2014 $7.6 $3.3 Link to Compensation Used to calculate Compensation EBITDA, which 50% is weighting of Annual Cash Incentive Bonus Plan and 100% weighting of long-term Performance Share Units (calculation of Compensation is EBITDA described below in Measuring CompensationEBITDACalculated) – How is Performance Performance Total revenues grew constant-currency (7% a on 3.7% basis) in 2019. From a multi-year perspective, we have achieved significant growth, with 58.7% a in revenue increase (or gross profit for years 2018*), prior to over 2017-2019 the three-year period compared to theas 2014-2016 period. three-year Link to Compensation Used to calculate Compensation Revenue, which is 50% weighting of Annual Cash Incentive Bonus Plan (calculation of Compensation Revenue is described below in Measuring CompensationRevenue Calculated) – How is Performance Performance We Adjusted EBITDA had growth of 2.2% versus prior the year. From a multi-year perspective, we achieved significant growth, with a 51.0% in Adjusted EBITDAincrease over the 2017-2019 three-year period as compared the to 2014-2016 three-year period. million

% % CAGR CAGR +19.5 +13.9 information, see Note 2 to the Financial of our 2019 Annual Consolidated Statements Report. ROOM NIGHTS BOOKED INROOM NIGHTS BOOKED 2019 845 2019 2019 844.9 $96.4 2018 2018 759.8 $92.7 2017 2017 673.1 $81.2 2016 2016 556.6 $68.1 million 2015 2015 432.3 $55.5

profit reported previous years. reported in For more profit

ROOM NIGHTS (MILLIONS) GROSS TRAVEL BOOKINGS GROSS TRAVEL BOOKINGS (BILLIONS) Appendix A to this proxy statement for a for statementthis measuresnon-GAAP reconciliation non-GAAP the a proxy to Appendix financial the of financial of for rationale and A use measures. 2014 50.3 2014 a of reported new 2018, 2018 and 2019 are to result the revenue accounting standard that began in total revenues in comparable recognition

346.0 $ As gross See

ALTERNATIVE ACCOMMODATIONS ALTERNATIVE ACCOMMODATIONS 12/31/19 LISTINGS AS OF 6.3 ** * Performance We continue to be the largest online accommodation reservation service in the world based on room nights booked. Room nights booked grew 11.2% in 2019 to 845 million. Over the three-year period from 2017 to 2019, we had 2.3 billion room nights booked. multi-year From a perspective, we have achieved significant growth, with a 70.6% increase in room nights booked over the 2017-2019 three-year period as compared the to three-year 2014-2016 period. Performance We achieved year-over-year gross growth of bookings 4.0% (8% on a constant currency basis). Over the three-year period from 2017 to 2019, we had gross of $270.4 travel bookings billion. From a multi-year perspective, we have achieved significant growth, with 55.5% a in grossincrease bookings over the period as three-year 2017-2019 compared to the 2014-2016 three-year period. EXECUTIVE COMPENSATION Executive Summary

Strategic Initiatives

We also made solid progress against our key strategic goals for the year by expanding Booking.com’s payments capabilities, improving our alternative accommodations offerings and executing on our long-term strategy to develop the “Connected Trip” (our efforts to build a more integrated offering of multiple elements of travel). We also launched an international flight product jointly developed by Agoda and Priceline, and Booking.com launched a flight product currently powered primarily by a third-party partner. Nevertheless, 2019 was not without its challenges. Booking.com continues to under-index in the United States market, we did not see the desired results from Booking.com's brand marketing efforts and, for much of the year, we were slower than desired to meet a number of our goals for increased collaboration, cooperation and integration among our brands.

Stockholder Return

Our operating and financial performance has resulted in STOCK PRICE AS OF DECEMBER 31, significant returns to stockholders. Our stock price increased from $1,466.06 on December 31, 2016 to $2,053.73 on $2053.7 December 31, 2019, representing a 40.1% increase over that $1737.7 three-year period. Through the repurchase of shares of our $1722.4 +12.5% $1466.1 common stock, we returned approximately $8.2 billion to $1274.9 CAGR stockholders in 2019 and approximately $16.0 billion over $1140.2 the 2017-2019 three-year period, representing 108% of the cash generated by operating activities during that three-year period.

2014 2015 2016 2017 2018 2019 $8.2 $16.0 billion billion RETURNED TO RETURNED TO STOCKHOLDERS STOCKHOLDERS IN 2019 OVER THE 2017-2019 THREE-YEAR PERIOD

42 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 43 Philosophy and Objectives Philosophy HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING policy against future such arrangements. policy against future do not: Provide change in control severance tax gross-ups and doseverancecontrolgross-ups and tax change in Provide have a approval. without stockholder stockoption repricing Permit significantexecutive-onlyperquisites. Provide our directors our stock by orhedgingpledging of Permit executiveofficers. and We

Objectives

and

compensation consultant, to ensure that compensation consultant, practices that it maintains compensation are in the best paid. have had a compensation program focused on rewarding earnings growth, which we believe have had hasa compensation focused program been on rewarding earnings growth, which we the the Compensation Committee decided that additional focus on revenue growth was appropriate. As a result, of of stockholder value because it requires management to focus on both revenue growth and expense : the programs should help us attract and retain key talent. management review of our compensation program to evaluate whether the objectives byit continues to further expressed the growth rate of the online travel market, taking into account the advice of its independent compensation consultant

“double triggers” in agreements and our severance triggers” “double Compensation Policies Compensation Compensation Committee believes that our compensation program should provide an balance betweenappropriate basic principles upon which our compensation programs built include have been the following: Compensation Committee continually reviews our executive officer Compensationcompensation and seeksprogram Committee continually our the advice of reviews officer executive do:

Conduct an annual stockholderengagement process. Conduct an annual succession planning. Conduct formal executive Conduct an annual risk assessment of our executiveofficer of our risk assessment Conduct an annual compensation program. executives’individual poolwhich senior the bonus Cap from cash bonuses are Have significantstockownership guidelines. Have policy. a clawback Have Use awards. equity Tie pay to performance. to Tie pay added an additional metric to our Annual Cash Incentive Bonus Plan based on revenue growth. and reward them if they achieve long-term results. Business focused: executive for external for theirofficers should be compensated management of the business and not factors. Risk management: the programs should not incentivize orexcessive inappropriate risk taking. : the programs should be consistent over time to enable executive officers to implement a long-term strategy time to enable executive Consistency: the programs should be consistent over officers to implement a long-term strategy : align Alignment with interests stockholders: the programs the interests ofshould executives with of those of stockholders by long-term to increase management through incentivizing value. stockholder performance metrics that are likely Retention : Performance-based: executive officers should be compensated primarily on performance. We we The short-term and long-term performance, with an emphasis on long-term As a result, our senior executiveperformance. compensation program is designed be thatto weighted such most an of executive’s potential is delivered compensation through The our long-term equity incentive awards, which in the form share performance are generally of units ("PSUs"). (Mercer), the views of management and input from some of our stockholders that adding (Mercer), ofa second performance metric managementthe views and input from some our of stockholders that adding could be useful, For many years, For we many years, management in order to achieve long-term earnings growth. Notwithstanding success of every year the Compensation our the historical performs a Committee compensation program, thorough highly successful in delivering outstanding results our for stockholders and for management. We believe that earnings growth is a key driver

Philosophy The above principles. As above principles. a result of As the annual evaluation at the end of 2018, and in light of the size of our and business the slowing interests our of stockholders. Mercer, its independent Key The ● ● ● ● ● ● EXECUTIVE COMPENSATION Philosophy and Objectives

Compensation Committee believes that this approach focuses executives on long-term performance while encouraging responsible short-term decision-making to achieve sustainable earnings growth over time. As shown in the chart below, 2019 target compensation for our current executive officers was primarily performance-based.

2019 CEO TARGET 2019 CURRENT EXECUTIVE OFFICERS COMPENSATION MIX TARGET COMPENSATION MIX 96% 4% 91% Performance-Based Performance-Based 9% Compensation Compensation

Different elements of our senior executive compensation program are designed to serve different objectives and drive different behaviors, and thereby work together to achieve the objectives described above, as follows:

Element Purpose Key Characteristics Base Salary Provide a level of economic security Determined by: and stability so that executives can ● Information from the Compensation Peer Group described focus on meeting our objectives. below; ● Individual performance of the executive, including level of responsibility and breadth of knowledge; and ● Internal review of the executive’s total compensation, both individually and relative to other senior executives. Annual Cash Incentive Provide a meaningful annual cash Bonus pool determined by: Bonus Plan bonus opportunity for meeting ● 50% Compensation Revenue short-term objectives. ● 50% Compensation EBITDA Bonus determined by our Compensation Revenue and Compensation EBITDA performance and individual performance. Long-term Equity Provide a significant compensation PSUs Incentives opportunity tied to long-term ● Tied to our Compensation EBITDA performance over the earnings growth and increases in three-year period ending December 31, 2021; our stock price over a three-year ● Number of shares ranges from zero to 2x the “target” grant, period. depending on our performance over the period; and ● Vest, subject to continued employment by us, on the three-year anniversary of the grant date. RSUs ● Generally used in connection with new hires or promotions to provide retention incentive.

44 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 45 Compensation Microsoft Corporation Inc. Netflix, Holdings,Inc. PayPal inc. salesforce.com, TripAdvisor, Inc. Benchmarking and Target and Benchmarking HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | to evaluate to which companies BOOKING Compensation Expedia Group, Inc. ExpediaGroup, Facebook, Inc. IAC/InterActiveCorp Intuit Inc. Group Qurate Retail

th th th percentile executivepercentile and of for the Compensation pay the 75 Peer Group. In Target

and

Microsoft were there their because, although Microsoft revenues were more than two times our revenues, a whole is competitive. The Compensation Peer a whole is competitive. The Group provides the Compensation Committee 2019 peer group (the “Compensation 2019 peer group Peer Group”): be between the 50 technology, travel services and/or e-commerce companies and are the same used companies technology, travel in services the same and/or e-commerce companies and are technology companies. as peers by those companies. The primary characteristics primary as peersused by thosecompanies. The the determining the peer group. When compensation peer group the the appropriate for 2019, above-market target bonuses as a percentage of base salary and incentiveequity awards that (PSUs) Committee’s own business judgment in establishing compensation for the named executive own business establishing compensation for the named officers. Committee’s judgment in one-half and two times our annual revenues. The Compensation one-half Committee also and two times included Alphabet, our annual revenues. The to reward our executive officers with above-market total compensation when we exceed our to reward our executive goals and officers with above-market total compensation when we we have also structured our programs towardscompensation performance-based compensation, with Blizzard, Inc. Blizzard, few companies that otherwise met our criteria, we compete with them for executive talent and compete companies that them few they, like us, with otherwise for executive talent met criteria, we our are Inc. (for most, but not all companies, the last three quarters of(for most, but not 2018 through quarter ofthe first 2019), our revenues ranked

guidance the named dictate guidance and information, executive officers’ compensation and is not a substitute for but does not

th percentile the Compensation approximately the 75 percentile of Compensation Peer Committee generally considered Group. The general, we believe that target total compensation for our named executive officersbelieve general, we that target approximates named total compensation for our median.the market Adobe Inc. Alphabet Amazon.com, Inc. Inc. eBay Electronic Inc. Arts Activision with at below-market salaries, below-market compensation when we underperform. provide an opportunity to achieve above-market total compensation. As a result, we believe provide believe our compensation programsan opportunity to achieve above-market are total compensation. a result, we As well-designed the Compensation In However, Based on thatthe four most recent were available quarters ofat the time that data Committee initiated itsthe Compensation review arriving at for the “market” compensation Compensation Peer Group, the cashMercer adjusted compensation information from the Compensation time the 2018-2019 Peer to account Group for projected increases at those pay companies over frame. The Compensation primarily to ensure uses Committee that our the Compensation Peer executive Group data compensation program as Compensation Committee looked closely at, among other things, companies included in the prior year’s peer group, as well Compensation in the prior year’s other things, companies included closely at, looked Committee peer group, as well among as companies identified relatively 2018, would comprise the

Amazon.com, Facebook and Amazon.com, Facebook Benchmarking In making compensation decisions, Compensation Committee comparesthe each element of total compensation against a peer group of Committee reviews annuallyCompensation The publicly-traded companies. the the appropriateness of companies comprising or leading e-commerce include in the peer group were: industry, revenuesinclude in the peer and peers byidentified our peers. In particular, the Compensation to include Committee sought merchandisers, online travelinternet and other companies companies with technology revenues between After which discussions with are Mercer, the Compensation determined that the sixteenCommittee listed below, companies primarily internet services, “market” compensation to EXECUTIVE COMPENSATION Measuring Performance

Measuring Performance

We refer to the primary performance measure for purposes of our senior executive compensation program as “Compensation EBITDA.” Compensation EBITDA is a non-GAAP financial measure based on our adjusted EBITDA, or adjusted earnings before interest, taxes, depreciation and amortization, as publicly reported in our earnings press releases (“Adjusted EBITDA”), further adjusted as described below. Compensation EBITDA is the sole performance measure for our 2019 PSU awards and is one of two performance measures for our 2019 Annual Cash Incentive Bonus Plan. The other measure for our 2019 Annual Cash Incentive Bonus Plan is a non-GAAP financial measure that we refer to herein as “Compensation Revenue.”

How is Compensation EBITDA Calculated?

Compensation EBITDA is calculated in generally the same manner for both our 2019 Annual Cash Incentive Bonus Plan and for our 2019 PSUs, except that Compensation EBITDA is calculated on a pre-bonus basis for purposes of our Annual Cash Incentive Bonus Plan and on a post-bonus basis for purposes of our PSU awards. To arrive at Compensation EBITDA, we begin with Adjusted EBITDA and then:

● Exclude the effect of any accounting changes during the applicable performance period (because the targets were set without regard to such changes);

● Exclude the impact, to the extent reasonably quantifiable or estimable, of a business acquisition (so that management cannot “buy” earnings to meet performance targets) or a business disposition (so that management cannot “sell” losses to meet performance targets or be hurt if we decide to sell a profitable business);

● Treat all capitalized costs incurred and capitalized in a particular period as expenses of that period; ● Exclude the impact of digital services taxes that were adopted subsequent to the setting of targets for the applicable performance period (because the targets were set without taking into account the impact of such digital services taxes);

● Adjust stock-based compensation expense to assume a vesting factor for our PSUs of 1x (so that stock-based compensation expense related to above-target performance does not then reduce the vesting factor of the PSUs); and

● With respect to certain of our brands, apply fixed exchange rates to fixed earnings percentages consistent with those used to set the performance targets (so that our performance is measured consistently against the performance targets and senior executives are not rewarded or punished based on currency exchange rate fluctuations, which are out of their control, but rather are compensated based on management of the underlying business).

How is Compensation Revenue Calculated?

Compensation Revenue refers to our revenues, as adjusted as part of our calculation of Compensation EBITDA described above – in other words, it is the non-GAAP revenue component of Compensation EBITDA. The Compensation Committee believes that the above adjustments to Adjusted EBITDA to arrive at Compensation EBITDA and Compensation Revenue support our guiding compensation principles described above. The Compensation Committee has made the use of fixed currency exchange rates and earnings percentages with respect to certain of our brands a feature of our compensation program for many years to ensure that management is focused on the operational success of the business without incentivizing excessive or inappropriate risk taking or decision-making based on short-term or speculative expectations regarding foreign currency exchange rates. In addition, the Compensation Committee believes that taking a fixed-currency approach more accurately addresses management performance, while aligning the interests of management and stockholders through any impact currency factors have on our stock price since equity compensation constitutes the largest component of our executive officers’ compensation.

46 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 47

HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | 2019 Executive Officer Compensation Program Compensation Officer 2019 Executive Program

BOOKING 2019 Compensation Revenue Performance 2018 Relative to Performance Weighting = 50% growth 10.7% growth 34.6% 4.9% growth Compensation

recommending our recommending the compensation of executive officers. for for our executive officers, the Compensation Committee maintains discretion to adjust Officer

4.1% growth 4.1% 2019 Compensation EBITDA 2019 Compensation EBITDA 2018 Performance Relative to Performance Weighting = 50% growth 23.2% 1.3% growth 1.3% Plan based on our 2019 Compensation EBITDA and 2019 Compensation Revenue. The amount in the pool amount based onour 2019 Compensation EBITDA and 2019 Compensation Revenue. The Compensation EBITDA and/or Compensation Revenue increases (until the cap on is reached), and the pool including base salary, target cash bonus and equity incentive award, was based on, among other targetthings: including base salary, cashother bonus and equity incentive was based award, on, among about market compensation from the Compensation Peer Group analysis described above; meaningful growth over achieved 2019 budgeted Compensation Further, our 2018 performance. meaningful growth over if we Incentive Bonus Plan opportunity and equity incentives, as well as payments that opportunity Incentive Bonus Plan would be and equity under incentives, required well as Executive

the amount of the amount 2019 Compensation EBITDA achieve a targetneeded (1x) bonus poolto was thanhigher actual 2018 needed to achieve a target (1x) bonus pool was higher than actual 2018 Compensation Revenue. In this way, achieve a targetwe needed (1x) bonus poolto was thanhigher actual 2018 Compensation this way, Revenue. In using a year-end estimates under the payments to be to the executive price, stock certain termination made officer sheet analysis based onsheet analysis based its assessment that the program to support continued the guiding compensation principles on a fixed currency basis, taking into account size the our of business, market expectations regarding our growth and process and any promotion or other change in responsibility. The Compensation Committee ultimately exercises process and any promotion or other change in responsibility. The severance and change in control severance and change scenarios. In making compensation decisions and recommendations, the

prepared by The tally each executive Mercer. sheet summarizes “target” compensation for the applicable officer’s total with respect to our Chief Executive Officer, the Board, generally reviews a presentation with total a “tally respect to our Chiefof compensation, Executive Officer, the Board, a presentation reviews generally fundamental principle fundamental underlying principle the 2019 Bonus Plan was that the bonus pool for senior executives, including the 2019 Bonus Plan was structured to give equal to EBITDACompensation weight and Compensation Revenue. In each relative importance of these factors varies depending on the individual executive, as well relative ofas the results ofimportance these factors the annual depending varies on the individual executive, as well Compensation elements, including each executive reviews annually all compensation Committee officer’s base salary,

Maximum Target review the sizeof and current value ofoutstanding, unvested equity awards. Individual performance of Individual performance of potentialthe executive, including level of responsibility, for individual contribution and breadth of knowledge and expertise; and Internal review as of a the executive’s total compensation, and both individually relative to other senior asexecutives, well Information employment and change employment and change in control scenarios. For Compensation 2019, the made adjustments Committee no as a result of At At Actual Bonus current executive had significantofficers, would year-over-year earnings and/or only meaningfully funded be if we revenue growth 2019 Bonus structured the 2019 Bonus Plan with the intent of ensuring that balancedrelatively the incentives were between both metrics. The case, the funding factor increased as Compensation EBITDA or Compensation Revenue, as applicable, increased. As a result, it is unlikely that there would ofmeaningful funding be the senior executive pool from whichbonus bonuses of the current executive unless the combination ofofficers would Compensation be paid EBITDA and Compensation Revenue performance demonstrated Revenue, Compensation EBITDA; and, if we achieved budgeted 2019 Compensation EBITDA, of the amount 2019 Compensation Revenue The review Our “2019 Bonus Plan”) 2019 Annual Cash Incentive applicable to our current Plan (the Bonus executive officers provided for an aggregate “pool” increases as our the aggregate pool and/or appropriate. upwards or downwardsindividual bonuses as it deems The Compensation Committee Compensation takesalso Committee consideration historical compensation, into including the value of unvested outstanding equity awards. Before giving approval offinal annual compensation of the executive officers, the Compensation Committee and, year and, the tally described above. Within the overall structure each current executive of our senior executive2019 officer’s compensation program, compensation, current executive from this pool. officer individual cash However, bonuses are paid although Company performance is a key factor in individual bonus payments judgment and discretion when setting or judgment and discretion when setting sheet,” of 2019 The Annual Cash various ● ● ● EXECUTIVE COMPENSATION 2019 Executive Officer Compensation Program

our expectations regarding the growth of our markets. Further, although the 2019 Bonus Plan did not provide for individual maximum or minimum amounts for the named executive officers, it did provide for a cap on the funding of the 2019 senior executive bonus pool. The Compensation Committee believed that in order for the funding of the pool to reach the cap, we would need to achieve Compensation EBITDA and/or Compensation Revenue growth rates that were significantly higher than our budgeted growth rates, would represent strong performance compared to our competition and would reward stockholders. Generally, in order for our senior executives to achieve their target annual bonus amounts, we must achieve a combination of Compensation EBITDA and Compensation Revenue growth that corresponds to a 1x bonus pool. Although we exceeded the 1x target for 2019 Compensation EBITDA, we did not achieve the 1x target for 2019 Compensation Revenue. As a result, our combined performance under the 2019 Bonus Plan was such that the bonus pool was funded at 0.77x. As a result of this lower funding level, and in order to provide additional funding for bonuses for less-highly compensated individuals, Messrs. Fogel, Goulden and Millones (our current executive officers) recommended, and the Compensation Committee agreed, that they receive no bonus payments for 2019.

Equity Incentives Performance Share Units (PSUs) The 2019 PSUs awarded to our current executive officers have a three-year performance period (January 1, 2019 to December 31, 2021), vest on the third anniversary of the grant date (subject to continued employment with us and pro rata earlier vesting in certain circumstances) and use Compensation EBITDA as the sole performance metric. The 2019 PSUs granted to our current executive officers are forfeitable if certain minimum performance thresholds are not achieved and have a maximum payout of 2x the number of “target” shares. The number of "target" shares was determined by taking a fixed U.S. Dollar amount established by the Compensation Committee and dividing that amount by the fair market value of our common stock on the date of grant, which, as provided under our equity plan, is the closing price of our common stock on the trading day immediately preceding the date of grant. In setting our 2019 PSU performance thresholds, the Compensation Committee considered our 2019 budget, our expectations for the global travel market over the three-year performance period, and internal and external projections over the three-year performance period (including analyst projections) for us and our primary global, direct competitor and other select travel and technology companies that management, Mercer and the Compensation Committee felt were relevant. The Compensation Committee also sought to ensure that the performance thresholds, in particular those that would result in a payout above 1x, reflected performance that would be expected to reward our stockholders. The Compensation EBITDA thresholds for the 2019 PSUs awarded to our current executive officers are as follows:

If Compensation EBITDA for the three-year period ending December 31, 2021 is: Then, the number of shares that will be issued is: Less than $15.5 billion — Between $15.5 billion and $16.4 billion 0x to 1x the “target” grant Between $16.4 billion and $17.6 billion 1x the “target” grant Between $17.6 billion and $19.3 billion 1x to 2x the “target” grant Above $19.3 billion 2x the “target” grant

Restricted Stock Units (RSUs) Although for a number of years the primary equity component of our compensation program for senior executives has been PSUs, from time to time we also grant other equity awards to senior executives. In some cases, different kinds of equity awards have been used together with PSUs. For example, RSUs have been used in connection with the hiring of a new senior executive to provide retention incentives during the first years of employment to balance the uncertainty associated with the PSUs. Other than RSUs awarded to Ms. Tans in August 2019 (discussed below), we did not award any RSUs to our named executive officers in 2019.

48 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 49 210% 190% 250% Fogel Fogel

&

Bonus Target as a % of Base Salary of % as a Bonus Target HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING 2019 Named Executive Officer Compensation & Performance Compensation Officer Executive 2019 Named Compensation

$750,000 $530,000 $600,000 Base Salary Officer

Executive

the lowest our of Compensation Peer Group. our current executive officers recommended, and the Board and the Compensation our current Committee agreed, executive officers and the Board recommended, Officer Named

Mr. Fogel’s base salary was not Fogel’sincreased in connection Mr. with base salary taking on the additional role Chiefwas not of Executive Officer the in 2019, as the Board and the Compensation believed Committee that our executive officers performed well room nights booked growth; executive the Compensationofficers, and considers Committee reviews of the dilutive impact such awards and all

2019 operating performance,and financial including: strategic leadership and vision, including the continued ofdevelopment our Connected long-term Trip strategy; they would not receive cash bonuses for 2019. This receive cashrecommendation and This not would they bonuses for 2019. was made in light of: decision 3.7% revenue growth; and 2.2% Adjusted EBITDA growth; 11.2% Compensation Committee made no changes to the target bonus percentages of the named executive Compensation Committee made no officers to the targetchanges for 2019. bonus percentages of the named Compensation Committee made no changes to the base salaries of Messrs. Fogel, Goulden and Millones for 2019. In Compensation Committee made no to the base salarieschanges of Messrs. Fogel, Goulden and Millones for 2019.

Our Our progress on increased our brands, in particular collaboration, cooperation and following Mr. integration among becoming Chief Executivethe Officer Booking.com; of His Our Our industry-leading operating margin (35.5% in 2019); Our additional funding of bonuses for less-highly individuals. compensated prior years; and anythe current executive officers’ desire to use funds that would have otherwise to gone their bonuses to provide Company financial performance that resulted in less ofoverall funding the senior executive pool as bonus to compared – – – Booking.com in Booking.com in June 2019. Named Executive Glenn Fogel D. Goulden I. David Peter J. Millones Mr. Fogel and For other the Compensation Committee Mr. Fogel’s 2019 performance assessment, the Board considered, among things: of that Although Performance The 2019 Base Salaries particular, 2019 Bonuses discussed above, equity awards granted by Companythe on This reviewour stockholders. has shown stockholder that dilution from our equity incentive including our programs, expense stock-based compensation as a percentage of year-end market capitalization, is consistently among 2019 Each year, in connection with the administration Each year, in connection our with of the administration equity incentive plans and equitymaking award decisions for our named We did executive to our grant any stock options not in 2019. officers named Stockholder Dilution Stock Options The ● ● ● ● ● ● EXECUTIVE COMPENSATION 2019 Named Executive Officer Compensation & Performance

● His strong working relationship with the management teams of our brands; and ● His healthy, open and constructive relationship with employees and the Board. The Board and the Compensation Committee also considered a number of other subjective and qualitative factors in their evaluations of Mr. Fogel, such as the business and operational challenges facing us in 2019 and Mr. Fogel’s integrity, ethics, commitment, people management skills and investor and Board communication skills. Other Named Executive Officers In evaluating Mr. Goulden’s 2019 performance, the Compensation Committee and Mr. Fogel considered, among other things, his exceptional performance as Chief Financial Officer and oversight, management and strengthening of our finance department; his strategic insight and advice; his efforts to improve our systems and processes; his effective management of our stock repurchase program and oversight of our treasury activities; and his leadership in developing our annual financial plan. In evaluating Mr. Millones’ 2019 performance, the Compensation Committee and Mr. Fogel considered, among other things, his strong leadership of our legal department; his significant contributions to improving our systems and processes; his oversight of our compliance department and efforts with ever-increasing regulatory and other legal requirements; his strategic insight and advice; his oversight of our corporate governance practices; and his efforts to organize and assist with the Board’s activities.

2019 PSUs

Our named executive officers were granted PSUs (as described above) as part of their 2019 compensation. In determining the amount of each named executive officer’s PSU award, the Compensation Committee and, in the case of Mr. Fogel, the Board considered the various factors discussed above, including their respective responsibilities and the information obtained through the Compensation Peer Group review.

Ms. Gillian Tans

Ms. Tans served as Chief Executive Officer of Booking.com until June 2019, at which point she became Chairwoman of Booking.com and ceased to be an executive officer of the Company. While serving as an executive officer, Ms. Tans’ compensation was determined in generally the same manner as that of the other named executive officers, except that:

● She was eligible to participate in the Booking.com annual senior bonus plan, which was funded based solely on Booking.com’s Compensation EBITDA (as further adjusted primarily to take into account inter-company transactions);

● Her 2019 PSUs were based solely on Booking.com’s Compensation EBITDA (as further adjusted primarily to take into account inter-company transactions); and

● Her 2019 PSUs were not forfeitable in that they had no minimum performance threshold and had a potential vesting factor of 1x-2x. The Compensation Committee felt that this approach was important so that Ms. Tans’ compensation as an executive officer was tied to the business for which she was responsible and was consistent with the compensation plan applicable to other Booking.com senior executives. In her role as Chairwoman of Booking.com, Ms. Tans’ compensation for the remainder of 2019 was agreed to as part of her transition agreement (See Employment Contracts, Termination of Employment and Change in Control Arrangements – Ms. Tans for a description of Ms. Tans’ transition agreement) and consisted of:

● An annual salary of €50,000; ● A guaranteed minimum bonus of €1 million; and ● An RSU award of $1.5 million that vests in full (subject to continued employment with us) in May 2020. In addition, Ms. Tans will continue to vest in her previously granted equity awards, subject to their terms, while she is employed by us.

50 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 51 or on the 4999 years additional materially parachute many Further, to gross-ups or Section deduction for of tax tax new (“excess a 4999. subject 4999 any be officers respect forfeit in in control Section may HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | of may Section of we executive any BOOKING payments gross-ups change officers. our that

respect individuals a tax 2019 Named Executive Officer Compensation & Performance Compensation Officer Executive 2019 Named in with approve for with to certain provides parachute executive

not or that

gross-ups provided Code excess tax connection not policy arrangements to in a to provides directors

have Revenue our

Code We related benefits entitled adopted with

of tax. Internal are gross-ups compensatory

the Revenue tax formally

of focused on our event business ofin the rumored or actual fundamental corporate change officers of Executive Compensation of Executive payments additional has arrangements modified arrangements between us and our executive officers. The payments betweenand other benefits are provided us andbecause our executive officers. The Internal 280G

this payment

to U.S. certain executive As a general matter, upon a termination of employment by us “without cause” by or by As a general matter, onus “without the employee upon a termination of employment the Section Committee cause” or to be employee-initiated, considers a termination Committee for “good reason,” not “without Committee the vesting of outstanding the vesting on be accelerated equity of outstanding will which the employee to occur on is the date materially of our subject receive and or parachute beginning Arrangements on beginning in Control Change See Employment Contracts,Terminationof Employment and reimbursement

of the Compensation Committee believes is appropriate, taking into account, among other things, the time it is the Compensation Committee believes taking into is appropriate, account, among compensatory coincident with or following a change in control.

coincident with or following pro-rata basis such change in control (on a on the portionbased of the performance with or that with from independently control following a change in occur or upon certain terminations of employment compensation-related risks and align the interests executives and compensation-related risks andof stockholders by incentivizing executives to align 4999 they tax new of his that death orof his occurs coincident disability (and in somewith a or following circumstances, for “good reason”) cause” The arrangements or, “for good reason.” with our executive officers provide severance payments in an if acceleration will onlyacceleration will occur with that occur upon respect to certain terminations those grants of employment of of reduced,the payment, so would constitute an excess parachute payment if such reduction would result anin be an excess parachute payment, we reduce will of the amount an excessbe to the extent such payment we parachute payment, sonecessary that no none excess amounts

under different circumstances would not have occurred and whichunder different circumstances beyond the control are would not of individual. the separated any severance and to ease the consequences an other benefits are intended to executive of an unexpected termination of manage andthe business evaluate change in control potential from a stockholder. transactions the perspective of encourage executives to remain needs if required, to provideor or and, assistance changes in the organization its employment during any transition, and manage and similar modified Section No taxes payments”), the in Compensation portion expected to take job as a separated employee and marketplace to find another the duration of practices as well non-competition agreements employment. Each of our current executive officers is entitled to receive severance benefits upon, among Each ofother things, a termination our current executive officers is entitled to receive severance benefits upon, among “without that page for additional 61 details. amount that increase the aggregate paymentsin and benefits to be provided to him, determined on an See after-tax basis. Potential Termination on pagebeginning Control and/or in 66 for additional details. Payments Upon a Change Severance Benefits Severance in our awardsarrangements and change-in-controlequity are designed to: provisions The With of each employment agreement respect Messrs.to Fogel, Goulden and Millones, if any payment made pursuant to his would the Compensation account Our equity not grants do provide for “single trigger” vesting accelerated solely upon of the occurrence in control. a change Rather, Change Change Control Benefits in coincident change in control, terminated period not provide that has of in the event the entire award for full of expired). Oura award agreements acceleration do termination Other Components Other a change in control. a change in control. ● ● EXECUTIVE COMPENSATION How We Make Compensation Decisions

Employee Benefits Our health care and other insurance programs are generally the same for all eligible employees, including the named executive officers, depending on their geographic location. For all eligible U.S.-based employees and certain eligible employees based outside the United States, we maintain a 401(k) plan. The 401(k) plan in which our eligible named executive officers participate allows all eligible employees to contribute up to 75% of their base salary and bonus, up to limits imposed by the U.S. Internal Revenue Code, on a pre-tax basis. We make a cash matching contribution to this 401(k) plan for all participants, including those named executive officers who participate in the plan, of 50% of the first 6% of compensation deferred by participants. The 401(k) match made to each of the participating named executive officers is reflected in the All Other Compensation column of the Summary Compensation Table.

Perquisites We do not maintain any material perquisites or personal benefits for any of the named executive officers, such as company planes, cars, security, financial services or country club memberships. In connection with Mr. Fogel taking on the role of CEO of Booking.com in the Netherlands in 2019 in addition to his role as Chief Executive Officer of the Company, the Company agreed to provide certain benefits to Mr. Fogel to ensure that Mr. Fogel is not subject to adverse tax consequences and does not incur additional expenses as a result of serving as CEO of Booking.com. These benefits include tax equalization for any Dutch taxes owed as a result of performing his new role in the Netherlands, a housing allowance of €6,100 per month for accommodations in the Netherlands (expected to begin in 2020), supplemental international medical insurance, payments of legal fees incurred in connection with entering into a letter agreement that sets forth the terms of this arrangement and payment of costs for the preparation of his Dutch and U.S. tax returns.

How We Make Compensation Decisions

THE ROLE OF MANAGEMENT THE ROLE OF THE BOARD Our Chief Executive Officer, Chief Financial Officer and The Board meets at the beginning of each year with our General Counsel provide significant input to help the Chief Executive Officer to agree upon his performance Compensation Committee develop the structure of, and objectives (which generally are stated in terms of Company set performance metrics for, our annual objectives) for the year. Generally and as deemed performance-based bonus plan and annual equity grants. In necessary or appropriate, our Chief Executive Officer and particular, our Chief Executive Officer provides the Board review these objectives and the Company's performance assessments and detailed compensation performance against them from time to time during the recommendations regarding our executive officers other year. than himself in executive session without other executive officers present. The Compensation Committee gives At the beginning of the following year, our Chief Executive significant weight to our Chief Executive Officer’s judgment Officer presents to the Compensation Committee a in these matters because he is in a unique position to summary of his and the Company's performance over the assess the other executive officers’ performance and past year. The Compensation Committee then meets in contributions to our business. executive session without any members of management to review our Chief Executive Officer's performance and The Compensation Committee has delegated limited develop recommendations for his compensation. The authority to the Chief Executive Officer, the Chief Financial Compensation Committee chairperson also discusses our Officer and the General Counsel to determine whether and Chief Executive Officer’s performance with each member to what extent certain equity awards held by non-executive of the Board. The Board then meets in executive session officers may be settled, vested, canceled, forfeited, or (without our Chief Executive Officer) to discuss our Chief surrendered pursuant to their terms. For instance, the Chief Executive Officer’s performance and the Compensation Executive Officer is authorized to determine whether an Committee’s compensation recommendations. The Board employee’s termination was, pursuant to the terms of the determines the review to be given to our Chief Executive relevant agreement, “with cause” or “without cause.” Officer, the actual payout amount of his bonus for the prior fiscal year, and the target total compensation he will receive for the current year.

52 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 53 We Decisions Compensation Make How HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING $793,000 executive compensation with stockholder interests and therefore did not executive with did not stockholder compensation and interests therefore Advisory Vote on Executive Advisory on Compensation Results Vote Committee in Committee 2019. The Compensation Committee The Compensation regards the results ofCommittee the stockholder vote as an indication that our management to seek Mercer’s input, analysis or recommendation respect to a specific with Committee on our compensation program for the named executive on our officers. Mercer has Committee been compensation program for the named the Compensation Committee and/or management may also the Compensationindependently seek Mercer’s management Committee and/or advice on may changes as a direct result of the vote. The Compensation Committee Compensation continue changes aswill Committee to consider the outcome a direct result of the vote. The the composition of the composition the Compensation Peer Group; the Compensation Committee for approximately eighteen Committee the Compensation this capacity. years in for approximately our stockholders with the opportunity to cast an annual advisory vote on executive compensation (a “say-on-pay” our stockholders with the opportunity to cast an annual advisory vote on executive compensation (a assistance in determining Pay Ratio” that appears in this proxy statement. the “CEO services to one of our subsidiaries. The aggregate fees by paid services to us one of our subsidiaries. The and our subsidiariesto Mercer and its The decision to engage affiliateMercer’s other for consulting services was made by management of the compensation practices effectively practices effectively align compensation subsidiary. Aftersubsidiary. reviewing information provided by Mercer regarding its independence and considering the in in 2019 are as follows: abstentions but not not broker non-votes) abstentions but were voted approving in favor of the executive compensation described in our 2019, among among things, Mercer assisted other 2019, the Compensation Committee on the following matters: meetings, meets in executive session with the Compensation Committee without executive management present. meets meetings, in session with Committee without the Compensation the the support of the Compensation regularlyCommittee, management asks Mercer to provide calculations and Compensation to advise an Mercer LLC, Committee engaged resourcesglobal outside consultinghuman firm, Advised on Reviewed our non-employee director compensation program; Prepared tally sheets and IRC Section 280G analyses determine parachuteto “excess payments;” and Provided Prepared compensation levels as analyses ofto Compensation Peercompared the executive Group, officer and made compensation recommendations; Evaluated the design and provided advice on the appropriateness of our 2019 Bonus Plan and long-term incentives; for other services and compensation products, for other services and approximately for insurance brokerage $2,492,000 services and consulting services to Mercer's affiliates, approximately for advice regarding executive compensation, approximately executive compensation,for advice regarding $520,000 approximately the Compensation Committee's direction, management generally Compensation Committee materials to provides compensation program addition to providing Mercer has atadvice, times provided our services to certain of our say-on-pay votes when structuring and our say-on-payimplementing compensation programs votes when structuring for executive officers. During At compensation-related matters. With compensation practice, program or arrangement being byconsidered the Compensation Committee. The chairperson of Mercer and discusses with materials and recommendations Mercer in advance of each Compensation Committee meeting. Mercer generally at attends the end of meetings Compensation Committee discuss to these matters and, most market The Compensationdata to inform the Compensation Committee's Committee decision-making process. periodically requests independence factors prescribed by SEC rules, determined thatthe Compensation Committee Mercer was independent and withfind that in services Mercer performed connection the not did any conflicts of interest existed for the Compensation Mercer’s affiliate was engaged to provide services by brokerage insurance after the NCG the NCG Committee Committee evaluated the relationship of Mercer’s affiliate with us and the Compensation Committee’s engagement of Mercer. relevant subsidiaries, including subsidiaries, benefitemployee including plan consulting services and benchmarking.compensation of An affiliate brokerage Mercer provides insurance affiliate of services to has Mercer us, and another provided commercial consulting In affiliates the Compensation working with THE ROLE OF THE COMPENSATION CONSULTANT OF THE COMPENSATION THE ROLE The ● ● ● ● ● ● ● ● ● 2019 proxy statement. implement any 2019 Say-on-Pay and Consideration We provide executive of proposal). At our annual ofmeeting stockholders held in June 2019, 89.9% of shares present and entitled to vote (which includes EXECUTIVE COMPENSATION Executive Officers

Stockholder Engagement

Through our stockholder engagement efforts and communications from our stockholders, we receive stockholder feedback on our compensation programs and practices and communicate that information to the Compensation Committee.

Executive Officers

Set forth below is biographical information as of March 31, 2020 for our current executive officers, other than Mr. Fogel, our Chief Executive Officer and President, whose biographical information can be found in the “Election of Directors” section. DAVID I. GOULDEN

Mr. Goulden has been our Executive Vice President and Chief Financial Officer since March 1, 2018. Mr. Goulden joined us after leaving Dell Technologies in February 2018. He was previously President, Infrastructure Solutions Group at Dell Technologies, a position he held starting in 2016 when Dell acquired EMC Corporation. From January 2014 until EMC’s acquisition by Dell, Mr. Goulden was Chief Executive Officer of the EMC Information Infrastructure business, EMC’s largest business by revenue and employees. Prior to his service in that role, he was President and Chief Operating Officer of EMC, responsible for overseeing engineering and product development, sales and customer operations, services, marketing, and G&A functions, since 2012. Mr. Goulden served as Chief Financial Officer of EMC from 2006 to 2014, responsible for financial operations of EMC’s consolidated businesses. Earlier in his career at EMC, Mr. Goulden led the company’s Sales and Customer Operations worldwide, including global sales in all theaters as well as global channels, alliance, and partners, and prior to that service he oversaw Marketing and New Business Development at EMC. Prior to joining EMC in 2002, Mr. Goulden served in various capacities at Getronics N.V., an information technology services company, most recently as a member of the board of management and President and Chief Operating Officer for the Americas and Asia Pacific. Mr. Goulden served on the board of directors of VMWare, a cloud infrastructure and business mobility company, from 2007 to 2014.

PETER J. MILLONES

Mr. Millones has been our General Counsel since January 2001 and our Executive Vice President since April 2003. He previously served as our Vice President and Associate General Counsel from March 2000 to January 2001 and as our Corporate Secretary from January 2001 to April 2018. Prior to that, Mr. Millones was with the law firm of Latham & Watkins LLP. As part of his responsibilities, Mr. Millones oversees our executive compensation programs.

54 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 55 (2) $1,637,254 Owned as of Owned stock ownership, Governance Matters Governance Value of Shares March 31, 2020 Key (3) (1) 1,217 9,549 $12,846,461 35,233 $47,399,660 permit our executive officers Owned as of Owned HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | March 31, 2020 Number of Shares BOOKING 72. Our detailed in our 72. stock ownership guidelines are Matters 15,000 shares or shares valued at $5 million or valued $5 15,000shares shares at valued threeortimes shares at shares 5,000 salary base valued threeortimes shares at shares 5,000 salary base Number of Shares Required to be Owned under be Owned Required to Shares Number of of: Guidelines – the Lesser Stock Ownershipour

For purposes of calculating stock owned stock For guidelines,under the stock ownership of purposes calculating shares of of stock options, ofthe vesting restricted shares or restricted stock units, performance share Certain Beneficial Owners and Management on page 37 for certain details relating to beneficial require, our executive officers to effect any disposal of shares of our pursuant to a common stock or selling publicly covered calls, buying traded options, including writing our stock on margin (unless trading plan adopted in compliance with Rule 10b5-1 under the Exchange Act (a “10b5-1 trading plan Plan”) adopted in compliance and our Rulewith 10b5-1 internal under the Exchange Act (a We have established guidelines for the adoption and We have established implementation of 10b5-1 guidelines for the adoption Plans by our directors and officers, including the following: and unvested stock-based equity awards are not eligible to be considered. If an eligible to be considered. If and unvested stock-based executive officer's stock ownership awardsequity are not Governance on the closing share price of of March closing share on on the price $1,345.32 31, 2020.

“For Investors.” or the value of shares owned or, in the case of Mr. Goulden, because our stock ownership guidelines permit him to or the value of owned or,shares Goulden, in the case of Mr. because our stock ownership guidelines permit outright been unvested stock options, vested are included, but outright the executive by stock options thatofficer have not

Goulden became Chief Financial Officer on March 1, 2018 and, as a result, will to ownership over time. on result, will be permitted Goulden became Chief Financialreach the guidelines March 1, Officer 2018 and, as a Non-Employee Director CompensationBenefits and Director on page Non-Employee the required ownership level over time). ownership level over the required See See Security Ownership of calculated in accordance with SEC rules. Based Mr. stock ownership guidelines also establish requirements for non-employee members of the Board, which set forth are

directors to pledge any of our securities. President President and Executive Chief Officer Executive President and Vice FinancialOfficer Chief Executive President and Vice GeneralCounsel A 10b5-1 must be adopted Plan during an open trading window. Glenn Fogel,D. Goulden, I. David Peter J. Millones, (1) (3) (2) Name executive It has been our long-standing policy to prohibit our executive officers, directors and entering into employees from hedging transactions to our with respect stock, speculating in our stock or short-term engaging in in our stock such as “day trading sellingtrading.” to, limited short (profiting Such prohibited activity if the market price includes, but is not of the securities decreases), buying guidelines. Corporate Governance Principles, a copy of which is available on our corporate website (www.bookingholdings.com) under (www.bookingholdings.com) Corporate Governance Principles, a copy whichof is available on corporate our website the tab Short-Selling, Hedging and Pledging Prohibitions pre-arranged under arrangements are made to cover any margin calls arrangements are made to cover any not in cash) or arbitrage trading.margin calls We also do We encourage, do not but Our Pre-arranged Trading Plans does not ownership guidelines,meet the stock they are required to retain a minimum 50% of of received the shares on an the exercise after-tax basis from or meet units or the settlement anyof other stock-based award equity the ownership target until is reached. As of March 31, 2020, each current executive officer listed below was in compliance the guidelines ofwith (whether due to the number shares owned Under our stock ownership guidelines, each current executive officer Under shares ofis required to own the number of our guidelines, our stock ownership officer each current executive below. common stock indicated Key Guidelines Stock Ownership owned exercised ● EXECUTIVE COMPENSATION Compensation Committee Report

● The first proposed sale under a 10b5-1 Plan generally cannot occur until the second trading day following the filing of the Form 10-Q or Form 10-K with the SEC, as applicable, during the first fiscal quarter following the fiscal quarter in which the plan is adopted.

● A 10b5-1 Plan must generally have a minimum of a one-year term. A 10b5-1 Plan may not be terminated earlier than the date provided for in the plan, except as approved by the chairperson of our Compensation Committee or, if such chairperson is unavailable, the chairperson of our Audit Committee.

● Sales under a 10b5-1 Plan may occur during a closed trading window. We reserve the right to modify the terms of our 10b5-1 guidelines at any time. As of March 31, 2020 none of our named executive officers or directors have a 10b5-1 Plan in effect. Consistent with our past practices, we intend to continue to provide a list of 10b5-1 Plans in existence for our named executive officers and directors on a quarterly basis following the closing of our trading window on our corporate website (www.bookingholdings.com) under the tab “For Investors.” We will also file a Current Report on Form 8-K promptly after the adoption of any 10b5-1 Plan by our Chief Executive Officer or Chief Financial Officer.

Equity Award Dates

The Compensation Committee selected March 4, May 12, August 12 and November 12 as the dates of grant for equity awards (to the extent the Compensation Committee authorizes any awards) to executive officers and other employees in 2020. The Compensation Committee reserves the right to adjust dates in advance or select additional grant dates in its sole discretion. All grants are or will be, as applicable, approved in advance by the Compensation Committee or, on an exception basis, the chairperson of the Compensation Committee.

Clawbacks

Effective as of February 7, 2013, we adopted a policy with respect to the “clawback” of executive compensation pending adoption by the SEC and The Nasdaq Stock Market of final rules on the matter. In general and subject to the terms and conditions of the policy, the policy provides that under certain circumstances where an executive officer has engaged in misconduct that has resulted in the executive receiving excessive incentive-based compensation, the Board may seek recovery of such excessive incentive-based compensation.

Compensation Committee Report

The Compensation Committee, comprised of independent directors, reviewed and discussed the above Compensation Discussion and Analysis with management. Based on that review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this proxy statement for filing with the SEC. COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS Mirian M. Graddick-Weir, Chairperson Timothy M. Armstrong James M. Guyette Robert J. Mylod Jr.

56 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 57 ($) Total 5,108,199 5,038,250 14,768,526 Booking.com (6) (6)

0 11,955,709 ($) 1,545 14,471,304 (6) 1,070 13,653,387 8,574 6,431,018 8,574 20,459,184 8,739 paid by us during 2019 8,790 8,630 6,339,479 17,921 13,522 14,314,980 24,543 27,774,458 1.11957 for 2019, 1.14500 All Other All Summary Compensation Table Compensation Summary Compensation includes reimbursement of legal (2) (4) (4) (5) (4) (2) (2)

0 0 0 0 ($) also HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | exchange rate of insurance premiums of Non-Equity Incentive Plan BOOKING Compensation value (5) (4) (5) — 1,425,000 —— 4,840,488 5,030,076 — 2,500,000 — 1,500,000 —— 5,700,000 6,000,000 ($) the benefit of such named executive officer and matching Option Awards his assumption of the Chief Executive Officer of

(1)

For Mr. Fogel, the amount ($) Stock 2019. Awards 4,500,777 8,999,521 4,500,849 8,000,546 10,801,458 20,999,915 14,000,610 10,500,268 — represents the U.S. Dollar (3) (8) Table

— — — — — — ($) Bonus the amount 500,000 Agreement in connection with

401(k) plan for fiscal year ($) Salary into the Letter translated into U.S. Dollars using an average Euro to 1 U.S. Dollar 2017 330,000 2017 621,695 2017 750,000 2019 530,0002019 — 335,871 1,119,570 4,499,460 — 2019 600,000 — 4,499,460 — 2019 750,000 — 14,000,605 — 2018 629,750 2018 496,667 2018 500,000 2018 750,000 entering bonus Mr. Goulden received when he became the Company’s Executive Vice President and Chief Financial Officer on Compensation

made by us to each individual’s the sign-on bonus received pursuant to Ms. Tans' Transition bonus pursuant Ms. 2019. Transition Agreement, dated received to Tans' June 26, 2018 cash awards paid 2018 Bonus in 2019 under the Plan. 2017 paid inawards 2018 under the cash 2017 Plan. Bonus (7) associated with

1, 2018. 1, who servedwho as our Chief Executive Officer and our Chief Financial Officer during 2019 and the next mostthree FinancialOfficer respect to Messrs. Fogel, Goulden and Millones,

respect to life insurance and accidental death and dismemberment insurance for

2018 and 1.13035 2017. for

Represents the aggregate grant date fair value of (a) PSUs granted to Messrs. Fogel, Goulden and Millones and Ms. Tans in 2019, (b) RSUs granted to Ms. Tans in 2019, (c) PSUs granted to Messrs. Fogel, Goulden and Millones and Ms. Tans in 2018, (d) RSUs granted to Mr. Goulden in 2018, RSUs (e) granted to Mr. Fogel in 2017, (f) PSUs granted to Messrs. Fogel and Millones, and Ms. Tans inwith FASB ASC Topic 718. 2017, For PSUs granted to Messrs. in Fogel, Goulden and Millones, and each Ms. Tans in 2019, the case amount reflects 1 times computed the "target" in accordance amount, as of the grant date, for those awards. The maximum number of shares that could be issued to Messrs. Fogel, Goulden and Millones, and Ms. Tans under the 2019 PSU awards is 2 times the "target" amount, which would result in$18,001,268 a respectively, value of based $28,001,210, $8,998,920, on $8,998,920 and the stock price used to Messrs. Fogel, Goulden and Millones, and Ms. Tans in 2018, the amount reflects 1 times the "target" amount, as of the grant date, for those awards. determine the aggregate grant date fair value of the The maximum number of shares that could be issued to Messrs. Fogel, Goulden and Millones, and Ms. Tans awards. under the 2018 PSU awards is 2 times For PSUs granted to the "target" amount, which would result in a value of $28,001,220, $9,001,554, $9,001,554 and $17,999,042 respectively, based on the stock price used to determine the aggregate grant date fair value of the awards. For PSUs granted to Messrs. amount Fogel reflects and Millones, 1 and Ms. times Tans in the 2017, the "target" amount, as of the Messrs. Fogel and Millones, and Ms. Tans under the 2017 PSU awards grant is 2 times the "target" amount, which would result in a value of date, $28,001,044, for those awards. The maximum number of $9,001,698 shares and that $16,001,092, could respectively, be based issued on to the stock price used amounts in this to column reflect our estimate determine of the payout the for these awards, as aggregate of the date grant of grant, and date do not correspond to fair the actual value, value if of any, the that awards. will The be recognized by the named ended December 31, 2019 year Financial Statements for our the Form 10-K included in the Annual Report on ended December 31, 2019. year for executive officers. For additional information, please refer There no Mr. paid Goulden bonuses were Fogel, Mr. to or Mr. Millones under the 2019 Bonus Plan. to Notes 2 and 4 of our Consolidated Represents for Represents Represents Represents With March contributions expenses position. The compensation for Ms. Tans is with following by table showsthe during compensation earned 2018 2019, 2017, exceptand for Mr. as Goulden noted below, Goulden is for 2018 and 2019 only,Goulden is for 2018 in accordance SEC with applicable rules, since he joined Company onthe March 1,

Executive Vice Executive President, Vice GeneralCounsel Chairwoman, Booking.com Chief President President and Chief Executive Officer (1) (2) Peter J.Millones Peter Tans Gillian (7) (3) (4) (5) (8) (6) Name & Principal Position Principal Name & Year David I. Goulden David I. Glenn D. Fogel

highly-compensated executive officers. These individuals are referred to as the “named Information executive highly-compensated executive officers.” for officers. These individuals referredare “named to as the Mr. Summary The persons 2018. Titles in the table titlesshown held are as of December 31, 2019. EXECUTIVE COMPENSATION Grants of Plan-Based Awards Table

Grants of Plan-Based Awards Table

The following table provides information about equity and non-equity awards granted to our named executive officers in 2019. The column “Estimated Possible Payouts under Non-Equity Incentive Plan Awards” shows the “target” cash payouts under the 2019 Bonus Plan at the time the plan was adopted; actual payouts were made in March 2020 based on the attainment by us of certain performance thresholds and can be found in the Summary Compensation Table in the column entitled “Non-Equity Incentive Plan Compensation” for the 2019 fiscal year.

Estimated Future Payouts Under Estimated Future Payouts All Other Grant Date Non-Equity Incentive Plan Under Equity Incentive Plan Stock Awards: Fair Value Awards1 Awards2 Number of of Stock Shares of and Option Name & Principal Date Grant Threshold Target Maximum Threshold Target Maximum Stock or Units Awards(3) Position Grant Date Approved ($) ($) ($) (#) (#) (#) (#) ($) Glenn D. Fogel 03-04-2019 02-20-2019 — — — 0 8,168 16,336 — 14,000,605 — — — 1,875,000 N/A — — — — — David I. 03-04-2019 02-20-2019 — — — 0 2,625 5,250 — 4,499,460 Goulden — — — 1,260,000 N/A — — — — — Peter J. 03-04-2019 02-20-2019 — — — 0 2,625 5,250 — 4,499,460 Millones — — — 1,007,000 N/A — — — — — Gillian Tans 03-04-2019 02-20-2019 — — — 5,251 5,251 10,502 — 9,000,634 08-12-2019 08-07-2019 — — — — — — 782 1,499,634

(1) These columns show the target amount, at the time the 2019 Bonus Plan was adopted, of the payout for each named executive officer under the 2019 Bonus Plan. The actual payments for 2019 for each named executive officer are included in the column entitled “Non-equity Incentive Plan Compensation” of the Summary Compensation Table. Although the Board and the Compensation Committee believed that our current executive officers performed well in 2019, as discussed above, our current executive officers recommended, and the Board and the Compensation Committee agreed, that they would not receive cash bonuses under the 2019 Bonus Plan. The business measurements and performance goals for determining the outcome of the 2019 Bonus Plan are described in the Compensation Discussion and Analysis beginning on page 40. (2) These columns show the “Threshold,” “Target” and “Maximum” number of shares of our common stock that could be issued in connection with PSUs granted in 2019 under our 1999 Omnibus Plan. The performance period commenced on January 1, 2019 and ends on December 31, 2021. The target payouts for Messrs. Fogel, Goulden and Millones are performance-driven and therefore completely at risk. The performance criteria for determining the number of shares of our common stock to be issued, if any, in connection with the PSUs are described in the Compensation Discussion and Analysis beginning on page 40. (3) Represents the aggregate grant date fair value of PSUs and RSUs granted to the named executive officers, computed in accordance with FASB ASC Topic 718. Generally, the grant date fair value is the full amount that we would expense in our financial statements over the award’s vesting schedule. Grant Date Fair Value for the PSUs granted on March 4, 2019 to Messrs. Fogel, Goulden and Millones, and Ms. Tans, was calculated using the target number of shares multiplied by the share price of $1,714.08, which was the closing price of our common stock on March 1, 2019, the trading day prior to such grant date. Grant Date Fair Value for the RSUs granted on August 12, 2019 to Ms. Tans was calculated using the granted number of shares multiplied by the share price of $1,917.69, which was the closing price of our common stock on August 9, 2019, the trading day prior to such grant date. As of December 31, 2019, the estimated probable number of shares that will be issued in connection with the PSUs at the end of the performance period is the “target” grant amount. The actual number of shares to be issued, if any, has not been determined and will be determined based on the relevant performance criteria over the three-year performance period. For additional information, please refer to Notes 2 and 4 of our Consolidated Financial Statements for the year ended December 31, 2019, included in our Annual Report on Form 10-K for the year ended December 31, 2019.

58 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 59 ($) 31, 31, 31, 31, be 31, 2021 72,476,532 23,297,657 47,899,145 and will 14,480,850 and were issued on 31, 2020 and which not been determined

be determined based and will be determined 31, 2019, and which vested Market or Payout Value of Market 31, 2019, and which vested 31, 2019, and which vested

Rights that Have Not Vested Have Rights that and will any, has Equity Incentive Plan Awards: Equity Incentive on January 1, 2019 and ends on on January 1, 2018 and ends on Unearned Shares, Units, or Other or Unearned Shares, Units, 1, 2018 and ends on December not been determined

(5) (2) (7) Ms. Tans in August 2019, consisting of HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | (#) (4) any, has 7,051 11,344 23,323 not been determined 35,290 on January 1, 2019 and ends on December on January 1, 2019 and ends on December on January 1, 2018 and ends on December on January commenced granted to BOOKING Outstanding Equity Awards at 2019 Fiscal Year-End Table Fiscal Year-End Awards at 2019 Equity Outstanding and ended on December on January 1, 2019 and ends on December any, has

two grants, if Mr. Fogel in March 2017 which vested commenced in in March 2021. commenced any, has not been determined that Have Not Vested Have that Units, or Other Rights Units, or our common stock that may be issued following the end of the 2019 Number of UnearnedShares, Number of on January 1, 2018 and ends on December Equity Incentive Plan Awards: Equity Incentive granted to

stock that may be issued following the end of the performance period stock that may be issued following the end of the performance period Stock Awards on January 1, 2017, on January 1, 2017 and ended on December on January 1, 2017 and ended on December shares of stock that may be issued following the end of the performance period in at — RSUs which the performance period commenced

($) stock that may be issued following the end of the performance period in commenced 1,606,017 be issued for these grants, if 8,284,747 4,240,952 commenced Not Vested commenced shares for which the performance period commenced shares of our common shares of our common Awards performance criteria over the applicable three-year performance period, subject to continued

shares of our common Units of Stock that Have Units of Stock Market Value of Shares or ValueMarket shares for Mr. Goulden in March 2018, (i) 1,033 shares of our common stock that vested and were issued on PSUs. The actual number of shares to be issued for the latter two grants, if (1) (6) in in May 2020. Table

our common stock subject to —

(#) 782 number of shares to be issued for these grants, if (3) 2,065 4,034 RSUs and/or unvested PSUs with performance and/or service conditions that have not yet yet RSUs and/or unvested been PSUs with and/or service performance conditions that not have granted to Equity

which the performance period shares of our common stock that will be issued pursuant to RSUs PSUs and 2,625 RSUs based on the relevant and which represents the maximum number of Have Not Vested Have Units of Stock that Units of Stock December which was31, 2019, $2,053.73. us. Number of Shares or Number period in connection with PSUs, and 8,168 period in connection with with PSUs, and 2,625 shares for which the performance period commenced with PSUs. The actual based applicable performance criteria on over the three-year performance period. the relevant Year-End December 31, 2019. There are no unexercised December stock option 31, 2019. awards, orvested either by unvested, held our the number of the number of shares of 31, 2020 31, 2021 and which represents the target number of shares of our common stock that may be issued following the end of the the maximum number of shares of our common

4,293 shares for which the performance period 4, are our common stock that 4, 2020 and (ii) 1,032 sharesvest to scheduled of in connection with PSUs, and 5,251 shares for which the performance period in connection with relevant performance over theon the criteria applicable performance period. three-year and which represents the maximum number of shares of our common stock that may be issued following the end of the performance and which represents the maximum number of shares of our common stock that may be issued following the end of the performance and which represents the target number of and which represents the target number of

will be determined shares that are scheduled to vest shares that are to scheduled executive market shareThe officers. value market the stock of price of awards is based onour per the closing

the over applicable the relevant performance criteria the three-year performance period. connection with PSUs. The actual number of shares to be issued for the latter connection with PSUs. The actual number of shares to

and which represents the target number of 2021 2021 in Represents December and Includes 4,426 shares for 2020 in based Includes 9,222 shares for which the performance period commenced 2020 Includes period March 4, 2020. Includes 13,354 shares for which the performance period and were issued on March 4, 2020. Includes 13,768 shares for which the performance period and were issued on March 4, 2020, 4,426 shares for which the performance period 782 connection connection period March December performance performance employment by on determined represents and were issued on March 4, 2020, 8,850 shares for which the performance period commenced Represents Represents, pursuant to following table provides information on the holdings of stock awards by our named following executive officers information table provides at on year-end fiscal the holdings of stock awards named by our

Name (1) (2) (5) (6) (3)

Glenn Fogel Goulden David Peter Millones Gillian Tans (4) (7) Fiscal common stock on The unvested 2019, including any Outstanding named satisfied as of EXECUTIVE COMPENSATION Option Exercises and Stock Vested Table

Option Exercises and Stock Vested Table

The following table contains information about the vesting of stock awards held by our named executive officers in 2019. There were no options exercised by our named executive officers in 2019.

Stock Awards Number of Shares Acquired on Vesting Value Realized on Vesting Name (#) ($) Glenn Fogel 6,906 11,837,436(1) David Goulden 1,033 1,770,645(1) Peter Millones 6,906 11,837,436(1) Gillian Tans 15,081 26,672,123(2)

(1) Reflects vesting of PSUs & RSUs in March 2019 with a per share market price of $1,714.08, the closing price of our common stock on March 1, 2019. (2) Reflects vesting of: a) 7,980 PSUs in March 2019 with a per share market price of $1,714.08, the closing price of our common stock on March 1, 2019; and b) 3,156 PSUs and 3,945 RSUs in May 2019 with a per share market price of $1,829.85, the closing price of our common stock on May 10, 2019.

60 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 61 Fogel Fogel

Fogel Fogel

Fogel for

HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | Employment

Reason” on or within twelve months after Reason” on or within twelve months of BOOKING

Contracts, Termination of Employment and Change in Control Arrangements in Control Employment TerminationContracts, and Change of Employment Termination

Arrangements

Fogel will be entitled Fogel other things, in addition to his to receive, among

2019 Named Executive Officer Compensation & Performance - Perquisites Officer Compensation & Performance 2019 Named Executive Reason”

“Good

for

Control

or

Contracts, in subject to his executing and revoking subject to his not a release:

written notice to the other party at ninetyleast days ofprior to the expiration the initial three-year through the date of his termination of his through the date of employment, the following severance compensation and of his base salary over a of his and target bonus, if any, for the year in which such termination occurs, paid “Cause”

or, under within certain circumstances, six months prior to, a “Change in Control” (as defined in the this amendment. is in place, a pro-rata annual bonus for the year in which termination of employment in place,occurs, determined atis a pro-rata annual for the year in bonus which termination employment of a Letter Agreement, dated October 24, 2019. This to October to amendment provides certain benefits Mr. a Letter Agreement,This Fogel 24, 2019. dated Fogel is not subject to adverse tax consequences and does not notincur expenses as a result ofFogel additional is tax consequences subject to adverse serving and does not made in all benefit plans and to our senior available and and fringe arrangements executives, to participate without his base salary and target bonus, if any, paid over a 24-month period following his over his base salary anda 24-month termination ofperiod following his employment; target bonus, if any, paid

held by such executive outstanding at December 31, 2019 that provide accelerated vesting for similar (or ninety days’ written notice. three-year initial for additional ninety days’ The term is automatically extended one year periods written 15, 2016, we entered agreement Mr. into 15, 2016, we January 1, 2017 with Fogel effective withan employment in connection Change provide for minimummost of the agreements annual base addition, provide that salaries. In executive willeach be

the then-current one year additional period that the employment agreement will not be agreement will extended. the then-current one not period thatyear additional the employment Executive Officer of Booking.com. See that Mr.

Mr. Fogel were our employee. three times the sum 36-month period oftermination following his employment; if a bonus plan the higher of and targetactual performance; and continuation benefits as if of health insurance for up to group following termination eighteen employment months of continuation for eighteen months group continuation following termination ofof insurance benefits health as if Mr. for eighteen months employment were our employee. if a bonus plan in place, occurs; and is actual annual a pro-rata for the year in bonus which termination of employment two times appointment as our President appointment and Chief as our President Executive Officer and as a member of the Board. with In connection Mr. each named executive each named executive agreement followed by a summary ofofficer’s employment the material terms of any equity 3. the consummation of, 2. 1. ensure 3. terminated “Cause” or If Mr. Fogel’s employment is without by Mr. Fogel for “Good 1. 2. for a description of Term Mr.agreement has Fogel’s employment an initial term beginning January 1, 2017, which three-year is by either terminable party upon term or Termination compensation accrued unless either party gives benefits: agreement), instead above severance and of Fogel willthe compensation benefits, Mr. be entitled to the following severance compensation and benefits, as Chief without In a termination the event “Cause” Fogel’s(as definedof of Mr. in the agreement) employment by or Mr. “Good Reason” (as defined in the agreement), Mr. Effective January 1, 2017, became and Chief Mr. Fogel Executive our Officer and President was appointed the Board.to On December benefits and perquisite benefits and perquisite generallyprograms provided to our other comparable senior executives. A summary is provided below of Mr. Fogel Employment Agreement his provisions) in control upon a change or termination. instruments We have an agreements agreement withemployment and officers. The executive are of each of duration varying our named generally Employment and taking on amended and supplemented this role of the additional Chief Executive Officer of in 2019, Booking.com we agreement with eligible to participate at eligible to participate commensurate or her a level with in our annual position his and long-term bonus compensation plans generally EXECUTIVE COMPENSATION Employment Contracts, Termination of Employment and Change in Control Arrangements

Termination as the Result of Death or “Disability” In the event of a termination of Mr. Fogel’s employment as the result of his death or “Disability,” (as defined in the agreement), Mr. Fogel’s heirs will be entitled to receive, among other things, in addition to his compensation accrued through the date of termination of employment, if a bonus plan is in place, a pro-rata target annual bonus for the year in which termination of employment occurs, continuation for twelve months following his death of group health insurance benefits for his dependents (or for Mr. Fogel, if he is terminated as the result of “Disability”) as if he were our employee, and in the event of termination of Mr. Fogel’s employment as the result of “Disability,” continuation for twelve months following termination of employment of group life and disability insurance benefits as if Mr. Fogel were our employee.

Other In addition, subject to certain limitations, if severance remuneration payable under the employment agreement is held to constitute a “parachute payment” under Section 280G of the Internal Revenue Code, we will reduce the amount of such payment to the extent necessary so that no portion of the payment, so reduced, would constitute a “parachute payment” if such reduction would result in an increase in the aggregate payments and benefits to be provided to Mr. Fogel determined on an after tax basis. Concurrently with entering into the employment agreement, Mr. Fogel also entered into a separate non-competition and non-solicitation agreement with us pursuant to which Mr. Fogel is subject to one-year non-competition and non-solicitation obligations following Mr. Fogel’s termination of employment with us. Equity Instruments PSUs The PSUs granted to Mr. Fogel in March 2019, 2018 and 2017 provide for accelerated vesting upon a termination of service without “Cause,” a termination of service for “Good Reason,” or a termination of service as the result of death or “Disability.” The number of shares to be delivered to Mr. Fogel would depend on the termination event (termination without cause/good reason/death/disability) and when it occurred. Upon a termination of service without “Cause,” for “Good Reason,” or as the result of death or “Disability” that does not occur coincident with or following a “Change in Control,” the PSU performance multiplier would be applied to a pro-rata portion (based on the number of days that had elapsed since March 4, 2019, March 4, 2018 or March 4, 2017, as applicable, (the grant dates of such PSUs) as of the date of his termination of service) of Mr. Fogel’s “target” PSU grant and could range from 0 to 2x, depending on our performance through the last fiscal quarter for which our financial results have been publicly reported. If a “Change in Control” occurs prior to March 4, 2022, March 4, 2021 or March 4, 2020, as applicable, and Mr. Fogel’s service is terminated without “Cause,” for “Good Reason,” or as a result of death or “Disability” coincident with or at any time following the effective date of the “Change in Control,” the PSU performance multiplier would be applied to a pro-rata portion (based on the number of days that had elapsed since March 4, 2019, March 4, 2018 or March 4, 2017, as applicable, (the grant dates of such PSUs) as of the effective date of the “Change in Control”) of Mr. Fogel’s “target” PSU grant and the performance multiplier could range from 0 to 2x, depending on our performance through the last fiscal quarter for which our financial results have been publicly reported; and Mr. Fogel would also receive a pro-rata portion of Mr. Fogel’s “target” PSU grant (based on the number of days that had elapsed since the effective date of the “Change in Control” as of the date of his termination) without the application of the performance multiplier.

RSUs The RSUs granted to Mr. Fogel in March 2017 provide for pro rata vesting upon a termination of service without “Cause,” a termination of service for “Good Reason,” or a termination of service as the result of death or “Disability,” in each case based on the number of days elapsed from March 4, 2017 (the grant date of such RSU) through and including the date of termination.

62 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 63 Goulden Goulden

Goulden will be

HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | Goulden also entered into a separate

BOOKING Goulden were our employee.

Goulden is subject to one-year

termination of employment with termination with us. of employment Contracts, Termination of Employment and Change in Control Arrangements in Control Employment TerminationContracts, and Change of Goulden’s

as the result of “Disability,” continuation for twelve months following as the result of “Disability,” continuation for twelve months Employment Reason”

employment “Disability”

or subject to his and subject to his executing not revoking a release:

Goulden, if he as if he is terminated as were our employee,of the result “Disability”) and “Good

Goulden’s

for

Death

of

severance compensation severance and benefits: or, under certain circumstances, within six months prior to, a “Change in Control” (as defined in written notice to the other party at written notice to the least ninety days ofprior to the expiration the initial three-year “Cause,” necessary sonecessary that no ofportion the payment, so reduced, would constitute a “parachute payment” if

Result

is in place, a pro-rata annual bonus for the year in which termination of employment in place,occurs, determined at is a pro-rata annual the year in for bonus which termination employment of of employment occurs, continuation for twelve months following occurs, of his death continuation for twelve employment group months of insurance health the

as without the sum of his base over ofsalary and base bonus, if any, the sum his a target year in for the which such termination occurs, paid

heirs will be entitled to receive, among other things, in addition to his Mr. Goulden’s heirs be other things, in addition to his compensation accrued will entitled to receive, among of employment group employment of life and of disability benefits insurance as if Mr. termination of of Mr. ninety days’ written notice. three-year initial for additional The ninety days’ term is automatically extended one year periods written a “parachute payment” under Section 280G of the Internal Revenue Code, we will reducea “parachute payment” the amount ofunder Section 280G such of the Internal Revenue Code, we Vice President and Chief Vice President Financial Officer. the date date of termination ofthe employment, if a bonus plan is in place, a pro-rata target annual for the year in bonus the then-current one year additional period that the employment agreement will not be will agreement extended. the then-current one not period thatyear additional the employment Mr. Goulden were our employee. the higher of actual the higher of and targetactual performance; and continuation of health insurance benefits as if following termination employment group for up to twelve months of 24-month 24-month period following termination of employment; his if a bonus plan continuation for twelve months group continuation following termination ofof benefits insurance health as if Mr. for twelve months employment were our employee. two times employment; if a bonus plan in place, occurs; and is a pro-rata actual annual for the year in which termination bonus of employment one times the sum of his one times base salary and his over a 12-month termination ofthe sum of target bonus, paid period following his Goulden’s employment agreement Goulden’s employment anhas term beginning initial three-year March 1, 2018, which terminable is by either entered with agreement appointment as Mr. into an Goulden, effective employment 2018 in connection March 1, with his non-competition and non-solicitation with agreement us pursuant to which Mr. non-competition and non-solicitation obligations following Mr. such reduction would result such reduction would in result an increase the aggregate paymentsin and benefits to be provided to Mr. Goulden determined on Mr. agreement, an after tax basis. Concurrently with entering into the employment which termination Other In addition, subject to certain limitations, agreement is held to if severance remuneration payable under the employment constitute payment to the extent Termination benefits for his dependents (or for Mr. in the event 2. 3. 1. through entitled to receive, among other things, in addition to his compensation accrued through the date of his termination other in addition ofentitled receive, compensation accrued his things, of to among to his through the date employment, the following 2. 3. If Mr. is terminatedGoulden’s employment “Cause” or without by Mr. Goulden for “Good Reason” on or within twelve months after the consummation of, In as result a terminationdeath or his the event Goulden’sof the of of “Disability,” (as Mr. in the employment defined agreement), termination 1. term or Termination In “Cause” (as without a termination the event Goulden’sof defined of Mr. in the agreement) or employment by Mr. Effective March and Chief 1, 2018, Mr. Goulden became On January 19, Financial Officer. 2018, our Executive Vice President we Executive Term Mr. Employment Employment Agreement party upon unless either party gives Mr. Goulden executingfor “Good and revoking Reason” (as not a release, Mr. defined in the agreement), subject to his the agreement), instead the severance andof above Gouldencompensation benefits, Mr. will be entitled to the following severance compensation and benefits, EXECUTIVE COMPENSATION Employment Contracts, Termination of Employment and Change in Control Arrangements

Equity Instruments PSUs The PSUs granted to Mr. Goulden in March 2019 and 2018 would be treated in the same fashion as the PSUs held by Mr. Fogel described above under “Mr. Fogel - Equity Instruments.”

RSUs The RSUs granted to Mr. Goulden in March 2018 provide for pro-rata vesting upon a termination of service without “Cause,” a termination of service for “Good Reason,” or a termination of service as the result of death or “Disability,” in each case based on the number of days elapsed from March 4, 2018 (the grant date of such RSUs) or the anniversary of the grant date that immediately precedes the date of termination, whichever applies, through and including the date of termination.

Mr. Millones Employment Agreement Termination without “Cause” or for “Good Reason” In the event of a termination of Mr. Millones’ employment by us without “Cause” (as defined in the agreement with Mr. Millones) or by Mr. Millones for “Good Reason” (as defined in the agreement), Mr. Millones will be entitled to receive, among other things, in addition to his compensation accrued through the date of his termination of employment, the following severance compensation and benefits: 1. two times his base salary and target bonus, if any, paid over a 12-month period following his termination of employment; 2. if a bonus plan is in place, a pro-rata target annual bonus for the year in which termination of employment occurs; and 3. continuation for one year following termination of employment of group health, life and disability insurance benefits as if he were our employee (in the event of a “Change in Control,” as defined in the agreement, continuation of benefits is for two years following the termination of employment).

Termination as a Result of Death or “Disability” In the event of a termination of Mr. Millones’ employment as a result of death or “Disability” (as defined in such agreement), Mr. Millones will be entitled to receive, among other things, in addition to his compensation accrued through the date of termination of employment, if a bonus plan is in place, a pro-rata target annual bonus for the year in which termination of employment occurs, in the event of termination as a result of death, continuation for one year following termination of employment of group health insurance benefits for Mr. Millones’ dependents as if he were our employee, and in the event of termination as a result of “Disability,” continuation for one year following termination of employment of group health, life and disability insurance benefits, as if he were our employee.

Other Mr. Millones’ employment agreement provides that, subject to certain limitations, if severance remuneration payable under the employment agreement is held to constitute an excess parachute payment under Section 280G of the Internal Revenue Code, we will reduce the amount of such payment to the extent necessary so that no portion of the payment, so reduced, would constitute a “parachute payment” if such reduction would result in an increase in the aggregate payments and benefits to be provided to Mr. Millones determined on an after tax basis. Mr. Millones entered into a separate non-competition and non-solicitation agreement with us in February 2013 pursuant to which Mr. Millones is subject to one-year non-competition and non-solicitation obligations following Mr. Millones’ termination of employment with us. Equity Instruments PSUs The PSUs granted to Mr. Millones in March 2019, 2018 and 2017, respectively, would be treated in the same fashion as the PSUs held by Mr. Fogel described above under “Mr. Fogel - Equity Instruments.

64 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 65 HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING agreement also a commuting includes cost Contracts, Termination of Employment and Change in Control Arrangements in Control Employment TerminationContracts, and Change of Employment Agreement with entered intoBooking.com, Booking.com Ms. Tans a Transition on June of of of such RSUs) as of termination. the date “Mr. “Mr. Fogel - Instruments” for the respective years ofEquity grant, except that the PSU Agreement”). Transition and Agreement”). The Agreement supplements termsamends certain of her amended President and President Chief Executive Officer, including the events that trigger payments to Ms. Tans. and non-solicitation provisions. The and employment non-solicitation provisions. The employment agreement with Booking.com, which she entered into in 2016 in connection with her appointment withemployment agreement which she Booking.com, entered into in 2016 in connection with appointment her €1,187,999.92. the end the Transitionthe of of the term Agreement, bonus payment in the amount of(b) a 2019 annual €1,000,000, (c) the Agreement, Ms. Tans the terms of the Transition is entitled to receive (a) an annual salary €50,000 be of to paid incurred in the preparation of the Transition in the preparation the Transition Agreement. incurred of RSUs granted to Ms. Tans on August 12, 2019 provide RSUs “Cause,” granted that Ms. or as to upon a terminationTans on the result of death August 12, without PSUs fashion as the PSUs granted Ms. Tans held by to in March 2018 Mr. 2019, and 2017 would be treated in the same employment agreement employment and the Transition withagreement Ms. TansAgreement certain confidentiality, include non-disparagement, 2019 (the “Transition “Disability,” Ms. Tans“Disability,” will receive portion a pro-rata of the RSUs based on the number of full days that elapsed from have RSUs The performance multiplier could only range from 1x to 2x. or August 12, grant date 2019 (the PSUs The Fogel described above under Equity Instruments non-competition, Under through In connection with Ms. Tans’ transition from serving as President and In from Ms. Tans’ transition connection Chief Executivewith serving as President Officer of Holding B.V. Booking.com Chairwoman of (“Booking.com”) to Amended and Restated Employment Agreement Employment and Restated Amended as Booking.com’s an RSU $1.5 grant of that willmillion by us 2020, vest in May and (d) a final compensation employment subject to continued payment of Ms. Tans 26, and restated reimbursement not to exceed per month and €200 the Transition Agreement provides for Booking.com’s of payment legal fees Other The EXECUTIVE COMPENSATION Potential Payments Upon a Change in Control and/or Termination

Potential Payments Upon a Change in Control and/or Termination

The following tables estimate the payments required to be made to each named executive officer in connection with a termination of his or her employment upon specified events or a change in control, assuming a $2,053.73 per share price for our common stock (the closing market price on December 31, 2019). The amounts shown also assume that the termination or change in control was effective December 31, 2019, and thus include amounts earned through such time and are estimates of the amounts which would be paid out to the named executive officers. Therefore, amounts shown do not reflect, for instance, any changes to base salaries or bonus targets effective in 2020, 2020 changes in the cost of health benefit plans, equity grants made in 2020 or the unvested pro-rata portion of equity awards for which the performance or vesting period extends beyond December 31, 2019. However, amounts shown do reflect incremental amounts due to the named executive officer upon or as a result of the specified event. The actual amounts paid can only be determined at the time of the termination of the named executive officer’s employment or a change in control. The terms “Cause,” “Good Reason,” and “Disability,” as applicable, have the meanings in the individual employment agreements or equity instruments described above. In the event of voluntary resignation or retirement where the person’s last date of employment was December 31, 2019, the named executive officer would only receive his or her accrued but unpaid salary through the termination date of employment. See Employment Contracts, Termination of Employment and Change in Control Arrangements above for more information.

Mr. Fogel

Termination for Termination without No Termination without "Good Reason" "Cause" or for Termination "Cause" (non-Change (non-Change in "Good Reason" (Change in Death or in Control) Control) (Change in Control) Control) Disability ($) ($) ($) ($) ($) Severance: Base Salary and Target Bonus 5,250,000 5,250,000 7,875,000 — 0 Pro-Rated Bonus 1,875,000 1,875,000 1,875,000 — 1,875,000 Equity and Benefits: Performance Share Units 47,391,873 47,391,873 47,391,873 — 47,391,873 Restricted Stock/RSUs 7,808,281 7,808,281 7,808,281 — 7,808,281 Stock Options 0 0 0 0 0 Health/Welfare(1) 27,107 27,107 27,107 — 18,071 Tax Gross-up 0 0 0 0 0 TOTAL 62,352,261 62,352,261 64,977,261 — 57,093,225

(1) Benefit amounts are based on 2019 annual premiums paid by the Company for medical, dental and vision coverage. In the case of termination due to Disability, Mr. Fogel would be eligible for an additional $324 for group life and disability insurance benefits (based on 2019 annual premiums paid by the Company).

66 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 67 0 0 0 0 0 0 — ($) ($) Death or Death or Disability Disability termination 0 0 0 0 0 — 1,755,939 — 13,167 — — 1,260,000 — 7,031,972 — 18,590 — — 1,007,000 — 15,236,623 — 10,061,078 — 16,262,213 ($) ($) No No Control) Control) (Change in (Change (Change in (Change Termination Termination 0 0 0 0 0 ($) ($) 13,167 HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | 37,828 7,031,972 1,755,939 1,007,000 3,074,000 1,260,000 3,720,000 and vision coverage, (b) group life insurance 19,355,451 15,236,623 13,781,078 and vision coverage. In the case of "Cause" or for "Cause" or for "Good Reason" "Good Reason" BOOKING Payments Upon a Change in Control and/or Termination aChange and/or in Control Upon Payments (Change in Control) (Change in (Change in Control) (Change in dental Termination without Termination Termination without Termination Potential

0 0 0 0 0 ($) ($) 13,167 18,914 group life and disability insurance benefits (based on 2019 annual Control) Control) 7,031,972 1,755,939 for 1,260,000 1,007,000 1,860,000 3,074,000 11,921,078 "Good Reason" "Good Reason" Termination for Termination Termination for (non-Change in (non-Change in

0 0 0 0 0 ($) ($) paid by the Company for medical, paid by the Company for (a) medical, dental an additional $324 18,914 13,167 1,007,000 7,031,972 1,755,939 3,074,000 in Control) in 15,236,623 15,236,623 1,260,000 19,336,537 19,336,537 1,860,000 in Control) in 11,921,078 Termination without Termination without "Cause" (non-Change "Cause" (non-Change Mr. Goulden would be eligible for (1) (1) insurance benefits. paid by the Company). Stock/RSUs Stock/RSUs Disability, Benefit amounts are based on 2019 annual premiums due due to and (c) disability premiums Benefit amounts are based on 2019 annual premiums Tax Tax Gross-up Health/Welfare Options Stock Health/Welfare Stock Options Stock Tax Gross-up Pro-Rated Bonus Pro-Rated Share Performance Units Restricted Base Salary TargetBase Bonus and Salary TargetBase Bonus and Pro-Rated Bonus Pro-Rated Performance Share Performance Units Restricted TOTAL (1) (1) TOTAL Equity and Benefits: Equity and Severance: Severance: Equity and Benefits: Equity and Mr. Millones Mr. Goulden EXECUTIVE COMPENSATION Potential Payments Upon a Change in Control and/or Termination

Ms. Tans

Termination for Termination without No Termination without "Good Reason" "Cause" or for Termination "Cause" (non-Change (non-Change in "Good Reason" (Change in Death or in Control) Control) (Change in Control) Control) Disability ($) ($) ($) ($) ($) Severance:(1) Base Salary and Target Bonus 1,330,049(2) 1,330,049(2) 1,330,049(2) — — Pro-Rated Bonus 0 0 0 — — Equity and Benefits: Performance Share Units 31,910,857 31,910,857 31,910,857 0 31,910,857 Restricted Stock/RSUs 831,761 0 831,761(3) — 831,761 Stock Options 0 0 0 0 0 Health/Welfare 0 0 0 — 0 Tax Gross-up 0 0 0 0 0 TOTAL 34,072,667 33,240,906 34,072,667 — 32,742,618

(1) Ms. Tans' compensation is translated into U.S. Dollars using an average exchange rate of 1.11957 U.S. Dollars to 1 Euro. (2) Reflects final compensation payment Ms. Tans is entitled to receive under the Transition Agreement. (3) Reflects value of RSUs Ms. Tans would be entitled to receive upon termination without "Cause" (Change in Control), but Ms. Tans would not be entitled to receive this amount upon termination for "Good Reason" (Change in Control).

68 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 69 CEO Pay Ratio CEO Pay 2019 HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING Fogel’s the Calculated in for 2019 was total compensation $14,768,526.

different methodologies, apply certain exclusions different methodologies, apply and make reasonable did not work for the Company for the entire fiscal year. We did not make work We did make for the Company any did not year. not fiscal for the entire Ratio

Pay

we are using the same median are using the same we employee identified in 2017 in our 2019 pay To ratio calculation. identify our 2017 and salary, and wage, overtime 2017 and salary, bonus compensation information payroll our from annualized records. We CEO in the Summary Compensation Table, Mr.

the pay ratio allow the pay ratio allow companies to use compensation reasonably believe compensation arrangements that would we result in a significant change to our pay ratio and assumptions that reflect their compensation practices. Executive Officer, Mr. Fogel, as disclosed in the Summary Table, Compensation to the annual total compensation employee in 2017, we used our worldwide employee population in 2017, used our population (without exclusions,employee we worldwide employee other than Mr. Fogel) as of total 2019 compensation to the total 2019 compensation ofMr. Fogel’s total 2019 compensation to the total 2019 our median employee 1. is 293 to pay This

manner as Mr. Fogel's total compensation, the total compensation of our median employee in 2019 was $50,418. The manner as Fogel'sMr. total compensation, of the total compensation our median employee in The 2019 was $50,418. not be not comparable the median be to our pay ratio reported and above, employee because SEC rules for identifying

estimates calculating ratio is a reasonable estimate calculated in a manner consistent with SEC rules. The ratio is a reasonable estimate calculated rules.pay ratio reported by other companies in a manner consistent with SEC The may median employees who compensation for those and cost-of-living adjustments, we excluded the value do not awardsannual equityof distribute equity because awards we to all employees. As reported same ratio of 2019 Exchange Pursuant to the Securities the ratio of are ofthe annual total compensation providing Act of 1934, as amended, we our Chief There of been our median or has (excludingno change in our employee our employee population Chief Executive Officer). employee October 31, disclosure and so EXECUTIVE COMPENSATION Equity Compensation Plan Information

Equity Compensation Plan Information We have one primary equity compensation plan: the 1999 Omnibus Plan, as amended (the “Plan”). In addition, in connection with our acquisition of KAYAK Software Corporation in May 2013, Buuteeq, Inc. in June 2014, OpenTable, Inc. in July 2014 and Rocket Travel, Inc. (“RocketMiles”) in March 2015, we assumed equity plans of those acquired companies (the “Assumed Company Plans”). We may continue to grant equity awards under certain of the Assumed Company Plans to employees of the applicable acquired company and, subject to certain limitations, other employees of ours. The Compensation Committee has broad authority to, among other things, grant equity awards and determine the terms, conditions and restrictions relating to those equity awards under the Plan and the Assumed Company Plans. The table below presents information as of December 31, 2019 on the Plans:

Number of securities remaining Number of securities to be Weighted-average available for future issuance under issued upon exercise of exercise price of equity compensation plans outstanding options, outstanding options, (excluding securities reflected warrants and rights(1) warrants and rights(2) in the first column)(3) Plan Category (#) ($) (#) Equity Compensation plans approved by security holders 1999 Omnibus Plan 533,332 $0.00 1,833,091 Equity Compensation plans not approved by security holders 2005 KAYAK Plan(4) 13,997 $455.28 0 2012 KAYAK Plan(4) 684 $596.80 4,003 Buuteeq Plan(5) 74 $79.97 2,562 OpenTable Plan(6) 30,206 $917.07 61,951(8) RocketMiles Plan(7) 14 $230.37 3,490 TOTAL 578,307 1,905,097

(1) Includes an aggregate of 562,754 unvested RSUs and unvested PSUs outstanding at December 31, 2019, consisting of 533,332 unvested shares under the 1999 Omnibus Plan, and 29,422 under the OpenTable Plan. (2) The weighted-average exercise price does not apply to PSUs or RSUs because there is no exercise price associated with such awards. (3) With respect to PSUs, this column assumes that the maximum number of shares underlying the PSUs will be issued at the end of the relevant performance periods, and therefore all such shares have been excluded. As of December 31, 2019, the actual number of shares to be issued, if any, had not been determined and will be determined based on the relevant performance criteria over the applicable performance periods. (4) The assumed KAYAK plans include the KAYAK Software Corporation 2012 Equity Incentive Plan (the "2012 KAYAK Plan") and the KAYAK Software Corporation 2005 Equity Incentive Plan (the "2005 KAYAK Plan"). No further grants may be made under the 2005 KAYAK Plan, although the stock options shown in the table were outstanding as of December 31, 2019. (5) The assumed Buuteeq plan is the Buuteeq, Inc. Amended and Restated 2010 Stock Plan. (6) The assumed OpenTable plan is the OpenTable, Inc. Amended and Restated 2009 Equity Incentive Award Plan. (7) The assumed RocketMiles plan is the Amended and Restated Rocket Travel, Inc. 2012 Stock Incentive Plan (8) Under the OpenTable Plan, there is fungible share-counting, and future full value awards would deplete the securities available for future issuance by the 1.66 fungible share ratio.

70 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 71 RSUs Benefits

(2) HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 |

and

Non-Employee Director Compensation and Benefits and Compensation Director Non-Employee BOOKING each incumbent non-employee director in May 2019 accelerate upon a change in control or if the director’s Fees ($) +40,000 +40,000 +30,000 +25,000 +20,000 +15,000 +10,000 +25,000 +RSUs at 110,000 valued approximately stock being granted to 2019 Director 60,000 RSUs at 265,000 valued approximately Compensation

the date of grant, and vesting will stock being granted to each non-incumbent non-employee director in June 2019. These Director

representing 157 shares of common the one-year anniversary of after Executive Officer, Mr. Fogel, received no additional compensation for serving on the Board during the year. Executive Officer, Mr. Fogel, received additional no serving on for the Board compensation or terminates a the death Board disability. the as director’s result of Committee and Leadership Fees and Committee Leadership Independent Director Independent RSUs representing 150 shares of common

on the day of non-executiveof in 2018. director compensation occurred of peer director pay of practices, and seeks the advice of Mercer, its consultant, to ensure independent compensation 2019, this resulted in RSUs

Chairperson ofAudit Chairperson Committee ofCompensation Committee Chairperson ofNCGCommittee Chairperson Audit Member Committee Member Compensation Committee Member NCGCommittee Lead Non-employee Chairperson Non-employee and We reimburse non-employee directors for all travel incurred in connection withand other expenses attending Board and committee meetings. In service on vest Compensation including a reviews our non-executive Committee program every director compensation years, two (1) Additional (2) (1) Position Non-employee Director Base Director Pay Non-employee Base

2019 Non-Employee Director Compensation Program Director Compensation 2019 Non-Employee Non-Employee The review In consultation withMercer, the Compensation consultant, the Compensation outside compensation Committee’s Board Committee and non-employee members 2019 compensation program for the approved the ofthe the Board. For 2019, our Chief that it that interests practices that are in the best maintains director compensation it of our stockholders. 1999 Our Omnibus Plan includes Compensation last a limit onCommittee's directors annual compensation for non-employee of $750,000. The review EXECUTIVE COMPENSATION Non-Employee Director Compensation and Benefits

The following table shows compensation earned during 2019 by all non-employee directors serving at any time during fiscal 2019.

Fees Earned or Stock Option All Other Paid in Cash(1) Awards(2)(3) Awards Compensation Total Name ($) ($) ($) ($) ($) Timothy M. Armstrong 75,000 264,689 0 0 339,689 Jeffery H. Boyd 85,000 374,274 0 0 459,274 Jeffrey E. Epstein(4) 40,903 0 0 0 40,903 Mirian M. Graddick-Weir 83,542 264,689 0 0 348,231 James M. Guyette 140,000 264,689 0 0 404,689 Wei Hopeman 39,861 264,750 0 0 304,611 Robert J. Mylod, Jr. 75,000 264,689 0 0 339,689 Charles H. Noski 100,000 264,689 0 0 364,689 Nancy B. Peretsman 70,000 264,689 0 0 334,689 Nicholas J. Read 75,694 264,689 0 0 340,383 Thomas E. Rothman 80,000 264,689 0 0 344,689 Craig W. Rydin(4) 47,361 0 0 0 47,361 Lynn M. Vojvodich 70,000 264,689 0 0 334,689 Vanessa A. Wittman 45,556 264,750 0 0 310,306

(1) This column reports the amount of cash compensation earned in 2019 for Board and committee service. (2) This column represents the aggregate grant date fair value of RSUs computed in accordance with FASB ASC Topic 718. For additional information, please refer to Notes 2 and 4 of the Company’s Consolidated Financial Statements for the year ended December 31, 2019, included in the Company’s Annual Report on Form 10-K. These amounts reflect the Company’s accounting expense for these awards, and do not correspond to the actual value, if any, that will be recognized by the non-employee directors. (3) As of December 31, 2019, the Company’s non-employee directors had the following outstanding equity awards: ● Timothy Armstrong: RSUs for 1,386 shares (which includes 1,229 vested shares the receipt of which has been deferred for tax planning purposes); ● Jeffery H. Boyd: RSUs for 970 shares (which includes 748 vested shares the receipt of which has been deferred for tax planning purposes); ● Mirian M. Graddick-Weir: RSUs for 280 shares (which includes 123 vested shares the receipt of which has been deferred for tax planning purposes); ● James M. Guyette: RSUs for 157 shares; ● Wei Hopeman: RSUs for 150 shares; ● Robert J. Mylod, Jr.: RSUs for 427 shares (which includes 270 vested shares the receipt of which has been deferred for tax planning purposes); ● Charles H. Noski: RSUs for 840 shares (which includes 683 vested shares the receipt of which has been deferred for tax planning purposes); ● Nancy B. Peretsman: RSUs for 1,703 shares (which includes 1,546 vested shares the receipt of which has been deferred for tax planning purposes); ● Nicholas J. Read: RSUs for 157 shares; ● Thomas E. Rothman: RSUs for 1,386 shares (which includes 1,229 vested shares the receipt of which has been deferred for tax planning purposes); ● Lynn M. Vojvodich: RSUs for 157 shares. ● Vanessa A. Wittman: RSUs for 150 shares; (4) Jeffrey E. Epstein and Craig W. Rydin retired from the Board effective June 6, 2019.

72 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 73 (2) (3) (3) (3) (3) No No No No Yes Yes Yes Yes Yes Yes Yes Yes stock ownership, $350,000 (Yes/No) Shares Valued Above Shares Valued beneficial (1) 0 0 the Board on June 6, 2019 and, 112 127 733 524 870 2,711 1,279 1,279 4,896 61,049 HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | 31, 2020. Non-Employee Director Compensation and Benefits and Compensation Director Non-Employee March 31, 2020 BOOKING Number of Shares Deemed Owned as of Deemed Owned certain details relating to Read and Ms. Wittman) met the holding

Number of Shares Required Shares Number of to be Owned under Our Stock Owned under to be Ownership Guidelines – theLesser– of: Guidelines Ownership the Board on June 7, 2018 and Ms. Hopeman and Ms. Wittman joined 2,500 shares or valued $350,000 shares shares at 2,500 2,500 shares or valued $350,000 shares shares at 2,500 or valued $350,000 shares shares at 2,500 or valued $350,000 shares shares at 2,500 or valued $350,000 shares shares at 2,500 or valued $350,000 shares shares at 2,500 2,500 shares or valued $350,000 shares shares at 2,500 2,500 shares or valued $350,000 shares shares at 2,500 or valued $350,000 shares shares at 2,500 or valued $350,000 shares shares at 2,500 2,500 shares or valued $350,000 shares shares at 2,500 stock-based awardsequity that to be owneddirectors have elected to defer non-employee by the Certain Beneficial Owners and Management on page 37 for of our of Stock non-employee directors asOwnership Guidelines for of March our Stock Ownership the additional has Guidelines benefit of acting as a holding period restriction as any on the terms of the deferral program in place on the terms the deferral at the time ofof Certain the deferral. of See Security Ownership Ownersand Management on page 37 for more stock ownership by ourdetails regarding non-employee directors. on the closing share price of of March closing share on on the price $1,345.32 31, 2020. shares will not be delivered to the director until 60 or 90 days after termination of his or her Board be the director shares will orservice, not delivered to days until 60 or 90 her Board after termination of his result, will be permitted to reach the ownership guidelines time. result, be reach guidelines over will to the permitted ownership Graddick-Weir and Mr. Read joined See See Security Ownership of as a Dr. calculated in accordance with SEC rules. Based Stock Stock require that Guidelines Ownership own shares of director each non-employee common stock our anin amount following forth table sets of the number shares deemed owned as by each non-employee director Marchof 31, 2020 for non-employee non-employee directors (other than Dr. Graddick-Weir, Ms. Hopeman, Mr. Thomas E. Thomas Rothman Charles H. CharlesH. Noski Nancy Peretsman B. Nicholas J. Read Vojvodich Lynn M. A.Wittman Vanessa (3) (2) Name Robert J. Mylod, Jr. (1) Timothy M. Timothy Armstrong M. H.Boyd Jeffery Graddick-WeirMirianM. Wei Hopeman or valued $350,000 shares shares at 2,500 James M. James Guyette M. All requirements Beneficial equal to exceeding the lesser or of 2,500 shares or valued shares at $350,000. Because and the shares are fully vested the ofdirector bears the shares has risk ofthe economic been deferred), (only delivery ownership our Stock Ownership vested Guidelines consider purposes of our Stock Ownership Guidelines. The depending Our Non-Employee Director Stock Ownership Guidelines Ownership Stock Director Non-Employee shares ofdirector for the purposes be for our Stockto counted Ownership We believeGuidelines. that deferred allowing purposes of deferred EXECUTIVE COMPENSATION Compensation Committee Interlocks and Insider Participation

Compensation Committee Interlocks and Insider Participation

As noted above, the Compensation Committee is currently comprised of four non-employee, independent directors: Dr. Graddick-Weir and Messrs. Armstrong, Guyette and Mylod. No member of the Compensation Committee is or was formerly an officer or employee of us, other than Mr. Mylod, who was an officer and employee of ours until 2011 and who joined the Board in 2017. No member of the Compensation Committee had any related person transaction required to be disclosed in which we were a participant during the last fiscal year. In addition, none of our executive officers serve on the compensation committee or board of directors of a company for which any of our directors serves as an executive officer.

Compensation Risk Assessment

The Compensation Committee believes that our compensation programs do not create or encourage excessive or inappropriate risk-taking that is reasonably likely to have a material adverse effect on us or our business.

Certain Relationships and Related Transactions

Review and Approval or Ratification of Related Person Transactions

The Audit Committee, pursuant to a written policy, reviews all relationships and transactions in which we participate and in which any related person has a direct or indirect material interest and the transaction involves or is expected to involve payments of $120,000 or more in the aggregate per fiscal year. Our legal staff is primarily responsible for gathering relevant information from the directors and executive officers. Related person transactions are generally identified in:

● questionnaires annually distributed to our directors and executive officers; ● certifications submitted annually by our executive officers and directors related to their compliance with our Code of Conduct;

● communications made directly by the related person to management; and ● periodic internal reviews by management. As required under SEC rules, transactions in which we participate and in which any related person has a direct or indirect material interest and the amount involved exceeds $120,000 are disclosed in our proxy statement. In addition, the Audit Committee reviews and approves or ratifies any related person transaction that is required to be disclosed. In the course of its review and approval or ratification of a disclosable related party transaction, the Audit Committee will consider:

● the nature of the related person’s interest in the transaction; ● the material terms of the transaction, including, without limitation, the amount and type of transaction; ● the importance of the transaction to the related person; ● the importance of the transaction to us; ● whether the transaction would impair the judgment of a director or executive officer to act in our best interest; and ● any other matters the Audit Committee deems appropriate. Any member of the Audit Committee who is a related person with respect to a transaction under review may not participate in the deliberations or vote respecting approval or ratification of the transaction; provided, however, that such director may be counted in determining the presence of a quorum at a meeting that considers the transaction. This process is included in our Corporate Governance Principles, which is available on our corporate website (www.bookingholdings.com) under the tab “For Investors.”

74 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT EXECUTIVE COMPENSATION 75 and

Executive

HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | 2019

BOOKING 2 Advisory Vote to Approve 2019 Executive Compensation 2019 Executive Approve Vote 2 Advisory to Proposal Approve

to our named executive officers, as disclosed to our named executive officers, to

Vote

Compensation Advisory 2 executive officers, as named executive officers, paid to the Company’s that the compensation

performance that is aligned with long-term stockholder interests. are encouraged Stockholders to read the to take into to take account the outcome of the vote future executive considering when compensation decisions. , the accompanying compensation tables Analysis and Discussion and narrative disclosure included the related focus focus that is designed to enhance long-term stockholder value. We believe ourthat senior executive in detailin under Compensation, our Analysis Discussionandcompensation program is designed to attract, vote to approve our vote to approve our executive compensation for 2019 as in this proxy statement (commonly described referred our executive compensation on an annual basis. This non-binding advisory vote is being provided as required Analysis, compensation tables and narrativeAnalysis, compensation discussion. The Board of Directors recommends that you voteadvisory of Directors recommends that FOR the approval, on an The Board paid basis, of the 2019 compensation pursuant to Item 402 of Regulation S-K, including the Compensation Discussion Item 402 of RegulationtheCompensation S-K, including pursuant to this and the Compensationthis vote is non-binding, Committee, which is comprised ofthe Board independent non-votes) were voted in support of our 2018 executive compensation program. Since 2011, we have sought advisory non-votes) were voted in support our of compensation program.2018 executive Since 2011, we non-votes are non-votes are not considered and therefore have no entitled to voteon the outcomeeffect on ofthe matter the vote.

“RESOLVED, disclosed pursuant to Item 402 of Regulation S-K, including the Compensation Discussion Discussion Compensation the S-K, including to Item 402 of Regulation disclosed pursuant tablesand Analysis, compensation is hereby APPROVED.” and narrative discussion

our 2019 annual meeting of of stockholders, shares present 89.9% and entitled to vote (which includes abstentions but not compensation program, with its balance of short-term incentives (including performance-based compensation program, with its cash bonus awards) and of (including balance short-term incentives long-term incentives (including equity performance-based awards that vest after three years), share and ownership guidelines reward sustained approval of Compensation As described motivate and and highly talented individuals at retain incentivize decision making all levels ofand the global organization management in this proxy statement. pursuant to Section 14A of the Exchange Act and applicable SEC rules. Accordingly, the Board pursuant Section 14Ais submitting this non-binding ofto Act the Exchange and applicable Accordingly, the Board SEC rules. stockholder This non-binding advisory vote on executive be consideredcompensation will approved by the affirmative vote a majorityof of the total number of present and shares entitled to vote on the matter. With to Proposalrespect 2, abstentions are consideredand therefore have present and same effect as the entitled to vote against the matter, and votes on the matter broker directors, expect At Proposal broker to as “say-on-pay”), byto as “say-on-pay”), approving the following resolution. Although This page intentionally left blank AUDIT MATTERS

Report of the Audit Committee of the Board of Directors 78 Auditor Independence 80 Proposal 3 Ratification of Selection of Independent Registered Public Accounting Firm 81

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 77 AUDIT MATTERS Report of the Audit Committee of the Board of Directors

Report of the Audit Committee of the Board of Directors

We, the Audit Committee of the Board of Directors of Booking Holdings Inc. (the “Company”), have the responsibility to, among other things, oversee the preparation of the Company’s consolidated financial statements, the Company’s system of internal controls and the qualifications, independence, compensation and performance of the Company’s independent registered public accounting firm (independent auditor). We have the sole authority and responsibility to select, evaluate and, when appropriate, replace the Company’s independent auditor. Our specific duties and responsibilities are described in our charter, which is available on the Company’s corporate website (www.bookingholdings.com) under the tab “For Investors.” We review the charter annually and work with the Board to amend it as appropriate to reflect the evolving role of the Audit Committee. The Board has determined that each of us is an independent director based on The Nasdaq Stock Market’s listing rules and that each of us also satisfies the Securities and Exchange Commission’s (SEC) additional independence requirements for members of audit committees. In addition, the Board has determined that each of Charles H. Noski, Nicholas J. Read and Vanessa A. Wittman is an “audit committee financial expert,” as defined by SEC rules. Management is responsible for the financial reporting process, including the Company’s system of internal controls, and for the preparation of the Company’s consolidated financial statements in accordance with U.S. generally accepted accounting principles. The Company’s independent auditor, Deloitte & Touche LLP (Deloitte), is responsible for performing an independent audit of the Company’s consolidated financial statements and internal control over financial reporting in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States) (PCAOB) and to issue reports thereon. Our responsibility is to oversee these processes, and we rely on the expertise and knowledge of management, the internal auditor and the independent auditor in carrying out that role. We are not professionally engaged in the practice of accounting or auditing and do not provide any expert or other special assurance or professional opinion as to the sufficiency of internal and external audits, whether the Company’s consolidated financial statements are complete and accurate and are in accordance with generally accepted accounting principles or on the effectiveness of the Company’s system of internal control over financial reporting. We met eleven times in 2019. Additional information regarding our activities can be found above under Board Committees - Audit Committee on page 30, Proposal 3 Ratification of Selection of Independent Registered Public Accounting Firm on page 81 and Board's Role in Risk Oversight on page 29. We reviewed and discussed with management and Deloitte the Company’s quarterly earnings press releases and periodic reports for the year ended December 31, 2019, including the Company’s 2019 audited consolidated financial statements and related annual report on Form 10-K, filed with the SEC. We also reviewed and discussed with management, the internal auditor and Deloitte management’s assessment of the effectiveness of the Company’s internal control over financial reporting. In connection with such discussions, Deloitte addressed the matters required to be discussed with us by applicable PCAOB standards and SEC rules and regulations. In addition, we discussed with the internal auditor and Deloitte the overall scope and plans for their respective audits. We met periodically with the internal auditor and Deloitte, separately or together, as appropriate, to discuss their work and the results of their audits. Our meetings included, whenever appropriate, executive sessions with the internal auditor or Deloitte without the presence of management. We have also received the written disclosures and the letter from Deloitte required by PCAOB Rule 3526 (“Communication With Audit Committees Concerning Independence”) and have discussed with Deloitte its independence with respect to the Company. In addition, we have considered whether Deloitte’s provision of non-audit services (including the fees for such services) is compatible with maintaining its independence. Deloitte rotates its lead audit partner every five years. In connection with the rotation that occurred for 2019, we interviewed proposed candidates, consulted with management and selected the lead audit partner. We assessed Deloitte’s performance as independent auditor during 2019, including the performance of the lead audit partner and the audit team, a process we undertake on an annual basis. We reviewed a variety of indicators of audit quality relating to Deloitte, including:

● the quality and candor of its communications with us and management, its responsiveness and accessibility, and its historical and recent performance on the Company’s audits;

● how effectively it maintained its independence and employed independent judgment, objectivity and professional skepticism;

78 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT AUDIT MATTERS 79 Rothman reporting reporting Nicholas J. Nicholas J. Read Vanessa A. Wittman H. Noski, Chairman Thomas E. Charles THE BOARD OF DIRECTORS BOARD THE OF OF HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | of the Audit Committee of the BoardtheAudit of of of Directors Committee SUBMITTED BY THE AUDIT COMMITTEE BOOKING Report that the Company’s audited consolidated financial that statements be audited consolidated financial the Company’s on Form 10-K for the year ended December on 31, 2019. Form 10-K the the selection of independent Deloitte as the Company’s auditor the year ending Decemberfor 31, 2020 in is of insight demonstrated in its review of the Company’s assessment of internal control over financial demonstrated of in insight its review the Company’s assessment internalof of over control consider the impact of changing auditors when changing assessing whether the impact of auditors consider the current independent auditor. to retain a As our evaluation of the independent auditor’s performance and considering all other factors we relevant,deemed our evaluation we of the independent auditor’s performance and considering we factors all other and practices, and reporting. financial control internal over perform the audit; and its as tenure and independent auditor the Company’s operations, of knowledge global the Company’s accounting policies and remediation and remediation control of deficiencies; data available qualityabout and external including reportsperformance, PCAOB by the and Deloitte’s to those response reports; the appropriateness of its fees, intotaking account size and the Company’s and complexity the resources necessary to the quality We also included in the Company’s Annual Report concluded that result of the best interests the Companyof and its stockholders. Based on the review and discussions referred to above, and our review of the representations of management the report and recommended of the independent auditor,to the Board we ● ● ● ● AUDIT MATTERS Auditor Independence

Auditor Independence

Deloitte & Touche LLP is our independent registered public accounting firm (independent auditor). The approximate aggregate fees and expenses billed for professional services by Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu and their respective affiliates (collectively, “Deloitte”) in 2019 and 2018 were as follows:

2019 2018 Type of Fees ($) ($) Audit Fees 10,991,000 8,762,000 Audit-Related Fees 282,000 295,000 Tax Fees 391,000 399,000 All Other Fees 196,000 5,000

● Audit Fees. The aggregate fees and related expenses billed for professional services rendered by Deloitte for the audit of our consolidated financial statements included in our Form 10-K, review of consolidated financial statements included in our Form 10-Qs and audit of management’s assessment of internal controls, for services related to acquisitions and for services that are normally provided by the independent auditor in connection with statutory and regulatory filings or engagements. The increase in audit fees in 2019 as compared with 2018 was primarily due to services provided by Deloitte related to consultations on accounting and control matters and procedures related to systems implementations.

● Audit-Related Fees. The aggregate fees billed for assurance and related services by Deloitte that are reasonably related to the performance of the audit or review of our consolidated financial statements and are not reported under “Audit Fees,” which include services for matters such as certain agreed-upon procedure attestation reports and audits of employee benefit plans.

● Tax Fees. The aggregate fees and related expenses billed for professional services rendered by Deloitte for tax compliance, tax advice and tax planning, which include state and local tax regulatory matters covering employee benefit plan tax, income tax, and non-income based tax matters, preparation and review of certain foreign tax returns and consultation related to tax strategies and planning.

● All Other Fees. The aggregate fees billed for other services rendered by Deloitte principally related to advice on the preparation and delivery of global training materials and licenses obtained for an online accounting research tool.

● Pre-Approval Policies and Procedures. The Audit Committee has adopted policies and procedures for pre-approving all audit and non-audit work performed by Deloitte. In accordance with our policy and applicable SEC rules and regulations, the Audit Committee or its chairperson pre-approves all audit-related services, tax services and other services provided to us by Deloitte (“Auditor Services”). Pre-approval is detailed as to the particular service or category of services. If Auditor Services are required prior to a regularly scheduled Audit Committee meeting and do not fall within the pre-approved services set forth in the pre-approval policy adopted by the Audit Committee, the Audit Committee chairperson is authorized to approve such services, provided that they are consistent with our policy and applicable SEC rules and regulations, and that the full Audit Committee is advised of such services at the next regularly scheduled Audit Committee meeting. Deloitte and management periodically report to the Audit Committee regarding the extent of the Auditor Services provided by Deloitte in accordance with this pre-approval, and the fees for the Auditor Services performed to date. All audit-related services, tax services and other services described above were pre-approved by the Audit Committee or the Audit Committee’s chairperson, and the Audit Committee concluded that the provision of such services by Deloitte was compatible with the maintenance of that firm’s independence.

80 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT AUDIT MATTERS 81

ratify the selection, ratify the the selection, Firm

HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | Independent

BOOKING of

Accounting 3 Ratification of Selection of Independent Registered Public AccountingIndependent of of Firm Public Registered Selection 3 Ratification

Proposal Selection at any time during the year.

of Public

may change the appointment may change Registered Ratification the Board believe to serve as that the Board our retention ofthe continued Deloitte & LLP Touche 3

firm requires approval by a majority shares presentnumber of the total of and entitled to vote on the December 31, order 2020. In to auditor independence, ensure continuing periodically the Audit Committee auditor is in our best interests and those of our stockholders, if our stockholders do is in our not auditor interests and best ofthose our stockholders, do if our stockholders Deloitte & Touche LLP to our stockholders for ratification as a matter good corporate stockholders for ratification to our Deloitte & of Although governance. as a matter Touche LLP The Board of Directors recommends a vote FOR Proposal 3. The Board

Audit Committee is appointment, compensation,directly responsible for the retention and oversight of our independent

questions. be available to respond to appropriate Touche LLP’s prior service to us, the Audit Committee has selected Deloitte & Touche LLP as Deloitte & Touche LLP service to us, Touche LLP’s prior our independent the Audit Committee hasauditor for selected The Ourrequire that are submitting By-Laws do not stockholders the ratify the selection of our independent auditor. However, we selection of Audit Committee reconsider whetherto Deloitte & Touche retain the Audit will or not Even LLP. is ratified, if the selection Committee, in its discretion, With Proposal to act as respect to 3, the ratificationour independent ofregistered the selection of Deloitte & LLP Touche public accounting matter. effect asWith respect to Proposal a vote 3, abstentionsagainst the matter. will have the same

registered statements. Deloitte & firm public accounting auditor) to audit(independent retained our consolidated financial Touche LLP has After audited since 1997. statements account taking into financial our consolidated its assessment of Deloitte & Proposal the Audit Committee and independent considers should be a regularwhether there rotation of the independent auditor, and the advisability and potential impact of independent selecting a different Further, in conjunction withauditor. the mandated Deloitte &rotation of Touche LLP’s lead audit partner (which occurs at least years),five every the Audit its and Committee chairperson are directly involved in the selection of Deloitte & Touche LLP’s new lead audit partner. We submittingare the Audit Committee’s selection of our independent public registered accounting firm for ratification by the stockholders at Meeting. Representatives ofthe Annual Deloitte & LLP willTouche be available at Meeting, the Annual will an opportunity a statement have to and make wish if they will the year ending This page intentionally left blank STOCKHOLDER PROPOSALS

Proposal 4 Stockholder Proposal – Right of Stockholders to Act by Written Consent 84 Board of Directors Statement in Opposition to Proposal 4 85 The Board of Directors Recommends a Vote AGAINST this Proposal 4. 85 2021 Stockholder Proposals 87

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 83 STOCKHOLDER PROPOSALS Proposal 4 Stockholder Proposal – Right of Stockholders to Act by Written Consent

Proposal 4 Stockholder Proposal – Right of Stockholders to Act by Written Consent

Mr. John Chevedden, 2215 Nelson Avenue, No. 205, Redondo Beach, California 90278, owner of not less than 10 shares of the Company’s common stock, has given notice that he intends to present the following proposal at the Annual Meeting: Proposal 4 – Adopt a Mainstream Shareholder Right – Written Consent Shareholders request that our board of directors take the steps necessary to permit written consent by shareholders entitled to cast the minimum number of votes that would be necessary to authorize the action at a meeting at which all shareholders entitled to vote thereon were present and voting. This written consent is to give shareholders the fullest power to act by written consent consistent with applicable law. This includes shareholder ability to initiate any appropriate topic for written consent. Hundreds of major companies enable shareholder action by written consent. This proposal topic won majority shareholder support at 13 large companies in a single year. This included 67%-support at both Allstate and Sprint. This proposal topic also won 63%-support at Cigna Corp, (CI) in 2019. This proposal topic would have received higher votes than 63% to 67% at these companies if more shareholders had access to independent proxy voting advice. Taking action by written consent is a means shareholders can use to raise important matters outside the normal annual meeting cycle like the election of a new director. This proposal is important to Booking Holdings shareholders because Booking Holdings has a higher than necessary 25% stock ownership threshold for shareholders to call a special meeting. Plus this 25% threshold was set in concrete in the Certificate of Incorporation which makes it more difficult to change. In any event the right for shareholders to act by written consent is gaining acceptance as a more important right than the right to call a special meeting. The directors at Intel apparently thought they could divert shareholder attention away from written consent by making it less difficult for shareholders to call a special meeting. However Intel shareholders responded with greater support for written consent in 2019 compared to 2018. Following a 45%-vote for a written consent shareholder proposal The Bank of New York Mellon Corporation (BK) said it adopted written consent in 2019. Perhaps BK is starting a new trend in recognizing that a 45%-vote represents a majority vote from the shares that have access to independent proxy voting advice. And a proxy advisor set certain minimum requirements for a company adopting written consent in case the directors of a company are tempted to adopt a "fig leaf' version of written consent. Please vote yes: Adopt a Mainstream Shareholder Right – Written Consent -Proposal 4

84 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT STOCKHOLDER PROPOSALS 85 4

HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | those who accumulate short-term to Proposal in Opposition of Statement Directors to to and is familiar with more detailed BOOKING Board Opposition

in

matters. Permitting a consent matters. Permitting stockholders to act by would permit written Statement

not provide a mechanism for all stockholders to meet to discuss voting matters, provide to meet to discussthe not a mechanism for all stockholders voting action by written consent could also lead to substantial confusion and disruption for consent could also written by action lead to substantial to and open to its principles corporatedialogue to of governance and encourages frequent stockholder support to call a special meeting (25% required). The existing right required). meetingstockholder support The (25% for our to call a special and accountable to stockholder concerns. The Company regards its and accountable to stockholder engagement with concerns. The 4

during the past ten years). during the past ten relating to important to important voting relating the Company’s stockholders and before the Board is given the Company’s stockholders and an opportunity the Board before to share its views on the would present an opportunity for special interest investors interest would (including present an opportunity for special Directors a special meeting is the superior method for stockholders to raise matters consideration outside of for

provide the opportunity provide the opportunity for dissemination of information to stockholders, ofsufficient time for consideration meeting process by ensuring that (a) the meeting all stockholders are notified and of the matters to be voted of with potentially multiple, even conflicting, written consents being solicited. with potentially multiple, even conflicting, written

annual meeting process because provides the aforementioned safeguardsit of notice, information, time and this topic as they have rejected a substantially similar a substantially every time it this topic as they have been proposal has rejected for a vote bypresented the voting director in elections; pieces of information for stockholders to consider as the Board pieces informationhas of access for stockholders to consider as the Board our stockholders on our business and operations, corporate governance matters, executive and compensation stockholders with a bare majority of the votes to take any stockholders with potentially significant notification to a bare majority ofa action without the votes to take of the Company the Board’s of or its stockholders and is unnecessary. Our stockholders have continually supported could disenfranchise stockholders and deprive them of the time and opportunity to carefully consider complete them of could disenfranchise stockholders and the time and opportunityand deprive to carefully issues that are important to to issues that our stockholders. Ininvestor important dialogue, our addition to the Company’s commitment are an opportunity for stockholders to be heard. In the past year, we have had an opportunity for stockholders to be heard.numerous discussions and Inmeetings with the past year, we notice. stockholder-friendly stockholder-friendly corporate governance practices include:

with any stockholder. If enough stockholders support a matter to pass an action by written pass an with consent (greater to any action by written If enough than 50% stockholder. stockholders support a matter Board of Directors Recommends a Vote AGAINST this Proposal 4. Recommends a Board of Directors positionsbest interests in the all through the borrowingof of thatshares) to improperly push for proposals are not Proposal

all points of view may be considered prior to a vote. The views and recommendation of the Board are particularly views and be considered view prior to a vote. The all points of recommendation of may the Board transparent Company regularly of to sound principles has demonstrated corporate its governance, working to ensure commitment Board matters thatstrongly believes requiring vote a stockholder important should be the subject of stockholder Board of Directors believes that action by written consent without prior notice Board consent prior is not Directors without to of notice all stockholders in the best believes that by written action

No super-majority voting provisions; Stock ownership guidelines for directors and executive officers; Majority Stockholder-approved proxy access; board); Annual director elections (i.e., no classified Lead Independent Director; The strong, stockholders as fundamental stockholders to call the Company is responsive other topics.discuss and Through input, these interactions, we receive additional provide answer questions and details, address proposal stockholders. Permitting stockholder stockholders, provide opportunity to consider excluding certain subsets a forum for discussion to all our all viewpoints and ofstockholders without stockholders from the entire process. Further, the proposal several of accurate information information about the Company and its operations than the stockholders. Depriving stockholders the opportunity to consider the Board’s views is counterproductive through to informed stockholder a Stockholders benefit decision-making. voting from fully required), there is sufficient the regular voting In contrast, since the right to act by written consent does not consentIn matter to be informationrequire notice and contrast, since the right to act by does not on written voting the distributed to all stockholders and does The upon; (b) all stockholders are provided the appropriate time and information to evaluate the matters vote presented for a and to make an informed done voting decision; and and (c)in secret presented to the Company then stockholder actions are not without meaningful subset of matter meetings, which interests position on stockholders (four times subset of The Board The the matters Board so the Company’s stockholders and the onto voted be transparent and discussion and interaction among that important to ● ● ● ● ● ● STOCKHOLDER PROPOSALS Board of Directors Statement in Opposition to Proposal 4

● Stockholders can call special meetings; ● No poison pill/rights plan; ● Annual “say-on-pay” vote; ● Long-standing practice of prohibiting hedging or pledging of stock by directors and executive officers; ● Disclosure of director and executive officer 10b5-1 Plans; and ● 11 of 13 current directors are independent. The Board believes permitting stockholders to act by written consent without prior notice to all stockholders would be detrimental to stockholder rights because it deprives stockholders of an opportunity for their voice to be heard. The combination of the Company's ongoing engagement with stockholders and the Company’s existing governance practices strikes the appropriate balance of ensuring accountability to stockholders, promoting stockholder democracy and enabling management and the Board to manage the business in an effective manner and in the best interest of all stockholders generally. The Company’s stockholders have consistently agreed with this approach, with rejection of a substantially similar proposal each time it has been considered by the stockholders. Accordingly, the Board believes that Proposal 4 is not in the best interests of the Company or our stockholders.

The Board of Directors recommends that you vote AGAINST this Proposal 4. Your proxy will be so voted unless you specify otherwise on the proxy card.

86 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT STOCKHOLDER PROPOSALS 87 Stockholder Proposals Stockholder 2021 HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING Proposals

to Article II Section II 13 of to Section Article our By-Laws), to be properly brought before the 2021 annual meeting of stockholders pursuant to Article II Section 13 of our By-Laws, II the notice required by II pursuant13 ofSection meeting Article of stockholders our By-Laws, to Article of the date this year’s the date of Annual Meeting. As a result, any of receivedsuch must be notice no than earlier pursuant to these provisions of the By-Laws (and not of pursuant to SEC the By-Laws Rule pursuant to these provisions II Section 13 or Article 14a-8 (and not of our Stockholder to the Board pursuant to Article to pursuant to Article II Section 13 the Board of our By-Laws) in the proxy materials to be distributed for inclusion

of the By-Laws must be delivered to our Corporate Secretary not than the By-Lawsless of 120 nor more than must be delivered to our 150 days Corporate Secretary not prior to the 2021 and no later than February 4, 2021. must be received no earlier than February 4, 2021 and no later than March 6, 2021. of stockholders in accordance with our By-Laws (and not accordance pursuant to SEC of stockholders within Rule 14a-8), a stockholder’s notice the our By-Laws of (and not

the stockholder wishes to present must be delivered to our Corporate Secretary not than the stockholder less to present wishes 90 nor than 120 more must be delivered to our Corporate Secretary not prior first the of this year’s prior to anniversary of the date a result, any notice given Meeting. As Annual by or behalfon of a

us in connection with us in connection with the 2021 annual of must submitmeeting stockholders their to our Corporate Secretaryproposals on If one or more eligible stockholders desire to include one or more nominees for election to the Board in our for electionIf one or to the Board proxy materials more eligible stockholders desire includeto one or more nominees for the 2021 annual meeting stockholder or before December 25, 2020. In (other for election order for proposals, including stockholder to the Board than those requested nominees to be included pursuant in our proxy materials matter days By-Laws) 2021 Stockholders in accordance of the SEC’s proxy rules, with who, Rule 14a-8 to present wish proposals (other than nominees for election Section 13 January 5, by first anniversary This page intentionally left blank OTHER MATTERS

Annual Meeting Information 90 For the Annual Meeting of Stockholders to be Held on Thursday, June 4, 2020 90 Voting Rights and Outstanding Shares; Approval 90 Voting Matters 91 Revocability of Proxies 91 Solicitation 91 How to Attend the Annual Meeting 91

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 89 OTHER MATTERS Annual Meeting Information

Other Matters

The Board knows of no other matters that will be presented for consideration at the Annual Meeting. If any other matters are properly brought before the meeting, the persons named in the accompanying proxy card intend to vote on those matters in accordance with their best judgment.

Annual Meeting Information For the Annual Meeting of Stockholders to be Held on Thursday, June 4, 2020

The enclosed proxy is solicited on behalf of the Board of Booking Holdings Inc. for use at our 2020 Annual Meeting of Stockholders to be held on Thursday, June 4, 2020, at 11:00 a.m. local (Eastern) time, or at any adjournment or postponement of the Annual Meeting, for the purposes set forth in this proxy statement and in the accompanying Notice of Annual Meeting of Stockholders. The Annual Meeting will be held online at www.virtualshareholdermeeting.com/BKNG2020. We intend to mail this proxy statement and the proxy card on or about April 24, 2020 to all stockholders entitled to vote at the Annual Meeting.

Voting Rights and Outstanding Shares; Approval

Only stockholders of record at the close of business on April 9, 2020 will be entitled to notice of and to vote at the Annual Meeting. At the close of business on April 9, 2020, 40,930,696 shares of common stock were outstanding and entitled to vote. Each holder of record of common stock on April 9, 2020 will be entitled to one vote for each share held on all matters to be voted upon at the Annual Meeting. The inspector of election appointed for the meeting will tabulate all votes and will separately tabulate affirmative and negative votes, abstentions and broker non-votes. A majority of the issued and outstanding shares of common stock entitled to vote at the Annual Meeting, present either at the webcast or by proxy, will constitute a quorum for the transaction of business at the Annual Meeting. Stockholders who are present at the Annual Meeting webcast or by proxy and who abstain, and proxies relating to shares held by a broker on your behalf (that is, in “street name”), that are not voted (referred to as “broker non-votes”) will be treated as present for purposes of determining whether a quorum is present. For purposes of approving the matters to be voted upon at the Annual Meeting:

● With respect to Proposal 1, the nominees for election to the Board who receive a majority of votes cast for the election of directors will be elected directors. With respect to the election of directors, a majority of votes cast means that the number of shares cast “for” a nominee’s election exceeds the number of “withhold” votes for that nominee. With respect to Proposal 1, votes cast does not include abstentions or broker non-votes, and therefore, abstentions and broker non-votes will not affect the outcome of the vote.

● With respect to Proposal 2, the non-binding advisory vote to approve 2019 executive compensation will be considered approved by the affirmative vote of a majority of the total number of shares present and entitled to vote on the matter. With respect to Proposal 2, abstentions are considered present and entitled to vote on the matter and therefore have the same effect as votes against the matter, and broker non-votes are not considered entitled to vote on the matter and therefore have no effect on the outcome of the vote.

● With respect to Proposal 3, the ratification of the selection of Deloitte & Touche LLP to act as our independent registered public accounting firm requires approval by a majority of the total number of shares present and entitled to vote on the matter. With respect to Proposal 3, abstentions will have the same effect as a vote against the matter. Because brokers are entitled to vote on Proposal 3 without specific instructions from beneficial owners, there will be no broker non-votes on this matter.

● With respect to Proposal 4, the non-binding stockholder proposal requesting the right of stockholders to act by written consent will be considered approved by the affirmative vote of a majority of the shares present and entitled to vote on the matter. With respect to Proposal 4, abstentions are considered present and entitled to vote on the matter and therefore have the same effect as votes against the matter, and broker non-votes are not considered entitled to vote on the matter and therefore have no effect on the outcome of the vote.

90 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT OTHER MATTERS 91 Meeting Information Meeting Board Vote Recommendation eachnominee FOR FOR FOR Annual HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING instruct the instruct to votebroker as to how the shares your 1, 2 on Proposals or solicitation of proxies, and we currently solicitation expect to pay of and we proxies, Innisfree will begin promptly at 11:00 a.m. Eastern Time. We encourage you to access the meeting website to access the meeting website will begin promptly at Time. We encouragea.m. 11:00 Eastern you obtain from the record holder a proxy issued in your name and present such proxy to us in order to and present such to obtain from theproxy to us record in order holder a proxy issued in your name may reimburse persons representing beneficial owners of of may reimburse persons representingcommon stock for their costs beneficial of forwarding owners not additionally not compensate directors, officers or other regular employees for these services. have We time to the meeting. you wish to voteensure your If or askability to access questions at the Annual Meeting, any of the following actions: technical support number that will be posted on platformthe virtual meeting page for assistance. $15,000 for its decide its the fees to use services services, more could be significantly though more if we Attend the Annual Meeting materials. Our directors, officers or other regular employees may also solicit by telephone,materials. Our directors, officers in-person orproxies or other regular employees may Matters not be counted as having been voted on the applicable to Proposal With respect proposal. broker3, the may We will provide copies of solicitation brokeragematerials to banks, and houses, fiduciaries holding in custodians the meeting to obtain a 16-digit control number. the to obtain meeting a 16-digit its discretion to to its discretion for orvote that against in the absence yourproposal of Please instruction. yourinstruct broker so during the Annual Meeting. If you experience duringtechnical difficulties duringexperience the Annual Meeting. If you check-in or during the Annual Meeting, pay for the entire cost of proxy solicitations, including preparation, assembly, printing and ofmailing proxy solicitation with our Corporate Secretary at our principal executive office (800 Connecticut Norwalk, Connecticut Avenue, a written notice a written ourof notice with revocation Corporate Secretary at our executive office (800 Connecticutprincipal Avenue, must provide the 16-digit control number provided on your proxy card, on Notice the Internet Availabilityof of Proxy 06854) a properly executed proxy showing a later date; or atattending through Meeting and the meeting the virtual Annual the platform (attendance will voting not, by itself, a revoke that proxy). Please note a broker, if by bank or record nominee and you to your sharesother wish vote at are the held of meeting, you must Norwalk, Connecticut 06854); filing vote at filing Proposal 1: ElectionofDirectors 1: Proposal Vote Approve2019 Compensation 2:Advisory to Executive Proposal Ratification of Publicof 3: Accounting Selection Registered Independent Proposal Firm Requesting of Proposal ConsentRight Stockholders 4: Act Stockholder Written Proposal to Non-Binding by AGAINST Proposal you solicitation please call the If you plan to attend the Annual Meeting, the webcast can If you plan be accessed at the Annual Meeting, can to www.virtualshareholdermeeting.com/BKNG2020 attend the webcast and the Annual Meeting Materials or on the instructions and that accompanied the proxy materials follow the instructions available on the meeting website Voting materials. your vote can counted. be How to otherwise. We will approximately extensively. We will their names of shares of stock our common ownedbeneficially by others to forward these materials to the beneficial owners common stock. We Solicitation engaged Innisfree M&A Incorporated to assist in the Any person giving a proxy in response to this solicitation has the power to revoke it at any time before it is voted. Proxies may Any person givingto this solicitation has a proxy in response the power to revoke it at any time before it voted. Proxies may is be revoked by Revocability of Proxies prior to the start 4, the broker exercise not may discretion to vote proposals.for or against those This would anda “broker non-vote” be these shares will exercise If your shares are held in “street name,” and you do are heldIf your shares not in “street name,” and you ● ● ● This page intentionally left blank APPENDICES

Appendix A Unaudited Reconciliation of GAAP to Non-GAAP Financial Information 94 Non-GAAP Financial Measures 96 Appendix B Form of Proxy Card 97

BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT 93 APPENDICES Appendix A Unaudited Reconciliation of GAAP to Non-GAAP Financial Information

Appendix A Unaudited Reconciliation of GAAP to Non-GAAP Financial Information

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA Year Ended December 31, (In millions)(1) 2019 2018 2017 2016 2015 2014 GAAP Net income $ 4,865 $3,998 $2,341 $2,135 $2,551 $2,422 (a) Adjustment to loyalty program liability — (27) — — — — (b) Net travel transaction tax charge (benefit) — 45 (12) — (30) — (c) Adjustment to personnel expenses 66 — — — — — (d) Litigation settlement — — 19 — — — (e) Depreciation and amortization 469 426 363 309 272 208 (f) Impairment of goodwill — — — 941 — — (e) Interest income (152) (187) (157) (95) (56) (14) (e) Interest expense 266 269 254 208 160 88 (g) Net unrealized (gains) losses on marketable equity securities (745) 367 — — — — (h) Loss on early extinguishment of debt — — 2 — — 6 (i) Remeasurement gains on certain Euro-denominated debt (7) — — — — — (j) Impairment of cost-method investments — — — 63 — — (e) Income tax expense 1,093 837 2,058 578 577 568 ADJUSTED EBITDA $5,855 $5,729 $4,867 $4,139 $3,475 $3,278

RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME Year Ended December 31, (In millions, except share and per share data)(1) 2019 2018 GAAP Net income $4,865 $3,998 (a) Adjustment to loyalty program liability — (27) (b) Net travel transaction tax charge (benefit) — 45 (c) Adjustment to personnel expenses 66 — (k) Amortization of intangible assets 175 178 (h) Debt discount amortization related to convertible debt 45 47 (c) Interest income — (2) (i) Remeasurement gains on certain Euro-denominated debt (7) — (g) Net unrealized (gains) losses on marketable equity securities (745) 367 (l) Income taxes on Convertible notes held for investment 21 — (m) Net income tax impact of the Tax Act (49) (48) (n) Tax impact of Non-GAAP adjustments 92 (111) NON-GAAP NET INCOME $4,463 $4,446 GAAP WEIGHTED-AVERAGE NUMBER OF DILUTED COMMON SHARES OUTSTANDING ('000) 43,509 48,017 NON-GAAP NET INCOME PER DILUTED COMMON SHARE $102.57 $92.59

94 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT APPENDICIES 95 2019 (368) which $4,497 $4,865 calculate from Net calculate in Interest Year Ended Year Ended December 31, December from Net income from Net income to hedging instrument for calculate Non-GAAP Net adjustments are excluded 2019, and were reclassified to debt are recorded from Net income to HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | 31, 2018. These from Net income to calculate Non-GAAP Net from Net Income BOOKING in Personnel expenses and is excluded introduced in the 1st quarter of 2018 to the program and is Unaudited Reconciliation of GAAP to Non-GAAP Financial Information Financial to Non-GAAP GAAP of Reconciliation Unaudited prior-period wage-related tax on compensation paid to certain from Net income to calculate Non-GAAP Net income and Adjusted and loss on early extinguishment of in Foreign currency transactions and other and is excluded changes in General and administrative expense and is excluded Appendix A tax expense and is excluded which is recorded recorded are excluded recorded on our Euro-denominated debt that is not designated as a in Income debt is tax charge (benefit) including estimated interest and penalties, where applicable, in Foreign currency transactions and other and excluded from Net Income to notes held for investment that matured in the 3rd quarter of separation, securities equity in Depreciation and amortization expense and excluded from Net income to calculate Non-GAAP NON-GAAP FREE CASH FLOW RECONCILIATION CASH FLOW FREE NON-GAAP favorable ruling for the twelve months ended December convertible expense which is a the amortization of debt discount are included in the calculation of Free included cash flow. are in calculation the of net travel transaction recorded in Foreign currency transactions and other and is excluded on marketable period OpenTable's loyalty program liability related to tax credits resulting from the Tax Cuts and Jobs Act (the "Tax Act") and an adjustment to the one-time deemed recorded former employees in the year of intangible assets is cost-method investments are recorded Opentable in recorded excluded from calculate EBITDA. Goodwill which Operating expenses and is Net Adjusted income to is in General and administrative expense are excluded from Net income to calculate Non-GAAP Net income and Adjusted EBITDA. to correct an immaterial error related to the nonpayment of of related to prior for foreign currency transaction gains or losses for patent litigation settlement property and equipment liability resulting from the Tax Act is recorded interest expense related to adjustment to from calculate income Net Net Non-GAAP to and Adjusted income EBITDA. are from calculate EBITDA. income excluded Net Adjusted to may not total due rounding to (1) EBITDA. for U.S. Federal the tax impact of Non-GAAP adjustments and is excluded impact Non-GAAPfrom Netthe tax of excluded is adjustments and income calculate Non-GAAP income. to Net and Adjusted EBITDA. income was recorded related to income. unrealized gains or losses Net cash provided by operating Net providedby activities cash calculate EBITDA. Adjusted Reclassification of income taxes related to Income EBITDA. Non-cash expense and Foreign currency transactions and other, respectively. Non-cash interest expense is excluded accounting purposes is from accumulated other comprehensive loss to income tax expense. Benefit Amortization of repatriation Additions to Net from Net income to calculate Non-GAAP Net income and Adjusted from Net calculate income EBITDA. Non-GAAP Netto income and Adjusted Adjustment calculate EBITDA. Non-GAAP Net income and Adjusted Adjustment Amounts Non-GAAP net income. Loss on early extinguishment of Impairments income. Reflects Impairment of Net Favorable Adjustments Interest highly-compensated to Adjusted Amounts excluded are recorded income to income calculate Adjusted EBITDA. to Adjustment (o) Additions propertyand to equipment (g) (h) (i) (l) (o) (m) (n) (k) (e) (f) (In millions) (In (1) (c) (d) (j) NON-GAAP FREE CASH FLOW FREENON-GAAP (a) (b) APPENDICES Appendix A Unaudited Reconciliation of GAAP to Non-GAAP Financial Information

Non-GAAP Financial Measures

Non-GAAP net-income represents GAAP net income, adjusted to exclude an adjustment to OpenTable’s loyalty program, prior period net travel transaction tax charges (benefit) (e.g., value-added taxes, sales taxes, excise taxes, hotel occupancy taxes, etc.), certain personnel adjustments, a litigation settlement, amortization of intangible assets, charges related to the impairment of goodwill, net unrealized losses on marketable equity securities, non-cash interest expense related to the amortization of debt discount and losses on early extinguishment of debt, if any, related to our convertible debt, charges related to other-than-temporary impairments of cost-method investments, the impact of the U.S. Tax Cuts and Jobs Act, and the income tax impact of the non-GAAP adjustments mentioned above. Adjusted EBITDA excludes the items listed above relating to non-GAAP net income as well as depreciation expense, interest income, interest expense and income tax expense. Free cash flow is net cash provided by operating activities less capital expenditures. Adjusted EBITDA, Non-GAAP net income and Free cash flow are “non-GAAP financial measures,” as such term is defined by the SEC, and may differ from non-GAAP financial measures used by other companies. As discussed in this proxy statement, we use Adjusted EBITDA (calculated as described in this proxy statement) as a key performance measure under our Annual Cash Incentive Bonus Plan and long-term equity incentive awards, as they pertain to the named executive officers. This non-GAAP measure and the other non-GAAP measures used are not intended to represent funds available for our 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 non-GAAP net income, Adjusted EBITDA and Free cash flow, but included in the calculation of their closest GAAP equivalents, are significant components of our consolidated statements of operations or statements of cash flows, as applicable, and must be considered in performing a comprehensive assessment of overall financial performance. We also use these non-GAAP financial measures for financial and operational decision-making. We believe that these non-GAAP financial measures are useful for analysts and investors to evaluate our ongoing operating performance because they facilitate comparison of our current period and projected next-period results to those of prior periods and to those of our competitors (though other companies may calculate similar non-GAAP financial measures differently than those calculated by us). We evaluate certain operating and financial measures on both an as-reported and constant-currency basis. We calculate constant currency by converting our current-year period financial results for transactions recorded in currencies other than U.S. Dollars using the corresponding prior-year period monthly average exchange rates rather than the current-year period monthly average exchange rates. The presentation of this financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP in the United States.

96 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT APPENDICIES 97 !! Form of Proxy of Card Form Against Abstain ! For Appendix B KEEP THIS PORTION FOR YOUR RECORDS DETACH AND RETURN THIS PORTION ONLY DETACH w Date HOLDINGS INC. | 2020 PROXY STATEMENT HOLDINGS INC. 2020 | BOOKING SCAN TO SCAN TO proposal requesting the right of stockholdersof right the requesting proposal VIEW MATERIALS & VOTE & VIEW MATERIALS D12044-P34292 Such other business as may properly come before the come before Such other business as may properly Stockholder to act by written consent.

Signature (Joint Owners) Signature To withhold authority to vote for any individual withhold authority to vote To nominee(s), mark "For All Except" and write the number(s) of the nominee(s) on the line below. VOTE ONLINE above or scan the QR Barcode Before The Meeting - Go to www.proxyvote.com delivery of information Use the Internet voting instructions and for electronic to transmit your your Have Easterndate. p.m. meeting 11:59 or until date up Time cut-off the before day the follow the instructions to obtain your in hand when you access the web site and card proxy voting instruction form. an electronic and to create records During The Meeting - Go to www.virtualshareholdermeeting.com/BKNG2020 may attend the meeting via the Internet and vote during the meeting. Have the information You the instructions. available and follow the arrow that is printed in the box marked by VOTE BY PHONE - 1-800-690-6903 until 11:59 p.m. Use any touch-tone telephone to transmit your voting instructions up in hand card Eastern date or meeting date. Have your proxy Time the cut-off the day before when you call and then follow the instructions. VOTE BY MAIL envelope we Mark, sign and date your proxy card and return it in the postage-paid Mercedes Way, have provided or return it to Vote Processing, c/o Broadridge, 51 Edgewood, NY 11717. 4. NOTE: meeting or any adjournment thereof. The Board of Directors recommends you vote AGAINST recommends of Directors The Board the following proposal: Card

For All For Except

!! !! All Against Abstain Withhold All For For ! ! !!! Proxy

of THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. ONLY THIS PROXY CARD IS VALID

anessa A. Wittman ynn M. Vojvodich Charles H. Noski Nicholas J. Read Thomas E. Rothman Bob van Dijk L V

07) 08) 09) 10) 11) 12)

ouche LLP as our independent Form . ove 2019 executive compensation. M. Graddick-Weir M. fery H. Boyd ei Hopeman imothy M. Armstrong

T Jef Glenn D. Fogel Mirian W Robert J. Mylod, Jr

4) o elect twelve directors to hold office until the next until the next to hold office o elect twelve directors BOOKING HOLDINGS INC. GERI JACKSON ATTN: 800 CONNECTICUT AVENUE CT 06854 NORWALK, Advisory vote to appr Nominees: T annual meeting of stockholders and until their respective elected and qualified. successors are Ratification of Deloitte & T public accounting firm for the fiscal year ending registered December 31, 2020. 01) 02) 03) 0 05) 06)

the following: 1. you vote FOR the recommends of Directors The Board following proposals: 2. The Board of Directors recommends you vote FOR recommends of Directors The Board Signature [PLEASE SIGN WITHIN BOX]Signature Date Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint or other fiduciary, administrator, executor, When signing as attorney, Please sign exactly as your name(s) appear(s) hereon. sign in full corporate or partnership name by authorized officer. All holders must sign. If a corporation or partnership, please owners should each sign personally.

3.

BOOKING HOLDINGS INC.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: Appendix B APPENDICES Appendix B Form of Proxy Card

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Proxy Statement & Annual Report are available at www.proxyvote.com.

D12045-P34292

BOOKING HOLDINGS INC. PROXY SOLICITED BY THE BOARD OF DIRECTORS FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON JUNE 4, 2020

The undersigned hereby appoints DAVID I. GOULDEN and PETER J. MILLONES, and each of them, as attorneys and proxies of the undersigned, with full power of substitution, to vote all of the shares of stock of Booking Holdings Inc. that the undersigned may be entitled to vote at the Annual Meeting of Stockholders of Booking Holdings Inc. to be held on Thursday, June 4, 2020 at 11:00 a.m. Eastern time held virtually at www.virtualshareholdermeeting.com/BKNG2020, and at any and all continuations and adjournments of the meeting, with all powers that the undersigned would possess if personally present, upon and in respect of the following matters and in accordance with the following instructions, with discretionary authority as to any and all matters that may properly come before the meeting.

UNLESS YOU INDICATE OTHERWISE, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED IN PROPOSAL 1, FOR PROPOSALS 2 AND 3, AND AGAINST PROPOSAL 4, EACH AS MORE SPECIFICALLY DESCRIBED IN THE PROXY STATEMENT AND IN ACCORDANCE WITH THE JUDGMENT OF THE PROXIES ON ANY OTHER MATTERS THAT MAY PROPERLY COME BEFORE THE MEETING. IF SPECIFIC INSTRUCTIONS ARE INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH YOUR INSTRUCTIONS.

Continued and to be signed on reverse side

98 BOOKING HOLDINGS INC. | 2020 PROXY STATEMENT Annual Report to Stockholders

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ______FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ______

For the fiscal year ended: December 31, 2019 Commission File No.: 1-36691 Booking Holdings Inc. (Exact name of Registrant as specified in its charter)

Delaware 06-1528493 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification Number) 800 Connecticut Avenue Norwalk, Connecticut 06854 (address of principal executive offices) Registrant's telephone number, including area code: (203) 299-8000 ______

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class: Trading Symbol Name of Each Exchange on which Registered: Common Stock par value $0.008 per share BKNG The NASDAQ Global Select Market 0.800% Senior Notes Due 2022 BKNG 22A The NASDAQ Stock Market LLC 2.150% Senior Notes Due 2022 BKNG 22 The NASDAQ Stock Market LLC 2.375% Senior Notes Due 2024 BKNG 24 The NASDAQ Stock Market LLC 1.800% Senior Notes Due 2027 BKNG 27 The NASDAQ Stock Market LLC Securities Registered Pursuant to Section 12(g) of the Act: None. ______Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer Accelerated filer Non-accelerated filer Smaller reporting company Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No The aggregate market value of common stock held by non-affiliates of Booking Holdings Inc. at June 30, 2019 was approximately $80.0 billion based upon the closing price reported for such date on the NASDAQ Global Select Market. For purposes of this disclosure, shares of common stock held by executive officers and directors of Booking Holdings Inc. on June 30, 2019 have been excluded because such persons may be deemed to be affiliates of Booking Holdings Inc. This determination of affiliate status is not necessarily a conclusive determination for other purposes. The number of outstanding shares of Booking Holdings Inc.’s common stock was 41,061,814 at February 19, 2020. DOCUMENTS INCORPORATED BY REFERENCE

The information required by Part III of this Annual Report on Form 10-K, to the extent not set forth in this Form 10-K, is incorporated herein by reference from Booking Holdings Inc.'s definitive proxy statement relating to its annual meeting of stockholders to be held on June 4, 2020, to be filed with the Securities and Exchange Commission within 120 days after the end of Booking Holdings Inc.'s fiscal year ended December 31, 2019.

Booking Holdings Inc. Annual Report on Form 10-K for the Year Ended December 31, 2019 Index

Page No. Special Note Regarding Forward Looking Statements 1 PART I 1 Item 1. Business 1 Item 1A. Risk Factors 7 Item 1B. Unresolved Staff Comments 30 Item 2. Properties 30 Item 3. Legal Proceedings 30 Item 4. Mine Safety Disclosures 30

PART II 31 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 31 Item 6. Selected Financial Data 34 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 36 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 53 Item 8. Financial Statements and Supplementary Data 54 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 54 Item 9A. Controls and Procedures 54 Item 9B. Other Information 57

PART III 57 Item 10. Directors, Executive Officers and Corporate Governance 57 Item 11. Executive Compensation 57 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 57 Item 13. Certain Relationships and Related Transactions, and Director Independence 57 Item 14. Principal Accountant Fees and Services 57

PART IV 57 Item 15. Exhibits and Financial Statement Schedules 57 Item 16. Form 10-K Summary 60 Signatures 61 Consolidated Financial Statements 63 Special Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K and the documents incorporated herein by reference contain forward-looking statements. These forward-looking statements reflect our views regarding current expectations and projections about future events and conditions and are based on currently available information. These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions that are difficult to predict, including the Risk Factors identified in Part I, Item 1A of this Annual Report; therefore, our actual results could differ materially from those expressed, implied or forecast in any such forward-looking statements. Expressions of future goals and expectations and similar expressions, including "may," "will," "should," "could," "aims," "seeks," "expects," "plans," "anticipates," "intends," "believes," "estimates," "predicts," "potential," "targets," and "continue," reflecting something other than historical fact are intended to identify forward-looking statements. Unless required by law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. However, readers should carefully review the reports and documents we file or furnish from time to time with the Securities and Exchange Commission (the "SEC" or the "Commission"), particularly our quarterly reports on Form 10-Q and current reports on Form 8-K.

PART I

Item 1. Business

Our mission is to make it easier for everyone to experience the world. We seek to empower people to cut through travel barriers, such as money, time, language and overwhelming options, so they can use our services to easily and confidently get where they want to go, stay where they want to stay, dine where they want to dine, pay how they want to pay and experience what they want to experience. We connect consumers wishing to make travel reservations with providers of travel services around the world through our online platforms. Through one or more of our brands, consumers can: book a broad array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, hostels and other properties); make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a cruise, flight, vacation package, tour or activity. Consumers can also use our meta-search services to easily compare travel reservation information, such as airline ticket, hotel reservation and rental car reservation information, from hundreds of online travel platforms at once. In addition, we offer various other services to consumers and partners, such as certain travel-related insurance products and restaurant management services to restaurants.

We offer these services through six primary consumer-facing brands: Booking.com, KAYAK, priceline, agoda, Rentalcars.com and OpenTable. While historically our brands operated on a largely independent basis and many of them focused on a particular service (e.g., accommodation reservations) or geography, we are increasing the collaboration, cooperation and interdependency among our brands in our efforts to provide consumers with the best and most comprehensive services. We also seek to maximize the benefits of our scale by sharing resources and technological innovations, co-developing new services and coordinating activities in key markets among our brands. For example, Booking.com, the world’s leading brand for booking online accommodation reservations (based on room nights booked), offers rental car and other ground transportation services, flights, restaurant reservations, tours and activities reservations and other services, many of which are supported by our other brands. Similarly, hotel reservations available through Booking.com are also generally available through agoda and priceline. The following table shows the key services offered to consumers by our primary brands:

1 Our business is driven primarily by international results, which consist of the results of Booking.com, agoda and Rentalcars.com and the international businesses of KAYAK and OpenTable. This classification is independent of where the consumer resides, where the consumer is physically located while using our services or the location of the travel service provider or restaurant. For example, a reservation made through Booking.com at a hotel in New York by a consumer in the United States is part of our international results. During the year ended December 31, 2019, our international business (the substantial majority of which is generated by Booking.com) represented approximately 90% of our consolidated revenues. A significant majority of our revenues, including a significant majority of our international revenues, is earned in connection with facilitating accommodation reservations. See Note 18 to the Consolidated Financial Statements for more geographic information.

Booking Holdings Inc. was formed as a Delaware limited liability company in 1997 and was converted into a Delaware corporation in July 1998. Our common stock is listed on the NASDAQ Global Select Market under the symbol "BKNG." We refer to our company and all of our subsidiaries and brands collectively as "Booking Holdings," the "Company," "we," "our" or "us."

The Booking Holdings Business Model

We derive substantially all of our revenues from enabling consumers to make travel service reservations. We also earn revenues from credit card processing rebates and customer processing fees, advertising services, restaurant reservations and restaurant management services, and various other services, such as travel-related insurance.

For the year ended December 31, 2019, we had revenues of $15.1 billion, which we classify as "agency" revenues, "merchant" revenues and "advertising and other" revenues.

• Agency revenues are derived from travel-related transactions where we do not facilitate payments from travelers for the services provided. We invoice the travel service providers for our commissions after travel is completed. Agency revenues consist almost entirely of travel reservation commissions.

• Merchant revenues are derived from travel-related transactions where we facilitate payments from travelers for the service provided, generally at the time of booking. Merchant revenues include travel reservation commissions and transaction net revenues (i.e., the amount charged to travelers less the amount owed to travel service providers) in connection with our merchant reservation services; credit card processing rebates and customer processing fees; and ancillary fees, including travel-related insurance revenues and certain global distribution system ("GDS") reservation booking fees. Substantially all merchant revenues are derived from transactions where travelers book accommodation reservations or rental car reservations.

• Advertising and other revenues are derived primarily from (a) revenues earned by KAYAK for sending referrals to online travel companies ("OTCs") and travel service providers and for advertising placements on its platforms and (b) revenues earned by OpenTable for its restaurant reservation services and subscription fees for restaurant management services.

The Booking Holdings Strategy

We aim to achieve our mission to make it easier for everyone to experience the world through global leadership in online travel and restaurant reservation and related services by striving to:

• provide consumers with the best choices and prices at any time, in any place, on any device; • make it easy for people to find, book, pay for and experience their travel desires; and • provide platforms, tools and insights to our business partners to help them be successful.

We focus on relentless innovation and execution and a commitment to serve both consumers and our travel service provider and restaurant partners with unmatched service and best-in-class digital technology. The global online travel and dining categories continue to grow as consumer purchasing shifts from traditional offline channels to interactive online channels, including mobile channels. Our strategy is to continue to participate broadly in this online growth by expanding our service offerings and markets. In particular, we seek to (a) leverage technology to provide consumers with the best experience, (b) partner with travel service providers and restaurants to our mutual benefit, (c) operate multiple brands that collaborate with each other, and (d) invest in profitable and sustainable growth.

2 • Providing the best consumer experience. We believe that offering consumers an outstanding online experience is essential for our future success. To accomplish this, we focus on providing consumers with: (a) intuitive, easy- to-use online travel and restaurant reservation and search services; (b) a continually increasing number, location and variety of accommodations, other travel offerings, restaurants and payment options through our services; (c) informative and useful content, such as pictures, accommodation and restaurant details and reviews; and (d) excellent customer service. Our goal is to make travel easy, frictionless and personal and to offer consumers the most trusted brands, the most personalized experience and the most extensive, varied and comprehensive travel service selection in every geography at the best prices. Further, we endeavor to provide excellent customer service in a variety of ways, including through our call centers and online platforms and the use of chatbots and other technologies, so that consumers can be confident that booking reservations through us will be a positive experience.

We are constantly innovating to grow our business by, among other things, providing a best-in-class user experience with intuitive, easy-to-use online platforms (i.e., websites and mobile apps) to ensure that we are meeting the needs of online consumers while aiming to exceed their expectations. As a result, our long-term strategy is to build a more integrated offering of multiple elements of travel, which we refer to as the "Connected Trip." We believe that through innovation and the utilization of emerging technologies such as artificial intelligence, the Connected Trip will simplify and improve all aspects of the travel experience, including: discovery, planning, booking, coordinating itineraries among travel service providers, automatic rescheduling/ rebooking, etc. For example, if a traveler’s flight is delayed, we envision that ultimately the Connected Trip will not only alert the traveler, but also automatically arrange for a late arrival at the hotel, change a dinner reservation and alert other diners, reschedule the airport transfer, find a later connecting flight, etc. We believe that such a system will benefit both the traveler and the travel service provider or restaurant, as well as provide a compelling and differentiated service offering for consumers.

• Partnering with travel service providers, restaurants and OTCs. We aim to establish mutually beneficial relationships with travel service providers and restaurants around the world. We believe that travel service providers and restaurants benefit from participating in our services by increasing their distribution channels, demand and inventory utilization in an efficient and cost-effective manner. Travel service providers and restaurants benefit from our well-known brands and online marketing efforts, expertise in offering an excellent consumer experience through our online platforms and ability to offer their inventory in markets and to consumers that the travel service provider or restaurant may otherwise be unable or unlikely to reach.

In addition, we have entered into commercial relationships with other OTCs, such as Didi (the leading ride hailing service in China) and Grab (the leading ride hailing company in Southeast Asia), whereby the customers of one company will have access to the services of the other. For example, through the Booking.com app, a Booking.com customer traveling in Southeast Asia can book a local ride arranged by Grab.

• Operating multiple brands. We employ a strategy of operating multiple brands, which we believe allows us the opportunity to offer our services in ways that appeal to different consumers, pursue different marketing and business strategies, encourage experimentation and innovation, provide different service offerings and focus on different markets. At the same time, we are increasing the collaboration, cooperation and interdependency among our brands in our efforts to provide consumers with the best and most comprehensive services. We intend to invest resources to support organic growth by all our brands, whether through increased marketing, geographic expansion, technological innovation or increased access to accommodations, rental cars, restaurants, airline tickets or other services.

• Investing in profitable and sustainable growth. We seek to offer online services that meet the needs and the expectations of consumers, travel service providers and restaurants and that we believe will result in long-term profitability and growth. We intend to accomplish this through continuous investment and innovation, growing our businesses in new and current markets, expanding our services and ensuring that we provide an appealing, intuitive and easy-to-use consumer experience. We have made significant investments in people, technology, marketing and expanded, new or additional services, such as increasing our extensive collection of accommodations including homes, apartments and other unique places to stay, expanded flight and ground transportation offerings and other offerings. We seek to maximize the benefits of our scale by sharing resources and technological innovations among our brands, co-developing new services and coordinating activities in key markets among our brands. We also regularly evaluate, and may pursue and consummate, potential strategic acquisitions, partnerships, joint ventures or investments, whether to expand our businesses into complementary areas, expand our current businesses, acquire innovative technology or for other reasons. 3 Service Offerings

Booking.com and Rentalcars.com. Booking.com is the world's leading brand for booking online accommodation reservations, based on room nights booked, with operations worldwide and headquarters in the Netherlands. At December 31, 2019, Booking.com offered accommodation reservation services for approximately 2,580,000 properties in over 230 countries and territories and in over 40 languages, consisting of approximately 460,000 hotels, motels and resorts and approximately 2,120,000 homes, apartments and other unique places to stay.

Booking.com has expanded its offerings to better help consumers experience the world. For example, Booking.com offers in-destination tours and activities in more than 200 cities around the world, as well as flight, rental car and restaurant reservation services. Rentalcars.com is operated as part of Booking.com and offers online rental car reservation services and allows consumers to make rental car reservations in over 60,000 locations throughout the world, with customer support in over 40 languages. Booking.com and Rentalcars.com also offer pre-booked taxi and black car services at over 850 airports throughout the world.

KAYAK. KAYAK, headquartered in Stamford, Connecticut, provides an online price comparison service (often referred to as "meta-search") that allows consumers to easily search and compare travel itineraries and prices, including airline ticket, accommodation reservation and rental car reservation information, from hundreds of travel websites at once. KAYAK offers its services in over 60 countries, with the United States being its largest market, through various websites, including Momondo, Cheapflights and HotelsCombined.

Priceline. Priceline is a leader in the discount travel reservation business and offers online travel reservation services primarily in North America and is headquartered in Norwalk, Connecticut. Priceline offers consumers hotel, rental car and airline ticket reservation services, as well as vacation packages and cruises.

Agoda. Agoda is a leading online accommodation reservation service catering primarily to consumers in the Asia- Pacific region, with headquarters in Singapore and operations in Bangkok, Thailand and elsewhere. Agoda also offers flight, ground transportation reservation services and activities.

OpenTable. OpenTable is a leading brand for booking online restaurant reservations. With significant operations in San Francisco, California, OpenTable provides online restaurant reservation services to consumers and reservation management services to restaurants. OpenTable does business primarily in the United States, though it continues to invest in expanding its international offerings.

Marketing and Brand Awareness

We have established widely used and recognized e-commerce brands through marketing and promotional campaigns. Both our performance and brand marketing expenses have increased significantly in recent years, and we intend to continue a strategy of promoting brand awareness through both performance and brand marketing efforts, including by expanding brand campaigns into additional markets, which may significantly increase our brand marketing expenses.

Competition

We compete globally with both online and traditional travel and restaurant reservation and related services. The markets for the services we offer are intensely competitive, constantly evolving and subject to rapid change, and current and new competitors can launch new services at a relatively low cost. Some of our current and potential competitors, such as Google, Apple, Alibaba, Tencent, Amazon and Facebook, have significantly more customers or users, consumer data and financial and other resources than we do, and they may be able to leverage other aspects of their businesses (e.g., search or mobile device businesses) to enable them to compete more effectively with us. For example, Google has entered various aspects of the online travel market and has grown rapidly in this area, including by offering a flight meta-search product ("Google Flights"), a hotel meta-search product ("Google Hotel Ads"), a vacation rental meta-search product, its "Book on Google" reservation functionality, Google Travel, a planning tool that aggregates its flight, hotel and packages products in one website and by integrating its hotel meta-search product into its Google Maps app. Google has also integrated restaurant information and reservations into the Google Maps app. In addition, Amazon has previously experimented with online travel, and has recently partnered with Booking.com to provide travel deals to Prime users in certain countries and with an OTC in India to offer domestic flights through Amazon Pay.

4 We currently, or may in the future, compete with a variety of companies, including:

• online travel reservation services;

• large online companies, including search, social networking and marketplace companies;

• traditional travel agencies, travel management companies, wholesalers and tour operators, many of which combine physical locations, telephone services and online services;

• travel service providers such as accommodation providers, rental car or car- or ride-sharing companies and airlines, many of which have their own branded online platforms to which they drive business;

• online travel search and price comparison services (generally referred to as "meta-search" services);

• online restaurant reservation services; and

• companies offering technology services and software solutions to travel service providers.

For more information regarding current and potential competitors and the competitive nature of the markets in which we operate, please see Part I, Item 1A, Risk Factors - "Intense competition could reduce our market share and harm our financial performance." in this Annual Report on Form 10-K.

Operations and Technology

Our business is supported by multiple systems and platforms, which were designed with an emphasis on scalability, performance, reliability, redundancy and security. These systems and platforms are generally independent among our brands, though some have become increasingly connected or shared. Our software systems, platforms and architecture use a variety of widely-used software tools and database systems.

These internal systems and platforms are designed to include open application protocol interfaces that can provide connectivity to vendors in the industries in which we operate. These include large global systems, such as accommodation, airline ticket and rental car reservation systems and financial service providers, as well as individual accommodation service providers, such as independent hotels. Our applications utilize digital certificates to help us conduct secure communications and transactions, as appropriate. The systems infrastructure and web and database servers of our worldwide operations are primarily hosted in the United Kingdom, Switzerland, the Netherlands, Germany, Singapore, Hong Kong and four locations in the United States, each of which provides network connectivity, networking infrastructure and 24-hour monitoring and engineering support typical of hosted data centers. All data center facilities have a continuous power supply system, generators, redundant servers and multiple back-up systems. Although we take steps to mitigate the effects of any loss or reduction in service at one of our hosting facilities, if a hosting facility were inaccessible or otherwise experienced a disruption in service for any reason, we could experience a disruption to our services, loss of transactions and revenue and consumer complaints.

We provide customer service through a mix of in-house call centers and outsourced third-party services.

Intellectual Property

Over time and through acquisitions, we have assembled a portfolio of patents, trademarks, service marks, copyrights, domain names and trade secrets covering our services. We regard the protection of our intellectual property as important to our success. We protect our intellectual property rights by relying on national, federal, state and common law rights in the United States and internationally, as well as a variety of administrative procedures, regulations, conventions and treaties. We also rely on contractual restrictions to protect our proprietary rights in our services. We enter into confidentiality and invention assignment agreements with employees and contractors and nondisclosure agreements with parties with whom we conduct business in order to limit access to and disclosure of our proprietary information. We also have procured various intellectual property licenses from third parties. See Part I, Item 1A, Risk Factors - "We face risks related to our intellectual property."

Seasonality

The majority of our gross bookings are generated in the first half of the year, as consumers plan and reserve their spring and summer vacations in Europe and North America. However, we generally recognize revenue from these bookings 5 when the travel begins (at "check-in"), which can be in a quarter other than when the associated reservations are booked. In contrast, we expense the substantial majority of our marketing activities as the expense is incurred, which, in the case of performance marketing in particular, is typically in the quarter in which associated reservations are booked. As a result of this potential timing difference between when we record marketing expense and when we recognize associated revenue, we experience our highest levels of profitability in the third quarter of the year, which is when we experience the highest levels of accommodation check-ins for the year for our European and North American businesses. The first quarter of the year is typically our lowest level of profitability and may experience additional volatility in earnings growth rates due to these seasonal timing factors. For our Asia-Pacific business, we experience the highest level of accommodation check-ins in the fourth quarter. As the relative growth rates for our businesses fluctuate, the quarterly distribution of our operating results may vary. For additional information regarding factors affecting the seasonality of our business, see Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations - Seasonality.

Employees

At December 31, 2019, we employed approximately 26,400 employees, of which approximately 4,300 were based in the United States and approximately 22,100 were based outside the United States. We also retain independent contractors to support our customer service, website content translation and system support functions.

We have never had a work stoppage and we consider our relations with our employees to be good. Although we have works councils or employee representatives in certain countries, our U.S. employees are not represented by a labor union and are not covered by a collective bargaining agreement. Our future success will depend, in part, on our ability to continue to attract, integrate, retain and motivate highly qualified technical and managerial employees, for whom competition is intense. See Part I, Item 1A, Risk Factors - "We rely on the performance of highly skilled employees; and, if we are unable to retain or motivate key employees or hire, retain and motivate qualified employees, our business would be harmed."

Company Websites

We maintain websites with the addresses www.bookingholdings.com, www.booking.com, www.priceline.com, www.kayak.com, www.agoda.com, www.rentalcars.com and www.opentable.com, among others. We are not including the information contained on our websites as a part of, or incorporating it by reference into, this Annual Report on Form 10-K. We make available free of charge through the www.bookingholdings.com website our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and amendments to these reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as soon as reasonably practicable after we electronically file such material with, or furnish such material to, the SEC. These reports and other information are also available, free of charge, at www.sec.gov. In addition, the Company's Code of Conduct is available through the www.bookingholdings.com website and any amendments to or waivers of the Code of Conduct will be disclosed on that website.

6 Item 1A. Risk Factors

The following risk factors and other information included in this Annual Report on Form 10-K should be carefully considered. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently believe are immaterial may also impair our business, results of operations or financial condition. If any of the following risks occur, our business, financial condition, operating results and cash flows could be materially adversely affected.

Declines or disruptions in the travel industry could adversely affect our business and financial performance.

Our financial results and prospects are almost entirely dependent upon the sale of travel services. Travel, including accommodation (including hotels, motels, resorts, homes, apartments and other unique places to stay), rental car and airline ticket reservations, is significantly dependent on discretionary spending levels. As a result, sales of travel services tend to decline during general economic downturns and recessions and times of political or economic uncertainty as consumers engage in less discretionary spending, are concerned about unemployment or inflation, have reduced access to credit or experience other concerns or effects that reduce their ability or willingness to travel.

Perceived or actual adverse economic conditions, including slow, slowing or negative economic growth, high or rising unemployment rates, inflation and weakening currencies, and concerns over government responses such as higher taxes or tariffs, increased interest rates and reduced government spending, could impair consumer spending and adversely affect travel demand.

Political uncertainty, conditions or events, such as the United Kingdom’s transition out of the European Union ("Brexit"), including uncertainty in the implementation of Brexit and other political concerns, can also negatively affect consumer spending and adversely affect travel demand. At times, we experience volatility in transaction growth rates, increased cancellation rates and weaker trends in accommodation average daily rates ("ADRs") across many regions of the world, particularly in those countries that appear to be most affected by economic and political uncertainties, which we believe are due at least in part to these macro-economic conditions and concerns. Economic or political disruptions could cause, contribute to or be indicative of deteriorating macro-economic conditions, which in turn could negatively affect travel to or from such countries or the travel industry in general and therefore have an adverse impact on our results of operations. While lower occupancy rates have historically resulted in accommodation providers increasing their distribution of accommodation reservations through third-party intermediaries such as us, our remuneration for accommodation reservation transactions changes proportionately with price, and therefore, lower ADRs generally have a negative effect on our accommodation reservation business and on our revenues and results of operations.

These and other macro-economic uncertainties, such as oil prices, geopolitical tensions and differing central bank monetary policies, have led to significant volatility in the exchange rates between the U.S. Dollar and the Euro, the British Pound Sterling and other currencies. Significant fluctuations in foreign currency exchange rates, stock markets and oil prices can also impact consumer travel behavior. For example, although lower oil prices may lead to increased travel activity as consumers have more discretionary funds and airline fares decrease, declines in oil prices may be indicative of broader macro- economic weakness, which in turn could negatively affect the travel industry, our business and results of operations. Conversely, higher oil prices may result in higher airfares and decreased travel activity, which can negatively affect our business and results of operations.

Since the United Kingdom's Brexit vote in 2016, global markets and foreign currency exchange rates have experienced increased volatility, including a decline in the value of the British Pound Sterling as compared to the U.S. Dollar. Although the United Kingdom has formally left the European Union, many uncertainties remain in the transition period during which the United Kingdom will negotiate its future relationship with the European Union and other nations. After finalization of the transition period of the United Kingdom's exit from the European Union, among other things, the United Kingdom could lose access to the single European Union market and travel between the United Kingdom and European Union countries could be restricted. We could face new regulatory costs and challenges if U.K. regulations and policies diverge from those of the European Union or if additional business licenses are required. Since the terms of the United Kingdom's exit from the European Union and/or the European Economic Area are uncertain, we are unable to predict the effect Brexit will have on our business and results of operations.

The uncertainty of macro-economic factors and their impact on consumer behavior, which may differ across regions, makes it more difficult to forecast industry and consumer trends and the timing and degree of their impact on our markets and business, which in turn could adversely affect our ability to effectively manage our business and adversely affect our results of operations. 7 In addition, events beyond our control, such as oil prices, stock market volatility, terrorist attacks, unusual or extreme weather or natural disasters such as earthquakes, hurricanes, tsunamis, floods, fires, droughts and volcanic eruptions, travel- related health concerns including pandemics and epidemics such as coronaviruses, Ebola and Zika, political instability, changes in economic conditions, wars and regional hostilities, imposition of taxes, tariffs or surcharges by regulatory authorities, changes in trade policies or trade disputes, changes in immigration policies, travel-related accidents or increased focus on the environmental impact of travel, have previously and may in the future disrupt travel, limit the ability or willingness of travelers to visit certain locations or otherwise result in declines in travel demand and adversely affect our business and results of operations. Because these events or concerns, and the full impact of their effects, are largely unpredictable, they can dramatically and suddenly affect travel behavior by consumers, and therefore demand for our services and our relationships with travel service providers and other partners, any of which can adversely affect our business and results of operations. Certain jurisdictions, particularly in Europe, are considering regulations intended to address the issue of "overtourism," including by restricting access to city centers or popular tourist destinations or limiting accommodation offerings in surrounding areas, such as by restricting construction of new hotels or the renting of homes or apartments. Such regulations could adversely affect travel to, or our ability to offer accommodations in, such markets, which could negatively impact our business, growth and results of operations. The United States has implemented or proposed, or is considering, various travel restrictions and actions that could affect U.S. trade policy or practices, which could also adversely affect travel to or from the United States.

As a result of the recent coronavirus outbreak originating in China, we began in January 2020 to experience, and continue to experience, a significant decline in travel demand and increase in customer cancellations predominantly related to travel to, from or in China and certain other Asian markets, though concerns about the coronavirus are also negatively impacting travel demand (and therefore our business) generally. Some countries have implemented travel bans or restrictions and some airlines have suspended or limited flights to or from China. We are working with our travelers and travel service provider partners to address cancellations, requests for refunds, rebookings and similar matters. In addition, like many other companies, we have instructed or allowed employees in high-risk areas to work from home or not report to work, which, especially if this persists for a prolonged period of time, may have an adverse impact on our employees, ability to service travelers, operations and systems. The ultimate extent of the coronavirus outbreak and its impact on travel in currently affected countries or more broadly is unknown and impossible to predict with certainty. As a result, the full extent to which the coronavirus will impact our business and results of operations is unknown. However, decreased travel demand resulting from the outbreak has had a negative impact, and is likely to have a negative and material impact, on our business, growth and results of operations. In addition, we may incur additional customer service costs in connection with servicing travelers affected by the outbreak, which would also have a negative impact on our results of operations.

Intense competition could reduce our market share and harm our financial performance.

We compete globally with both online and traditional travel and restaurant reservation and related services. The markets for the services we offer are intensely competitive, constantly evolving and subject to rapid change, and current and new competitors can launch new services at a relatively low cost. Some of our current and potential competitors, such as Google, Apple, Alibaba, Tencent, Amazon and Facebook, have significantly more customers or users, consumer data and financial and other resources than we do, and they may be able to leverage other aspects of their businesses (e.g., search or mobile device businesses) to enable them to compete more effectively with us. For example, Google has entered various aspects of the online travel market and has grown rapidly in this area, including by offering a flight meta-search product ("Google Flights"), a hotel meta-search product ("Google Hotel Ads"), a vacation rental meta-search product, its "Book on Google" reservation functionality, Google Travel, a planning tool that aggregates its flight, hotel and packages products in one website and by integrating its hotel meta-search products into its Google Maps app. Google has also integrated restaurant information and reservations into the Google Maps app. In addition, Amazon has previously experimented with online travel, and has recently partnered with Booking.com to provide travel deals to Prime users in certain countries and with an OTC in India to offer domestic flights through Amazon Pay.

We currently, or may in the future, compete with a variety of companies, including:

• online travel reservation services such as Expedia, Hotels.com, Hotwire, Orbitz, Travelocity, Wotif, Cheaptickets, ebookers, HotelClub, RatesToGo and CarRentals.com, which are owned by Expedia Group, Traveloka (in which Expedia Group holds a minority interest) and Despegar/Decolar (in which Expedia Group holds a minority interest); Trip.com Group (in which we hold a small minority interest), Trip.com (which is owned by Trip.com Group), Tongcheng-eLong (in which Trip.com Group holds a significant minority interest), ezTravel (in which Trip.com Group holds a majority interest) and MakeMyTrip (in which Trip.com Group holds a significant minority interest); Hotel Reservation Service (HRS) and hotel.de, which are owned by Hotel Reservation Service; and AutoEurope, 8 CarTrawler, Meituan Dianping (in which we hold a small minority interest), Rakuten, Jalan (which is owned by Recruit), Fliggy (which is owned by Alibaba), HotelTonight (which is owned by Airbnb), CheapOair and eDreams ODIGEO;

• online accommodation search and/or reservation services that are currently focused primarily on alternative accommodations, including individually owned properties such as homes and apartments, such as Airbnb, Vrbo (which is owned by Expedia Group), Tujia (in which Trip.com Group and Expedia Group hold investments) and Xiaozhu;

• large online companies, including search, social networking and marketplace companies such as Google, Facebook, Alibaba, Tencent, Amazon and Baidu;

• traditional travel agencies, travel management companies, wholesalers and tour operators, many of which combine physical locations, telephone services and online services, such as Carlson Wagonlit, American Express, BCD Travel, Egencia and Expedia Partner Solutions (which are owned by Expedia Group), Concur (which is owned by SAP), TUI, Webjet and Hotelbeds Group, as well as thousands of individual travel agencies around the world;

• travel service providers such as accommodation providers, rental car companies and airlines, many of which have their own branded online platforms to which they drive business, including large hotel chains such as Marriott International, Hilton and Intercontinental Hotel Group and emerging hotel chains such as OYO Rooms, as well as joint efforts by travel service providers such as Room Key, an online hotel reservation service owned by several major hotel companies;

• online travel search and price comparison services (generally referred to as "meta-search" services), such as Google Flights, Google Hotel Ads, Google's vacation rental meta-search product, TripAdvisor, trivago (in which Expedia Group holds a majority interest), Qunar (which is controlled by Trip.com Group) and Skyscanner (which is owned by Trip.com Group);

• online restaurant reservation services, such as LaFourchette and Bookatable (which are owned by TripAdvisor), SeatMe (which is owned by Yelp), Zomato, Quandoo (which is owned by Recruit) and Resy (which is owned by American Express);

• companies offering new rental car business models or car- or ride-sharing services that affect demand for rental cars, some of which have developed innovative technologies to improve efficiency of point-to-point transportation and extensively utilize mobile platforms, such as Uber, Lyft, Gett, Zipcar (which is owned by Avis), Turo, BlaBlaCar, Didi Chuxing (in which we hold a small minority interest), Grab (in which we hold a small minority interest), Go-Jek and Ola; and

• companies offering technology services and software solutions to travel service providers, including large global distribution systems ("GDSs"), such as Amadeus, Sabre and Travelport, and hospitality software platforms, such as Oracle and Shiji.

Google, the world's largest search engine and one of the world's largest companies and other large, established companies with substantial resources and expertise in developing online commerce and facilitating internet traffic offer travel or travel-related search, meta-search and/or reservation booking services and may create additional inroads into online travel. Google's travel meta-search services, Google Hotel Ads and Google Flights, have grown rapidly and have achieved significant market share in a relatively short time. Meta-search services leverage their search technology to aggregate travel search results for the consumer's specific itinerary across travel service providers (e.g., accommodations, rental car companies or airlines), online travel companies ("OTC") and other online platforms and, in many instances, compete directly with us for customers. Meta-search services intend to appeal to consumers by showing broader travel search results than may be available through OTCs or other online platforms, which could lead to travel service providers or others gaining a larger share of search traffic. Google leverages its general search business to promote its meta-search offerings by showing meta-search results at the top of its organic search results. Further, TripAdvisor and trivago, two other leading meta-search companies, support their meta- search services with significant brand and performance marketing. Through our KAYAK meta-search service, we compete directly with these and other meta-search services. If we are unable to effectively compete with these companies, our business and results of operations could be harmed.

Consumers may favor travel services offered by meta-search platforms or search companies over OTCs, which could reduce traffic to our travel reservation platforms, increase consumer awareness of our competitors' brands and services and 9 increase our marketing and other customer acquisition costs. To the extent any such consumer behavior leads to growth in our KAYAK meta-search business, such growth may not result in sufficient increases in revenues from our KAYAK meta-search business to offset any related decrease in revenues or increase in marketing and other customer acquisition costs experienced by our OTC brands. Further, meta-search services may evolve into more traditional OTCs by offering consumers the ability to make travel reservations directly through their platforms. For example, TripAdvisor allows consumers to make a reservation at some accommodations while staying on TripAdvisor through its "Instant Booking" offering, which includes participation by many of the leading global hotel chains. Google also provides reservation services through "Book on Google." To the extent we participate in any such offerings provided by meta-search services, resulting reservations could be less profitable and could cannibalize business that would otherwise come directly to us or through other more profitable channels. If consumers book travel services through a service such as TripAdvisor's Instant Booking, Google's "Book on Google," a meta-search website or directly with a travel service provider after visiting a meta-search platform or using a meta-search utility on a traditional search engine without using an OTC like us, or if meta-search services limit our participation within their search results or evolve into more traditional OTCs, we may need to increase our marketing or other customer acquisition costs to maintain or grow our reservation bookings and our business and results of operations could be adversely affected.

Over the years, there has been a proliferation of new channels through which accommodation providers can offer reservations as the market for travel services has evolved. For example, companies such as Airbnb and Expedia Group offer services providing alternative accommodation property owners, particularly individuals, an online place to list their accommodations where travelers can search and book such properties and compete directly with our alternative accommodation services. In addition, Airbnb, which owns HotelTonight, offers some hotel reservations through its online platforms. Further, meta-search services may lower the cost for new companies to enter the market by providing a distribution channel without the cost of promoting the new entrant's brand to drive consumers directly to its platform. New travel-related services are frequently being introduced to the market. For example, in 2019, Google launched Google Travel, which combines its hotel, flight and packages offerings into one website with trip-planning tools. Some of our competitors and potential competitors offer a variety of online services, such as food delivery, shopping, gaming or search services, many of which are used by consumers more frequently than online travel services. As a result, a competitor or potential competitor that has established other, more frequent online interactions with consumers may be able to more easily or cost-effectively acquire customers for its online travel services than we can. For example, some competitors or potential competitors with more frequent online interactions with consumers are seeking to create "super-apps" where consumers can use many online services without leaving that company's app, in particular in markets such as Asia where online activity (including e-commerce) is conducted primarily through apps on mobile devices. If any of these platforms are successful in offering new travel-related services or services similar to ours to consumers who would otherwise use our platforms or if we are unable to offer our services to consumers within these super-apps, our customer acquisition efforts could be less effective and our customer acquisition costs, including our brand and performance marketing expenses, could increase, either of which would harm our business and results of operations.

Although we believe that providing an extensive collection of properties, excellent customer service and an intuitive, easy-to-use consumer experience are important factors influencing a consumer's decision to make a reservation, for many consumers, particularly in certain markets, the price of the travel service is the primary factor determining whether a consumer will book a reservation. As a result, it is increasingly important to offer travel services, such as accommodation reservations, at competitive prices, whether through discounts, coupons, closed-user group rates or loyalty programs, or otherwise. Discounting and couponing coupled with a high degree of consumer shopping behavior is particularly common in Asian markets. In some cases, our competitors are willing to make little or no profit on a transaction, or offer travel services at a loss, in order to gain market share. As a result, in certain markets we may need to provide discounts or other incentives in order to be competitive, which may make it difficult for us to maintain or grow market share and to maintain historical profit margins. These initiatives may also result in lower ADRs and lower revenues as a percentage of gross bookings. As part of our strategy to provide more payment options to consumers and travel service providers, Booking.com is increasingly processing transactions on a merchant basis, where it facilitates payments on behalf of customers. This allows Booking.com to present consumers with more pricing options. If we are unable to effectively offer competitive prices, our market share, business and results of operations could be materially adversely affected.

Travel service providers, including hotel chains, rental car companies and airlines with which we conduct business, compete with us in online channels to drive consumers to their own platforms in lieu of third-party distributors such as us. Travel service providers may charge lower prices and, in some instances, offer advantages such as loyalty points or special discounts to members of closed-user groups (such as loyalty program participants or consumers with registered accounts), any of which could make their offerings more attractive to consumers than our services. For example, many large hotel chains have instituted additional initiatives, such as increased discounting and incentives, to encourage consumers to book accommodations directly through their online platforms. We also offer various incentives to consumers and may need to offer additional or increased advantages to maintain or grow our reservation bookings, which adversely impacts our profit margins. Further, 10 consolidation among travel service providers, such as Marriott International's acquisition of Starwood Hotels & Resorts in 2017, could result in lower rates of commission paid to OTCs, increased discounting and greater incentives for consumers to join closed-user groups as such travel service providers expand their offerings. If we are not as effective as our competitors (including hotel chains) in offering discounted prices and other incentives to consumers, our ability to grow and compete and our results of operations could be harmed.

We are exposed to fluctuations in foreign currency exchange rates.

We conduct a substantial majority of our business outside the United States but we report our results in U.S. Dollars. As a result, we face exposure to movements in foreign currency exchange rates as the financial results of our international businesses are translated from local currency (principally Euros and British Pounds Sterling) into U.S. Dollars. When the U.S. Dollar strengthens against other currencies in which we transact, as it generally did in 2015, our foreign-currency-denominated net assets, gross bookings, revenues, operating expenses and net income are lower as expressed in U.S. Dollars. When the U.S. Dollar weakens against other currencies in which we transact, as it generally did in 2017 and 2018, our foreign-currency- denominated net assets, gross bookings, revenues, operating expenses and net income are higher as expressed in U.S. Dollars. Foreign currency exchange rate fluctuations on transactions denominated in currencies other than the functional currency result in gains and losses that are reflected in our financial results.

Recent years have seen significant volatility in the exchange rate between the Euro, the British Pound Sterling, the U.S. Dollar and other currencies. Significant fluctuations in foreign currency exchange rates can affect consumer travel behavior. For example, the strengthening of the U.S. Dollar relative to the Euro in 2015 made it more expensive for Europeans to travel to the United States. Consumers traveling from a country whose currency has weakened against other currencies may book lower ADR accommodations, choose to shorten or cancel their international travel plans or choose to travel domestically rather than internationally, any of which could adversely affect our gross bookings, revenues and results of operations, in particular when expressed in U.S. Dollars.

Volatility in foreign currency exchange rates and its impact on consumer behavior, which may differ across regions, make it more difficult to forecast industry and consumer trends and the timing and degree of their impact on our markets and business, which in turn makes it more difficult to manage our business and forecast our financial and operational performance.

We face risks related to the growth rate and the global expansion of our business.

We derive a substantial portion of our revenues, and have significant operations, outside the United States. Our international businesses include our Netherlands-based OTC brand Booking.com (including Rentalcars.com, based in the United Kingdom), our Asia-based OTC brand agoda and, to a lesser extent, KAYAK's international meta-search services and OpenTable's international restaurant reservation business. Our international OTC operations have historically achieved significant year-over-year growth in their gross bookings, in particular with respect to their accommodation reservation services. These growth rates, which have contributed significantly to our growth in consolidated revenues and earnings, have generally declined over time as the absolute level of our gross bookings increased and online travel growth rates have declined. Other factors may also slow the growth rates of our international businesses, including, for example, worldwide or regional economic conditions, strengthening of the U.S. Dollar versus the Euro, the British Pound Sterling and other currencies, declines in ADRs, increases in cancellations, adverse changes in travel market conditions and the competitiveness of the market. Any decline in the growth rates of our international businesses would have a negative impact on our revenue and earnings growth rates and, as a consequence, our stock price.

Our strategy involves continued expansion throughout the world. Many regions have different economic conditions, customs, languages, currencies, consumer expectations, levels of consumer acceptance and use of online platforms for commerce, legislation, regulatory environments (including labor laws and customs), tax laws and levels of political stability, and we are subject to associated risks typical of international businesses. International markets may have strong local competitors with an established brand and travel service provider or restaurant relationships that may make expansion in that market difficult or costly and take more time than anticipated. In addition, compliance with legal, regulatory or tax requirements in multiple jurisdictions places demands on our time and resources, and we may nonetheless experience unforeseen and potentially adverse legal, regulatory or tax consequences. In some markets such as China, legal and other regulatory requirements may prohibit or limit participation by foreign businesses, such as by making foreign ownership or management of internet or travel-related businesses illegal or difficult, or may make direct participation in those markets uneconomic, which could make our entry into and expansion in those markets difficult or impossible, require that we work with a local partner or result in higher operating costs. Certain markets in which we operate that are in earlier stages of development have lower operating margins compared to more mature markets, which could have a negative impact on our overall profit margins as these markets increase in size over time. If we are unsuccessful in expanding in new and existing markets and effectively managing that expansion, our business and results of operations could be adversely affected. 11 Although we intend to continue to invest in adding accommodations available for reservation on our platforms, such as hotels, motels, resorts, homes, apartments and other unique places to stay, the growth rate of our accommodations may vary in part as a result of removing accommodations from our platforms from time to time. Many of the newer accommodations we add to our travel reservation services, especially in highly-penetrated markets, may have fewer rooms or higher credit risk and may appeal to a smaller subset of consumers (e.g., hostels and bed and breakfasts). Because alternative accommodations are often either a single unit or a small collection of independent units, these properties generally represent more limited booking opportunities than hotels, motels and resorts, which generally have more units to rent per property. Further, alternative accommodations in general may be subject to increased seasonality due to local tourism seasons, weather or other factors or may not be available at peak times due to use by the property owners. We also experience lower profit margins with respect to alternative accommodation properties due to certain additional costs related to offering these accommodations on our platforms. As we increase our alternative accommodation business, these different characteristics negatively impact our profit margins; and, to the extent these properties represent an increasing percentage of the properties added to our platforms, we expect that our room-night growth rate and property growth rate will continue to diverge over time (since each such alternative accommodation property has fewer booking opportunities). As a result of the foregoing, as the percentage of alternative accommodation properties increases, the number of reservations per property will likely continue to decrease.

In addition, as our alternative accommodation reservation business grows, we may incur increasing numbers of complaints related to non-existent properties or properties that are significantly different than as described in the listing, as well as claims of liability based on events occurring at such properties such as robbery, injury, death and other similar events. Such complaints or claims could result in negative publicity and increased costs, which could adversely affect our reputation, business and results of operations. Further, the regulatory environment related to some alternative accommodations such as homes and apartments is evolving, and laws, regulations or property association rules could impose restrictions or burdens on these property owners and managers that limit or negatively affect their ability to rent their properties. Some jurisdictions have adopted or are considering statutes or ordinances that prohibit owners and managers from renting certain properties for fewer than a stated number of consecutive days or for more than an aggregate total number of days per year or that require owners or managers to obtain a license to rent their properties. In addition, several jurisdictions have adopted or are considering adopting statutes or ordinances requiring online platforms that list certain alternative accommodations to obtain a license to list such accommodations and/or to comply with other restrictions or requirements. This dynamic regulatory environment requires us to expend significant time and resources and could negatively impact the growth and/or size of our alternative accommodation reservation business.

We believe that the increase in the number and variety of accommodation providers that participate on our platforms, and the corresponding access to accommodation room nights, has been a key driver of the growth of our accommodation reservation business. The breadth of our accommodation bookings typically makes us an attractive source of consumer demand for our accommodation providers. However, accommodation providers may wish to limit the amount of business that flows through a single distribution channel. Also, certain jurisdictions, particularly in Europe, are considering regulations intended to address the issue of "overtourism," including by restricting accommodation offerings in city centers or near popular tourist destinations, such as by restricting construction of new hotels or the renting of homes or apartments. Such restrictions could also include limiting the number of tourists permitted to visit and stay near popular areas during peak seasons or as a general matter. As a result, we may experience constraints on the number of listings, or accommodation room nights, actually available to us, which could negatively impact our business growth rate and results of operations.

The number of our employees worldwide has grown from approximately 9,500 at December 31, 2013 to approximately 26,400 at December 31, 2019, which growth is mostly comprised of hires by our international operations. The growth of our operations may make it more difficult to hire, train, retain, motivate and manage the required employees. Historically, our brands operated on a largely independent basis and many of them focused on particular services or geographies. As we look to develop the Connected Trip, we are increasing the collaboration, cooperation and interdependency among our brands. As we manage this shift, in addition to managing organic growth and growth through acquisitions, we may find it difficult to maintain the beneficial aspects of our corporate culture at the brand companies and throughout the organization as a whole. In addition, expansion increases the complexity of our business and places additional strain on our management, operations, technical performance, financial resources and administrative, legal, tax, internal control and financial reporting functions. Our current and planned employees, systems, procedures and controls may not be adequate to support and effectively manage this growth and increased complexity, especially as we employ employees in multiple geographic locations around the world and increase the number and variety of our products and payment systems. The implementation of new information technology, payment, enterprise resource planning (ERP) or other systems could be disruptive and/or costly or we may experience difficulty successfully integrating new systems into existing systems or migrating to new systems from existing systems, any of which could adversely affect our business and results of operations.

12 We rely on performance and brand marketing channels to generate a significant amount of traffic to our platforms and grow our business.

We believe that maintaining and strengthening our brands are important aspects of our efforts to attract and retain customers. We have invested considerable money and resources in the establishment and maintenance of our brands, and we will continue to invest resources in brand marketing and other brand building efforts to preserve and enhance consumer awareness of our brands. In addition, effective performance marketing has been an important factor in our growth, and we believe it will continue to be important to our future success. As our competitors spend increasingly more on advertising and other marketing efforts, we are required to spend more in order to maintain our brand recognition and, in the case of performance marketing, to maintain and grow traffic to our platforms through performance marketing channels. We may not be able to successfully maintain or enhance consumer awareness and acceptance of our brands, and, even if we are successful in our branding efforts, such efforts may not be cost-effective. For instance, we have observed increased brand marketing by OTCs, meta-search services and travel service providers, which may make our brand marketing efforts more expensive and less effective. If we are unable to maintain or enhance consumer awareness and acceptance of our brands in a cost-effective manner, our business, market share and results of operations would be materially adversely affected.

Our online performance marketing efficiency, expressed as performance marketing expense as a percentage of revenues, is impacted by a number of factors that are subject to variability and that are, in some cases, outside of our control, including ADRs, costs per click, cancellation rates, foreign currency exchange rates, our ability to convert paid traffic to booking customers and the extent to which consumers come directly to our websites or mobile apps for bookings. For example, competition for desired rankings in search results and/or a decline in ad clicks by consumers could increase our costs- per-click and reduce our performance marketing efficiency. We use third-party websites, including online search engines (primarily Google), meta-search and travel research services and affiliate marketing as the primary means of generating traffic to our websites. Growth of some of these channels has slowed. Our performance marketing expense has increased significantly and our performance marketing efficiency has declined in recent years, a trend we expect to continue, though the rate of decrease may fluctuate and there may be periods of stable or increasing returns on investment ("ROIs") from time to time. Further, at times we may pursue a strategy of increasing performance marketing ROIs, which could negatively affect our gross bookings and revenue growth rates. When evaluating our performance marketing spend, we consider several factors for each channel, such as the customer experience on the advertising platform, the incrementality of the traffic we receive and the anticipated repeat rate from a particular platform, as well as other factors. Pursuing a strategy of improving performance marketing ROIs, as we did beginning in the third quarter of 2017 through the fourth quarter of 2018, along with factors such as competitors' actions in the bidding environment, the amount of marketing invested by these channels to generate demand and overall performance marketing platform traffic growth trends, which have shown volatility and long-term deceleration of growth rates, may also impact growth rates for performance marketing channels. Any reduction in our performance marketing efficiency could have an adverse effect on our business and results of operations, whether through reduced revenues or revenue growth, or through performance marketing expenses increasing faster than revenues and thereby reducing margins and earnings growth.

We believe that a number of factors could cause consumers to increase their shopping activity before making a travel purchase. Increased shopping activity reduces our performance marketing efficiency and effectiveness because traffic becomes less likely to result in a reservation through our platforms, and such traffic is more likely to be obtained through paid performance marketing channels than through direct channels. Further, consumers may favor travel services offered by search or meta-search companies over OTCs, which could reduce traffic to our travel reservation platforms, increase consumer awareness of our competitors' brands and platforms, increase our marketing and other customer acquisition costs and adversely affect our business, margins and results of operations. To the extent any such increased shopping behavior leads to growth in our KAYAK meta-search business, such growth may not result in sufficient increases in revenues from our KAYAK meta- search business to offset any related decrease in revenues or increase in marketing and other customer acquisition costs experienced by our OTC brands.

We may not be able to keep up with rapid technological or other market changes.

The markets in which we compete are characterized by rapidly changing technology, evolving industry standards, consolidation, frequent new service announcements, introductions and enhancements and changing consumer demands and preferences. We may not be able to keep up with these rapid changes. In addition, these market characteristics are heightened by the progress of technology adoption in various markets, including the continuing adoption of the internet and online commerce in certain geographies and the emergence and growth of the use of smartphones, tablets and other smart devices, including those with voice and artificial intelligence capabilities, for mobile e-commerce transactions. New developments in other areas, such as cloud computing, could make entering our markets easier for competitors due to lower upfront technology costs. As a result, our future success will depend on our ability to adapt to rapidly changing technologies, to adapt our services

13 and online platforms to evolving industry standards and local preferences and to continually innovate and improve the performance, features and reliability of our services and online platforms in response to competitive service offerings and the evolving demands of the marketplace. In particular, it is increasingly important for us to effectively offer our services on mobile devices through mobile apps and mobile-optimized websites and to tailor our services to varying devices and platforms. Any failure by us to successfully develop and achieve consumer adoption of our mobile platforms would have a material and adverse effect on our growth, market share, business and results of operations. Further, to the extent mobile devices or platforms enable users to block advertising content, our advertising revenue and our ability to market our brands and acquire new consumers may be negatively affected. We believe that ease-of-use, comprehensive functionality and the look and feel of our mobile platforms are increasingly competitively critical as consumers obtain more of their travel and restaurant services through mobile devices and platforms. As a result, we intend to continue to spend significant resources maintaining, developing and enhancing our mobile platforms and other technologies and platforms. Additionally, our ability to achieve our long-term strategy to build the Connected Trip depends on successfully integrating and developing new and evolving technologies, which is likely to require increased financial and personnel investments that could have an adverse impact on our results of operations until we achieve the expected return on these investments. However, these efforts may not be successful in improving the travel experience or retaining and attracting new customers, which would harm our business and results of operations. Further, technical innovation often results in bugs, vulnerabilities and other system failures. Any such bug, vulnerability or failure, especially in connection with a significant technical implementation or change, could result in lost business, harm to our brand or reputation, consumer complaints and other adverse consequences, any of which could adversely affect our business and results of operations.

We believe that another critical component to our future success will be our ability to enhance our payments capabilities, including by offering alternative payment solutions to consumers even when those payment solutions may not be accepted by the travel service provider or restaurant. Alternate payment providers such as Alipay, Paytm and WeChat Pay operate closed-loop payments systems with direct connections to both consumers and merchants. In many markets, particularly in Asia where credit cards are not readily available and/or e-commerce is largely carried out through mobile devices, these and other emerging alternative payment methods are the exclusive or preferred means of payment for many consumers. Therefore, if we are unable to offer consumers their preferred method of payment by integrating new or emerging payment methods into our platforms, we may not be able to effectively offer our services to these consumers, which would limit our growth opportunities in these markets and our business and results of operations could be harmed.

Furthermore, as the overall size of our business continues to grow, the competitive pressure to innovate will encompass a wider range of services and technologies, including services and technologies that may be outside of our historical core business, and our ability to keep pace may slow. Our current and potential competitors range from large and established companies to emerging start-ups. Emerging start-ups may be able to innovate and focus on developing a particularly new product or service faster than we can or may foresee consumer need for new services or technologies before we do. Some of our larger competitors or potential competitors have more resources or more established or varied relationships with consumers than we have, and they could use these advantages in ways that could affect our competitive position, including by making acquisitions, entering or investing in travel reservation businesses, investing in research and development and competing aggressively for highly-skilled employees. For example, because consumers often utilize other online services more frequently than online travel services, a competitor or potential competitor that has established other, more frequent online interactions with consumers may be able to more easily or cost effectively acquire consumers for its online travel services than we can.

In addition, the widespread adoption of new internet, networking or telecommunications technologies or other technological changes (including new devices and services, such as Amazon's Echo and Alexa and Google Home and Google Assistant, developing technologies, such as artificial intelligence, chatbot and virtual reality technologies, and the creation of "super-apps" where consumers can use many online services without leaving a particular app) could require us to incur substantial expenditures to modify or adapt our services or infrastructure to these new technologies, which could adversely affect our results of operations or financial condition. Any failure to implement or adapt to new technologies in a timely manner or at all could adversely affect our ability to compete, increase our consumer acquisition costs or otherwise adversely affect our business, and therefore adversely affect our brand, market share and results of operations.

Our processing, storage, use and disclosure of personal data exposes us to risks of internal or external security breaches and could give rise to liabilities and/or damage to reputation.

The security of data when engaging in e-commerce is essential to maintaining consumer and travel service provider confidence in our services. Cyberattacks by individuals, groups of hackers and state-sponsored organizations are increasing in frequency and sophistication and are constantly evolving. Any security breach whether instigated internally or externally on our systems or third-party systems could significantly harm our reputation and therefore our business, brand, market share and results of operations. Consumers who use certain of our services provide us with their credit card information. We require user

14 names and passwords in order to access our information technology systems. We also use encryption and authentication technologies to secure the transmission and storage of data and prevent unauthorized access to our data or accounts. Computer circumvention capabilities, new discoveries or advances or other developments, including our own acts or omissions, could result in a compromise or breach of consumer data. For example, third parties may attempt to fraudulently induce employees, travel service provider partners or consumers to disclose user names, passwords or other sensitive information ("phishing"), which may in turn be used to access our information technology systems or to defraud our partners or consumers. Third parties may also attempt to take over consumer accounts by using passwords, usernames and other personal information obtained elsewhere to attempt to login to consumer accounts on our platforms. We have experienced targeted and organized phishing and account takeover attacks and we expect to continue to experience these events in the future. These risks are likely to increase as we expand our offerings, integrate our products and services, and store and process more data, including personal information. Our efforts to protect information from unauthorized access may be unsuccessful or may result in the rejection of legitimate attempts to book reservations through our services, any of which could result in lost business and could materially and adversely affect our business, reputation and results of operations.

Our existing security measures may not be successful in preventing security breaches. A party (whether internal, external, an affiliate or unrelated third party) that is able to circumvent our security systems could steal consumer information or transaction data or other proprietary information. In the last few years, several major companies experienced high-profile security breaches that exposed their systems and information and/or their consumers' or employees' personal information, and it is expected that these types of events will continue to occur. We have a heightened risk of security breaches due to some of our operations being located in certain international jurisdictions. We expend significant resources to protect against security breaches, and regularly increase our security-related expenditures to maintain or increase our systems' security. We have experienced and responded to cyberattacks, which we believe have not had a significant impact on the integrity of our systems or the security of data, including customer data maintained by us. These issues are likely to become more difficult to manage as we expand the number of places where we operate and the number and variety of services we offer, and as the tools and techniques used in such attacks become more advanced. Security breaches could result in severe damage to our information technology infrastructure, including damage that could impair our ability to offer our services or the ability of consumers to make reservations or conduct searches through our services, as well as loss of consumer, financial or other data that could materially and adversely affect our ability to conduct our business, satisfy our commercial obligations or meet our public reporting requirements in a timely fashion or at all. Security breaches could also result in negative publicity, damage our reputation, expose us to risk of loss or litigation and possible liability, subject us to regulatory penalties and sanctions, or cause consumers to lose confidence in our security and choose to use the services of our competitors, any of which would have a negative effect on our brands, market share, results of operations and financial condition. Our insurance policies have coverage limits and may not be adequate to reimburse us for all losses caused by security breaches.

We also face risks associated with security breaches affecting third parties conducting business over the internet. Consumers generally are concerned with security and privacy on the internet, and any publicized security problems could negatively affect consumers' willingness to provide private information or effect online commercial transactions generally, including through our services. Some of our business is conducted with third-party marketing affiliates, which may generate travel reservations through our infrastructure or through other systems. Additionally, our consumers' personal data could be affected by security breaches at third parties upon which we rely, such as travel service providers, payroll providers, health plan providers, payment processors or GDSs. A security breach at any such third-party marketing affiliate, travel service provider, payment processor, GDS or other third party on which we rely, such as the security breach experienced by Sabre in May 2017, could be perceived by consumers as a security breach of our systems and in any event could result in negative publicity, subject us to notification requirements, damage our reputation, expose us to risk of loss or litigation and possible liability and subject us to regulatory penalties and sanctions. In addition, such third parties may not comply with applicable disclosure requirements or with parameters within which we permit them to process data, which could expose us to liability.

In the operation of our business, we receive and store a large volume of personally identifiable data and payment information. This data is increasingly subject to legislation and regulations in numerous jurisdictions around the world. The European Union's General Data Protection Regulation (the "GDPR"), which went into effect in May 2018, is designed to unify data protection within the European Union under a single law, which has resulted and will continue to result in significantly greater compliance burdens and costs for us. Under the GDPR, fines of up to 20 million Euros or up to 4% of the annual global revenues of the infringer, whichever is greater, could be imposed. Several data protection authorities have already imposed significant fines on companies of various sizes across industry sectors for violations of the GDPR. The California Consumer Privacy Act (the "CCPA"), which went into effect in January 2020, has created new data privacy rights for users in California and has resulted and will continue to result in additional complexity and costs related to compliance. Many other jurisdictions continue to consider adopting or may adopt similar data protection regulations. These regulations are typically intended to protect the privacy of personal data that is collected, processed and transmitted in or from the governing jurisdiction as well as to give individuals greater rights and/or control over how their data is processed. These laws and their interpretations continue

15 to develop and may be inconsistent from jurisdiction to jurisdiction. Additionally, some of these regulations, such as the CCPA, give consumers a private right of action against companies for violations of these rules. In many cases, these laws apply not only to third-party transactions, but also to transfers of information between us and our subsidiaries, including employee information. While we have invested and continue to invest significant resources to comply with the GDPR, CCPA and other privacy regulations, many of these regulations are new, extremely complex and subject to interpretation. Non-compliance with these laws could result in negative publicity, damage to our reputation, significant penalties or other legal liability. If legislation or regulations are expanded to require changes in our business practices or if governing jurisdictions interpret or implement their legislation or regulations in ways that negatively affect our business, our results of operations, financial condition or competitive position could be adversely affected.

Our business could be negatively affected by changes in online search and meta-search algorithms and dynamics or traffic-generating arrangements.

We use Google to generate a significant portion of the traffic to our platforms, and, to a lesser extent, we use other search and meta-search services to generate traffic to our platforms, principally through pay-per-click marketing campaigns. The pricing and operating dynamics on these search and meta-search platforms can experience rapid change commercially, technically and competitively. For example, Google frequently updates and changes the logic which determines the placement and display of results of a consumer's search, such that the placement of links to our platforms can be negatively affected and our costs to improve or maintain our placement in search results can increase. The European Commission has fined Google significant amounts for anti-competitive behavior relating to its comparison-shopping service and online search advertising services. Changes by Google in how it presents travel search results, including its promotion of its travel meta-search services, or the manner in which it conducts the auction for placement among search results, whether as a result of a court order, investigation or other reason, may be competitively disadvantageous to us and may impact our ability to efficiently generate traffic to our platforms, which in turn would have an adverse effect on our business, market share and results of operations. Recently Google announced modifications to its flights display model, including that it would not be charging airlines and OTCs for sending referrals from Google Flights. As a result, airline and OTC partners may choose to limit or eliminate their use of other meta-search services or may demand cost savings from their other meta-search services and/or Google may receive access to discounted fares not provided to meta-search services that charge for referrals, any of which could adversely affect our meta-search business, profit margins and results of operations. Similarly, changes by our other search and meta-search partners in how they present travel search results or the manner in which they conduct the auction for placement among search results may be competitively disadvantageous to us and may impact our ability to efficiently generate traffic to our platforms. In addition, if travel search traffic declines or grows less quickly than in the past, our ability to efficiently generate traffic to our platforms through performance marketing on general search platforms may be adversely affected, which could have an adverse effect on our business and results of operations.

In addition, we purchase online traffic from a number of other sources, including some operated by our competitors, in the form of pay-per-click arrangements that can be terminated with little or no notice. If one or more of such arrangements is terminated, our business, market share and results of operations could be adversely affected. We rely on various third-party distribution channels (i.e., marketing affiliates) to distribute accommodation, rental car and airline ticket reservations. Should one or more of such third parties cease distribution of reservations made through us, or suffer deterioration in its search or meta-search ranking, due to changes in search or meta-search algorithms or otherwise, our business, market share and results of operations could be negatively affected.

System capacity constraints, system failures or denial-of-service or other attacks could harm our business and our reputation.

We have experienced rapid growth in consumer traffic to our online platforms, the number of accommodations on our extranets and the geographic breadth of our operations. If our systems cannot be expanded to cope with increased demand or fail to perform, we could experience unanticipated disruptions in service, slower response times, decreased customer service and customer satisfaction and delays in the introduction of new services, any of which could impair our reputation, damage our brands and materially and adversely affect our results of operations. Further, as an online business, we are dependent on the internet and maintaining connectivity between ourselves and consumers, sources of internet traffic, such as Google, and our travel service providers and restaurants. As consumers increasingly turn to mobile and other smart devices, we also become dependent on consumers' access to the internet through mobile carriers and their systems. Disruptions in internet access, such as the denial-of-service attack against Dyn in October 2016 that resulted in a service outage for several major internet companies, whether generally, in a specific market or otherwise, especially if widespread or prolonged, could materially adversely affect our business and results of operations. While we do maintain redundant systems and hosting services, it is possible that we could experience an interruption in our business, and we do not carry business interruption insurance sufficient to compensate us for all losses that may occur.

16 Our computer hardware for operating our services is currently located at hosting facilities around the world. These systems and operations are vulnerable to damage or interruption from human error, computer viruses, floods, fires, power loss, telecommunication failures and similar events. They are also subject to break-ins, sabotage, intentional acts of vandalism, terrorism and similar misconduct. Despite any precautions we may take, the occurrence of any disruption of service due to any such misconduct, natural disaster or other unanticipated problems at such facilities, or the failure by such facilities to provide our required data communications capacity could result in lengthy interruptions or delays in our services. Any system failure that causes an interruption or delay in service could impair our reputation, damage our brands, result in lost business or result in consumers choosing to use a competitive service, any of which could have a material adverse effect on our business and results of operations.

Our existing security measures may not be successful in preventing attacks on our systems, and any such attack could cause significant interruptions in our operations. For instance, from time to time, we have experienced denial-of-service type attacks on our systems that have made portions of our websites slow or unavailable for periods of time. There are numerous other potential forms of attack, such as phishing (where a third party attempts to infiltrate our systems or acquire information by posing as a legitimate inquiry or electronic communication), account takeover attacks, SQL injection (where a third party attempts to insert malicious code into our software through data entry fields in our websites in order to gain control of the system) and attempting to use our websites as a platform to launch a denial-of-service attack on another party, each of which could cause significant interruptions in our operations and potentially adversely affect the value of our brands, operations and results of operations or involve us in legal or regulatory proceedings. We expend significant resources in an attempt to prepare for and mitigate the effects of any such attacks. Reductions in the availability and response time of our online services could cause loss of substantial business volumes during the occurrence of any such attack on our systems and measures we may take to divert suspect traffic in the event of such an attack could result in the diversion of bona fide customers. These issues are likely to become more difficult to manage as we expand the number of places where we operate and the variety of services we offer, and as the tools and techniques used in such attacks become more advanced. Successful attacks could result in negative publicity, damage our reputation and prevent consumers from booking travel services, researching travel services or making restaurant reservations through us during the attack, any of which could cause consumers to use the services of our competitors, which would have a negative effect on the value of our brands, our market share, business and results of operations.

We rely on certain third-party computer systems and third-party service providers, including GDSs and computerized central reservation systems of the accommodation, rental car and airline industries in connection with providing some of our services. Any damage to, breach of or interruption in these third-party services and systems or deterioration in their performance could prevent us from booking related accommodation, rental car and airline reservations and have a material adverse effect on our business, brands and results of operations. Our agreements with some third-party service providers are terminable upon short notice and often do not provide recourse for service interruptions. In the event our arrangement with any such third party is terminated, we may not be able to find an alternative source of systems support on a timely basis or on commercially reasonable terms and, as a result, it could have a material adverse effect on our business and results of operations.

We depend upon various third parties to process payments, including credit cards, for our merchant transactions around the world. In addition, we rely on third parties to provide credit card numbers which we use as a payment mechanism for merchant transactions. If any such third party were wholly or partially compromised, our cash flows could be disrupted or we may not be able to generate merchant transactions (and related revenues) until such a time as a replacement process could be put in place with a different vendor, and this could have a negative effect on our business, reputation and results of operations.

We do not have a completely formalized or comprehensive disaster recovery plan in every geographic region in which we conduct business. In the event of certain system failures, we may not be able to switch to back-up systems immediately and the time to full recovery could be prolonged. Like many online businesses, we have experienced system failures from time to time. In addition to placing increased burdens on our engineering staff, these outages create a significant amount of consumer questions and complaints that need to be addressed by our customer support employees. Any unscheduled interruption in our service could result in an immediate loss of revenues that could be substantial, increase customer service costs, harm our reputation and result in some consumers switching to our competitors. If we experience frequent or persistent system failures, our reputation and brand could be permanently and significantly harmed. We have taken and continue to take steps to increase the reliability and redundancy of our systems. These steps are expensive, may reduce our margins and may not be successful in reducing the frequency or duration of unscheduled downtime.

We use both internally-developed systems and third-party systems to operate our services, including transaction processing, order management and financial and accounting systems. If the number of consumers using our services increases substantially, or if critical third-party systems stop operating as designed, we may need to significantly expand and upgrade our technology, transaction processing systems, financial and accounting systems or other infrastructure. We may not be able to

17 upgrade our systems and infrastructure to accommodate such conditions in a timely manner, and, depending on the systems affected, our transactional, financial and accounting systems could be impacted for a meaningful amount of time before upgrade, expansion or repair. Many of our processes and systems, including those related to processing and recording revenue, are highly automated and involve multiple inputs from various IT systems, which can mitigate the risk of human error but which can also make testing, troubleshooting and auditing more difficult. As a result, it may be difficult to quickly detect and correct errors embedded in these processes or systems.

Consumer adoption and use of mobile devices creates challenges and may enable device companies such as Google and Apple to compete directly with us.

Widespread adoption of mobile devices, such as the iPhone, Android-enabled smartphones, and tablets such as the iPad, coupled with the web browsing functionality and development of thousands of apps available on these devices, is driving substantial online traffic and commerce to mobile platforms. We have experienced a significant shift of business, both direct and indirect, to mobile platforms and our advertising partners are also seeing a rapid shift of traffic to mobile platforms. Some competitors offer last-minute discounts for mobile accommodation reservations. Advertising and distribution opportunities may be more limited on mobile devices given their smaller screen sizes. The revenues earned on a mobile transaction may be less than a typical desktop transaction due to different consumer purchasing patterns. For example, accommodation reservations made on a mobile device typically are for shorter lengths of stay, have lower ADRs and are not made as far in advance. Further, given the device sizes and technical limitations of tablets and smartphones, mobile consumers may not be willing to download multiple apps from multiple companies providing a similar service and instead prefer to use one or a limited number of apps for their mobile travel and restaurant research and reservation activity. As a result, the consumer experience with mobile apps as well as brand recognition and loyalty are likely to become increasingly important. Our mobile offerings have received generally strong reviews and are driving a material and increasing share of our business. We believe that mobile bookings present an opportunity for growth and are necessary to maintain and grow our business as consumers increasingly turn to mobile devices instead of a personal computer. As a result, it is increasingly important for us to develop and maintain effective mobile platforms to provide consumers with an appealing, easy-to-use mobile experience. If we are unable to continue to rapidly innovate and create new, user-friendly and differentiated mobile offerings and efficiently and effectively advertise and distribute on these platforms, or if our mobile offerings are not used by consumers, we could lose market share and our business, future growth and results of operations could be adversely affected.

Google's Android operating system is the leading smartphone operating system in the world. As a result, Google has the ability to leverage its Android operating system to give its travel services a competitive advantage, either technically or with prominence on its Google Play app store or within its mobile search results. Further, Google is the leading internet search service and has leveraged its search popularity to promote its travel services. The European Commission has fined Google significant amounts for breaching European Union antitrust rules by imposing restrictions on Android device manufacturers and mobile network operators, including by mandating the pre-installation of Google apps and limiting access to its Google Play app store. In addition, the European Commission's decision requires Google to end those practices or face penalty payments of up to 5% of the average daily worldwide turnover of Alphabet, Google's parent company. Google has appealed the European Commission's decision, and it is not yet clear how or whether the decision will affect Google's business, including its travel services.

Apple, the producer of, among other things, the iPhone and iPad, obtained a patent for "iTravel," a mobile app that would allow a traveler to check in for a travel reservation. In addition, Apple's iPhone operating system includes "Wallet," a virtual wallet app that holds tickets, boarding passes, coupons and gift cards, and, along with iTravel, may be indicative of Apple's intent to enter the travel reservations business in some capacity. Apple has substantial market share in the smartphone market and controls integration of offerings, including travel services, into its mobile operating system. Apple also has more experience producing and developing mobile apps and has access to greater resources than we have. Apple may use or expand iTravel, Wallet, Siri (Apple's voice recognition "concierge" service), Apple Pay (Apple's mobile payment system) or another mobile app or functionality as a means of entering the online travel reservations marketplace. To the extent Google or Apple use their mobile operating systems, app distribution channels or, in the case of Google, search services, to favor their own travel service offerings, our business and results of operations could be harmed.

We may have exposure to additional tax liabilities.

As an international business providing reservation and marketing services around the world, we are subject to income taxes and non-income-based taxes in the United States and various international jurisdictions. Due to economic and political conditions, tax rates and tax regimes in various jurisdictions may be subject to significant change. Our future effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets or changes in tax laws or their interpretation. If our effective tax rates were to increase, our results of operations and cash flows would be adversely affected. 18 Although we believe that our tax filing positions are reasonable and comply with applicable law, we regularly review our tax filing positions, especially in light of tax law or business practice changes, and may change our positions or determine that previous positions should be amended, either of which could result in additional tax liabilities. The final determination of tax audits or tax disputes may be different from what is reflected in our historical income tax provisions and accruals. To date, we have been audited in many taxing jurisdictions with no significant impact on our results of operations. If current or future audits find that additional taxes are due, we may be subject to incremental tax liabilities, possibly including interest and penalties, which could have a material adverse effect on our results of operations, financial condition and cash flows. For example, Booking.com is the subject of tax proceedings in France and has been assessed approximately 465 million Euros, the majority of which represents penalties and interest. We believe that Booking.com has been, and continues to be, in compliance with French tax law, and we are contesting the assessments. In January 2019, we were required to pay the assessments for the years 2003 through 2012 (356 million Euros) in order to preserve our right to contest the assessments for that period in court, though the payment is not an admission that we owe the taxes. See Note 16 to our Consolidated Financial Statements for more information regarding certain tax contingencies.

In general, governments are increasingly focused on ways to increase tax revenues, which has contributed to an increase in audit activity, more aggressive positions taken by tax authorities, more time and difficulty to resolve any audits or disputes and an increase in new tax legislation. Any such additional taxes or other assessments may be in excess of our current tax provisions or may require us to modify our business practices in order to reduce our exposure to additional taxes going forward, any of which could have a material adverse effect on our business, results of operations and financial condition.

In December 2017, the Tax Cuts and Jobs Act (the "Tax Act") was enacted into law in the United States. The Tax Act introduced a tax on 50% of global intangible low-taxed income, which is income determined to be in excess of a specified routine rate of return on qualifying business assets. The Tax Act further introduced a base erosion and anti-abuse tax ("BEAT") aimed at preventing the erosion of the U.S. tax base and a new tax deduction with respect to certain foreign-derived intangible income. If we are unable to operate our business so that BEAT does not impact us, our effective tax rate, results of operations and cash flows would be materially adversely affected. The tax law changes made by the Tax Act are broad and complex, and there continues to be significant uncertainty about how the Tax Act will be interpreted at both the U.S. federal and state levels. The interpretation and implementation of the Tax Act and regulations, rules or guidance that have been or may be adopted under, or result from, the Tax Act have had and could have a negative impact on our results of operations and cash flows.

Additionally, there have been significant changes made and proposed to international tax laws that increase the complexity, burden and cost of tax compliance. The Organisation for Economic Co-operation and Development ("OECD") initiated the "base erosion and profit shifting" ("BEPS") project to ensure international tax standards keep pace with changes in global business practices and to address situations where multinational businesses may pay little or no tax in certain jurisdictions by shifting profits away from jurisdictions in which the profit generating activities take place. The OECD is working towards a consensus-based solution by the end of 2020 to address the challenges posed to the current tax system by the digitalization of the economy. The OECD Secretariat's current proposal aims to ensure that multinational businesses are taxed in jurisdictions where they are conducting significant business but do not have a physical presence by establishing new nexus rules determining where tax should be paid and new profit allocation rules determining what portion of profits should be taxed. Certain countries and a number of E.U. member states have taken steps to unilaterally introduce a digital services tax to address the issue of multinational businesses carrying on business in their jurisdiction without a physical presence and therefore generally not subject to income tax in those jurisdictions. In July 2019, France passed legislation that introduced a 3% digital services tax, which is retroactively applicable as of January 1, 2019. Although the French tax authorities have postponed the requirement to pay the 2020 digital services tax until December 2020, the French government has not repealed the tax and is merely postponing the payment of the tax to see if a consensus is reached by the OECD during 2020 on how online businesses should be taxed. Consequently, we continue to accrue for the tax in 2020 because we will owe the tax to France if no consensus is reached by the OECD and France does not repeal the tax. Italy and Turkey have also passed legislation that introduces digital services taxes of 3% and 7.5%, respectively, that will be effective in 2020. Several other countries are also considering adopting digital services taxes. For example, the United Kingdom has proposed legislation to implement a digital services tax that, if enacted, would become effective in 2020 and would impose a 2% tax on revenue earned by larger companies from U.K. users of digital services. Similarly, Spain submitted a digital services tax bill to its parliament for approval in January 2019 that would tax digital services at 3%. Many questions remain as to the enactment, form and application of these digital services taxes. For example, it is not clear whether all countries will allow a deduction of digital services taxes for income tax purposes or whether there is potential for double taxation on the same transaction. The interpretation and implementation of the various digital services taxes (especially if there is inconsistency in the application of these taxes across tax jurisdictions) could have a materially adverse impact on our results of operations and cash flows. Further, digital services taxes may not apply to our competitors such as hotel chains and smaller OTCs, which harms our business and competitive position.

19 Any changes to international tax laws, including new definitions of permanent establishment, new nexus and profit allocation rules, or changes affecting the benefits of preferential tax regimes such as the Dutch "Innovation Box Tax" (discussed below), could impact the tax treatment of our foreign earnings and adversely impact our effective tax rate. Further, changes to tax laws and additional reporting requirements could increase the complexity, burden and cost of compliance. Due to the large and expanding scale of our international business activities, any changes in U.S. or international taxation of our activities or the combined effect of tax laws in multiple jurisdictions may increase our worldwide effective tax rate, increase the complexity and costs associated with tax compliance (especially if changes are implemented or interpreted inconsistently across tax jurisdictions) and adversely affect our cash flows and results of operations.

We are also subject to non-income-based taxes, such as value-added, payroll, sales, use, excise, net worth, property, hotel occupancy and goods and services taxes. We refer generally to taxes on travel transactions (e.g., value-added taxes, sales taxes, excise taxes, hotel occupancy taxes, etc.) as "travel transaction taxes." From time to time, we are under audit or investigation by tax authorities or involved in legal proceedings related to these non-income-based taxes or we may revise or amend our tax positions, which may result in additional non-income-based tax liabilities. A number of jurisdictions in the United States have initiated lawsuits against online travel companies, including us, related to, among other things, the payment of certain travel transaction taxes (such as hotel occupancy taxes) that could include historical taxes that are claimed to be owed, interest, penalties, punitive damages and/or attorney's fees and costs. In addition, a number of jurisdictions have initiated audit proceedings, issued proposed tax assessments or started inquiries relating to the payment of travel transaction taxes. Additional jurisdictions may assert that we are subject to, among other things, travel transaction taxes and could seek to collect such taxes, either retroactively, prospectively or both. Jurisdictions could also seek to amend their tax statutes in order to collect travel transaction taxes from us on a prospective basis. Litigation is subject to uncertainty and there could be adverse developments in these pending or future cases and proceedings. Additionally, several U.S. jurisdictions have adopted or may adopt laws that require us to collect and remit sales tax on behalf of travel service providers, which in some instances may negatively impact our revenue. Adverse tax decisions or new laws could have a material adverse effect on our business, margins, cash flows and results of operations. An unfavorable outcome or settlement of pending litigation may encourage the commencement of additional litigation, audit proceedings or other regulatory inquiries. In addition, an unfavorable outcome or settlement of these actions or proceedings could result in substantial liabilities for past and/or future bookings, including, among other things, interest, penalties, punitive damages and/or attorneys' fees and costs.

We may not be able to maintain our "Innovation Box Tax" benefit.

The Netherlands corporate income tax law provides that income generated from qualifying innovative activities is taxed at the rate of 7% ("Innovation Box Tax") rather than the Dutch statutory rate of 25%. A portion of Booking.com's earnings currently qualifies for Innovation Box Tax treatment. In 2019, the Innovation Box Tax benefit reduced our consolidated income tax expense by $443 million. In 2019, the Dutch government approved a reduction in its corporate income tax rate from 25% to 21.7%, effective in 2021. Furthermore, the Dutch government has proposed an increase in the Innovation Box Tax rate from 7% to 9%, which, if enacted, could be effective beginning in 2021.

In order to be eligible for Innovation Box Tax treatment, Booking.com must, among other things, apply for and obtain a research and development ("R&D") certificate from a Dutch governmental agency every six months confirming that the activities that Booking.com intends to be engaged in over the subsequent six-month period are "innovative." The R&D certificate is current but should Booking.com fail to secure such a certificate in any future period - for example, because the governmental agency does not view Booking.com's new or anticipated activities as innovative - or should this agency determine that the activities performed in a prior period were not performed as contemplated or did not comply with the agency's requirements, Booking.com may lose its certificate and, as a result, the Innovation Box Tax benefit may be reduced or eliminated. Booking.com intends to apply for continued Innovation Box Tax treatment for future periods. However, Booking.com's application may not be accepted, or, if accepted, the amount of qualifying earnings may be reduced.

The loss of the Innovation Box Tax benefit (or any material portion thereof), whether due to a change in tax law or a determination by the Dutch government that Booking.com's activities are not innovative or for any other reason, would substantially increase our effective tax rate and adversely impact our results of operations and cash flows.

We are dependent on providers of accommodations, rental cars and airline tickets and on restaurants.

We rely on providers of accommodations, rental cars and airline tickets and on restaurants to make their services available to consumers through us. Our arrangements with travel service providers generally do not require them to make available any specific quantity of accommodation reservations, rental cars or airline tickets, or to make accommodation reservations, rental cars or airline tickets available in any geographic area, for any particular route or at any particular price. Similarly, our arrangements with restaurants generally do not require them to provide all of their available tables and reservations to customers through us. We are in regular dialogue with our major travel service providers about the nature and 20 extent of their participation in our services. A significant reduction on the part of any of our major travel service providers or providers that are particularly popular with consumers in their participation in our services for a sustained period of time or their complete withdrawal could have a material adverse effect on our business, market share and results of operations. To the extent any of those major or popular travel service providers ceased to participate in our services in favor of one of our competitors' services or decided to require consumers to purchase services directly from them, our business, market share and results of operations could be harmed. During periods of higher occupancy rates, accommodation providers may decrease their distribution of accommodation reservations through third-party intermediaries like us, in particular through our discount services. Further, as consolidation among travel service providers increases, the potential adverse effect of a decision by any particular significant travel service provider (such as a large hotel chain, airline or rental car company) to withdraw from or reduce its participation in our services also increases. To the extent restaurants limit the availability of reservations through OpenTable, consumers may not continue to use our services and/or our revenues and results of operations could be adversely affected, especially if reservations during highly desirable times on high volume days are not made available through us.

KAYAK, a meta-search service, depends on access to information related to travel service pricing, schedules, availability and other related information from OTCs and travel service providers to attract consumers. Many of KAYAK's agreements with OTCs and travel service providers are short-term agreements that may be terminated on 30 days' notice. To the extent OTCs or travel service providers no longer provide such information to KAYAK, KAYAK's ability to provide comprehensive travel service information to consumers could be diminished and its brand, business and results of operations could be harmed. To the extent consumers do not view KAYAK as a reliable source of comprehensive travel service information, fewer consumers would likely visit its websites, which would also likely have a negative impact on KAYAK's advertising revenue and results of operations. In addition, if OTCs or travel service providers choose not to advertise with KAYAK or choose to reduce or eliminate the fees paid to KAYAK for referrals from query results, KAYAK's business and results of operations could be adversely affected.

We rely on the performance of highly skilled employees; and, if we are unable to retain or motivate key employees or hire, retain and motivate qualified employees, our business would be harmed.

Our performance is largely dependent on the talents and efforts of highly skilled individuals. Our future success depends on our continuing ability to identify, hire, develop, motivate and retain highly skilled employees for all areas of our organization. In particular, the contributions of key senior management in the United States, Europe and Asia are critical to the overall management of our business. We may not be able to retain the services of any members of our senior management or other key employees, the loss of whom could harm our business and competitive position. We do not maintain any key person life insurance policies.

In addition, competition for well-qualified employees in all aspects of our business, including software engineers, mobile communication talent and other technology professionals, is intense. Our international success in particular has led to increased efforts by our competitors and others to hire our international employees. These difficulties may be amplified by evolving restrictions on immigration, travel or availability of visas or work permits for skilled technology workers. The competition for talent in our industry has in the past and may in the future increase our personnel expenses, which may adversely affect our results of operations. Our continued ability to compete effectively and to innovate and develop products, services, technologies and enhancements depends on our ability to attract new employees and to retain and motivate existing employees. If we do not succeed in attracting well-qualified employees or retaining, training, managing and motivating existing employees, our business, competitive position, reputation and results of operations would be adversely affected.

Our business is subject to various competition, anti-trust, consumer protection and online commerce laws, rules and regulations around the world, and as the size of our business grows, scrutiny of our business by legislators and regulators in these areas may intensify.

We, the travel industry and the technology industry generally are subject to competition, anti-trust and consumer protection laws and regulations around the world. These laws and regulations evolve and change, and their interpretation, application and enforcement can also change, be unpredictable or be affected by changing political or social pressures. As we expand our business into new areas, including our evolution towards the Connected Trip, we may become subject to additional laws and regulations. At times, online travel platforms, including us, have been the subject of investigations or inquiries by various national competition authorities ("NCAs") or other governmental authorities. For example, we have been and continue to be involved in investigations related to whether Booking.com's contractual parity arrangements with accommodation providers, sometimes also referred to as "most favored nation" or "MFN" provisions, are anti-competitive because they require accommodation providers to provide Booking.com with room rates, conditions or availability that are at least as favorable as those offered to other OTCs or through the accommodation provider's website. To resolve and close certain of the investigations, we have from time to time made commitments to the investigating authorities regarding future business

21 practices or activities. For example, Booking.com has made commitments to several NCAs, including agreeing to narrow the scope of its parity arrangements, in order to resolve parity-related investigations.

We have also been involved in investigations or inquiries involving consumer protection matters. For example, in October 2017 the United Kingdom's NCA (the Competition and Markets Authority, or CMA) launched a consumer protection law investigation into the clarity, accuracy and presentation of information on hotel booking sites with a specific focus on the display of search results (e.g., ranking), claims regarding discounts, methods of "pressure selling" (such as allegedly creating false impressions regarding room availability) and failure to disclose hidden charges. In connection with this investigation, in June 2018, the CMA announced that it would proceed with enforcement action against a number of hotel booking sites. Booking.com, agoda and KAYAK, along with a number of other OTCs, voluntarily agreed to certain commitments with the CMA addressing its concerns in resolution of this investigation, which took effect on September 1, 2019. Among other things, the commitments provided to the CMA include showing prices inclusive of all mandatory taxes and charges, providing information about the effect of money earned on search result rankings on or before the search results page and making certain adjustments to how discounts and statements concerning popularity or availability are shown to consumers. The CMA has stated that it expects all market participants to adhere to the same standards, regardless of whether they formally signed the commitments. The commitments concluded the CMA’s investigation without a finding of infringement or an admission of wrongdoing by the OTCs involved. As a result of additional inquiries from other NCAs in the European Economic Area, Booking.com has made similar commitments with the Consumer Protection Cooperation Network to be applicable across the E.U. beginning in June 2020. There are consumer protection investigations or inquiries in other countries as well, including in Hungary, Italy and Brazil, and other countries may decide to investigate these or similar issues generally or with respect to specific businesses, including ours, and we are unable to predict the outcome of any such other investigations or inquiries. To the extent that any such other investigations or inquiries result in additional commitments, fines, damages or other remedies, our business, financial condition and results of operations could be harmed.

As markets evolve and NCAs or other governmental authorities continue to monitor our industry, new investigations of the industry generally or of us specifically could and have occurred, including revisiting issues that were the subject of prior investigations. For example, a working group of 10 European NCAs (France, Germany, Belgium, Hungary, Ireland, Italy, the Netherlands, Czech Republic, the United Kingdom and Sweden) was established by the European Commission to monitor the effects of the narrow parity clause in Europe. This working group has decided to keep the sector under review and re-assess the competitive situation in due course. Also, while we believe that we are complying with our commitments, investigating authorities or third parties may determine that we are not complying with the commitments we have made and decide to pursue legal action to compel compliance or seek other remedies. Further, in September 2017 the Swiss Price Surveillance Office opened an investigation into the level of commissions of Booking.com in Switzerland and the investigation is ongoing.

We are cooperating with regulators where applicable, but we are unable to predict what, if any, effect any investigations or resolutions thereof, including the effect of any commitments we might make, will have on our business, industry practices or online commerce more generally.

To the extent that regulatory authorities impose fines on us or require changes to our business practices or to those currently common to the industry, our business, competitive position and results of operations could be materially and adversely affected. Negative publicity regarding competition and/or consumer law investigations could adversely affect our brands and therefore our business, market share and results of operations. Competition and consumer law-related investigations, legislation or issues have and could in the future result in private litigation.

Another area of increased scrutiny, particularly in Europe, involves contractual search term bidding restrictions where one contracting party agrees not to bid on certain key search terms related to the other party (e.g., such other party’s name). Although we are generally moving away from these types of agreements, in some of our contracts, we or the other party have agreed to bidding restrictions. If bidding restrictions are held to be illegal or otherwise unenforceable or if we remove them from all of our contracts, our performance marketing costs may increase if bidding on affected key words (especially those related to us) becomes more expensive, which could adversely affect our performance marketing efficiency, business and results of operations.

Recently, there has been increased legislative and public focus on the technology industry, especially as technology companies become larger. In some instances, countries have passed legislation that goes further to restrict business activities than actions taken by NCAs or other regulatory authorities. For example, France, Italy, Belgium and Austria have passed legislation prohibiting parity contract clauses in their entirety. Additionally, the EU's Platform to Business Regulation, which comes into effect in July 2020, will regulate the relationship between online platforms such as Booking.com and European business users of online platforms. This new regulation will require online platforms to provide additional disclosure to European business partners, such as terms related to search result ranking and preferential pricing as well as provide for a 22 mediation process to handle any disputes, among other changes. New laws and regulations and changing public perception relating to the technology industry could impact our services, require us to change our business practices or otherwise cause us to incur additional operating costs to comply with or address these developments. Further, as market conditions change as a result of investigations, litigation, legislation or political or social pressure, we may decide to voluntarily modify our business practices beyond what is required, the full effects of which may not be known when making the decision, but which could harm our competitive position and adversely affect our business and results of operations.

With additional attention on the size of travel or technology companies generally, our size and market share may negatively affect our ability to obtain regulatory approval of proposed acquisitions, our ability to expand into complementary businesses or our latitude in dealing with travel service providers (such as by limiting our ability to provide discounts, rebates or incentives or to exercise contractual rights), any of which could adversely affect our business, results of operations or ability to grow and compete.

Regulatory and legal requirements and uncertainties could subject us to business constraints, increased compliance costs and complexities or otherwise harm our business.

The services we offer and could offer in the future are subject to legal regulations (including laws, ordinances, rules, licensing requirements and other requirements and regulations) of national and local governments and regulatory authorities around the world, many of which are evolving and subject to the possibility of new or revised interpretations. Our ability to provide our services is and will continue to be affected by such regulations. For example, we began offering optional rental car-related insurance products to customers protecting them against accidental damage to their rental vehicles, which subjects us to certain insurance regulations and related increased compliance costs and complexities, any of which could negatively impact our business and results of operations. Laws in some countries relating to data localization, registration as a travel agent and other local requirements could, if applicable to us, adversely affect our ability to conduct business in those countries. Any increase in the number or complexity of the laws and regulations applicable to us and our businesses could increase our compliance costs and burdens and negatively affect our business and results of operations.

For example, in the European Union, the Package Travel Directive (the "Package Directive") sets out broad requirements such as local registration, certain mandatory financial guarantees, industry specific value-added tax regimes, disclosure requirements and other rules regulating the provision of travel packages and linked travel arrangements. The Package Directive also creates additional liability for a provider of travel packages, which could be the OTC, for performance of the travel services within a packaged trip under certain circumstances. Certain parts of our business are already subject to the broad scope of the Package Directive as it relates to linked travel arrangements, and as our offerings continue to diversify and expand, we may become subject to additional requirements of the Package Directive. Compliance with this directive could be costly and complex or, as a result of these requirements, we could choose to limit offerings that would otherwise be beneficial for the business, any of which could adversely affect our business, results of operations or ability to grow and compete.

The implementation of unfavorable regulations or unfavorable interpretations of existing regulations by judicial or regulatory bodies could require us to incur significant compliance costs, cause the development of the affected markets to become impractical and otherwise have a material adverse effect on our business and results of operations. For example, in connection with a lawsuit begun in 2015 by the Association of Turkish Travel Agencies, a Turkish court ordered in 2019 that Booking.com must meet certain registration requirements in order to offer Turkish hotels and accommodations to Turkish residents. If Booking.com does not successfully appeal this decision or meet the Turkish registration requirements, Booking.com will be unable to resume offering Turkish hotels and accommodations to Turkish residents, which would continue to negatively impact our results of operations. Another example is that the U.S. Government announced in May 2019 that it will no longer suspend the right of private parties to bring litigation under Title III of the Cuban Liberty and Solidarity (Libertad) Act of 1996, popularly known as the Helms-Burton Act, allowing certain individuals whose property was confiscated by the Cuban government beginning in 1959 to sue anyone who "traffics" in the property in question in U.S. courts. We are a defendant in a number of these lawsuits, which seek remedies including the value of the expropriated property (generally, the applicable hotel), plus interest, treble damages, attorneys' fees and costs. We believe that we have meritorious defenses to existing and potential claims and that the results of any related litigation will not be material to our business, financial condition or results of operations. However, litigation is uncertain and there is little judicial history or interpretation of the relevant claims and defenses, in particular as applied to businesses like ours. As a result, there can be no assurance that there will not be an adverse outcome to any such litigation or that such an outcome would not result in an adverse impact on our business, financial condition or results of operations.

Certain jurisdictions, particularly in Europe, are considering regulations intended to address the issue of "overtourism," including restrictions that may adversely affect our ability to offer accommodations, in particular, alternative

23 accommodations, near city centers or popular tourist destinations. To the extent any such regulations require online platforms such as ours to comply with additional restrictions related to offering reservations for accommodations, tours and activities or other travel services in such areas, we could be subject to increased legal and compliance costs, and our business, growth and results of operations could be adversely affected.

Compliance with the laws and regulations of multiple jurisdictions increases our cost of doing business. These laws and regulations, which vary and sometimes conflict, include the U.S. Foreign Corrupt Practices Act, the U.K. Bribery Act and local laws which also prohibit corrupt payments to governmental officials or third parties, data privacy requirements, labor relations laws, tax laws, anti-trust or competition laws, U.S., E.U. or U.N. sanctioned country or sanctioned persons mandates, and consumer protection laws. Violations of these laws and regulations could result in fines and/or criminal sanctions against us, our officers or our employees and/or prohibitions on the conduct of our business. Any such violations could result in prohibitions on our ability to offer our services in one or more countries, could delay or prevent potential acquisitions, and could also materially damage our reputation, our brands, our international expansion efforts, our ability to attract and retain employees, our business and our operating results. Even if we comply with these laws and regulations, doing business in certain jurisdictions could harm our reputation and brands, which could adversely affect our results of operations or stock price. In addition, these restrictions may provide a competitive advantage to our competitors unless they are also subject to comparable restrictions. Our success depends, in part, on our ability to anticipate these risks and manage these difficulties. We are also subject to a variety of other regulatory, legal and public policy risks and challenges in managing an organization operating in various countries, including those related to:

• regulatory changes or other government actions;

• additional complexity to comply with regulations in multiple jurisdictions, as well as overlapping or inconsistent legal regimes, in particular with respect to tax, labor, consumer protection, digital content, advertising, promotions, privacy and anti-trust laws;

• difficulties in transferring funds from or converting currencies in certain countries;

• reduced protection for intellectual property rights in some countries; and

• changes in social or political conditions or policies relating to a wide range of sustainability topics.

Our business has grown substantially over the last several years as we have expanded into new geographies and added new services. In addition, we have made efforts and expect to make further efforts to integrate access to travel services across our various brands. These changes add complexity to legal and tax compliance and our internal controls, and our increased size and operating history may increase the likelihood that we will be subject to regulatory scrutiny or audits by tax authorities in various jurisdictions. In addition, by virtue of Booking.com's size and presence in the Netherlands, it was recently required to establish a supervisory board to oversee the strategy and operations of Booking.com. While we do not expect the existence of the supervisory board to have a significant impact on our operations, under certain circumstances, this governance structure could require Booking.com to obtain supervisory board approval in order to take certain actions, which could result in delays or other unanticipated strategic or operational challenges.

There are various risks associated with the facilitation of payments from consumers, including risks related to fraud, compliance with evolving rules and regulations and reliance on third parties.

Our results have been and will likely continue to be negatively impacted by consumer purchases made using fraudulent credit cards, claims the consumer did not authorize the purchase or consumers who have closed bank accounts or have insufficient funds in their bank accounts to satisfy payments. We may be held liable for accepting fraudulent credit cards on our platforms or in connection with other fraudulent transactions on our platforms, as well as other payment disputes with consumers. Accordingly, we calculate and record an allowance for the resulting chargebacks. We must also continually implement and evolve measures to detect and reduce the risk of fraud, in particular as these methods become increasingly sophisticated. If we are unable to combat the use of fraudulent credit cards on our websites, our business, profit margins, results of operations and financial condition could be materially adversely affected.

We believe that an important component of our future success will be our ability to offer consumers their preferred method of payment in the most efficient manner on all our platforms, and, as a result, we are increasingly processing transactions on a merchant basis where we facilitate payments from travelers through the use of credit cards and other payment methods (such as PayPal, Alipay, Paytm and WeChat Pay). While processing transactions on a merchant basis allows us to process transactions for properties that do not otherwise accept credit cards and to increase our ability to offer a variety of

24 payment methods and flexible transaction terms to consumers, we incur additional payment processing costs (which are typically higher for foreign currency transactions) and other costs related to these transactions, such as costs related to fraudulent payments and transactions and fraud detection. As our merchant transactions continue to grow, in addition to the revenues from these transactions, we may experience a significant increase in these costs, and our results of operations and profit margins could be materially adversely affected, in particular if we experience a significant increase in non-variable costs related to fraudulent payments and transactions.

The growth in processing transactions on a merchant basis also requires us to manage our global systems and processes associated with these transactions on a larger scale, which introduces additional complexity and increases administrative burdens and costs, which could adversely affect our results of operations. The increase in payments processing may also subject the business to additional regulations, including financial services regulation or other regulatory regimes applicable to highly regulated businesses, which could result in increased compliance costs and complexities, including those associated with the implementation of new or advanced internal controls. For example, the E.U.'s Payment Services Directive 2 has further complicated the authentication process for accepting credit cards. As a result of this directive, payments made on our platforms by consumers in the European Economic Area are subject to Strong Customer Authentication, which requires the consumer to engage in additional steps to authenticate their transaction. This new process could cause consumer transactions to take longer to process or otherwise inconvenience the consumer, which could result in consumers choosing not to utilize our platforms as often or at all. The implementation of this process has resulted and may continue to result in increased compliance costs and administrative burdens for us. As our business evolves or as we change the way we facilitate payments on our platforms and new money transmission and online payments rules come into effect, we may become subject to new payments and financial services laws and regulations including those relating to money transmission licenses, anti-money laundering, banking, privacy and security of our processes, among others. Compliance with this changing regulatory environment could create significant additional compliance costs and burdens or it could lead us to modify our business plans or operations, any of which could negatively impact our business, results of operations and profit margins.

We are also subject to payment card association rules and obligations under our contracts with payment card processors, including the Payment Card Industry and Data Security Standard (the "Standard"). Under the Standard and these association rules and obligations, if information is compromised, we could be liable to payment card issuers for associated expenses and penalties, and in some cases, we could be restricted in our ability to accept payment cards. Under certain circumstances, we are also subject to periodic audits, self-assessments and other assessments of our compliance with the Standard, which could result in additional expenses and administrative burdens. In addition, if we fail to follow payment card industry security standards, even if no consumer information is compromised, we could incur significant fines or experience a significant increase in payment card transaction costs. Additionally, compliance with the Standard may not prevent all security incidents. If we are fined or required to pay additional processing fees or if our ability to accept payment cards is restricted in any way as a result of our failure to comply with these payment card industry rules, or otherwise, it could adversely impact our business, results of operations and profit margins.

We rely on banks and other payment processors to execute certain components of the payments process. We generally pay these third parties interchange fees and other processing and gateway fees to help us facilitate payments from consumers to travel service providers. As a result, if we are unable to maintain our relationships with these third parties on favorable terms or if these fees are increased for any reason, our profit margin, business and results of operations could be harmed. Additionally, if these third parties experience service disruptions, consumers and travel service providers could have difficulty making or receiving payments, which could adversely impact our reputation, business and results of operation.

In addition, in the event that one of our major travel service providers voluntarily or involuntarily declares bankruptcy, we could experience an increase in chargebacks from customers with travel reservations with such travel service provider. For example, airlines that participate in our services and declare bankruptcy or cease operations may be unable or unwilling to honor tickets sold for their flights. Our policy in such events is to direct customers seeking a refund or exchange to the airline and/or their credit card company, and not to provide a remedy ourselves. However, we have experienced in the past, and could experience in the future, an increase in chargebacks from customers with tickets on airlines that ceased operations, which could adversely impact our results of operations.

Our stock price is highly volatile.

The market price of our common stock is highly volatile and is likely to continue to be subject to wide fluctuations in response to factors such as the following, some of which are beyond our control:

• financial or operating results that vary from the expectations of securities analysts and investors or our publicly- disclosed estimates;

25 • quarterly variations in our financial or operating results;

• changes in expectations as to our future financial or operating performance, including estimates by securities analysts and investors or our publicly-disclosed estimates of future performance;

• worldwide economic conditions in general and in Europe in particular;

• fluctuations in foreign currency exchange rates, particularly between the U.S. Dollar and the Euro;

• changes in interest rates;

• occurrence of a significant security breach;

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

• changes in our capital structure;

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

• announcements by us or our competitors of price reductions, promotions, significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments;

• loss of a major travel service provider participant, such as a hotel chain, rental car company or airline, from our services;

• changes in the status of our intellectual property rights;

• lack of success in the expansion of our business models geographically;

• business interruptions, such as may result from natural disasters, health concerns such as the coronavirus or other events;

• announcements by third parties of significant claims or initiation of litigation proceedings against us or adverse developments in pending proceedings;

• additions or departures of key personnel; and

• trading volume fluctuations.

Sales of a substantial number of shares of our common stock, including through the conversion of our convertible notes, could adversely affect the market price of our common stock by introducing a large number of sellers to the market. Given the volatility that exists for our shares, such sales could cause the market price of our common stock to decline significantly. In addition, fluctuations in our stock price and our price-to-earnings multiple may have made our stock attractive to momentum, hedge or day-trading investors who often shift funds into and out of stocks rapidly, exacerbating price fluctuations in either direction, particularly when viewed on a quarterly basis.

The trading prices of internet company stocks in general, including ours, have experienced extreme price and volume fluctuations. To the extent that the public's perception of the prospects of internet or e-commerce companies is negative, our stock price could decline, regardless of our results. Other broad market and industry factors may decrease the market price of our common stock, regardless of our operating performance. Market fluctuations, as well as general political and economic conditions, such as a recession, interest rate or foreign currency exchange rate fluctuations, political instability (e.g., Brexit), changes in trade policy, trade disputes or a natural disaster, health concerns such as the coronavirus or a terrorist attack affecting a significant market for our business, such as Europe or the United States, could cause our stock price to decline. Negative market conditions could adversely affect our ability to raise additional capital or the value of our stock for purposes of acquiring other companies or businesses.

We have, in the past, been a defendant in securities class action litigation. Securities class action litigation has often been brought against a company following periods of volatility in the market price of its securities. To the extent our stock price declines or is volatile, we may in the future be the target of additional litigation. This additional litigation could result in 26 substantial costs and divert management's attention and resources, either of which could adversely affect our business, financial condition and results of operations.

We face increased risks if the level of our debt increases.

We have a substantial amount of outstanding indebtedness and we may incur substantial additional indebtedness in the future, including through public or private offerings of debt securities. Our outstanding indebtedness and any additional indebtedness we incur may have significant consequences, which could include:

• requiring the dedication of a portion of our cash flow from operations to service our indebtedness, thereby reducing the amount of cash flow available for other purposes, including capital expenditures, share repurchases and acquisitions;

• increased vulnerability to downturns in our business, to competitive pressures and to adverse changes in general economic and industry conditions;

• decreased or lost ability to obtain additional financing on terms acceptable to us for working capital, capital expenditures, acquisitions, share repurchases or other general corporate purposes; and

• decreased flexibility when planning for or reacting to changes in our business and industry.

Our ability to make payments of principal and interest on our indebtedness depends upon our future performance, which will be subject to general economic conditions, industry cycles and financial, business and other factors affecting our results of operations and financial condition, many of which are beyond our control. Further, we may not have access to equity or debt markets or other sources of financing, or such financing may not be available to us on commercially reasonable terms, to repay or refinance our debt as it comes due or, in the case of our convertible notes, upon conversion.

We face risks related to our intellectual property.

We regard our intellectual property as critical to our success, and we rely on domain name, trademark, copyright and patent law, trade secret protection and confidentiality and/or license agreements with our employees, travel service providers, partners and others to protect our proprietary rights. We have filed various applications for protection of certain aspects of our intellectual property in the United States and other jurisdictions, and we currently hold a number of issued patents in several jurisdictions. Further, in the future we may acquire additional patents or patent portfolios, which could require significant cash expenditures. However, we may choose not to patent or otherwise register some of our intellectual property and instead rely on trade secret or other means of protecting our intellectual property. We have licensed in the past, and may license in the future, certain of our proprietary rights, such as trademarks or copyrighted material, to third parties, and these licensees may take actions that diminish the value of our proprietary rights or harm our reputation. We also have procured various intellectual property licenses from third parties. In addition, effective intellectual property protection may not be available in every country in which our services are made available online, particularly in certain jurisdictions in which we operate in which theft of intellectual property may be more prevalent. We may be required to expend significant time and resources to prevent infringement or to enforce our intellectual property rights.

We believe that our intellectual property rights help to protect our business. We endeavor to defend our intellectual property rights diligently, but intellectual property litigation is extremely expensive and time-consuming, and may divert managerial attention and resources from our business objectives. We may not be able to successfully defend our intellectual property rights or they may not be sufficient to effectively protect our business, which could materially adversely affect our business, brands and results of operations.

From time to time, in the ordinary course of our business, we have been subject to, and are currently subject to, legal proceedings and claims relating to the intellectual property rights of others, and we expect that third parties will continue to assert intellectual property claims, in particular patent claims, against us, particularly as we expand the complexity and scope of our business. Successful infringement claims against us could result in a significant monetary liability or prevent us from operating our business, or portions of our business, or require us to change business practices or develop non-infringing intellectual property, which could require significant effort and expense. In addition, resolution of claims may require us to obtain licenses to use intellectual property rights belonging to third parties, which may be expensive to procure, or possibly to cease using those rights altogether. Any of these events could have a material adverse effect on our business, results of operations and financial condition.

27 The value of our investments could decline, which could adversely affect our financial condition and results of operations.

We maintain an investment portfolio of various holdings, types and maturities. Our portfolio includes marketable debt securities, equity securities of publicly-traded companies, the values of which are subject to market price volatility, and investments in private companies. Our investments in marketable debt securities and preferred stock classified as debt securities for accounting purposes are generally classified as available-for-sale and, consequently, are recorded in our balance sheets at fair value with unrealized gains or losses, net of tax, reported in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. If such investments suffer market price declines, we may recognize in earnings the decline in the fair value of our investments below their cost basis when the decline is judged to be other than temporary (see Note 2 to our Consolidated Financial Statements for the accounting change to the other-than-temporary impairment model, effective January 1, 2020). For periods beginning on or after January 1, 2018, changes in the fair value of our investments in publicly-traded equity securities are recognized in net income and these changes have had, and are likely to continue to have, a significant impact on our quarterly net income. Our investments in equity securities (other than those classified as debt securities for accounting purposes) of private companies are primarily measured at cost, less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer, with changes in value also recognized in net income (see Note 2 to our Consolidated Financial Statements).

We have invested a significant amount in Trip.com Group convertible notes and ADSs. We have also invested in other Chinese internet companies (i.e., Meituan Dianping ("Meituan") and Didi Chuxing ("Didi")). See Note 5 to our Consolidated Financial Statements for more information regarding our investments in Trip.com Group, Meituan and Didi securities. The value of these securities is subject to the risks associated with Trip.com Group's, Meituan's and Didi's respective businesses, as well as any changes by the Chinese government in foreign investment laws or elevated scrutiny or regulation of foreign investments in Chinese companies. For example, Trip.com Group is a Cayman Islands company operating in China through what is commonly referred to as a variable interest entity, or VIE, structure where it conducts part of its business through contractual relationships with affiliated Chinese entities. Although VIE structures are commonly used by Chinese internet and e-commerce companies, there are substantial uncertainties regarding the interpretation and application of People's Republic of China ("PRC") laws and regulations to VIE structures, and it is possible that the PRC government may view the VIE structure as a violation of PRC law. VIE contractual relationships are not as effective in providing control over the affiliated Chinese companies as direct ownership, and Trip.com Group would have to rely on the PRC legal system to enforce those contracts in the event of a breach by one of these entities. Further, conflicts of interest could arise to the extent Trip.com Group's officers or directors are also shareholders, officers or directors of the affiliated Chinese entities. Any of these risks could materially and adversely affect Trip.com Group's business and therefore the value of our investment in Trip.com Group. Similar VIE-structure considerations and risks apply with respect to our investments in securities of Meituan and Didi, each of which is a Cayman Islands company operating in China through a VIE structure.

Our investments in private companies are inherently risky in that such companies are typically at an early stage of development, may have no or limited revenues, may not be or ever become profitable, may not be able to secure additional funding or their technologies, services or products may not be successfully developed or introduced to the market. Further, our ability to liquidate any such investments is typically dependent on a liquidity event, such as a public offering or acquisition, as no public market exists for such securities. Valuations of privately-held companies are inherently complex and uncertain due to the lack of a liquid market for such securities. If we determine that any of our investments in such companies have experienced a decline in value, we are required to recognize the change in net income. For example, in 2016 we recognized impairments totaling $63 million related to investments in two private companies and in 2017 we recognized an impairment of $8 million related to an investment in one private company.

We could lose the full amount of any of our investments, and any impairment of our investments could have a material adverse effect on our financial condition and results of operations.

Investment in new business strategies and acquisitions could disrupt our ongoing business and present risks not originally contemplated.

Our mission is to make it easier for everyone to experience the world. As a result, our strategy involves evaluating and potentially entering complementary businesses in furtherance of that mission. We have invested, and in the future may invest, in new business strategies and acquisitions. For example, we acquired FareHarbor in April 2018 to increase our ability to offer local activities and experiences (such as tours and attractions). We also have acquired, and in the future may acquire, businesses similar to those we already operate in an effort to expand our geographic markets, acquire technology or products or to otherwise improve or grow our business. For example, in July 2017 we acquired the Momondo Group and in November 2018 we acquired HotelsCombined, in each case, among other things, to enhance the global reach of our meta-search services.

28 Such endeavors may involve significant risks and uncertainties, including diversion of management's attention from current operations, greater than expected liabilities and expenses, inadequate return on capital, new risks with which we are not familiar, legal compliance obligations that previously did not apply to us, integration risks and difficulties and unidentified issues not discovered in our investigations and evaluations of those strategies and acquisitions. As a result, entering new businesses involves risks and costs that could, if realized, have an adverse effect on our business, reputation, results of operations, profit margins, cash flows or financial condition, as well as on our ability to achieve the expected benefits of any such investments or acquisitions.

We may decide to make minority investments, including through joint ventures, in which we have limited or no management or operational control. The controlling person in such a case may have business interests, strategies or goals that are inconsistent with ours, and decisions of the company or venture in which we invested may result in harm to our reputation or business or adversely affect the value of our investment. A substantial portion of our goodwill and intangible assets were acquired in acquisitions. If we determine that any of our goodwill and intangible assets, or any goodwill or intangible assets acquired in future transactions, experiences a decline in value, we may be required to record, as we have in the past, an impairment, which could materially adversely affect our results of operations. Further, we may issue shares of our common stock in these transactions, which could result in dilution to our stockholders.

We may not be able to successfully integrate acquired businesses or combine internal businesses.

The integration of acquired businesses requires significant time and resources, and we may not manage these processes successfully. Further, as our businesses develop and market conditions change, we have integrated businesses that had been managed independently and integrated certain functions across businesses and we may do so in the future. These integrations may be of varying degree, depending on many factors such as business compatibility, strategic goals or geographic location, among others. Integrations are complex, often involve additional or unexpected costs and create a variety of issues and risks, including:

• disruption or harm to the businesses involved;

• disruption to our other businesses, including as a result of the need for management to spend time and attention on the integration;

• difficulty combining different company cultures; systems; reporting structures, titles and job descriptions; and compensation schemes;

• problems retaining key personnel, in particular at the acquired or integrated company;

• loss of travel service providers, restaurants or partners of the acquired business; and

• difficulty implementing and maintaining effective controls, procedures and policies.

We may not successfully integrate companies or achieve the strategic, financial or operating objectives of the acquisition or integration, any of which could adversely affect our business, results of operations or the value of our acquisitions.

Our use of "open source" software could adversely affect our ability to protect our proprietary software and subject us to possible litigation.

We use open source software in connection with our software development. From time to time, companies that use open source software have faced claims challenging the use of open source software and/or compliance with open source license terms. We could be subject to suits by parties claiming ownership of what we believe to be open source software, or claiming non-compliance with open source licensing terms. Some open source licenses require users who distribute software containing open source to make available all or part of such software, which in some circumstances could include valuable proprietary code of the user. While we monitor our use of open source software and try to ensure that none is used in a manner that would require us to disclose our proprietary source code or that would otherwise breach the terms of an open source agreement, such use could inadvertently occur, in part because open source license terms are often ambiguous. Any requirement to disclose our proprietary source code or pay damages for breach of contract could be harmful to our business, results of operations or financial condition, and could help our competitors develop services that are similar to or better than ours.

29 "Cookie" laws could negatively impact the way we do business.

A "cookie" is a text file that is stored on a user's computer or mobile device. Cookies are common tools used by thousands of websites and mobile apps, including ours, to, among other things, store or gather information (e.g., remember log- on details so a user does not have to re-enter them when revisiting a website or opening an app), market to consumers and enhance the user experience. Cookies are valuable tools for platforms like ours to improve the customer experience and increase conversion. Many jurisdictions, including the European Union and more recently, California, have adopted regulations governing the use of "cookies." To the extent any such regulations require "opt-in" consent before certain cookies can be placed on a user's computer or mobile device, our ability to serve certain customers in the manner we currently do might be adversely affected and our ability to continue to improve and optimize performance on our platforms might be impaired, either of which could negatively affect a consumer's experience using our services and our business, market share and results of operations.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

We lease office space facilities for our corporate headquarters in Norwalk, Connecticut, United States of America. We lease additional space, including office space and data center facilities in various locations around the world, to support our operations, the largest being the headquarters of our Booking.com business in Amsterdam, Netherlands. Other than the office building for the future headquarters of Booking.com that is currently under construction in the Netherlands (see the section "Building Construction" within Note 16 to our Consolidated Financial Statements for more details, which is incorporated into this Item 2 by reference thereto), we did not own any real estate at December 31, 2019.

We believe that our existing facilities are adequate to meet our current requirements, and that suitable additional or substitute space will be available as needed to accommodate any further expansion of corporate operations.

Item 3. Legal Proceedings

A description of any material legal proceedings to which we are a party is included in Note 16 to our Consolidated Financial Statements included in this Annual Report on Form 10-K for the year ended December 31, 2019, and is incorporated into this Item 3 by reference thereto.

Item 4. Mine Safety Disclosures

Not applicable.

30 PART II

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Common Stock

Our common stock is quoted on the NASDAQ Global Select Market under the symbol "BKNG."

Holders

At February 19, 2020, there were approximately 166 stockholders of record of Booking Holdings Inc.'s common stock.

Dividend Policy

We have not declared or paid any cash dividends on our capital stock since our inception and do not expect to pay any cash dividends for the foreseeable future.

Performance Measurement Comparison

The following graph shows the total stockholder return through December 31, 2019 of an investment of $100 in cash on December 31, 2014 for our common stock and an investment of $100 in cash on December 31, 2014 for (i) the NASDAQ Composite Index, (ii) the Standard and Poor's 500 Index and (iii) the Research Data Group ("RDG") Internet Composite Index. The RDG Internet Composite Index is an index of stocks representing the internet industry, including internet software and service companies and e-commerce companies. Historic stock performance is not necessarily indicative of future stock price performance. All values assume reinvestment of the full amount of all dividends and are calculated as of the last day of each month:

31 Measurement Point Booking Holdings NASDAQ S&P 500 RDG Internet December 31 Inc. Composite Index Index Composite

2014 100.00 100.00 100.00 100.00 2015 111.82 106.96 101.38 128.89 2016 128.58 116.45 113.51 135.45 2017 152.41 150.96 138.29 203.48 2018 151.06 146.67 132.23 197.34 2019 180.12 200.49 173.86 262.03

32 Issuer Purchases of Equity Securities

The following table sets forth information relating to repurchases of our equity securities during the three months ended December 31, 2019:

ISSUER PURCHASES OF EQUITY SECURITIES

Maximum Number (or Approximate Dollar Value) Total Number of of Shares (or Units) Shares (or Units) that May Total Number Average Purchased as Part of Yet Be Purchased of Shares (or Price Paid per Publicly Announced Under the

Period Units) Purchased Share (or Unit) Plans or Programs Plans or Programs

October 1, 2019 — 229,668 (1) $ 2,002.76 229,668 $ 12,418,461,506 (1) October 31, 2019 210 (2) $ 1,944.25 N/A N/A

— November 1, 2019 — 230,653 (1) $ 1,898.41 230,653 $ 11,980,588,388 (1) November 30, 2019 2,160 (2) $ 1,897.45 N/A N/A

December 1, 2019 — 222,023 (1) $ 1,972.69 222,023 $ 11,542,606,620 (1) December 31, 2019 241 (2) $ 2,022.91 N/A N/A

Total 684,955 $ 1,957.53 682,344 $ 11,542,606,620

(1) Pursuant to a stock repurchase program announced on May 9, 2019, whereby we are authorized to repurchase up to $15.0 billion of our common stock. (2) Pursuant to a general authorization, not publicly announced, whereby we are authorized to repurchase shares of our common stock to satisfy employee withholding tax obligations related to stock-based compensation. The table above does not include adjustments in the three months ended December 31, 2019 to previously withheld share amounts (reduction of 13 shares) that reflect changes to the estimates of employee tax withholding obligations.

33 Item 6. Selected Financial Data

SELECTED FINANCIAL DATA

The selected consolidated financial data presented below is derived from the Consolidated Financial Statements and related Notes of the Company, and should be read in connection with those statements, some of which are included herein. Selected financial data reflects results of any acquired business from the date of acquisition, including data related to the Momondo Group from its acquisition date of July 24, 2017, FareHarbor from its acquisition date of April 26, 2018 and HotelsCombined from its acquisition date of November 30, 2018. The information set forth below is not necessarily indicative of future results and should be read in conjunction with Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations.

Year Ended December 31, 2019(1) 2018(1) 2017 2016 2015

(In millions, except per share amounts) Total revenues $ 15,066 $ 14,527 $ 12,681 $ 10,743 $ 9,224 Cost of revenues N/A N/A 242 415 646 Gross profit N/A N/A 12,439 10,328 8,578 Total operating expenses (2) 9,721 9,186 7,901 7,422 5,319 Operating income (2) 5,345 5,341 4,538 2,906 3,259 Total other income (expense) (3) 613 (506) (139) (193) (131) Income tax expense (4) 1,093 837 2,058 578 577 Net income (2) (3) (4) 4,865 3,998 2,341 2,135 2,551 Net income applicable to common stockholders per basic common share (2) (3) (4) 112.93 84.26 47.78 43.14 50.09 Net income applicable to common stockholders per diluted common share (2) (3) (4) 111.82 83.26 46.86 42.65 49.45 Total assets (5) 21,402 22,687 25,451 19,839 17,421 Long-term obligations (5) (6) 11,091 10,347 11,403 8,128 7,186 Total liabilities (5) 15,469 13,902 14,187 9,990 8,626 Total stockholders' equity 5,933 8,785 11,261 9,820 8,795

(1) The financial statements for the years ended December 31, 2019 and 2018 are presented in accordance with the current revenue recognition accounting standard adopted on January 1, 2018. Financial statements for all periods prior to January 1, 2018 are presented under the previous revenue recognition accounting standard. Under the current revenue recognition standard, we no longer present "Cost of revenues" or "Gross profit" in our Consolidated Statements of Operations. Therefore total revenues reported in 2019 and 2018 are comparable to gross profit reported in previous years. See Note 2 to our Consolidated Financial Statements for further information.

(2) Includes a non-cash charge related to an impairment of OpenTable goodwill of $941 million, which is not tax deductible, for the year ended December 31, 2016. The goodwill impairment charge reduced the 2016 basic and diluted net income per share by $19.01 and $18.79, respectively.

(3) Includes net unrealized gains on marketable equity securities of $745 million for the year ended December 31, 2019 and net unrealized losses on marketable equity securities of $367 million for the year ended December 31, 2018. The unrealized gains (losses) on marketable equity securities, net of tax, increased the 2019 basic and diluted net income per share by $13.52 and $13.39, respectively, and reduced the 2018 basic and diluted net income per share by $6.50 and $6.42, respectively. Pursuant to the adoption of the accounting update on financial instruments in 2018, for periods beginning after December 31, 2017, changes in fair value of marketable equity securities are recognized in net income rather than "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. See Note 2 to our Consolidated Financial Statements for further information.

(4) Includes income tax benefits of $17 million and $46 million for the years ended December 31, 2019 and 2018, respectively, to adjust the 2017 provisional tax expense related to a one-time transitional tax on mandatory deemed repatriation of accumulated unremitted international earnings as a result of the U.S. Tax Cuts and Jobs Act (“Tax Act”) enacted in December 2017 (see Note 15 to the Consolidated Financial Statements). The income tax provision for the

34 year ended December 31, 2017 includes a provisional tax expense of $1.6 billion related to the transition tax mentioned above and a provisional net tax benefit of $217 million related to the remeasurement of the Company’s U.S. deferred tax assets and liabilities as a result of the Tax Act, which reduced the 2017 basic and diluted net income per share by $27.47 and $26.94, respectively.

(5) Includes, as applicable, operating lease assets of $620 million, current operating lease liabilities of $161 million and non-current operating lease liabilities of $462 million that are reported in the Consolidated Balance Sheet at December 31, 2019. Operating lease assets and liabilities are recognized in the balance sheet as a result of the adoption of the current lease standard on January 1, 2019. See Notes 2 and 10 to our Consolidated Financial Statements for further information.

(6) Includes convertible debt which is classified as a current liability, when applicable.

35 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our Consolidated Financial Statements, including the notes to those statements, included elsewhere in this Annual Report on Form 10-K, and the Section entitled "Special Note Regarding Forward-Looking Statements" in this Annual Report on Form 10-K. As discussed in more detail in the Section entitled "Special Note Regarding Forward-Looking Statements," this discussion contains forward-looking statements, which involve risks and uncertainties. Our actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause those differences include those discussed in "Risk Factors" and elsewhere in this Annual Report on Form 10-K.

We evaluate certain operating and financial measures on both an as-reported and constant-currency basis. We calculate constant currency by converting our current-year period financial results for transactions recorded in currencies other than U.S. Dollars using the corresponding prior-year period monthly average exchange rates rather than the current- year period monthly average exchange rates.

Overview

Our mission is to make it easier for everyone to experience the world. We seek to empower people to cut through travel barriers, such as money, time, language and overwhelming options, so they can use our services to easily and confidently get where they want to go, stay where they want to stay, dine where they want to dine, pay how they want to pay and experience what they want to experience. We connect consumers wishing to make travel reservations with providers of travel services around the world through our online platforms. Through one or more of our brands, consumers can: book a broad array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, hostels and other properties); make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a cruise, flight, vacation package, tour or activity. Consumers can also use our meta-search services to easily compare travel reservation information, such as airline ticket, hotel reservation and rental car reservation information, from hundreds of online travel platforms at once. In addition, we offer various other services to consumers and partners, such as certain travel-related insurance products and restaurant management services to restaurants.

We offer these services through six primary consumer-facing brands: Booking.com, KAYAK, priceline, agoda, Rentalcars.com and OpenTable. While historically our brands operated on a largely independent basis and many of them focused on a particular service (e.g., accommodation reservations) or geography, we are increasing the collaboration, cooperation and interdependency among our brands in our efforts to provide consumers with the best and most comprehensive services. We also seek to maximize the benefits of our scale by sharing resources and technological innovations, co-developing new services and coordinating activities in key markets among our brands. For example, Booking.com, the world’s leading brand for booking online accommodation reservations (based on room nights booked), offers rental car and other ground transportation services, flights, restaurant reservations, tours and activities reservations and other services, many of which are supported by our other brands. Similarly, hotel reservations available through Booking.com are also generally available through agoda and priceline. See Note 2 to the Consolidated Financial Statements - Segment Reporting for information on our operating segments.

Our results include FareHarbor and HotelsCombined since they were acquired in April 2018 and November 2018, respectively. We refer to our company and all of our subsidiaries and brands collectively as "Booking Holdings," the "Company," "we," "our" or "us."

Our business is driven primarily by international results, which consist of the results of Booking.com, agoda and Rentalcars.com and the international businesses of KAYAK and OpenTable. This classification is independent of where the consumer resides, where the consumer is physically located while using our services or the location of the travel service provider or restaurant. For example, a reservation made through Booking.com at a hotel in New York by a consumer in the United States is part of our international results. In 2019, our international business (the substantial majority of which is generated by Booking.com) represented approximately 90% of our consolidated revenues. A significant majority of our revenues, including a significant majority of our international revenues, is earned in connection with facilitating accommodation reservations. See Note 18 to the Consolidated Financial Statements for more geographic information.

We derive substantially all of our revenues from enabling consumers to make travel service reservations. We also earn revenues from credit card processing rebates and customer processing fees, advertising services, restaurant reservations and restaurant management services, and various other services, such as travel-related insurance revenues.

36 Trends

The recent coronavirus outbreak has had a significant and negative impact on our business during the first quarter of 2020, in particular in China and certain other Asian markets, though concerns about the coronavirus are also negatively impacting travel demand (and therefore our business) generally. In the more affected markets like China, we have seen a significant increase in cancellations and reduction in new bookings, and ADRs have also been negatively affected. The ultimate impact of the outbreak on our business is impossible to predict with certainty, and therefore the full extent to which the coronavirus will impact our business and results of operations is unknown. However, decreased travel demand resulting from the outbreak has had a negative impact, and is likely to have a negative and material impact, on our business, growth and results of operations. For more information, see Part I, Item 1A, Risk Factors - "Declines or disruptions in the travel industry could adversely affect our business and financial performance."

Over the last several years, we have experienced significant growth in our accommodation reservation services. We believe this growth is the result of, among other things, the broader shift of travel purchases from offline to online, the widespread adoption of mobile devices and the growth of travel overall. We also believe this growth is the result of the continued innovation and execution by our teams around the world to increase the number and the variety of accommodations we offer consumers, increase and improve content, build distribution and improve the consumer experience on our online platforms, as well as consistently and effectively marketing our brands through performance and brand marketing efforts. These year-over-year growth rates have generally decelerated. Given the size of our accommodation reservation business and the general slowing growth rate of the online travel market discussed below, we expect that our year-over-year growth rates will generally continue to decelerate, though the rate of deceleration may fluctuate and there may be periods of acceleration from time to time.

We are a global business, and online travel growth rates vary across the world depending on numerous factors, including local and regional economic conditions, individual disposable income, access to the internet and adoption of e- commerce. Online travel growth rates have generally slowed in markets such as North America and Europe where online activity is high and consumers have been engaging in e-commerce transactions for many years, while online travel growth rates remain relatively high in markets such as Asia-Pacific where incomes are rising more quickly and the increased availability and use of mobile devices has accelerated the growth of internet usage and travel e-commerce transactions. Over the long-term, we expect online travel growth rates to slow as markets continue to mature. However, we believe that the opportunity to continue to grow our business exists for the markets in which we operate, including in both mature and fast-growing markets. Further, we believe that this opportunity for growth exists because we feel we provide significant value to travel service providers, regardless of size or geography, due to our global reach and online marketing expertise. For example, we believe that accommodation providers of all sizes, from large hotel chains to small, independent hotels and alternative accommodations such as homes and apartments, benefit from using our services, which enable them to reach a broader audience of potential customers.

Our growth has primarily been generated by the worldwide accommodation reservation business of Booking.com, which is our most significant brand, and has been due, in part, to the availability of a large number of properties through Booking.com. Booking.com included approximately 2,580,000 properties on its website at December 31, 2019, consisting of approximately 460,000 hotels, motels and resorts and approximately 2,120,000 homes, apartments and other unique places to stay, compared to approximately 2,180,000 properties (including approximately 436,000 hotels, motels and resorts and approximately 1,744,000 homes, apartments, and other unique places to stay) at December 31, 2018. Booking.com categorizes properties listed on its website as either (a) hotels, motels and resorts, which groups together more traditional accommodation types (including hostels and inns), or (b) homes, apartments and other unique places to stay, also referred to as alternative accommodations, which encompasses all other types of accommodations, including bed and breakfasts, villas, apart-hotels and beyond.

We intend to continue to improve the accommodation choices available for reservation on our platforms, however the growth rate of our accommodations may vary in part as a result of removing accommodations from our platforms from time to time. Many of the newer accommodations we add to our travel reservation services, especially in highly-penetrated markets, may have fewer rooms or higher credit risk and may appeal to a smaller subset of consumers (e.g., hostels and bed and breakfasts). Because alternative accommodations are often either a single unit or a small collection of independent units, these properties generally represent more limited booking opportunities than hotels, motels and resorts, which generally have more units to rent per property. Further, alternative accommodations in general may be subject to increased seasonality due to local tourism seasons or other factors or may not be available at peak times due to use by the property owners. We may also experience lower profit margins with respect to these properties due to certain additional costs, such as increased customer service costs, related to offering these accommodations on our platforms. As our alternative accommodation business has grown, these different characteristics have negatively impacted our profit margins and we expect this trend to continue. 37 Further, to the extent these properties represent an increasing percentage of the properties added to our platforms, we expect that our room nights growth rate and property growth rate will continue to diverge over time (since each such property has fewer booking opportunities). As a result of the foregoing, as the percentage of alternative accommodation properties increases, the number of reservations per property will likely continue to decrease. We believe that continuing to expand the number and variety of accommodations available through our services, in particular Booking.com, will help us to continue to grow our accommodation reservation business.

We are constantly innovating to grow our business by, among other things, providing a best-in-class user experience with intuitive, easy-to-use online platforms (i.e., websites and mobile apps) to ensure that we are meeting the needs of online consumers while aiming to exceed their expectations. As part of these ongoing efforts, we have a long-term strategy to build a more integrated offering of multiple elements of travel, which we refer to as the "Connected Trip." Although we expect our efforts to build the Connected Trip may increase revenue growth over time, we may see a negative impact on our operating margins in the near term as we incur the expenses associated with these investments. Further, to the extent our non- accommodation services grow faster than our accommodation services, whether as part of the Connected Trip or otherwise, our operating margins may be negatively affected if we experience an increasing mix of revenues from lower-margin services.

As part of our strategy to provide more payment options to consumers and travel service providers, increase the number and variety of accommodations available on Booking.com and enable the growth of our in-destination activities businesses, Booking.com is increasingly processing transactions on a merchant basis, where it facilitates payments from travelers for the services provided. This allows Booking.com to process transactions for travel service providers and to increase its ability to offer secure and flexible transaction terms to consumers, such as the form and timing of payment. We believe that adding these types of service offerings will benefit consumers and travel service providers, as well as our gross bookings, room night and earnings growth rates. However, this results in additional expenses for personnel, payment processing, customer chargebacks (including those related to fraud) and other expenses related to these transactions, which are recorded in "Personnel" and "Sales and other expenses" in our Consolidated Statements of Operations, as well as associated incremental revenues in the form of credit card rebates, for example, which are recorded in "Merchant revenues." As this business continues to grow, we expect these expenses to continue to increase, which would negatively impact our operating margins despite increases in associated incremental revenues. Components of revenues and expenses related to our merchant business may be recognized in different periods. These timing factors could impact our operating margins as well as the relationship between our gross bookings and revenues in a particular period, especially as our merchant business increases as a percentage of our overall business.

We compete globally with both online and traditional providers of travel and restaurant reservation and related services. The markets for the services we offer are intensely competitive, constantly evolving and subject to rapid change, and current and new competitors can launch new services at relatively low cost. Some of our current and potential competitors, such as Google, Apple, Alibaba, Tencent, Amazon and Facebook, have significantly more customers or users, consumer data and financial and other resources than we do, and they may be able to leverage other aspects of their businesses (e.g., search or mobile device businesses) to enable them to compete more effectively with us. For example, Google has entered various aspects of the online travel market and has grown rapidly in this area, including by offering a flight meta-search product (Google Flights), a hotel meta-search product (Google Hotel Ads), a vacation rental meta-search product, its "Book on Google" reservation functionality and integrating its hotel and restaurant meta-search products into its Google Maps app, as well as Google Travel, a planning tool which aggregates its flight, hotel and packages products in one website. Our markets are also subject to rapidly changing conditions, including technological developments, consumer behavior changes, regulatory changes and travel service provider consolidation. We expect these trends to continue. For example, we have experienced a significant shift of both direct and indirect business to mobile platforms and our advertising partners are also seeing a rapid shift of traffic to mobile platforms. Advertising and distribution opportunities may be more limited on mobile devices given their smaller screen sizes. In addition, the revenue earned on a mobile transaction may be less than a typical desktop transaction due to different consumer purchasing patterns. For example, accommodation reservations made on a mobile device typically are for shorter lengths of stay, have lower accommodation average daily rates ("ADRs") and are not made as far in advance. For more detail regarding the competitive trends and risks we face, see Part I, Item 1, Business - "Competition," Part I, Item 1A, Risk Factors - "Intense competition could reduce our market share and harm our financial performance." and "Consumer adoption and use of mobile devices creates challenges and may enable device companies such as Google and Apple to compete directly with us." and "We may not be able to keep up with rapid technological or other market changes."

Although we believe that providing an extensive collection of properties, excellent customer service and an intuitive, easy-to-use consumer experience are important factors influencing a consumer's decision to make a reservation, for many consumers, particularly in certain markets, the price of the travel service is the primary factor determining whether a consumer will book a reservation. As a result, it is increasingly important to offer travel services, such as accommodation reservations, at competitive prices, whether through discounts, coupons, closed-user group rates or loyalty programs, or otherwise. These 38 initiatives have resulted and in the future may result in lower ADRs and lower revenue as a percentage of gross bookings. Discounting and couponing coupled with a high degree of consumer shopping behavior is particularly common in Asian markets. In some cases, our competitors are willing to make little or no profit on a transaction, or offer travel services at a loss, in order to gain market share.

We have observed a trend of declining constant-currency accommodation ADRs, which we expect to continue, though the rate of decline may fluctuate and there may be periods of stable or increasing ADRs. We believe the trend of declining ADRs is partially driven by the negative impact of the changing geographical mix of our business (e.g., lower ADR regions like Asia-Pacific are generally growing faster than higher ADR regions like Western Europe) as well as pricing pressures within local markets from time to time resulting from competitive conditions, weakening economic conditions or changes in travel patterns. These declining ADR trends have resulted in and may continue to result in our gross bookings growing at a lower rate of growth than our accommodation room nights.

We have established widely used and recognized e-commerce brands through marketing and promotional campaigns. Historically our performance marketing expenses have increased significantly, however, more recently, we have experienced more moderate growth rates, a trend we expect to continue. Our performance marketing expense is primarily related to the use of online search engines (primarily Google), meta-search and travel research services and affiliate marketing to generate traffic to our websites. More recently, growth of some of these channels has slowed. Performance marketing expenses were $4.4 billion, $4.4 billion and $4.2 billion for the years ended December 31, 2019, 2018 and 2017, respectively. We also invested $548 million, $509 million and $435 million in brand marketing for the years ended December 31, 2019, 2018 and 2017, respectively, primarily related to costs associated with producing and airing television advertising, online video advertising (for example, on YouTube and Facebook), online display advertising and other brand marketing. We intend to continue a strategy of promoting brand awareness through both online and offline marketing efforts, including by expanding brand campaigns into additional markets, which we expect will increase our brand marketing expenses over time. We have observed increased brand marketing by other OTCs, meta-search services and travel service providers, which may make our brand marketing efforts more expensive and less effective.

Performance marketing efficiency, expressed as performance marketing expense as a percentage of total revenues, is impacted by a number of factors that are subject to variability and that are, in some cases, outside of our control, including ADRs, costs per click, cancellation rates, foreign currency exchange rates, our ability to convert paid traffic to booking customers and the extent to which consumers come directly to our platforms for bookings. For example, competition for desired rankings in search results and/or a decline in ad clicks by consumers could increase our costs per click and reduce our performance marketing efficiency. Changes by Google or any of our other search or meta-search partners in how it presents travel search results, including, if applicable, by placing its own offerings at or near the top of search results, or the manner in which it conducts the auction for placement among search results may be competitively disadvantageous to us and may impact our ability to efficiently generate traffic to our websites.

We have observed a long-term trend of decreasing performance marketing returns on investment ("ROIs"). More recently, we have observed periods of stable or increasing ROIs, however, it is uncertain whether this trend will continue or if ROIs will return to the prior trend of declining over time. We may from time to time, as we did beginning in the third quarter of 2017 through the fourth quarter of 2018, pursue a strategy of improving our performance marketing ROIs, which could negatively impact growth and positively impact performance marketing efficiency and profitability. When evaluating our performance marketing spend, we consider several factors for each channel, such as the customer experience on the advertising platform, the incrementality of the traffic we receive and the anticipated repeat rate from a particular platform, as well as other factors. The amount of business we obtain through each performance marketing channel is impacted by numerous factors, including bidding decisions by us and our competitors (including decisions to optimize performance marketing ROIs) and the marketing efforts and success of those channels to attract consumers and generate demand. See Part I, Item 1A, Risk Factors - "We rely on performance and brand marketing channels to generate a significant amount of traffic to our platforms and grow our business." and "Our business could be negatively affected by changes in online search and meta-search algorithms and dynamics or traffic-generating arrangements."

In recent years, we experienced significant increases in our cancellation rates, which negatively affected our marketing efficiency and results of operations. Beginning in the third quarter of 2018, our cancellation rates have generally decreased, which has benefited our marketing efficiency and results of operations. We believe that many factors influence cancellation rates, and it is uncertain whether future cancellation rates will continue to decrease, stabilize or return to their prior trend of generally increasing over time.

Perceived or actual adverse economic conditions, including slow, slowing or negative economic growth, high or rising unemployment rates, inflation and weakening currencies, and concerns over government responses such as higher taxes or 39 tariffs and reduced government spending, could impair consumer spending and adversely affect travel demand. Further, political uncertainty, conditions or events, such as the United Kingdom's decision to leave the European Union ("Brexit"), including uncertainty in the implementation of Brexit and other political concerns can also negatively affect consumer spending and adversely affect travel demand. At times, we have experienced volatility in transaction growth rates, increased cancellation rates and weaker trends in ADRs across many regions of the world, particularly in those countries that appear to be most affected by economic and political uncertainties, which we believe are due at least in part to these macro-economic conditions and concerns. For more detail, see Part I, Item 1A, Risk Factors - "Declines or disruptions in the travel industry could adversely affect our business and financial performance."

These and other macro-economic uncertainties, such as geopolitical tensions and differing central bank monetary policies, have led to significant volatility in the exchange rates between the U.S. Dollar and the Euro, the British Pound Sterling and other currencies. Significant fluctuations in foreign currency exchange rates, stock markets and oil prices can also impact consumer travel behavior.

As noted earlier, our international business represents a substantial majority of our financial results. Therefore, because we report our results in U.S. Dollars, we face exposure to movements in foreign currency exchange rates as the financial results and the financial condition of our international businesses are translated from local currency (principally Euros and British Pounds Sterling) into U.S. Dollars. As a result, both the absolute amounts of and percentage changes in our foreign-currency-denominated net assets, gross bookings, revenues, operating expenses and net income as expressed in U.S. Dollars are affected by foreign currency exchange rate changes. Our foreign-currency-denominated gross bookings, revenues, operating expenses and net income as expressed in U.S. Dollars are lower for the year ended December 31, 2019 than they would have been had foreign currency exchange rates remained where they were for the year ended December 31, 2018. For example, total revenues from our international operations grew 4.1% for the year ended December 31, 2019 as compared to the year ended December 31, 2018, but, without the impact of changes in foreign currency exchange rates, grew year-over-year on a constant-currency basis by approximately 8%. Since our expenses are generally denominated in foreign currencies on a basis similar to our revenues, our operating margins have not been significantly impacted by currency fluctuations. Historically, the aggregate principal value of our Euro-denominated long-term debt, and accrued interest thereon, provided a hedge against the impact of foreign currency exchange rate fluctuations on the net assets of one of our Euro functional currency subsidiaries. Beginning in the second quarter of 2019, we have only designated certain portions of the aggregate principal value of our Euro- denominated debt as a hedge, and as a result we have recognized foreign currency transaction gains or losses. The foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument for accounting purposes are recognized in "Foreign currency transactions and other" in the Consolidated Statement of Operations (see Note 12 to our Consolidated Financial Statements). For more information, see Part I, Item 1A, Risk Factors - "We are exposed to fluctuations in foreign currency exchange rates."

We generally enter into derivative instruments to minimize the impact of short-term foreign currency exchange rate fluctuations on the translation of our consolidated operating results into U.S. Dollars. However, such derivative instruments are short-term in nature and not designed to hedge against currency fluctuations that could impact growth rates for our gross bookings or revenues (see Note 6 to our Consolidated Financial Statements for additional information on our derivative contracts).

Many taxing authorities are increasingly focused on ways to increase tax revenues and have targeted large multinational technology companies in these efforts. As a result, many countries have implemented or are considering adoption of a digital services tax that imposes a tax on revenue earned from digital advertisements and the use of online platforms, even when there is no physical presence in the jurisdiction. Currently rates for this tax range from 2% to 7.5% of revenue deemed generated in the jurisdiction. The digital services taxes currently in effect have negatively impacted our results of operations and if many other countries pass similar legislation, the collective impact of all of these measures could have a materially adverse impact on our results of operations and cash flows. For more information, see Note 16 to our Consolidated Financial Statements and Part I, Item 1A, Risk Factors - "We may have exposure to additional tax liabilities."

Many national governments have conducted or are conducting investigations into competitive practices within the online travel industry, and we may be involved or affected by such investigations and their results. Some countries have adopted or proposed legislation that could also affect business practices within the online travel industry. For example, France, Italy, Belgium and Austria have passed legislation prohibiting parity contract clauses in their entirety. Also, a number of governments are investigating or conducting information-gathering exercises with respect to compliance by OTCs with consumer protection laws, including practices related to the display of search results and search ranking algorithms, claims regarding discounts, disclosure of charges and availability, and similar messaging. For more information on these investigations and their potential effects on our business, see Note 16 to our Consolidated Financial Statements and Part I, Item 1A, Risk Factors - "Our business is subject to various competition, anti-trust, consumer protection and online commerce laws,

40 rules and regulations around the world, and as the size of our business grows, scrutiny of our business by legislators and regulators in these areas may intensify." In addition to the price parity and consumer protection investigations, from time to time national competition authorities, other governmental agencies, trade associations and private parties take legal actions, including commencing legal proceedings, that may affect our operations. In general, increased regulatory focus on online businesses, including online travel businesses like ours, could result in increased compliance costs or otherwise adversely affect our business.

Seasonality

The majority of our gross bookings are generated in the first half of the year, as consumers plan and reserve their spring and summer vacations in Europe and North America. However, we generally recognize revenue from these bookings when the travel begins (at "check-in"), which can be in a quarter other than when the associated reservations are booked. In contrast, we expense the substantial majority of our marketing activities as the expense is incurred, which, in the case of performance marketing in particular, is typically in the quarter in which associated reservations are booked. As a result of this potential timing difference between when we record marketing expense and when we recognize associated revenue, we experience our highest levels of profitability in the third quarter of the year, which is when we experience the highest levels of accommodation check-ins for the year for our European and North American businesses. The first quarter of the year is typically our lowest level of profitability and may experience additional volatility in earnings growth rates due to these seasonal timing factors. For our Asia-Pacific business, we experience the highest level of accommodation check-ins in the fourth quarter. As the relative growth rates for our businesses fluctuate, the quarterly distribution of our operating results may vary.

For several years, we experienced an expansion of the booking window (the average time between the making of a travel reservation and the travel), which impacts the relationship between our gross bookings (recognized at the time of booking) and our revenues (recognized at the time of check-in). However, we saw a contraction of the booking window throughout 2018 and 2019. Future changes in the length of the booking window will affect the degree to which our gross bookings and revenues occur in the same period and, as a result, whether our gross bookings growth rates and revenue growth rates converge or diverge.

In addition, the date on which certain holidays fall can have an impact on our quarterly results. For example, in 2019, Easter fell on April 21 and Easter-related travel began in the second quarter, when the associated revenue was recognized. By comparison, in 2018, Easter was on April 1 and a meaningful amount of Easter-related travel began in the week leading up to the holiday with the associated revenue being recognized in the first quarter of 2018. As a result of the shift in Easter timing relative to 2018, our first quarter 2019 year-over-year growth rates in revenue, operating income and operating margins were negatively impacted and our second quarter 2019 year-over-year growth rates were positively impacted. The timing of other holidays such as Ramadan can also impact our quarterly year-over-year growth rates.

The impact of seasonality can be exaggerated in the short term by the gross bookings growth rate of the business. For example, in periods where our gross bookings growth rate substantially decelerates, our operating margins typically benefit from relatively less variable marketing expense. In addition, revenue growth is typically less impacted by decelerating gross bookings growth in the near term due to the benefit of revenue related to reservations booked in previous quarters, but any such deceleration would negatively impact revenue growth in subsequent periods. Conversely, in periods where our gross bookings growth rate accelerates, our operating margins are typically negatively impacted by relatively more variable marketing expense. In addition, revenue growth is typically less impacted by accelerating gross bookings growth in the near term, but any such acceleration would positively impact revenue growth in subsequent periods as a portion of the revenue recognized from such gross bookings will occur in future quarters.

Other Factors

We believe that our future success depends in large part on our ability to continue to profitably grow our brands worldwide, and, over time, to offer other travel and travel-related services. Factors beyond our control, such as oil prices, stock market volatility, terrorist attacks, unusual or extreme weather or natural disasters such as earthquakes, hurricanes, tsunamis, floods, fires, droughts and volcanic eruptions, travel-related health concerns including pandemics and epidemics such as coronaviruses, Ebola and Zika, political instability, changes in economic conditions, wars and regional hostilities, imposition of taxes, tariffs or surcharges by regulatory authorities, changes in trade policies or trade disputes, changes in immigration policies or travel-related accidents or increased focus on the environmental impact of travel, can disrupt travel, limit the ability or willingness of travelers to visit certain locations or otherwise result in declines in travel demand. These kinds of events have negatively affected our business and results of operations in the past and may do so again in the future. Because these events or concerns, and the full impact of their effects, are largely unpredictable, they can dramatically and suddenly affect travel behavior by consumers, and therefore demand for our services and our relationships with travel service providers and other 41 partners, any of which can adversely affect our business and results of operations. See Part I, Item 1A, Risk Factors - "Declines or disruptions in the travel industry could adversely affect our business and financial performance."

We intend to continue to invest in marketing and promotion, technology and personnel within parameters consistent with attempts to improve long-term operating results, even if those expenditures create pressure on operating margins. We have experienced pressure on operating margins as we invest in initiatives to drive future growth. We also intend to broaden the scope of our business, and to that end, we explore strategic alternatives from time to time in the form of, among other things, acquisitions. As the overall size of our business has grown, the competitive pressure to innovate will encompass a wider range of services and technologies, including services and technologies that may be outside of our historical core business, and our ability to keep pace may slow. Potential competitors, such as emerging start-ups, may be able to innovate and focus on developing a particularly new product or service faster than we can or may foresee consumer need for new services or technologies before us. Some of our larger competitors or potential competitors have more resources or more established or diversified relationships with consumers than we do, and they could use these advantages in ways that could affect our competitive position, including by making acquisitions, entering or investing in travel reservation businesses, investing in research and development, and competing aggressively for highly-skilled employees. For example, because consumers often utilize other online services more frequently than online travel services, a competitor or potential competitor that has established other, more frequent online interactions with consumers may be able to more easily or cost-effectively acquire customers for its online travel services than we can. Our goal is to grow revenue and achieve healthy operating margins in an effort to maintain profitability. The uncertain and highly competitive environment in which we operate makes the prediction of future results of operations difficult, and accordingly, we may not be able to sustain revenue growth and profitability.

Critical Accounting Policies and Estimates

Management's Discussion and Analysis of Financial Condition and Results of Operations is based upon our Consolidated Financial Statements, which have been prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). Our significant accounting policies and estimates are more fully described in Note 2 to our Consolidated Financial Statements. Certain of our accounting estimates are particularly important to our financial position and results of operations and require us to make difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Our management uses its judgment to determine the appropriate assumptions to be used in the determination of certain estimates. We evaluate our estimates on an ongoing basis. Estimates are based on, among other things, historical experience, terms of existing contracts, our observance of trends in the travel industry and on various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates under different assumptions or conditions. Our critical accounting policies that involve significant estimates and judgments of management include the following:

• Valuation of Goodwill and Other Long-Lived Assets. The application of the acquisition accounting for business combinations requires the use of significant estimates and assumptions to determine the fair value of the assets acquired and liabilities assumed. Our estimates of the fair value are based upon assumptions that we believe are reasonable. When we deem appropriate, we utilize assistance from a third-party valuation firm. The consideration transferred is allocated to the assets acquired and liabilities assumed based on their respective fair values at the acquisition date. The excess of the consideration transferred over the net of the amounts allocated to the identifiable assets acquired and liabilities assumed is recognized as goodwill. Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination as of the acquisition date.

We review goodwill for impairment annually and whenever events or changes in circumstances indicate the carrying amount of goodwill may not be recoverable. A substantial portion of our intangible assets and goodwill relates to the acquisitions of OpenTable and KAYAK. At September 30, 2019, we performed our annual goodwill impairment testing and concluded that there was no impairment of goodwill and that the fair values of our reporting units substantially exceeded their respective carrying values at September 30, 2019. Since the annual impairment test, there have been no events or changes in circumstances to indicate a potential impairment to our goodwill.

We review long-lived assets whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The assessment of possible impairment is based upon our ability to recover the carrying value of the assets from the estimated undiscounted future net cash flows, before interest and taxes, of the related asset group. We did not identify any impairment indicators for our long-lived assets at December 31, 2019.

42 • Income Taxes. We determine our tax expense based on our income and statutory tax rates applicable in the various jurisdictions in which we operate. Due to the complex nature of tax legislation and frequent changes with such associated legislation, significant judgment is required in computing our tax expense and determining our tax positions. In December 2017, the U.S. government enacted the U.S. Tax Cuts and Jobs Act (the "Tax Act"). The Tax Act made significant changes to U.S. federal tax law, including a reduction in the U.S. federal statutory tax rate from 35% to 21%, effective January 1, 2018. The Tax Act imposed a one- time deemed repatriation tax on accumulated unremitted international earnings, to be paid over eight years.

The Tax Act also introduced in 2018 a tax on 50% of global intangible low-taxed income ("GILTI"), which is income determined to be in excess of a specified routine rate of return, and a base erosion and anti-abuse tax ("BEAT") aimed at preventing the erosion of the U.S. tax base. We have adopted an accounting policy to treat taxes on GILTI as period costs.

In December 2017, Staff Accounting Bulletin No. 118 ("SAB 118") was issued by the Securities and Exchange Commission to address the application of U.S. GAAP in situations when the registrant does not have all the necessary information available, prepared or analyzed (including computations) in reasonable detail to complete its accounting for the change in tax law. In accordance with SAB 118, to the extent a registrant can reasonably estimate the effects of the Tax Act, a provisional tax amount can be recorded, but must have been finalized prior to December 22, 2018. In 2018, we completed our accounting for the income tax effects of the Tax Act based on technical guidance issued by U.S. federal and state tax authorities available at that time, which resulted in an income tax benefit of $48 million. In 2019, as a result of additional technical guidance issued by U.S. federal and state tax authorities, we recorded an additional income tax benefit of $17 million to adjust our income tax expense relating to the U.S federal one-time deemed repatriation liability, as well as U.S state income taxes associated with the mandatory deemed repatriation.

We do not intend to indefinitely reinvest our international earnings that were subject to U.S. taxation pursuant to the mandatory deemed repatriation or subject to U.S. taxation as GILTI.

We regularly review our deferred tax assets for recoverability considering historical profitability, projected future taxable income, the expected timing of the reversals of temporary differences and tax planning strategies and record valuation allowances as required.

We are subject to ongoing tax examinations and assessments in various jurisdictions. To date, we have been audited in several taxing jurisdictions with no significant impact on our results of operations. Although we believe that our tax filing positions comply with applicable laws, the final determination of tax audits or tax disputes may be different from what is reflected in our historical income tax provisions and accruals. Accordingly, we may incur additional tax expense based upon our assessment of the more-likely-than-not outcomes or we may adjust previously recorded tax expense to reflect examination results. See Note 16 to our Consolidated Financial Statements for further information.

Recent Accounting Pronouncements - See Note 2 to our Consolidated Financial Statements for details, which is incorporated into this Item 7 by reference thereto.

43 Results of Operations

Year Ended December 31, 2019 compared to Year Ended December 31, 2018

We evaluate certain operating and financial measures on both an as-reported and constant-currency basis. We calculate constant currency by converting our current-year period financial results for transactions recorded in currencies other than U.S. Dollars using the corresponding prior-year period monthly average exchange rates rather than the current- year period monthly average exchange rates.

Operating and Statistical Metrics

Our financial results are driven by certain operating metrics that encompass the booking and other business activity generated by our travel and travel-related services. Specifically, reservations of accommodation room nights, rental car days and airline tickets capture the volume of units booked through our OTC brands by our travel reservation services customers. Gross bookings is an operating and statistical metric that captures the total dollar value, generally inclusive of taxes and fees, of all travel services booked through our OTC brands by our customers, net of cancellations, and is widely used in the travel business. Our non-OTC brands (KAYAK and OpenTable) have different business metrics from those of our OTC brands and therefore search queries through KAYAK and restaurant reservations through OpenTable do not contribute to our gross bookings.

Accommodation room nights, rental car days and airline tickets reserved through our services for the years ended December 31, 2019 and 2018 were as follows: Year Ended December 31,

(in millions)

2019 2018 Increase Room nights 845 760 11.2% Rental car days 77 73 4.6% Airline tickets 7 7 3.7%

Accommodation room night reservations increased by 11.2% for the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily due to our investments in marketing channels, providing a continuously improving consumer experience and improving the accommodation choices we offer consumers, as well as the overall growth in the travel industry and the ongoing shift from offline to online for travel bookings. The increase for the year ended December 31, 2019, compared to the year ended December 31, 2018 was also positively impacted by a decrease in cancellation rates.

Rental car day reservations increased by 4.6% for the year ended December 31, 2019, compared to the year ended December 31, 2018, due primarily to an increase in rental car day reservations at Rentalcars.com as a result of the integration with Booking.com.

Airline ticket reservations increased by 3.7% for the year ended December 31, 2019, compared to the year ended December 31, 2018, due to the growth of priceline's vacation packages product.

Gross bookings resulting from reservations of accommodation room nights, rental car days and airline tickets made through our agency and merchant models for the years ended December 31, 2019 and 2018 were as follows (numbers may not total due to rounding):

Year Ended December 31, (in millions) Increase 2019 2018 (decrease) Agency $ 70,651 $ 73,919 (4.4)% Merchant 25,791 18,812 37.1 % Total $ 96,443 $ 92,731 4.0 %

Gross bookings increased by 4.0% for the year ended December 31, 2019, compared to the year ended December 31, 2018 (growth on a constant-currency basis was approximately 8%), almost entirely due to growth of 11.2% in accommodation 44 room night reservations, partially offset by the negative impact of foreign currency exchange rate fluctuations and a 2% decrease in accommodation ADRs on a constant-currency basis for the year ended December 31, 2019, compared to the year ended December 31, 2018. We believe that unit growth rates and growth in total gross bookings on a constant-currency basis, which excludes the impact of foreign currency exchange rate fluctuations, are important measures to understand the fundamental performance of the business.

Agency gross bookings are derived from travel-related transactions where we do not facilitate payments from travelers for the travel services provided. Agency gross bookings decreased by 4.4% for the year ended December 31, 2019, compared to the year ended December 31, 2018, almost entirely due to a decrease in gross bookings from agency accommodation room night reservations at Booking.com, primarily resulting from the growth of its merchant accommodation reservation services, as well as the aforementioned negative impact of foreign currency exchange rate fluctuations.

Merchant gross bookings are derived from services where we facilitate payments from travelers for the travel services provided. Merchant gross bookings increased by 37.1% for the year ended December 31, 2019, compared to the year ended December 31, 2018, almost entirely due to growth in gross bookings from our merchant accommodation reservation services at Booking.com and agoda, partially offset by the aforementioned negative impact of foreign currency exchange rate fluctuations. Booking.com has been expanding its merchant accommodation reservation services to, among other reasons, provide more payment options to consumers and travel service providers, increase the number and variety of accommodations available on Booking.com and enable the growth of its in-destination activities businesses.

Revenues

Online travel reservation services

Substantially all of our revenues are generated by providing online travel reservation services, which facilitate online travel purchases between travel service providers and travelers.

Revenues from online travel reservation services are classified into two categories:

• Agency. Agency revenues are derived from travel-related transactions where we do not facilitate payments from travelers for the services provided. Agency revenues consist almost entirely of travel reservation commissions. Substantially all of our agency revenue is from Booking.com agency accommodation reservations.

• Merchant. Merchant revenues are derived from travel-related transactions where we facilitate payments from travelers for the services provided, generally at the time of booking. Merchant revenues include (1) travel reservation commissions and transaction net revenues (i.e., the amount charged to travelers less the amount owed to travel service providers) in connection with our merchant reservation services; (2) credit card processing rebates and customer processing fees; and (3) ancillary fees, including travel-related insurance revenues and certain global distribution system ("GDS") reservation booking fees. Substantially all merchant revenues are derived from transactions where travelers book accommodation reservations or rental car reservations.

Advertising and other revenues

Advertising and other revenues are derived primarily from (1) revenues earned by KAYAK for (a) sending referrals to OTCs and travel service providers and (b) advertising placements on its platforms; and (2) revenues earned by OpenTable for (a) restaurant reservation services (fees paid by restaurants for diners seated through OpenTable's online reservation service) and (b) subscription fees for restaurant management services.

Year Ended December 31,

(in millions) Increase 2019 2018 (decrease)

Agency revenues $ 10,117 $ 10,480 (3.5)% Merchant revenues 3,830 2,987 28.2 % Advertising and other revenues 1,119 1,060 5.6 % Total revenues $ 15,066 $ 14,527 3.7 %

45 Total revenues for the year ended December 31, 2019, as compared to the year ended December 31, 2018, respectively, increased by 3.7% (growth on a constant-currency basis was approximately 7%). Substantially all of the year- over-year increase was related to revenues from our accommodation reservation services.

Agency revenues decreased by 3.5% for the year ended December 31, 2019, compared to the year ended December 31, 2018, almost entirely due to decreased gross bookings from agency accommodation room night reservations at Booking.com, primarily resulting from the growth of its merchant accommodation reservation services.

Merchant revenues increased by 28.2% for the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily due to the increases in merchant accommodation reservation services.

Advertising and other revenues increased by 5.6% for the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily due to the inclusion of $67 million in revenue related to HotelsCombined for the year ended December 31, 2019, compared to $4 million in revenue related to HotelsCombined since its acquisition in November 2018 for the year ended December 31, 2018.

Total revenues as a percentage of gross bookings was 15.6% for the year ended December 31, 2019 as compared to 15.7% for the year ended December 31, 2018.

Our international businesses accounted for approximately $13.5 billion of our total revenues for the year ended December 31, 2019, compared to $13.0 billion for the year ended December 31, 2018. Total revenues attributable to our international businesses for the year ended December 31, 2019 increased by 4.1%, compared to the year ended December 31, 2018 (growth on a constant-currency basis was approximately 8%). Total revenues attributable to our U.S. businesses were relatively flat for the year ended December 31, 2019 compared to the year ended December 31, 2018.

Operating Expenses

Marketing

Year Ended December 31,

(in millions) Increase 2019 2018 (decrease)

Performance marketing $ 4,419 $ 4,447 (0.6)%

% of Total revenues 29.3% 30.6% Brand marketing $ 548 $ 509 7.5 %

% of Total revenues 3.6% 3.5%

We rely on performance marketing channels to generate a significant amount of traffic to our websites. Performance marketing expenses consist primarily of the costs of: (1) search engine keyword purchases; (2) referrals from meta-search and travel research websites; (3) affiliate programs; and (4) other performance-based marketing and incentives. For the year ended December 31, 2019, our performance marketing expense growth rate was reduced by foreign currency exchange rate fluctuations and slowing growth in performance marketing channels. We adjust our performance marketing spend based on our growth and profitability objectives and the expected ROIs in our performance marketing channels. Performance marketing expense as a percentage of total revenues decreased for the year ended December 31, 2019, compared to the year ended December 31, 2018, due to changes in the share of traffic by channel, primarily related to an increase in the share of direct traffic, and increased performance marketing ROIs.

Brand marketing expenses consist primarily of television advertising and online video and display advertising (including the airing of our television advertising online), as well as other marketing spend such as public relations and sponsorships. For the year ended December 31, 2019, brand marketing expenses increased by 7.5% compared to the year ended December 31, 2018, primarily due to increased brand marketing expenses at Booking.com in the first half of 2019 in order to increase brand awareness and grow the number of customers that come directly to the Booking.com platforms.

46 Sales and Other Expenses

Year Ended December 31,

(in millions)

2019 2018 Increase Sales and other expenses $ 955 $ 830 15.1%

% of Total revenues 6.3% 5.7%

Sales and other expenses consist primarily of: (1) credit card and other payment processing fees associated with merchant transactions; (2) fees paid to third parties that provide call center, website content translations and other services; (3) customer chargeback provisions and fraud prevention expenses associated with merchant transactions; (4) customer relations costs; and (5) provisions for bad debt, primarily related to agency accommodation commission receivables. For the year ended December 31, 2019, sales and other expenses, which are substantially variable in nature, increased compared to the year ended December 31, 2018 due primarily to increases in our merchant transaction volumes, partially offset by lower chargeback expense and lower bad debt provisions.

Personnel

Year Ended December 31,

(in millions)

2019 2018 Increase Personnel $ 2,248 $ 2,042 10.0%

% of Total revenues 14.9% 14.1%

Personnel expenses consist of compensation to our personnel, including salaries, stock-based compensation, bonuses, payroll taxes, and employee health and other benefits. Personnel expenses increased during the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily due to an increase in aggregate salaries of $132 million related to headcount growth to support our businesses, partially offset by lower bonus expenses. The increase in personnel expenses was also due to an accrual of $61 million recorded in 2019 to correct an immaterial error related to the nonpayment in prior periods of a wage-related tax under Netherlands' law on compensation paid to certain highly-compensated former employees in the year of their separation from employment with Booking.com. Stock-based compensation expense was $308 million for the year ended December 31, 2019, compared to $317 million for the year ended December 31, 2018. Headcount increased, primarily at agoda and Booking.com, in the areas of customer service and information technology to support transaction growth and various business initiatives, such as alternative accommodations, marketing, payments and in-destination experiences.

General and Administrative

Year Ended December 31,

(in millions)

2019 2018 Increase General and administrative $ 797 $ 699 14.2%

% of Total revenues 5.3% 4.8%

General and administrative expenses consist primarily of: (1) occupancy and office expenses; (2) personnel-related expenses such as travel, relocation, recruiting and training expenses; (3) fees for outside professionals, including litigation expenses; and (4) indirect taxes such as travel transaction taxes and digital services taxes. General and administrative expenses increased during the year ended December 31, 2019, compared to the year ended December 31, 2018, due to increased professional fees, increased indirect taxes including $36 million related to French digital service taxes, higher occupancy and office expenses and personnel-related expenses associated with increased headcount and outside consultants to support the expansion of our international businesses.

47 Information Technology

Year Ended December 31,

(in millions)

2019 2018 Increase Information technology $ 285 $ 233 22.3%

% of Total revenues 1.9% 1.6%

Information technology expenses consist primarily of: (1) software license and system maintenance fees; (2) outsourced data center and cloud computing costs; (3) payments to contractors; and (4) data communications and other expenses associated with operating our services. Information technology expenses increased during the year ended December 31, 2019, compared to the year ended December 31, 2018, due to increased outsourced data center and cloud computing costs to support the growth in our businesses, software fees and payments to contractors.

Depreciation and Amortization

Year Ended December 31,

(in millions) 2019 2018 Increase

Depreciation and amortization $ 469 $ 426 10.0%

% of Total revenues 3.1% 2.9%

Depreciation and amortization expenses consist of: (1) amortization of intangible assets with determinable lives; (2) depreciation of computer equipment; (3) amortization of internally-developed and purchased software; and (4) depreciation of leasehold improvements, furniture and fixtures and office equipment. Depreciation and amortization expenses increased during the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily as a result of increases of $22 million in data center equipment depreciation expenses and $18 million of internally-developed software amortization expenses due to higher capital expenditures and capitalized software development costs to support growth and geographic expansion.

Other Income (Expense)

Year Ended December 31,

(in millions) Increase 2019 2018 (decrease) Interest income $ 152 $ 187 (18.5)% Interest expense (266) (269) (1.2)% Net unrealized gains (losses) on marketable equity securities 745 (367) 302.7 % Foreign currency transactions and other (18) (57) (68.2)% Total $ 613 $ (506) 221.2 %

Interest income decreased for the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily due to lower average invested balances of marketable securities and lower yields as well as increased usage of investments classified as cash equivalents.

Net unrealized gains (losses) on marketable equity securities for the year ended December 31, 2019 and December 31, 2018 principally related to our equity investments in Trip.com Group and Meituan Dianping (see Note 5 to our Consolidated Financial Statements for further information).

Foreign currency transactions and other includes foreign currency gains or losses on derivative contracts, foreign currency transaction gains or losses, including costs related to foreign currency transactions, and net realized gains or losses on investments and other income or expense. Foreign currency transactions and other includes foreign currency losses on derivative contracts of $19 million and $44 million and foreign currency transaction losses of $13 million and $9 million for

48 the years ended December 31, 2019 and 2018, respectively. In addition, foreign currency transactions and other includes a net realized gain of $11 million for the year ended December 31, 2019 from sales of investments in debt securities.

Income Taxes

Year Ended December 31,

(in millions) 2019 2018 Increase

Income tax expense $ 1,093 $ 837 30.6% % of Earnings before income taxes 18.3% 17.3%

Our 2019 effective tax rate differs from the U.S. federal statutory tax rate of 21%, primarily due to the benefit of the Netherlands Innovation Box Tax (discussed below), partially offset by the effect of higher international tax rates and U.S. federal and state tax associated with our current year international earnings, resulting from the enactment of the Tax Act, as well as certain non-deductible expenses. Our 2018 effective tax rate differs from the U.S. federal statutory tax rate of 21%, primarily due to the benefit of the Netherlands Innovation Box Tax and the $46 million benefit resulting from the adjustment to our 2017 provisional income tax expense due to our completion of the accounting for the income tax effects of the Tax Act, partially offset by the effect of higher international tax rates and U.S. federal and state tax associated with our 2018 international earnings, resulting from the enactment of the Tax Act, as well as certain non-deductible expenses.

Our effective tax rate was higher for the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily as a result of (1) higher U.S. gains from equity securities that contributed to a lower international jurisdictional earnings mix, which lessened the impact of the benefit of the Netherlands Innovation Box Tax, and (2) the effect of the higher tax benefit recorded during the year ended December 31, 2018 to adjust our 2017 provisional income tax expense related to the Tax Act. These increases in our effective tax rate were partially offset by higher U.S. federal tax credits, lower U.S. federal and state tax associated with our current year international earnings, and certain lower non-deductible expenses.

A portion of Booking.com's earnings during the years ended December 31, 2019 and 2018 qualified for Innovation Box Tax treatment under Dutch tax law, which had a significant beneficial impact on our effective tax rates for those periods. In 2019, the Dutch government approved a reduction in its corporate income tax rate from 25% to 21.7%, effective in 2021. Furthermore, the Dutch government has proposed an increase in the Innovation Box Tax rate from 7% to 9%, which, if enacted, could be effective beginning in 2021. While we expect Booking.com to continue to qualify for Innovation Box Tax treatment with respect to a portion of its earnings for the foreseeable future, the loss of the Innovation Box Tax benefit, whether due to a change in tax law or a determination by the Dutch government that Booking.com's activities are not innovative or for any other reason, would substantially increase our effective tax rate and adversely impact our results of operations and cash flows. See Part I, Item 1A, Risk Factors - "We may not be able to maintain our 'Innovation Box Tax' benefit."

Results of Operations

Year Ended December 31, 2018 compared to Year Ended December 31, 2017

For a comparison of our results of operations for the fiscal years ended December 31, 2018 and 2017, see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the SEC on February 27, 2019.

49 Liquidity and Capital Resources

At December 31, 2019, we had $11.8 billion in cash, cash equivalents and short-term and long-term investments, of which approximately $4.7 billion is held by our international subsidiaries and is denominated primarily in U.S. Dollars, Euros and, to a lesser extent, British Pounds Sterling and other currencies. Cash equivalents and short-term and long-term investments are principally comprised of U.S. and international corporate bonds, U.S. and international government securities, money market funds, time deposits and certificates of deposit, convertible debt securities and American Depositary Shares ("ADSs") of Trip.com Group, Meituan Dianping equity securities and our investments in private companies. In August 2019, $500 million of Trip.com Group convertible notes were repaid on maturity. See Notes 5 and 6 to our Consolidated Financial Statements for further information.

In the first quarter of 2020 and 2019, we made prepayments of $717 million and $774 million, respectively, which represent a portion of our Dutch income tax liability, to earn prepayment discounts.

At December 31, 2019, we had a remaining transition tax liability of $1.1 billion as a result of the Tax Act, which included $1.0 billion reported as "Long-term U.S. transition tax liability" and $53 million included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheet. This liability will be paid over the next seven years. Generally, in accordance with the Tax Act, future repatriation of our international cash will not be subject to a U.S. federal income tax liability as a dividend, but will be subject to U.S. state income taxes and international withholding taxes, which have been accrued by us. See Note 15 to our Consolidated Financial Statements for further information.

In August 2019, we entered into a $2.0 billion five-year unsecured revolving credit facility with a group of lenders. The revolving credit facility provides for the issuance of up to $80 million of letters of credit as well as borrowings of up to $100 million on same-day notice, referred to as swingline loans. The proceeds of loans made under the facility can be used for working capital and general corporate purposes, including acquisitions, share repurchases and debt repayments. At December 31, 2019, there were no borrowings outstanding and $5 million of letters of credit issued under the facility. Upon entering into the new revolving credit facility in August 2019, we terminated the $2.0 billion five-year revolving credit facility entered into in June 2015. We made several short-term borrowings under this prior revolving credit facility in the first half of 2019 totaling $400 million, all of which were repaid prior to June 30, 2019. See Note 12 to our Consolidated Financial Statements for further information.

Our Convertible Senior Notes due June 2020 (the "2020 Notes") are reported as current liabilities in the Consolidated Balance Sheet at December 31, 2019. The holders will have the right to convert all or any portion of the 2020 Notes starting on March 15, 2020 regardless of our stock price (see Note 12 to the Consolidated Financial Statements).

During the year ended December 31, 2019, we repurchased 4,444,944 shares of our common stock for an aggregate cost of $8.2 billion. At December 31, 2019, we had a remaining aggregate amount of $11.5 billion authorized by our Board of Directors to repurchase our common stock. We have continued to make repurchases of our common stock in the first quarter of 2020 and may continue to make additional repurchases of our common stock from time to time, depending on prevailing market conditions, alternate uses of capital and other factors.

In September 2016, we signed a turnkey agreement to construct an office building for Booking.com’s future headquarters in the Netherlands for 270 million Euros. Upon signing this agreement, we paid 43 million Euros for the acquired land-use rights. In addition, since signing the turnkey agreement we have made several progress payments principally related to the construction of the building. At December 31, 2019, we have a remaining obligation of 109 million Euros ($123 million) related to the building construction, which will be paid through mid-2022, when we anticipate construction will be complete. In addition to the turnkey agreement, we have a remaining obligation at December 31, 2019 to pay 71 million Euros ($80 million) over the remaining term of the acquired land lease. We will also make additional capital expenditures to fit out and furnish the office space. See Note 16 to our Consolidated Financial Statements.

Cash Flow Analysis

Net cash provided by operating activities decreased by $473 million, for the year ended December 31, 2019, compared to the year ended December 31, 2018, primarily due to the payment of $403 million in 2019 to French tax authorities to preserve our right in order to contest certain tax assessments in court (see Note 16 to our Consolidated Financial Statements).

Net cash provided by operating activities for the year ended December 31, 2019, was $4.9 billion, resulting from net income of $4.9 billion and a favorable impact from adjustments for non-cash items of $541 million, partially offset by an unfavorable net change in working capital and long-term assets and liabilities of $541 million. Non-cash items were 50 principally associated with net unrealized gains on marketable equity securities, depreciation and amortization, stock-based compensation expense, operating lease amortization and the provision for uncollectible accounts and chargebacks. The changes in working capital for the year ended December 31, 2019, reflecting the increase in business volume and growth in Booking.com's merchant transactions, were primarily related to a $480 million increase in accounts payable, accrued expenses and other current liabilities, offset by a $323 million increase in accounts receivable and $263 million increase in prepaid expenses and other current assets. Net change in other long-term assets and liabilities of $399 million was primarily due to the increase in other long-term assets related to the payment of $403 million to French tax authorities in order to preserve our right to contest the assessments in court (see Note 16 to our Consolidated Financial Statements).

Net cash provided by operating activities for the year ended December 31, 2018 was $5.3 billion, resulting from net income of $4.0 billion, a favorable impact from adjustments for non-cash items of $1.2 billion and a favorable net change in working capital and long-term assets and liabilities of $125 million. Non-cash items were principally associated with net unrealized losses on marketable equity securities, stock-based compensation expense, depreciation and amortization and the provision for uncollectible accounts and chargebacks. The changes in working capital for the year ended December 31, 2018, reflecting the increase in business volume and growth in Booking.com's merchant transactions, were primarily related to a $635 million increase in accounts payable, accrued expenses and other current liabilities, offset by a $319 million increase in accounts receivable and a $201 million increase in prepaid expenses and other current assets.

Net cash provided by investing activities for the year ended December 31, 2019 was $7.1 billion, principally resulting from the proceeds from sales and maturities of investments of $8.1 billion, net of purchases of $0.7 billion. Net cash provided by investing activities for the year ended December 31, 2018 was $2.2 billion, principally resulting from the proceeds from sales and maturities of investments of $5.6 billion, net of purchases of $2.7 billion, partially offset by acquisitions and other investments, net of cash acquired, of $273 million. Cash invested in the purchase of property and equipment was $368 million and $442 million for the years ended December 31, 2019 and 2018, respectively, which primarily related to additional data center capacity and new offices to support growth and geographic expansion related to our Booking.com and agoda brands. Cash invested in the purchase of property and equipment for the years ended December 31, 2019 and 2018 includes payments of $51 million and $78 million, respectively, related to the turnkey agreement for constructing Booking.com's future headquarters.

Net cash used in financing activities for the year ended December 31, 2019 was $8.2 billion, almost entirely resulting from payments for the repurchase of common stock. Net cash used in financing activities for the year ended December 31, 2018 was $7.4 billion, which primarily consisted of payments for the repurchase of common stock of $6.0 billion and payments for the conversion of senior notes of $1.5 billion.

For a discussion of our liquidity and capital resources as of and our cash flow activities for the fiscal year ended December 31, 2017, see Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the SEC on February 27, 2019.

Contingencies

French tax authorities conducted an audit of Booking.com for the years 2003 through 2012 and are conducting audits for the years 2013 through 2018. They are asserting that Booking.com has a permanent establishment in France and are seeking to recover what they claim are unpaid income and value-added taxes. In December 2015, the French tax authorities issued Booking.com assessments related to tax years 2003 through 2012 for approximately 356 million Euros, the majority of which represents penalties and interest. As a result of a formal demand from the French tax authorities for payment of the amounts assessed for the years 2003 through 2012, in January 2019, we paid the assessments of approximately 356 million Euros ($403 million) in order to preserve our right to contest those assessments in court. The payment, which is included in "Other assets" in the Consolidated Balance Sheet at December 31, 2019, does not constitute an admission that we owe the taxes and will be refunded (with interest) to us to the extent we prevail. If we are unable to resolve the matter with the French tax authorities, we plan to challenge the assessments in the French courts. In December 2019, the French tax authorities issued an additional assessment of 70 million Euros ($79 million), including interest and penalties, for the 2013 year asserting that Booking.com has taxable income in France attributable to a permanent establishment in France. Furthermore, the French tax authorities have issued assessments totaling 39 million Euros ($44 million), including interest and penalties, for certain tax years between 2011 and 2015 on Booking.com's French subsidiary asserting that the subsidiary did not receive sufficient compensation for the services it rendered to Booking.com in the Netherlands. We have not recorded a liability in connection with any of the French tax assessments as we believe that Booking.com has been, and continues to be, in compliance with French tax law, and we are contesting the assessments. Additional assessments could result when the French tax authorities complete the outstanding audits. See Note 16 to our Consolidated Financial Statements and Part I, Item 1A, Risk Factors - "We may have exposure to additional tax liabilities." 51 Contractual Obligations and Commercial Commitments

The following table represents our material contractual obligations and commercial commitments at December 31, 2019:

By Period (in millions) Less than 1 to 3 More than 5 Total 1 Year Years 3 to 5 Years Years Operating lease obligations(1) $ 690 $ 172 $ 251 $ 104 $ 163 Building construction obligation(2) 123 55 68 — — Purchase obligations (3) 79 65 14 — — Senior notes(4) 9,639 1,170 3,293 1,867 3,309 U.S. transition tax liability 1,074 53 198 308 515 Letters of credit and bank guarantees(5) 160 118 23 1 18 Revolving credit facility(6) 9243— Total(7) $ 11,774 $ 1,635 $ 3,851 $ 2,283 $ 4,005

(1) Includes the land lease for Booking.com's future headquarters. See Notes 10 and 16 to our Consolidated Financial Statements for further details. (2) See Note 16 to our Consolidated Financial Statements for further details. (3) Represents significant noncancellable contractual obligations individually greater than $10 million. The obligations are primarily related to sponsorship and cloud hosting arrangements. (4) Represents the aggregate principal amount of our senior notes outstanding at December 31, 2019 and cumulative interest to maturity of $928 million. Convertible debt does not reflect the market value in excess of the outstanding principal amount because we can settle the conversion premium amount in cash or shares of common stock at our option. See Note 12 to our Consolidated Financial Statements. (5) Standby letters of credit and bank guarantees issued on behalf of the Company at December 31, 2019 are primarily related to payment guarantees to third-party payment processors (see Notes 12 and 16). (6) Represents commitment fees on undrawn balances available under the revolving credit facility and fees on outstanding letters of credit at December 31, 2019. (7) We reported "Other long-term liabilities" of $104 million in the Consolidated Balance Sheet at December 31, 2019, the majority of which relates to unrecognized tax benefits of $51 million (see Note 15 to our Consolidated Financial Statements). We have excluded these long-term liabilities from the contractual obligations table above as a variety of factors could affect the timing of payments for the liabilities; therefore, we cannot reasonably estimate the timing of such payments. We believe that these matters will likely not be resolved in the next twelve months and, accordingly, we have classified the estimated liability as non-current in the Consolidated Balance Sheet.

In 2018, we entered into an agreement to sign a future lease related to approximately 222,000 square feet of office space in the city of Manchester in the United Kingdom for the future headquarters of Rentalcars.com. Our obligation to execute the lease is conditional upon the lessor completing certain activities, which are expected to be completed in 2021. If these activities are completed, the lease will commence for a term of approximately 13 years and we will have a lease obligation of approximately 65 million British Pounds Sterling ($86 million), excluding lease incentives. We will also make capital expenditures to fit out and furnish the office space. The obligation is not included in the table of contractual obligations presented above.

We believe that our existing cash balances and liquid resources will be sufficient to fund our operating activities, capital expenditures and other obligations through at least the next twelve months. However, if during that period or thereafter, we are not successful in generating sufficient cash flow from operations or in raising additional capital when required in sufficient amounts and on terms acceptable to us, we may be required to reduce our planned capital expenditures and scale back the scope of our business plans, either of which could have a material adverse effect on our future financial condition or results of operations. If additional funds were raised through the issuance of equity securities, the percentage ownership of our then current stockholders would be diluted. We may not generate sufficient cash flow from operations in the future, revenue growth

52 or sustained profitability may not be realized, and future borrowings or equity sales may not be available in amounts sufficient to make anticipated capital expenditures, finance our strategies or repay our indebtedness.

Off-Balance Sheet Arrangements

At December 31, 2019, we did not have any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

We have exposure to several types of market risk: changes in interest rates, foreign currency exchange rates and equity prices.

We manage our exposure to interest rate risk and foreign currency risk through internally established policies and procedures and, when deemed appropriate, through the use of derivative financial instruments. We use foreign currency exchange derivative contracts to manage short-term foreign currency risk.

The objective of our policies is to mitigate potential income statement, cash flow and fair value exposures resulting from possible future adverse fluctuations in rates. We evaluate our exposure to market risk by assessing the anticipated near- term and long-term fluctuations in interest rates and foreign currency exchange rates. This evaluation includes the review of leading market indicators, discussions with financial analysts and investment bankers regarding current and future economic conditions and the review of market projections as to expected future rates. We utilize this information to determine our own investment strategies as well as to determine if the use of derivative financial instruments is appropriate to mitigate any potential future market exposure that we may face. Our policy does not allow speculation in derivative instruments for profit or execution of derivative instrument contracts for which there are no underlying exposures. We do not use financial instruments for trading purposes and are not a party to any leveraged derivatives. To the extent that changes in interest rates and foreign currency exchange rates affect general economic conditions, we would also be affected by such changes.

We did not experience any material changes in interest rate exposures during the year ended December 31, 2019. Our investments in marketable debt securities are subject to unrealized gains and losses due to interest rate volatility. We performed a sensitivity analysis to determine the impact a change in interest rates would have on the fair value of our investments in marketable debt securities assuming an adverse change of 100 basis points. A hypothetical 100 basis point (1.0%) increase in interest rates would have resulted in a decrease in the fair values of our investments of approximately $23 million and $126 million at December 31, 2019 and 2018, respectively. These hypothetical losses would only be realized if we sold the investments prior to their maturity. This amount excludes our investments in Trip.com Group convertible senior notes, which are more sensitive to the equity market price volatility of Trip.com Group's American Depositary Shares ("ADSs") than changes in interest rates. The fair value of our Trip.com Group convertible senior notes will likely increase as the market price of Trip.com Group's ADSs increases and will likely decrease as the market price of Trip.com Group's ADSs falls.

At December 31, 2019 and 2018, the outstanding aggregate principal amount of our debt was approximately $8.7 billion and $8.8 billion, respectively. We estimate that the fair value of such debt was approximately $9.8 billion and $9.3 billion at December 31, 2019 and 2018, respectively. A substantial portion of the fair value of our debt in excess of the outstanding principal amount relates to the conversion premium on our outstanding convertible senior notes. Excluding the effect on the fair value of our convertible senior notes, a hypothetical 100 basis point (1.0%) decrease in interest rates would have resulted in an increase in the fair values of our other debt of approximately $325 million and $370 million at December 31, 2019 and 2018, respectively. Our convertible senior notes are more sensitive to the equity market price volatility of our shares than changes in interest rates. The fair value of the convertible senior notes will likely increase as the market price of our shares increases and will likely decrease as the market price of our shares falls.

Our international business represents a substantial majority of our financial results. Therefore, because we report our results in U.S. Dollars, we face exposure to movements in foreign currency exchange rates as the financial results and the financial condition of our international businesses are translated from local currencies (principally Euros and British Pounds Sterling) into U.S. Dollars. If the U.S. Dollar weakens against the local currencies, the translation of these foreign-currency- denominated balances will result in increased net assets, gross bookings, revenues, operating expenses, and net income. Similarly, our net assets, gross bookings, revenues, operating expenses, and net income will decrease if the U.S. Dollar strengthens against the local currencies. Additionally, foreign currency exchange rate fluctuations on transactions, denominated in currencies other than the functional currency, result in gains and losses that are reflected in our Consolidated Statements of Operations. 53 As a result of foreign currency exchange rate changes, our foreign-currency-denominated gross bookings, revenues and operating expenses as expressed in U.S. Dollars are lower for the year ended December 31, 2019 than they would have been had foreign currency exchange rates remained where they were for the year ended December 31, 2018. Since our expenses are generally denominated in foreign currencies on a basis similar to our revenues, our operating margins have not been significantly impacted by currency fluctuations. Historically, the aggregate principal value of our Euro-denominated debt and accrued interest thereon had provided a hedge against the impact of foreign currency exchange rate fluctuations on the net assets of one of our Euro functional currency subsidiaries. Beginning in the second quarter of 2019, we have only designated certain portions of the aggregate principal value of the Euro-denominated debt as a hedge. The foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument for accounting purposes are recognized in "Foreign currency transactions and other" in the Consolidated Statement of Operations.

We enter into foreign currency derivative contracts to hedge translation risks from short-term foreign currency exchange rate fluctuations for the Euro, British Pound Sterling and certain other currencies versus the U.S. Dollar. We also enter into foreign currency forward contracts to hedge our exposure to the impact of movements in foreign currency exchange rates on our transactional balances denominated in currencies other than the functional currency. See Note 6 to our Consolidated Financial Statements for further information.

We are exposed to equity price risk as it relates to changes in fair value of our investments in equity securities of publicly-traded companies and private companies. The fair value of our investments in equity securities of publicly-traded companies and private companies, excluding certain investments classified as debt securities for accounting purposes, was $1.8 billion and $501 million, respectively, at December 31, 2019, and $1.0 billion and $501 million, respectively, at December 31, 2018. Our investments in private companies, excluding certain investments classified as debt securities for accounting purposes, are measured at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. See Note 2 and 5 to our Consolidated Financial Statements for further information. A hypothetical 10% decrease in the fair value of these investments at December 31, 2019 and 2018 would have resulted in a total loss, before tax, of approximately $230 million and $150 million, respectively, being recognized in net income.

Item 8. Financial Statements and Supplementary Data

The following Consolidated Financial Statements of the Company and the report of our independent registered public accounting firm are filed as part of this Annual Report on Form 10-K (See Part IV, Item 15, Exhibits and Financial Statement Schedules): Consolidated Balance Sheets at December 31, 2019 and 2018; Consolidated Statements of Operations, Consolidated Statements of Comprehensive Income, Consolidated Statements of Changes in Stockholders' Equity and Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017; Notes to the Consolidated Financial Statements; and Report of Independent Registered Public Accounting Firm.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures. Under the supervision and with the participation of our management, including our principal executive officer and our principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Exchange Act Rule 13a-15(e). Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this Annual Report on Form 10-K.

Pursuant to Section 404 of the Sarbanes-Oxley Act of 2002, we include a report of our management's assessment of the design and effectiveness of our internal controls over financial reporting for the year ended December 31, 2019.

Management's Report on Internal Control Over Financial Reporting. Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the 54 framework in the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on our evaluation, our management concluded that our internal control over financial reporting was effective as of December 31, 2019. Our independent registered public accounting firm also attested to, and reported on the effectiveness of internal control over financial reporting.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Changes in Internal Controls. No change in our internal control over financial reporting (as such term is defined in Exchange Act Rule 13a-15(f)) occurred during the three months ended December 31, 2019 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

55 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Booking Holdings Inc.

Opinion on Internal Control over Financial Reporting We have audited the internal control over financial reporting of Booking Holdings Inc. and subsidiaries (the "Company") as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the financial statements as of and for the year ended December 31, 2019, of the Company and our report dated February 26, 2020, expressed an unqualified opinion on those financial statements and included an explanatory paragraph related to the Company’s change in method of accounting for the recognition and measurement of financial instruments in 2018 due to the adoption of an accounting standards update. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying "Management's Report on Internal Control Over Financial Reporting." Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ DELOITTE & TOUCHE LLP Stamford, Connecticut February 26, 2020

56 Item 9B. Other Information

None.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

Information required by Part III, Item 10 will be included in our Proxy Statement relating to our 2020 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, 2019, and is incorporated herein by reference.

Item 11. Executive Compensation

Information required by Part III, Item 11 will be included in our Proxy Statement relating to our 2020 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, 2019, and is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Information required by Part III, Item 12 will be included in our Proxy Statement relating to our 2020 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, 2019, and is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions, and Director Independence

Information required by Part III, Item 13 will be included in our Proxy Statement relating to our 2020 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, 2019, and is incorporated herein by reference.

Item 14. Principal Accountant Fees and Services

Information required by Part III, Item 14 will be included in our Proxy Statement relating to our 2020 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the end of our fiscal year ended December 31, 2019, and is incorporated herein by reference.

PART IV

Item 15. Exhibits and Financial Statement Schedules.

(a) List of Documents Filed as a Part of this Annual Report on Form 10-K:

The following Consolidated Financial Statements of the Company and the report of our independent registered public accounting firm are filed as part of this Annual Report on Form 10-K: Consolidated Balance Sheets at December 31, 2019 and 2018; Consolidated Statements of Operations, Consolidated Statements of Comprehensive Income, Consolidated Statements of Changes in Stockholders' Equity and Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017; Notes to the Consolidated Financial Statements; and Report of Independent Registered Public Accounting Firm.

All financial statement schedules have been omitted because they are not applicable, not material or the required information is shown in the Consolidated Financial Statements or the notes thereto.

(b) Exhibits

In reviewing the agreements included as exhibits to this Annual Report on Form 10-K, please remember they are included to provide you with information regarding their terms and are not intended to provide any other factual or disclosure information about the Company or the other parties to the agreements. Some agreements contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the other parties to the applicable agreement and:

57 • should not be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; • may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement; • may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and • were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.

Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time. Additional information about the Company may be found elsewhere in this Annual Report on Form 10 K and the Company's other public filings, which are available without charge through the SEC's website at http://www.sec.gov.

Exhibit Number Description 3.1(a) Restated Certificate of Incorporation of the Registrant. 3.2(b) Amended and Restated By-Laws of the Registrant. 4.1 Reference is hereby made to Exhibits 3.1 and 3.2. 4.2(c) Specimen Certificate for Registrant's Common Stock. 4.3(d) Indenture, dated as of June 4, 2013, between the Registrant and American Stock Transfer & Trust Company, LLC as Trustee. 4.4(e) Indenture, dated as of August 20, 2014, between the Registrant and American Stock Transfer & Trust Company, LLC as Trustee. 4.5(f) Indenture, dated as of September 23, 2014, between the Registrant and Deutsche Bank Trust Company Americas, as Trustee. 4.6(g) Indenture, dated as of August 8, 2017, between the Company and U.S. Bank National Association, as trustee. 4.7(h) Form of 2.375% Senior Note due 2024. 4.8(i) Officers' Certificate, dated September 23, 2014, for the 2.375% Senior Notes due 2024. 4.9(j) Form of 1.800% Senior Note due 2027. 4.10(k) Officers' Certificate, dated March 3, 2015, for the 1.800% Senior Notes due 2027. 4.11(l) Form of 3.650% Senior Note due 2025. 4.12(m) Officers' Certificate, dated March 13, 2015, for the 3.650% Senior Notes due 2025. 4.13(f) Form of 2.15% Senior Note due 2022. 4.14(f) Officers' Certificate, dated November 25, 2015, for the 2.15% Senior Notes due 2022. 4.15(n) Form of 3.600% Senior Note due 2026. 4.16(n) Officers' Certificate, dated May 23, 2016, for the 3.600% Senior Notes due 2026. 4.17(o) Form of 0.800% Senior Note due 2022. 4.18(o) Officers' Certificate, dated March 10, 2017, for the 0.800% Senior Notes due 2022. 4.19(p) Form of 2.750% Senior Note due 2023. 4.20(p) Officers' Certificate, dated August 15, 2017, with respect to the 2.750% Senior Notes due 2023. 4.21(p) Form of 3.550% Senior Note due 2028. 4.22(p) Officers' Certificate, dated August 15, 2017, with respect to the 3.550% Senior Notes due 2028. 4.23 Description of the Company's Common Stock Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. 4.24 Description of the Company's 0.800% Senior Notes due 2022 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. 4.25 Description of the Company's 2.150% Senior Notes due 2022 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. 4.26 Description of the Company's 2.375% Senior Notes due 2024 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. 4.27 Description of the Company's 1.800% Senior Notes due 2027 Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. 10.1(q)+ Booking Holdings Inc. 1999 Omnibus Plan (As Amended and Restated Effective June 7, 2018).

58 Exhibit Number Description 10.2(r)+ Form of Restricted Stock Unit Award Agreement for Employees in the Netherlands under the 1999 Omnibus Plan. 10.3(s)+ Form of Restricted Stock Unit Agreement for awards under the 1999 Omnibus Plan to non-employee directors. 10.4(t)+ Form of Restricted Stock Unit Agreement for awards under the 1999 Omnibus Plan. 10.5(u)+ 2017 Form of Performance Share Unit Agreement under the 1999 Omnibus Plan. 10.6(t)+ 2018 Form of Performance Share Unit Agreement under the 1999 Omnibus Plan. 10.7(v)+ 2019 Form of Performance Share Unit Agreement under the 1999 Omnibus Plan. 10.8(u)+ Amended and Restated KAYAK Software Corporation 2012 Equity Incentive Plan. 10.9(u)+ OpenTable, Inc. Amended and Restated 2009 Equity Incentive Award Plan. 10.10(w)+ Buuteeq, Inc. Amended and Restated 2010 Stock Plan. 10.11(x)+ Amended and Restated Rocket Travel, Inc. 2012 Stock Incentive Plan. 10.12(x)+ Amended and Restated Annual Bonus Plan. 10.13(y)+ Form of Non-Competition and Non-Solicitation Agreement. 10.17(z)+ Second Amended and Restated Employment Agreement, dated April 21, 2015 by and between the Registrant and Peter J. Millones. 10.18(aa)+ Amended and Restated Employment contract, dated May 19, 2016 by and between Booking.com Holding B.V. and Gillian Tans. 10.19(bb)+ Employment Agreement, dated December 15, 2016 by and between the Registrant and Glenn D. Fogel. 10.20(bb)+ Non-Competition and Non-Solicitation Agreement, dated December 15, 2016 by and between the Registrant and Glenn D. Fogel. 10.21(bb)+ Employee Confidentiality and Assignment Agreement, dated December 15, 2016 by and between the Registrant and Glenn D. Fogel. 10.25(cc)+ Employment Agreement, dated January 19, 2018, between the Registrant and David I. Goulden. 10.26(cc)+ Non-Competition and Non-Solicitation Agreement, dated March 1, 2018, between the Registrant and David I. Goulden. 10.27(cc)+ Employee Confidentiality and Assignment Agreement, dated January 19, 2018, between the Registrant and David I. Goulden. 10.28(dd)+ Transition Agreement, dated June 26, 2019, between Booking.com Holding B.V. and Gillian Tans. 10.29(ee) Credit Agreement, dated as of August 14, 2019, among the Registrant, the lenders from time to time party thereto, and JPMorgan Chase Bank, N.A. as Administrative Agent. 10.30(b)+ Letter Agreement, dated October 24, 2019 by and between the Registrant and Glenn D. Fogel. 10.31(ff)+ Form of Employee Confidentiality and Assignment Agreement. 21 List of Subsidiaries. 23.1 Consent of Deloitte & Touche LLP. 24.1 Power of Attorney (included in the Signature Page). 31.1 Certification of Glenn D. Fogel, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 31.2 Certification of David I. Goulden, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. 32.1(gg) Certification of Glenn D. Fogel, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code). 32.2(gg) Certification of David I. Goulden, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code). 101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the inline XBRL document. 104 Cover Page Interactive Data File - the cover page from this Annual Report on Form 10-K for the year ended December 31, 2019, formatted in Inline XBRL (included in Exhibit 101). ______

+ Indicates a management contract or compensatory plan or arrangement.

59 (a) Previously filed as an exhibit to the Current Report on Form 8-K filed on February 21, 2018 (File No. 1-36691). (b) Previously filed as an exhibit to the Current Report on Form 8-K filed on October 25, 2019 (File No. 1-36691). (c) Previously filed as an exhibit to Amendment No. 2 to Registration Statement on Form S-1 filed on March 18, 1999 (File No. 333-69657). (d) Previously filed as an exhibit to the Current Report on Form 8-K filed on June 4, 2013 (File No. 0-25581). (e) Previously filed as an exhibit to the Current Report on Form 8-K filed on August 20, 2014 (File No. 0-25581). (f) Previously filed as an exhibit to the Current Report on Form 8-K filed on November 25, 2015 (File No. 1-36691). (g) Previously filed as an exhibit to the Registration Statement on Form S-3 filed on August 8, 2017 (File No. 333-219800). (h) Previously filed as an exhibit to the Current Report on Form 8-K filed on September 22, 2014 (File No. 0-25581). (i) Previously filed as an exhibit to the Current Report on Form 8-K filed on September 26, 2014 (File No. 0-25581). (j) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 2, 2015 (File No. 1-36691). (k) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 4, 2015 (File No. 1-36691). (l) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 12, 2015 (File No. 1-36691). (m) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 13, 2015 (File No. 1-36691). (n) Previously filed as an exhibit to the Current Report on Form 8-K filed on May 23, 2016 (File No. 1-36691). (o) (p) Previously filed as an exhibit to our Current Report on Form 8-K filed on August 15, 2017 (File No. 1-36691). (q) Previously filed as an exhibit to our Current Report on Form 8-K filed on June 8, 2018 (File No. 1-36691). (r) 0-25581). (s) (t) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 2, 2018 (File No. 1-36691). (u) (v) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 1, 2019 (File No. 1-36691). (w) Previously filed as an exhibit to the Registration Statement on Form S-8 filed on June 13, 2014 (File No. 333-196756). (x) Previously filed as an exhibit to the Annual Report on Form 10-K filed for the year ended December 31, 2015 (File No. 1-36691). (y) Previously filed as an exhibit to the Current Report on Form 8-K filed on March 4, 2013 (File No. 0-25581). (z) Previously filed as an exhibit to our Current Report on Form 8-K filed on April 24, 2015 (File No. 1-36691). (aa) Previously filed as an exhibit to the Current Report on Form 8-K filed on May 20, 2016 (File No. 1-36691). (bb) Previously filed as an exhibit to the Current Report on Form 8-K filed on December 16, 2016 (File No. 1-36691). (cc) Previously filed as an exhibit to the Current Report on Form 8-K filed on January 22, 2018 (File No. 1-36691). (dd) Previously filed as an exhibit to the Current Report on Form 8-K filed on June 28, 2019 (File No. 1-36691) (ee) Previously filed as an exhibit to the Current Report on Form 8-K filed on August 14, 2019 (File No. 1-36691). (ff) Previously filed as an exhibit to the Quarterly Report on Form 10-Q filed on May 9, 2019 (File No. 1-36691). (gg)

Item 16. Form 10-K Summary.

None.

60 Signatures

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

BOOKING HOLDINGS INC.

By: /s/ Glenn D. Fogel Name: Glenn D. Fogel Title: Chief Executive Officer and President Date: February 26, 2020

Power of Attorney

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Glenn D. Fogel, David I. Goulden and Peter J. Millones, and each of them severally, his or her true and lawful attorney-in-fact with power of substitution and resubstitution to sign in his or her name, place and stead, in any and all capacities, to do any and all things and execute any and all instruments that such attorney may deem necessary or advisable under the Securities Exchange Act of 1934 and any rules, regulations and requirements of the Securities and Exchange Commission in connection with this Annual Report on Form 10-K and any and all amendments hereto, as fully and for all intents and purposes as he or she might do or could do in person, and hereby ratifies and confirms all said attorneys-in-fact and agents, each acting alone, and his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature Title Date

/s/ Jeffery H. Boyd Director, Chairman of the Board February 26, 2020 Jeffery H. Boyd

/s/ Glenn D. Fogel Director, Chief Executive Officer and President February 26, 2020 Glenn D. Fogel

/s/ David I. Goulden Executive Vice President and Chief Financial February 26, 2020 David I. Goulden Officer (Principal Financial Officer)

/s/ Susana D'Emic Chief Accounting Officer and Controller February 26, 2020 Susana D'Emic (Principal Accounting Officer)

/s/ Timothy M. Armstrong Director February 26, 2020 Timothy M. Armstrong

/s/ Mirian Graddick-Weir Director February 26, 2020

Mirian Graddick-Weir

/s/ James M. Guyette Director February 26, 2020

James M. Guyette

61 Signature Title Date

/s/ Wei Hopeman Director February 26, 2020 Wei Hopeman

/s/ Robert J. Mylod Jr. Director February 26, 2020 Robert J. Mylod Jr.

/s/ Charles H. Noski Director February 26, 2020

Charles H. Noski

/s/ Nancy B. Peretsman Director February 26, 2020

Nancy B. Peretsman

/s/ Nicholas J. Read Director February 26, 2020 Nicholas J. Read

/s/ Thomas E. Rothman Director February 26, 2020 Thomas E. Rothman

/s/ Lynn M. Vojvodich Director February 26, 2020 Lynn M. Vojvodich

/s/ Vanessa A. Wittman Director February 26, 2020 Vanessa A. Wittman

62 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

Page No.

Report of Independent Registered Public Accounting Firm 64

Consolidated Balance Sheets at December 31, 2019 and 2018 67

Consolidated Statements of Operations for the years ended December 31, 2019, 2018 and 2017 68

Consolidated Statements of Comprehensive Income for the years ended December 31, 2019, 2018 and 2017 69

Consolidated Statements of Changes in Stockholders' Equity for the years ended December 31, 2019, 2018 and 2017 70

Consolidated Statements of Cash Flows for the years ended December 31, 2019, 2018 and 2017 71

Notes to Consolidated Financial Statements 72

63 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of Booking Holdings Inc.

Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Booking Holdings Inc. and subsidiaries (the "Company") as of December 31, 2019 and 2018, the related consolidated statements of operations, comprehensive income, changes in stockholders' equity, and cash flows for each of the three years in the period ended December 31, 2019, including the related notes (collectively, the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its cash flows, for each of the three years in the period ended December 31, 2019, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 26, 2020, expressed an unqualified opinion on the Company's internal control over financial reporting. Change in Accounting Principle

As discussed in Note 2 to the financial statements, the Company has changed its method of accounting for the recognition and measurement of financial instruments in 2018 due to the adoption of an accounting standards update. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matters The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate. Total Revenues - Refer to Notes 2 and 3 to the financial statements Critical Audit Matter Description Substantially all of the Company’s revenues are generated by providing online travel reservation services, which principally allow travelers to book travel reservations with travel service providers through the Company’s platforms. Total revenues for the year ended December 31, 2019 were $15.1 billion. The Company operates six primary brands and the revenues from each of the brands consist of a significant volume of low-dollar transactions utilizing multiple custom systems. We identified total revenues as a critical audit matter as the processes to calculate and record revenues are highly automated, rely on a number of internally-built custom systems, and involve interfacing significant volumes of data across multiple systems. Given the complex information technology (IT) environment, this required the involvement of professionals with expertise in IT to identify, test, and evaluate the revenue data flows, the revenue systems and the automated controls.

64 How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the Company's revenue transactions included the following, among others: • With the assistance of our IT specialists, we: – Identified the systems used to calculate and record revenue transactions. – Tested the general IT controls over each of these systems, including testing of user access controls, change management controls, and IT operations controls. – Performed testing of system interface controls and automated controls within the relevant revenue streams. • We tested business process controls to reconcile the various systems to the Company's general ledgers. • We performed detail transaction testing by agreeing the amounts recognized to source documents and testing the mathematical accuracy of the recorded revenues. Goodwill - Refer to Notes 2 and 11 to the financial statements Critical Audit Matter Description The Company's annual evaluation of goodwill impairment involves the comparison of the fair value of each of the Company's reporting units to its carrying value. The total goodwill balance was $2.9 billion as of December 31, 2019. A substantial portion of the Company's goodwill relates to the acquisitions of KAYAK in 2013 and OpenTable in 2014. The Company estimated the fair values using a combination of standard valuation techniques, including an income approach (discounted cash flows) and market approaches (earnings before interest, taxes, depreciation, and amortization ("EBITDA") multiples of comparable publicly traded companies and precedent transactions). With respect to the income approach, management makes significant estimates and assumptions related to forecasts of future performance, including revenues, operating margins and discount rates. Given the significant judgments made by management to estimate the fair value of the KAYAK and OpenTable reporting units, performing audit procedures to evaluate the reasonableness of management's estimates and assumptions related to selection of the discount rates and forecasts of future revenues and operating margins required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the forecasts of future revenues and operating margins and the selection of the discount rates for the KAYAK and OpenTable reporting units included the following, among others: • We tested the effectiveness of controls over goodwill impairment evaluation, including those over the forecasts and the selection of the discount rates. • We evaluated management's ability to accurately forecast by comparing actual results in previous years to management’s historical forecasts. • We evaluated the reasonableness of management’s forecasts of future revenues and operating margins by comparing management’s forecasts with: – Historical revenues and operating margins. – Internal communications to management and the Board of Directors. – Forecasted information included in analyst and industry reports of the Company and selected companies in its peer group. • We considered the impact of industry and market conditions on management's forecasts. • With the assistance of our fair value specialists, we evaluated the discount rates, including testing the underlying source information and the mathematical accuracy of the calculations and developing a range of independent estimates and comparing those to the discount rates selected by management. • We evaluated the reasonableness of management's forecasts of future cash flows and discount rates utilized in the income approach fair value calculation by comparing the income approach fair value to the market approach fair values. Commitments and Contingencies - Tax Matters - Refer to Note 16 to the financial statements Critical Audit Matter Description The Company is subject to ongoing tax examinations and assessments in various jurisdictions. The Company has received proposed income tax assessments relating to permanent establishment and transfer pricing matters, including interest and 65 penalties from French, Italian and Turkish tax authorities in the amount of $526 million, $118 million and $91 million respectively. The Company believes that it has been, and continues to be, in compliance with the relevant tax laws, and the Company is contesting these assessments. The Company has not recorded a liability in connection with these assessments. Given the complexity of the relevant tax laws and regulations, auditing management's evaluation and accounting for the tax positions associated with these income tax assessments involved subjective and complex judgments. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the accounting for the tax positions associated with the income tax assessments included the following, among others: • We tested the effectiveness of controls over accounting for uncertain tax positions. • With the assistance of our income tax specialists, we evaluated management's analysis regarding the likelihood of sustaining its tax positions upon examination by the relevant tax authorities. • We assessed the basis of the Company's analysis and measurement by obtaining, reading, and evaluating the third-party specialists' reports. • We obtained, read, and evaluated correspondence between the Company and the tax authorities. • We evaluated any developments in the matters during the current fiscal year through inquiry of both Company personnel and the Company's third-party specialists.

/s/ DELOITTE & TOUCHE LLP Stamford, Connecticut February 26, 2020 We have served as the Company’s auditor since 1997.

66 Booking Holdings Inc. CONSOLIDATED BALANCE SHEETS (In millions, except share and per share data)

December 31,

2019 2018

ASSETS

Current assets: Cash and cash equivalents $ 6,312 $ 2,624 Short-term investments in marketable securities 998 3,660 Accounts receivable, net of allowance for doubtful accounts of $49 and $51, respectively 1,680 1,523 Prepaid expenses and other current assets 843 600 Total current assets 9,833 8,407 Property and equipment, net 738 656 Operating lease assets 620 — Intangible assets, net 1,954 2,125 Goodwill 2,913 2,910 Long-term investments 4,477 8,408 Other assets 867 181 Total assets $ 21,402 $ 22,687

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities: Accounts payable $ 1,239 $ 1,134 Accrued expenses and other current liabilities 1,578 1,399 Deferred merchant bookings 1,561 1,022 Convertible debt 988 — Total current liabilities 5,366 3,555 Deferred income taxes 876 370 Operating lease liabilities 462 — Long-term U.S. transition tax liability 1,021 1,166 Other long-term liabilities 104 162 Long-term debt 7,640 8,649 Total liabilities 15,469 13,902

Commitments and Contingencies (See Note 16)

Stockholders' equity: Common stock, $0.008 par value, Authorized shares: 1,000,000,000 Issued shares: 63,179,471 and 62,948,762, respectively — — Treasury stock, 21,762,070 and 17,317,126 shares, respectively (22,864) (14,711) Additional paid-in capital 5,756 5,445 Retained earnings 23,232 18,367 Accumulated other comprehensive loss (191) (316) Total stockholders' equity 5,933 8,785 Total liabilities and stockholders' equity $ 21,402 $ 22,687

See Notes to Consolidated Financial Statements.

67 Booking Holdings Inc. CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except share and per share data)

Year Ended December 31,

2019 2018 2017 Agency revenues $ 10,117 $ 10,480 $ 9,714 Merchant revenues 3,830 2,987 2,133 Advertising and other revenues 1,119 1,060 834 Total revenues 15,066 14,527 12,681 Cost of revenues 242 Gross profit 12,439

Operating expenses: Performance marketing 4,419 4,447 4,161 Brand marketing 548 509 435 Sales and other expenses 955 830 517 Personnel, including stock-based compensation of $308, $317 and $261, respectively 2,248 2,042 1,660 General and administrative 797 699 576 Information technology 285 233 189 Depreciation and amortization 469 426 363 Total operating expenses 9,721 9,186 7,901 Operating income 5,345 5,341 4,538

Other income (expense): Interest income 152 187 157 Interest expense (266) (269) (254) Net unrealized gains (losses) on marketable equity securities 745 (367)— Foreign currency transactions and other (18) (57) (42) Total other income (expense) 613 (506) (139) Earnings before income taxes 5,958 4,835 4,399 Income tax expense 1,093 837 2,058 Net income $ 4,865 $ 3,998 $ 2,341 Net income applicable to common stockholders per basic common share $ 112.93 $ 84.26 $ 47.78 Weighted-average number of basic common shares outstanding (in 000's) 43,082 47,446 48,994 Net income applicable to common stockholders per diluted common share $ 111.82 $ 83.26 $ 46.86 Weighted-average number of diluted common shares outstanding (in 000's) 43,509 48,017 49,954

See Notes to Consolidated Financial Statements.

68 Booking Holdings Inc. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (In millions)

Year Ended December 31, 2019 2018 2017 Net income $ 4,865 $ 3,998 $ 2,341 Other comprehensive income (loss), net of tax Foreign currency translation adjustments, net of tax (10) (114) 297 Net unrealized gains (losses) on available-for-sale securities, net of tax 135 (199)76 Total other comprehensive income (loss), net of tax 125 (313) 373 Comprehensive income $ 4,990 $ 3,685 $ 2,714

See Notes to Consolidated Financial Statements.

69 Booking Holdings Inc. CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2019, 2018 and 2017 (In millions except share data)

Accumulated Common Stock Treasury Stock Additional Other Shares Shares Paid-in Retained Comprehensive (in 000's) Amount (in 000's) Amount Capital Earnings (Loss) Income Total Balance, December 31, 2016 62,379 $ — (13,191)$ (6,855) $ 5,483 $ 11,327 $ (135) $ 9,820 Cumulative effect of adoption of accounting standards updates — — — — 9 271 — 280 Net income —————2,341 — 2,341 Foreign currency translation adjustments — ————— 297297 Net unrealized gains on available-for-sale securities — ————— 7676 Reclassification adjustment for convertible debt in mezzanine — ———26——26 Exercise of stock options and vesting of restricted stock units and performance share units 160 — — — 5 — — 5 Repurchase of common stock —— (1,026) (1,844) — — — (1,844) Stock-based compensation and other stock-based payments — — — — 261 — — 261 Conversion of debt 150 — — — (1)— —(1) Balance, December 31, 2017 62,689 $ — (14,217)$ (8,699) $ 5,783 $ 13,939 $ 238 $ 11,261 70 Cumulative effect of adoption of accounting standards updates — ————430 (241) 189 Net income —————3,998 — 3,998 Foreign currency translation adjustments — ————— (114)(114) Net unrealized losses on available-for-sale securities — ————— (199) (199) Reclassification adjustment for convertible debt in mezzanine — — — — 3 — — 3 Exercise of stock options and vesting of restricted stock units and performance share units 208 — — — 2 — — 2 Repurchase of common stock —— (3,100) (6,012) — — — (6,012) Stock-based compensation and other stock-based payments — — — — 320 — — 320 Conversion of debt ————(773) — — (773) Common stock issued in an acquisition 52 — — — 110 — — 110 Balance, December 31, 2018 62,949 $ — (17,317)$ (14,711) $ 5,445 $ 18,367 $ (316) $ 8,785 Net income —————4,865 — 4,865 Foreign currency translation adjustments — ————— (10)(10) Net unrealized gains on available-for-sale securities — ————— 135135 Exercise of stock options and vesting of restricted stock units and performance share units 230 — — — 3 — — 3 Repurchase of common stock —— (4,445) (8,153) — — — (8,153) Stock-based compensation and other stock-based payments — — — — 308 — — 308 Balance, December 31, 2019 63,179 $ — (21,762)$ (22,864) $ 5,756 $ 23,232 $ (191) $ 5,933

See Notes to Consolidated Financial Statements. Booking Holdings Inc. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions)

Year Ended December 31, 2019 2018 2017 OPERATING ACTIVITIES: Net income $ 4,865 $ 3,998 $ 2,341 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 469 426 363 Provision for uncollectible accounts and chargebacks 138 163 62 Deferred income tax expense (benefit) 122 (150) (32) Net unrealized (gains) losses on marketable equity securities (745) 367 — Stock-based compensation expense and other stock-based payments 325 331 261 Amortization of debt discount and debt issuance costs 58 59 79 Operating lease amortization 172 — — Other 21910 Changes in assets and liabilities, net of effects of acquisitions: Accounts receivable (323) (319) (270) Prepaid expenses and other current assets (263) (201) (124) Accounts payable, accrued expenses and other current liabilities 480 635 687 Long-term U.S. transition tax liability (36) 40 1,251 Other long-term assets and liabilities (399) (30)34 Net cash provided by operating activities 4,865 5,338 4,662 INVESTING ACTIVITIES: Purchase of investments (672) (2,686) (6,941) Proceeds from sale and maturity of investments 8,099 5,616 3,580 Additions to property and equipment (368) (442) (288) Acquisitions and other investments, net of cash acquired (9) (273) (553) Net cash provided by (used in) investing activities 7,050 2,215 (4,202) FINANCING ACTIVITIES: Proceeds from revolving credit facility and short-term borrowings 400 25 — Repayments of revolving credit facility and short-term borrowings (425)— — Proceeds from the issuance of long-term debt — — 2,045 Payments for conversion of senior notes — (1,487) (286) Payments for repurchase of common stock (8,187) (5,971) (1,828) Other financing activities (8)2(10) Net cash used in financing activities (8,220) (7,431) (79) Effect of exchange rate changes on cash and cash equivalents and restricted cash and cash equivalents (8) (40) 100 Net increase in cash and cash equivalents and restricted cash and cash equivalents 3,687 82 481 Total cash and cash equivalents and restricted cash and cash equivalents, beginning of period 2,645 2,563 2,082 Total cash and cash equivalents and restricted cash and cash equivalents, end of period $ 6,332 $ 2,645 $ 2,563 SUPPLEMENTAL CASH FLOW INFORMATION: Cash paid during the period for income taxes $ 1,074 $ 1,169 $ 702 Cash paid during the period for interest $ 221 $ 219 $ 155 Non-cash operating and financing activity for an acquisition (see Note 20) $ — $ 51 $ — Non-cash investing and financing activity for an acquisition (see Note 20) $ — $ 59 $ — See Notes to Consolidated Financial Statements.

71 Booking Holdings Inc. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1. BUSINESS DESCRIPTION

Booking Holdings Inc. ("Booking Holdings" or the "Company") seeks to make it easier for everyone to experience the world by providing consumers, travel service providers and restaurants with leading travel and restaurant online reservation and related services. Through one or more of the Company's brands, consumers can: book a broad array of accommodations (including hotels, motels, resorts, homes, apartments, bed and breakfasts, hostels and other properties); make a car rental reservation or arrange for an airport taxi; make a dinner reservation; or book a cruise, flight, vacation package, tour or activity. Consumers can also use the Company's meta-search services to easily compare travel reservation information, such as airline ticket, hotel reservation and rental car reservation information, from hundreds of online travel platforms at once. In addition, the Company offers various other services to consumers, travel service providers and restaurants, such as certain travel-related insurance products and restaurant management services.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation The Company's Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries, including acquired businesses from the dates of acquisition. All intercompany accounts and transactions have been eliminated in consolidation.

Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States ("U.S. GAAP") requires management to make estimates and assumptions that affect the amounts reported in the financial statements and footnotes thereto. Actual results may differ significantly from those estimates. The estimates underlying the Company's Consolidated Financial Statements relate to, among other things, the valuation of goodwill, other long-lived tangible and intangible assets, income taxes, stock-based compensation, the allowance for doubtful accounts, customer chargeback provisions and the accrual of obligations for loyalty and other incentive programs.

Reclassifications Certain amounts from prior periods have been reclassified to conform to the current year presentation.

Fair Value of Financial Instruments The Company's financial instruments, including cash, restricted cash, accounts receivable, accounts payable, accrued expenses and deferred merchant bookings, are carried at cost which approximates their fair value because of the short-term nature of these financial instruments. See Notes 5, 6 and 12 for information related to fair value for investments, derivatives, and the Company's outstanding senior notes.

Cash and Cash Equivalents Cash and cash equivalents consists primarily of cash and highly liquid investment grade securities with an original maturity of three months or less. Cash equivalents are recognized based on settlement date.

72 Restricted Cash and Cash Equivalents Restricted cash and cash equivalents are restricted through legal contracts or regulations. Restricted cash and cash equivalents at December 31, 2019, 2018 and 2017 principally relates to the minimum cash requirement for the Company's travel-related insurance business. The following table reconciles cash and cash equivalents and restricted cash and cash equivalents reported in the Consolidated Balance Sheets to the total amount shown in the Consolidated Statements of Cash Flows (in millions): December 31, 2019 2018 2017 As included in the Consolidated Balance Sheets: Cash and cash equivalents $ 6,312 $ 2,624 $ 2,542 Restricted cash and cash equivalents included in prepaid expenses and other current assets 20 21 21 Total cash and cash equivalents and restricted cash and cash equivalents as shown in the Consolidated Statements of Cash Flows $ 6,332 $ 2,645 $ 2,563

Investments Investments held by the Company include debt securities and equity securities. Preferred stock that is either mandatorily redeemable or redeemable at the option of the investor is considered a debt security for accounting purposes. Investments in debt or equity securities that include embedded features, such as conversion or redemption features, are analyzed by the Company to determine if these features are embedded derivatives that require separate accounting treatment. Payments made for investments are reported in "Purchase of investments" and proceeds received from sales or maturities of investments are reported in "Proceeds from sale and maturity of investments" in the Consolidated Statements of Cash Flows.

Debt Securities The Company has classified its investments in debt securities as available-for-sale securities. These securities are reported at estimated fair value with the aggregate unrealized gains and losses, net of tax, reflected in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. Investments in debt securities are considered to be impaired when a decline in fair value is judged to be other than temporary because the Company either intends to sell or it is more-likely-than not that it will be required to sell the impaired security before recovery. Once a decline in fair value is determined to be other than temporary, an impairment charge is recorded and a new cost basis in the investment is established. If the Company does not intend to sell the debt security, but it is probable that the Company will not collect all amounts due, then only the impairment due to the credit risk would be recognized in net income and the remaining amount of the impairment would be recognized in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. See "Other Recent Accounting Pronouncements" later in this Note for the accounting change to the other-than-temporary impairment model, effective January 1, 2020. The fair value of these investments is based on the specific quoted market price of the securities or comparable securities at the balance sheet dates. Unobservable inputs are also used when little or no market data is available. See Note 6 for information related to fair value measurements.

The Company's investments in marketable debt securities are recognized based on the trade date. The marketable debt securities generally have a term of less than five years and are reported as "Short-term investments in marketable securities" or "Long-term investments" in the Consolidated Balance Sheets based on the maturity dates of the debt securities and the Company's expectations regarding the timing of sales and redemptions. Investments of a strategic nature that have been made for the purpose of affiliation or potential business advantage or in connection with a commercial relationship are included in "Long-term investments" in the Consolidated Balance Sheets. The cost of marketable debt securities sold is determined using a first-in and first-out method.

Equity Securities Equity securities are reported as "Long-term investments" in the Consolidated Balance Sheets and include marketable equity securities and equity investments without readily determinable fair values.

For periods beginning after December 31, 2017, marketable equity securities are reported at estimated fair value with changes in fair value recognized in "Net unrealized gains (losses) on marketable equity securities" in the Consolidated Statements of Operations rather than "Accumulated other comprehensive loss" in the Consolidated Balance Sheets, pursuant to the adoption of the accounting update on financial instruments in 2018.

73 The Company holds investments in equity securities of private companies, over which the Company does not have the ability to exercise significant influence or control. Pursuant to the adoption of the accounting update on financial instruments in 2018, for periods beginning after December 31, 2017, the Company elected to measure these investments at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. Previously, these investments were carried at cost and adjusted to fair value only for other-than-temporary declines in fair value.

See Note 5 and 6 for further information related to investments.

Accounts Receivable from Customers and Allowance for Doubtful Accounts Receivables from customers are recorded at the original invoiced amounts net of an allowance for doubtful accounts. The allowance for doubtful accounts is estimated based on historical experience, aging of the receivable, credit quality of the customers, current economic trends and other factors that may affect the Company's ability to collect from customers. See Note 7 for additional information. See "Other Recent Accounting Pronouncements" later in this Note for the accounting change to the measurement of credit losses for accounts receivable, effective January 1, 2020.

Property and Equipment, Net Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets or, when applicable, the term of the lease related to leasehold improvements, whichever is shorter.

Building Construction-in-progress Building construction-in-progress is associated with the construction of Booking.com's future headquarters in the Netherlands and is included in "Property and equipment, net" in the Consolidated Balance Sheets. Depreciation of the building and its related components will commence once it is ready for the Company’s use.

Website and Internal-use Software Capitalization Certain direct development costs associated with website and internal-use software are capitalized and include external direct costs of services and payroll costs for employees devoting time to the software projects principally related to platform development, including support systems, software coding, designing system interfaces and installation and testing of the software. These costs are recorded as property and equipment and are generally amortized over a period of two to five years beginning when the asset is substantially ready for use. Costs incurred for enhancements that are expected to result in additional features or functionalities are capitalized and amortized over the estimated useful life of the enhancements. Costs incurred during the preliminary project stage, as well as maintenance and training costs, are expensed as incurred. Additions to capitalized costs during the years ended December 31, 2019, 2018 and 2017 were $106 million, $97 million and $80 million, respectively.

Cloud Computing Arrangements The Company utilizes various third-party computer systems and third-party service providers, including global distribution systems ("GDSs") serving the accommodation, rental car and airline industries. The Company uses both internally- developed systems and third-party systems to operate its services, including transaction processing, order management and financial and accounting systems. For periods beginning after December 31, 2018, implementation costs incurred in a hosting arrangement that is a service contract are capitalized and amortized over the term of the hosting arrangement (see "Recent Accounting Pronouncements Adopted" later in this Note). The capitalized implementation costs are reported as "Prepaid expenses and other current assets" or "Other assets" in the Company's Consolidated Balance Sheets as appropriate. The related amortization expenses are reported as "Information technology" in the Company's Consolidated Statements of Operations.

Leases On January 1, 2019, the Company adopted Accounting Standards Codification ("ASC") 842, Leases, using a modified retrospective method applied to all contracts as of January 1, 2019. Therefore, for reporting periods beginning after December 31, 2018, the financial statements are prepared in accordance with the current lease standard and the financial statements for all periods prior to January 1, 2019 are presented under the previous lease standard ("ASC 840"). See "Recent Accounting Pronouncements Adopted" later in this Note for further information related to the impact of the adoption of this accounting standard.

74 The Company determines if an arrangement is a lease, or contains a lease, when a contract is signed. The Company determines if a lease is an operating or finance lease and records a lease asset and a lease liability upon lease commencement, which is the date when the underlying asset is made available for use by the lessor. The Company has operating leases for office space, data centers and land for Booking.com's future headquarters. For office space, data centers and land, the Company has elected to combine the fixed payments to lease the asset and any fixed non-lease payments (such as maintenance or utility charges) when determining its lease payments. The Company uses its incremental borrowing rate as its discount rate to determine the present value of its remaining lease payments to calculate its lease assets and lease liabilities because the rate implicit in the lease is not readily determinable. The incremental borrowing rates approximate the rate the Company would pay to borrow in the currency of the lease payments on a collateralized basis for the weighted-average life of the lease. Operating lease assets also include any prepaid lease payments and lease incentives received prior to lease commencement. The Company recognizes lease expense on a straight-line basis over the lease term. Certain of the Company's lease agreements include rent payments which are adjusted periodically for inflation. Any change in payments due to changes in inflation rates are recognized as variable lease expense as they are incurred. Variable lease expense also includes costs for property taxes, insurance and services provided by the lessor which are charged based on usage or performance (such as maintenance or utility charges). Most leases have one or more options to renew, with renewal terms that can initially extend the lease term for various periods up to 9 years. The exercise of renewal options for office space and data centers is at the Company’s discretion and are included if they are reasonably certain to be exercised. The land lease for Booking.com's future headquarters has an initial term which expires in 2065, at which time the lease payments will be adjusted based on the value of the land on the reassessment date. The Company considered the initial term of the land lease to be its expected period of use. At December 31, 2018, the Company had $47 million land-use rights related to payment in 2016 for the land lease for Booking.com's future headquarters as described above. The land-use rights were included in "Other assets" in the Consolidated Balance Sheets, for periods prior to January 1, 2019, and reclassified from "Other assets" to "Operating lease assets" on January 1, 2019 as part of the adoption of ASC 842, Leases (see "Recent Accounting Pronouncements Adopted" later in this Note). The land-use rights are amortized on a straight-line basis over its expected period of use. This expense is recorded as lease expense in "General and administrative" expense in the Consolidated Statements of Operations. See Note 10 and 16 for further information.

Goodwill The Company accounts for acquired businesses using the acquisition method of accounting which requires that the assets acquired and liabilities assumed be recorded at the date of acquisition at their respective fair values. Any excess of the purchase price over the estimated fair values of the net assets acquired is recorded as goodwill. The Company's Consolidated Financial Statements reflect an acquired business starting at the date of the acquisition.

Goodwill is not subject to amortization and is tested at least annually for impairment, or earlier if an event occurs or circumstances change and there is an indication of impairment. The Company tests goodwill at a reporting unit level. The fair value of the reporting unit is compared to its carrying value, including goodwill. Fair values are determined using a combination of standard valuation techniques, including an income approach (discounted cash flows) and market approaches (EBITDA multiples of comparable publicly-traded companies and precedent transactions) and based on market participant assumptions. An impairment is recorded to the extent that the implied fair value of goodwill is less than the carrying value of goodwill. See Note 11 for further information. See "Other Recent Accounting Pronouncements" later in this Note for the new accounting standard that the Company adopted in the first quarter of 2020.

Impairment of Long-Lived Assets The Company reviews long-lived assets whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. The assessment of possible impairment is based upon the Company's ability to recover the carrying value of the assets from the estimated undiscounted future net cash flows, before interest and taxes, of the related asset group. The amount of impairment loss, if any, is measured as the excess of the carrying value of the asset over the present value of estimated future cash flows, using a discount rate commensurate with the risks involved and based on assumptions representative of market participants.

75 Foreign Currency Translation The functional currency of the Company's subsidiaries is generally the respective local currency. For international operations, assets and liabilities are translated into U.S. Dollars at the rate of exchange existing at the balance sheet date. Income statement amounts are translated at monthly average exchange rates applicable for the period. Translation gains and losses are included as a component of "Accumulated other comprehensive loss" in the Company's Consolidated Balance Sheets. Foreign currency transaction gains and losses are included in "Foreign currency transactions and other" in the Company's Consolidated Statements of Operations.

Derivative Financial Instruments As a result of the Company's international operations, it is exposed to various market risks that may affect its consolidated results of operations, cash flows and financial position. These market risks include, but are not limited to, fluctuations in foreign currency exchange rates. The Company's primary foreign currency exposures are in Euros and British Pounds Sterling, in which it conducts a significant portion of its business activities. As a result, the Company faces exposure to adverse movements in foreign currency exchange rates as the financial results of its international operations are translated from local currencies into U.S. Dollars upon consolidation. Additionally, foreign currency exchange rate fluctuations on transactions denominated in currencies other than the functional currency of an entity result in gains and losses that are reflected in net income.

The Company may enter into derivative instruments to hedge certain net exposures of nonfunctional currency denominated assets and liabilities and the volatility associated with translating earnings for its international operations into U.S. Dollars, even though it does not elect to apply hedge accounting or hedge accounting does not apply. These contracts are generally short-term in duration. Certain of the Company's derivative instruments have master netting arrangements, which reduce credit risk by permitting net settlement of transactions with the same counterparty. The Company reports the fair value of its derivative assets and liabilities on a gross basis in the Consolidated Balance Sheets in "Prepaid expenses and other current assets" and "Accrued expenses and other current liabilities," respectively. Unless designated as hedges for accounting purposes, gains and losses resulting from changes in the fair value of derivative instruments are recognized in "Foreign currency transactions and other" in the Consolidated Statements of Operations in the period that the changes occur and are classified within "Net cash provided by operating activities" in the Consolidated Statements of Cash Flows. See Note 6 for further information related to these derivative instruments.

The Company, from time to time in the past, has utilized derivative instruments to hedge the impact of changes in foreign currency exchange rates on the net assets of its foreign subsidiaries. These derivative instruments were designated as net investment hedges. Hedge ineffectiveness was assessed and measured based on changes in forward exchange rates. The Company recorded gains and losses on these derivative instruments as foreign currency translation adjustments, which offset a portion of the foreign currency translation adjustments related to the foreign subsidiaries' net assets. Gains and losses on these derivative instruments were recognized in the Consolidated Balance Sheets in "Accumulated other comprehensive loss" and will be realized upon a partial sale or liquidation of the investment.

The Company is exposed to the risk that counterparties to derivative instruments may fail to meet their contractual obligations. The Company regularly reviews its credit exposure and assesses the creditworthiness of its counterparties.

Non-derivative Instrument Designated as Net Investment Hedge Historically, the aggregate principal value of the Euro-denominated Senior Notes maturing in March 2022, November 2022, September 2024 and March 2027 (collectively "Euro-denominated debt") and accrued interest had been designated as a hedge of the Company's net investment in a Euro functional currency subsidiary. Beginning in the second quarter of 2019, the Company has only designated certain portions of the aggregate principal value of the Euro-denominated debt as a hedge. The foreign currency transaction gains or losses on these Euro-denominated liabilities are measured based upon changes in spot rates. The foreign currency transaction gains or losses on the Euro-denominated debt that is designated as a hedging instrument for accounting purposes are recorded in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The net assets of this Euro functional currency subsidiary are translated into U.S. Dollars at each balance sheet date, with the effects of foreign currency changes also reported in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument are recognized in "Foreign currency transactions and other" in the Consolidated Statement of Operations. See Notes 12 and 14 for further information related to the net investment hedge.

76 Revenue Recognition Online travel reservation services On January 1, 2018, the Company adopted ASC 606, Revenue from Contracts with Customers, using a modified retrospective method applied to all contracts as of January 1, 2018. Therefore, for reporting periods beginning after December 31, 2017, the financial statements are prepared in accordance with the current revenue recognition standard and the financial statements for all periods prior to January 1, 2018 are presented under the previous revenue recognition accounting standard. The Company recorded a net increase to its retained earnings of $189 million, net of tax, as of January 1, 2018, due to the cumulative impact of adopting the current revenue recognition standard, with substantially all of the impact related to the Company’s travel reservation services.

For periods beginning after December 31, 2017, the Company recognizes revenue for travel reservation services when the travel begins rather than when the travel is completed. Substantially all of the Company's revenues are generated by providing online travel reservation services, which principally allows travelers to book travel reservations with travel service providers through the Company’s platforms. While the Company generally refers to a consumer that books travel reservation services on the Company's platforms as its customer, for accounting purposes, the Company's customers are the travel service providers and, in certain merchant transactions, the travelers. The Company's contracts with travel service providers give them the ability to market their reservation availability without transferring responsibility to deliver the travel service to the Company. Therefore, the Company's revenues are presented on a net basis in the Consolidated Statements of Operations. These contracts include payment terms and establish the consideration to which the Company is entitled, which includes either a commission or a margin on the travel transaction. Revenue is measured based on the expected consideration specified in the contract with the travel service provider, considering the effects of sales incentives, "no show" cancellations (where the traveler has not cancelled the reservation but does not arrive on the scheduled reservation date) and "late" cancellations (where the travel service provider accepts a cancellation after its cancellation cut-off date). Estimates for cancellations and sales incentives are based on historical experience and current trends. Coupons are recorded as a reduction of the transaction price at the time they are redeemed. The local occupancy taxes, general excise taxes, value-added taxes, sales taxes and other similar taxes ("travel transaction taxes"), if any, collected from travelers are reported on a net basis in revenues in the Consolidated Statements of Operations.

Revenues for online travel reservation services are recognized at a point in time when the Company has completed its post-booking services and the travelers begin using the arranged travel services. These services are classified into two categories:

• Agency revenues are derived from travel-related transactions where the Company does not facilitate payments from travelers for the services provided. The Company invoices the travel service providers for its commissions in the month that travel is completed. Agency revenues consist almost entirely of travel reservation commissions. Substantially all of the Company's agency revenue is from Booking.com agency accommodation reservations.

• Merchant revenues are derived from travel-related transactions where the Company facilitates payments from travelers for the services provided, generally at the time of booking. The Company records cash collected from travelers, which includes the amounts owed to the travel service providers and the Company’s commission or margin and fees, as deferred merchant bookings until the arranged travel service begins. Merchant revenues include travel reservation commissions and transaction net revenues (i.e., the amount charged to travelers less the amount owed to travel service providers) in connection with the Company's merchant reservations services; credit card processing rebates and customer processing fees; and ancillary fees, including travel-related insurance revenues and certain GDS reservation booking fees. Substantially all merchant revenues are derived from transactions where travelers book accommodation reservations or rental car reservations.

Under the previous revenue recognition standard, revenues from priceline's Name Your Own Price® transactions were presented on a gross basis with the amount remitted to the travel service providers reported as cost of revenues. Under the current revenue recognition standard, Name Your Own Price® revenues are reported on a net basis with the amount remitted to the travel service providers recorded as an offset in merchant revenues. Therefore, for periods beginning after December 31, 2017, the Company no longer presents "Cost of revenues" or "Gross profit" in its Consolidated Statements of Operations. Total revenues reported in 2019 and 2018 are comparable to gross profit reported in previous years.

77 Advertising and Other Revenues Advertising and other revenues are primarily recognized by KAYAK and OpenTable. KAYAK recognizes advertising revenue primarily by sending referrals to online travel companies ("OTCs") and travel service providers and from advertising placements on its platforms. Revenue related to referrals is recognized when a consumer clicks on a referral placement or upon completion of the travel. Revenue for advertising placements is recognized based upon when a consumer clicks on an advertisement or when KAYAK displays an advertisement. OpenTable recognizes revenues for reservation fees when diners are seated through its online restaurant reservation service and revenues for subscription fees for restaurant management services on a straight-line basis over the contractual period in accordance with how the service is provided.

Accrued Liabilities for Loyalty and Other Incentive Programs — See Note 3.

Deferred Revenue — See Note 3.

Advertising Expenses The Company's advertising expenses are reported in and presented as "Performance marketing" and "Brand marketing" expenses in the Consolidated Statements of Operations. Included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets are accrued performance advertising liabilities of $333 million and $313 million at December 31, 2019 and 2018, respectively.

Performance Marketing Performance marketing expenses are expenses generally measured by return on investment or an increase in bookings over a specified time period. These expenses consist primarily of the costs of: (1) search engine keyword purchases; (2) referrals from meta-search and travel research websites; (3) affiliate programs; and (4) other performance-based marketing and incentives. Performance marketing expenses are recognized as incurred.

Brand Marketing Brand marketing expenses are expenses incurred to build brand awareness over a specified time period. These expenses consist primarily of television advertising and online video and display advertising (including the airing of the Company's television advertising online), as well as other marketing expenses such as public relations and sponsorships. Brand marketing expenses are generally recognized as incurred with the exception of advertising production costs, which are deferred and expensed the first time the advertisement is displayed or broadcast.

Sales and Other Expenses Sales and other expenses are generally variable in nature and consist primarily of: (1) credit cards and other payment processing fees associated with merchant transactions; (2) fees paid to third parties that provide call center, website content translations and other services; (3) customer chargeback provisions and fraud prevention expenses associated with merchant transactions; (4) customer relations costs; (5) provisions for bad debt, primarily related to agency accommodation commission receivables; and (6) insurance claim costs for the Company's travel-related insurance business.

Personnel Personnel expenses consist of compensation to the Company's personnel, including salaries, stock-based compensation, bonuses, payroll taxes and employee health and other benefits. Included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets are accrued compensation liabilities of $344 million and $348 million at December 31, 2019 and 2018, respectively.

Stock-Based Compensation Stock-based compensation expense related to performance share units, restricted stock units and stock options is recognized based on fair value on a straight-line basis over the respective requisite service periods and forfeitures are accounted for when they occur. The fair value on the grant date of performance share units and restricted stock units is determined based on the number of units granted and the quoted price of the Company's common stock. The Company records stock-based compensation expense for performance-based awards using its estimate of the probable outcome at the end of the performance period (i.e., the estimated performance against the performance targets). The Company periodically adjusts the cumulative stock-based compensation expense recorded when the probable outcome for these performance-based awards is updated based upon changes in actual and forecasted operating results. The fair value of employee stock options assumed in acquisitions was

78 determined using the Black-Scholes model and the market value of the Company's common stock at the respective acquisition dates.

The benefits of tax deductions in excess of recognized compensation costs are recognized in the income statement as a discrete item when an option exercise or a vesting and release of shares occurs. Excess tax benefits are presented as operating cash flows and cash payments for employee statutory tax withholding related to vested stock awards are presented as financing cash flows in the Consolidated Statements of Cash Flows. See Note 4 for further information related to stock-based awards.

Information Technology Information technology expenses consist primarily of: (1) software license and system maintenance fees; (2) outsourced data center and cloud computing costs; (3) payments to contractors; and (4) data communications and other expenses associated with operating the Company's services.

Income Taxes The Company accounts for income taxes under the asset and liability method. The Company records the estimated future tax effects of temporary differences between the tax bases of assets and liabilities and amounts reported in the Consolidated Balance Sheets, as well as operating loss and tax credit carryforwards. Deferred taxes are classified as noncurrent in the balance sheet.

The Company records deferred tax assets to the extent it believes these assets will more likely than not be realized. The Company regularly reviews its deferred tax assets for recoverability considering historical profitability, projected future taxable income, the expected timing of the reversals of existing temporary differences, the carryforward periods available for tax reporting purposes, and tax planning strategies. A valuation allowance is provided when it is more likely than not that some portion or all of a deferred tax asset will not be realized. The ultimate realization of deferred tax assets depends on the generation of future taxable income during the period in which related temporary differences become deductible. In determining the future tax consequences of events that have been recognized in the financial statements or tax returns, significant judgments, estimates, and interpretation of statutes are required.

Deferred taxes are measured using the enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date of such change.

The Company recognizes liabilities when it believes that uncertain positions may not be fully sustained upon audit by the tax authorities. Liabilities recognized for uncertain tax positions are based on a two-step approach for recognition and measurement. First, the Company evaluates the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit based on its technical merits. Second, the Company measures the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. Interest and penalties attributable to uncertain tax positions, if any, are recognized as a component of income tax expense.

In 2018, the Company adopted an accounting policy to treat taxes on global intangible low-taxed income ("GILTI") introduced by the U.S. Tax Cuts and Jobs Act (the "Tax Act") as period costs. See Note 15 for further details related to income taxes.

Segment Reporting The Company historically determined that its primary brands constituted its operating segments. In 2019, reflecting changes to the management structure, the Company reorganized its operating segments from six to four operating segments by combining Booking.com with Rentalcars.com and KAYAK with OpenTable. The Company's Booking.com and Rentalcars.com operating segment represents a substantial majority of total revenues and operating income. The Company's operating segments continue to be aggregated into one reportable segment based on the similarity in economic characteristics, other qualitative factors and the objectives and principles of ASC 280, Segment Reporting. For geographic information, see Note 18.

79 Recent Accounting Pronouncements Adopted

Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract

In August 2018, the Financial Accounting Standards Board ("FASB") issued a new accounting standard to address a customer's accounting for implementation costs incurred in a cloud computing arrangement that is a service contract and also added certain disclosure requirements related to implementation costs incurred for internal-use software and cloud computing arrangements. The amendment aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software (and hosting arrangements that include an internal-use software license). The Company adopted this standard on January 1, 2019 and applied it on a prospective basis. The adoption did not have a material impact to the Consolidated Financial Statements.

Leases

In February 2016, the FASB issued a new accounting standard that requires lessees to recognize an asset and a liability in the balance sheet for the rights and obligations created by entering into lease transactions. The new standard retains the dual- model concept by requiring entities to determine if a lease is an operating or finance lease. The new standard also expands qualitative and quantitative disclosures for lessees.

The Company adopted this new standard on January 1, 2019 on a modified retrospective basis and has elected not to restate comparative periods. The Company elected other options, which allow the Company to use its previous evaluations regarding if an arrangement contains a lease, if a lease is an operating or finance lease and what costs are capitalized as initial direct costs prior to adoption. The Company also elected to combine lease and non-lease components.

Upon the adoption of the new lease standard, on January 1, 2019, the Company recognized operating lease assets of $646 million and total operating lease liabilities of $646 million (including a current liability of $152 million) in the consolidated balance sheet and reclassified certain balances related to existing leases. There was no impact to retained earnings at adoption. See Note 10 for more information related to leases.

Other Recent Accounting Pronouncements

Simplifying the Accounting for Income Taxes

In December 2019, the FASB issued a new accounting update relating to income taxes. This update provides an exception to the general methodology for calculating income taxes in an interim period when a year-to-date loss exceeds the anticipated loss for the year. This update also (1) requires an entity to recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based tax, (2) requires an entity to evaluate when a step-up in the tax basis of goodwill should be considered part of the business combination in which goodwill was originally recognized for accounting purposes and when it should be considered a separate transaction, and (3) requires that an entity reflect the effect of an enacted change in tax laws or rates in the annual effective tax rate computation in the interim period that includes the enactment date.

For public business entities, this update is effective for fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. Early adoption is permitted. The amendment related to franchise taxes that are partially based on income should be applied on either a retrospective basis for all periods presented or a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. All other amendments should be applied on a prospective basis. The Company is currently evaluating the impact to its Consolidated Financial Statements of adopting this update and does not expect it to have a material impact.

Simplifying the Test for Goodwill Impairment

In January 2017, the FASB issued a new accounting update to simplify the test for goodwill impairment. The revised guidance eliminates the previously required step two of the goodwill impairment test, which required a hypothetical purchase price allocation to measure goodwill impairment. Under the revised guidance, a goodwill impairment loss will be measured at the amount by which a reporting unit’s carrying amount exceeds its fair value, not to exceed the carrying amount of goodwill. The Company adopted this update in the first quarter of 2020 and will apply it on a prospective basis.

80 Measurement of Credit Losses on Financial Instruments

In June 2016, the FASB issued a new accounting update on the measurement of credit losses for certain financial assets measured at amortized cost and available-for-sale debt securities. For financial assets measured at amortized cost, this update requires an entity to (1) estimate its lifetime expected credit losses upon recognition of the financial assets and establish an allowance to present the net amount expected to be collected, (2) recognize this allowance and changes in the allowance during subsequent periods through net income and (3) consider relevant information about past events, current conditions and reasonable and supportable forecasts in assessing the lifetime expected credit losses. For available-for-sale debt securities, this update made several targeted amendments to the existing other-than-temporary impairment model, including (1) requiring disclosure of the allowance for credit losses, (2) allowing reversals of the previously recognized credit losses until the entity has the intent to sell, is more-likely-than-not required to sell the securities or the maturity of the securities, (3) limiting impairment to the difference between the amortized cost basis and fair value and (4) not allowing entities to consider the length of time that fair value has been less than amortized cost as a factor in evaluating whether a credit loss exists. The Company adopted this update in the first quarter of 2020 and applied this update on a modified retrospective basis. The adoption did not have a material impact to the Company's Consolidated Financial Statements.

3. REVENUE

See Note 2 for the Company's accounting policy related to revenue recognition.

Disaggregation of Revenue

Revenue by Geographic Area (see Note 18)

Revenue by Type of Service

Approximately 87% of the Company's revenues for each of the years ended December 31, 2019 and 2018 relates to online accommodation reservation services. Revenue from all other sources of online travel reservation services and advertising and other revenues each individually represent less than 10% of the Company's total revenues for each year. For the year ended December 31, 2017 and prior years, revenues were recognized and presented under the previous revenue recognition accounting standard (see Note 2).

Deferred Revenue

Cash payments received from travelers in advance of the Company completing its service obligations are included in "Deferred merchant bookings" in the Company's Consolidated Balance Sheets and are comprised principally of amounts estimated to be payable to the travel service providers as well as the Company's deferred revenue for its commission or margin and fees. The Company expects to complete its service obligation within one year from the reservation date.

The following table summarizes the activity of deferred revenue for the years ended December 31, 2019 and 2018: Year Ended December 31,

2019 2018 Balance, beginning of year $ 149 $ 151 Revenues recognized from the beginning balance (134) (109) Cancellations (15) (10) One-time adjustment to retained earnings at adoption of ASC 606 — (32) Payments received from travelers net of amounts estimated to be payable to travel service providers and other 220 149 Balance, end of year $ 220 $ 149

Loyalty and Other Incentive Programs

The Company provides loyalty programs where participating consumers are awarded loyalty points on current transactions that can be redeemed in the future. At December 31, 2019 and 2018, liabilities for loyalty program incentives of $80 million and $73 million, respectively, were included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets. The Company’s largest loyalty program is at OpenTable, where points can be redeemed for rewards such as 81 qualifying reservations at participating restaurants, third-party gift cards and accommodation reservations booked through some of the Company’s other platforms. The estimated fair value of the loyalty points that are expected to be redeemed is recognized as a reduction of revenue at the time the incentives are granted. In the first quarter of 2018, OpenTable introduced a three-year time-based expiration for points earned by diners, which reduced its loyalty program liability by $27 million, with a corresponding increase to revenue.

In addition to the loyalty programs, at December 31, 2019 and 2018, liabilities of $22 million and $61 million, respectively, for other incentive programs, such as referral bonuses, credits and discounts, were included in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheets. In the third quarter of 2019, the Company recorded a decrease of $37 million to the liability for loyalty and other incentive programs, based on changes to estimates of the amounts expected to be redeemed, with a corresponding increase to revenue.

4. STOCK-BASED COMPENSATION

The Company's 1999 Omnibus Plan, as amended and restated effective June 7, 2018, (the "1999 Plan") is the primary stock compensation plan from which broad-based employee, non-employee director and consultant equity awards may be made. At December 31, 2019, there were 1,833,091 shares of common stock available for future grant under the 1999 Plan. In addition, under plans assumed in connection with various acquisitions, there were 72,006 shares of common stock available for future grant at December 31, 2019.

Stock-based compensation issued under the plans generally consists of restricted stock units, performance share units and, to a far lesser extent and only in the context of assuming grants in connection with acquisitions, stock options. The Company issues shares of common stock upon the vesting of restricted stock units and performance share units and the exercise of stock options. See Note 2 for the Company's accounting policy on stock-based compensation.

Stock-based compensation included in "Personnel" expenses in the Consolidated Statements of Operations was $308 million, $317 million and $261 million for the years ended December 31, 2019, 2018 and 2017, respectively. Stock-based compensation for the years ended December 31, 2019, 2018 and 2017 includes a benefit of $4 million and charges of $48 million and $11 million, respectively, representing the impact of adjusting the estimated probable outcome at the end of the performance period for outstanding unvested performance share units. The related tax benefit for stock-based compensation was $38 million, $36 million and $46 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Share-based awards granted by the Company during the years ended December 31, 2019, 2018 and 2017 had aggregate grant-date fair values of $380 million, $337 million and $304 million, respectively. Restricted stock units and performance share units that vested during the years ended December 31, 2019, 2018, and 2017 had aggregate fair values at vesting of $373 million, $415 million and $251 million, respectively. At December 31, 2019, there was $0 million of total future compensation cost related to unvested share-based awards to be recognized over a weighted-average period of 1.8 years.

82 Restricted Stock Units

The following table summarizes the activity of restricted stock units for employees and non-employee directors during the years ended December 31, 2017, 2018 and 2019:

Weighted-Average Grant Restricted Stock Units Shares Date Fair Value

Unvested at December 31, 2016 195,059 $ 1,300

Granted 100,614 $ 1,745 Vested (67,041) $ 1,302 Forfeited/Canceled (24,671) $ 1,430 Unvested at December 31, 2017 203,961 $ 1,503

Granted 116,583 $ 2,025 Vested (69,693) $ 1,389 Forfeited/Canceled (25,868) $ 1,731 Unvested at December 31, 2018 224,983 $ 1,783

Granted 157,205 $ 1,739 Vested (95,484) $ 1,653 Forfeited/Canceled (29,959) $ 1,812 Unvested at December 31, 2019 256,745 $ 1,801

The Company makes broad-based grants of restricted stock units that generally vest during a period of one- to three- years, subject to certain exceptions for terminations other than for "cause," for "good reason" or on account of death or disability.

Performance Share Units

The following table summarizes the activity of performance share units for employees during the years ended December 31, 2017, 2018 and 2019:

Weighted-Average Grant Performance Share Units Shares Date Fair Value

Unvested at December 31, 2016 320,547 $ 1,288

Granted 73,893 $ 1,735 Vested (76,730) $ 1,328 Performance Shares Adjustment 19,357 $ 1,501 Forfeited/Canceled (16,332) $ 1,395 Unvested at December 31, 2017 320,735 $ 1,386

Granted 49,721 $ 2,034 Vested (134,549) $ 1,250 Performance Shares Adjustment 66,245 $ 1,872 Forfeited/Canceled (15,573) $ 1,685 Unvested at December 31, 2018 286,579 $ 1,659

Granted 61,912 $ 1,716 Vested (118,668) $ 1,346 Performance Shares Adjustment (683) $ 1,729 Forfeited/Canceled (13,057) $ 1,769 Unvested at December 31, 2019 216,083 $ 1,835

83 The Company grants performance share units to executives and certain other employees, which generally vest at the end of a three-year period, subject to certain exceptions for terminations other than for "cause," for "good reason" or on account of death or disability. Stock-based compensation related to performance share units reflects the estimated probable outcome at the end of the performance period. Performance share units are payable in shares of the Company's common stock upon vesting. The number of shares which ultimately will vest depends on achieving certain performance metrics by the end of the performance period, assuming there is no accelerated vesting for, among other things, a termination of employment under certain circumstances.

The following table summarizes the estimated vesting of performance share units granted in 2019, 2018 and 2017, net of forfeiture and vesting since the respective grant dates, at December 31, 2019: Performance Share Units, by grant year 2019 2018 2017 Shares probable to be issued 60,588 76,560 78,935 Shares not subject to the achievement of minimum performance thresholds 47,170 29,753 N/A* Shares that could be issued if maximum performance thresholds are met 121,176 82,126 N/A*

* The performance period for the performance share units granted in 2017 ended on December 31, 2019.

Stock Options

All outstanding employee stock options were assumed in acquisitions, and generally have a term of 10 years from the grant date. At December 31, 2019, all stock options were vested and exercisable. The aggregate intrinsic value of employee stock options exercised during the years ended December 31, 2019, 2018 and 2017 was $20 million, $5 million and $26 million, respectively.

The following table summarizes the activity for stock options during the year ended December 31, 2019:

Weighted- Average Weighted- Aggregate Remaining Number Average Intrinsic Value Contractual Employee Stock Options of Shares Exercise Price (in millions) Term (in years) Balance, December 31, 2018 27,263 $ 387 $ 36 2.8 Exercised (12,141) $ 266 Balance, December 31, 2019 15,122 $ 484 $ 24 2.6 Vested and exercisable at December 31, 2019 15,122 $ 484 $ 24 2.6

84 5. INVESTMENTS

See Note 2 for the Company's accounting policy related to its investments.

The following table summarizes, by major security type, the Company's investments at December 31, 2019 (in millions): Gross Gross Unrealized Unrealized Carrying prv Cost Gains Losses Value Short-term investments in marketable securities: Debt securities: International government securities $ 109 $ — $ — $ 109 U.S. government securities 138 — — 138 Corporate debt securities 751 1 (1) 751 Total $ 998 $ 1 $ (1) $ 998

Long-term investments: Investments in marketable securities: Debt securities: International government securities $ 68 $ — $ — $ 68 U.S. government securities 136 — (1) 135 Corporate debt securities 963 2 (2) 963 Trip.com Group convertible debt securities 775 — (8) 767 Equity securities 1,117 684 (8) 1,793 Investments in private companies: Debt securities 250 — — 250 Equity securities 501 ——501 Total $ 3,810 $ 686 $ (19) $ 4,477

85 The following table summarizes, by major security type, the Company's investments at December 31, 2018 (in millions):

Gross Gross Unrealized Unrealized Carrying Cost Value Gains Losses Short-term investments in marketable securities: Debt securities: International government securities $ 314 $ — $ — $ 314 U.S. government securities 658 — (2) 656 Corporate debt securities 2,693 — (12) 2,681 U.S. government agency securities 1 — — 1 Commercial paper 7 — — 7 Time deposits and certificates of deposit 1—— 1 Total $ 3,674 $ — $ (14) $ 3,660

Long-term investments: Investments in marketable securities: Debt securities: International government securities $ 797 $ 3 $ — $ 800 U.S. government securities 299 — (6) 293 Corporate debt securities 4,445 4 (48) 4,401 Trip.com Group convertible debt securities 1,275 — (98) 1,177 Equity securities 1,105 3 (72) 1,036 Investments in private companies: Debt securities 200 — — 200 Equity securities 501 — — 501 Total $ 8,622 $ 10 $ (224) $ 8,408

Investments in Marketable Securities

Investments in Marketable Debt Securities

Investments in marketable debt securities are reported at estimated fair value with the aggregate unrealized gains and losses, net of tax, reflected in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The Company's investment policy seeks to preserve capital and maintain sufficient liquidity to meet operational and other needs of the business. At December 31, 2019, the weighted-average life of the Company’s investments in marketable debt securities, excluding its investment in Trip.com Group convertible debt securities, was approximately 1.1 years with an average credit quality of A+/ A1/A+.

The Company invests in international government securities with high credit quality. At December 31, 2019, investments in international government securities principally included debt securities issued by the governments of the Netherlands, Germany, France, Finland and Belgium. At December 31, 2019, the Company does not consider any of its investments in marketable debt securities to be other-than-temporarily impaired.

Investments in Trip.com Group

At December 31, 2019, the Company had $775 million invested in convertible senior notes issued at par value by Trip.com Group with maturity dates ranging from May 2020 to December 2025. The strategic investments in Trip.com Group, including $250 million of convertible notes due May 2020, were classified as "Long-term investments" in the Consolidated Balance Sheet at December 31, 2019. In August 2019, the Company's August 2014 investment of $500 million in Trip.com Group's convertible notes was repaid on maturity. The Trip.com Group convertible notes have been marked-to-market in accordance with the accounting guidance for available-for-sale securities, with the aggregate unrealized gains and losses, net of tax, reflected in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The Company has also invested

86 $655 million in Trip.com Group American Depositary Shares ("ADSs"), which had a fair value of $726 million and $585 million at December 31, 2019 and December 31, 2018, respectively. "Net unrealized gains (losses) on marketable equity securities" in the Consolidated Statements of Operations includes a net unrealized gain of $141 million and a net unrealized loss of $368 million for the years ended December 31, 2019 and 2018, respectively, related to Trip.com Group ADSs.

Certain Trip.com Group convertible notes include a put option allowing the Company, at its option, to require prepayment in cash from Trip.com Group at certain points of time. The Company determined that the economic characteristics and risks of the put options are clearly and closely related to the notes, and therefore did not meet the requirement for separate accounting as embedded derivatives. The Company monitors the conversion features of these notes to determine whether they meet the definition of an embedded derivative during each reporting period. The conversion feature associated with the $25 million convertible notes issued in 2016 meets the definition of an embedded derivative that requires separate accounting. The embedded derivative is bifurcated for fair value measurement purposes only and is reported in the Consolidated Balance Sheets with its host contract in "Long-term investments." The mark-to-market adjustments of the embedded derivative are included in "Foreign currency transactions and other" in the Company's Consolidated Statements of Operations.

Investment in Meituan Dianping

In 2017, the Company invested $450 million in preferred shares of Meituan Dianping, the leading e-commerce platform for local services in China. The investment has been classified as a marketable equity security since Meituan Dianping's initial public offering in 2018. The investment had a fair value of $1.1 billion and $451 million at December 31, 2019 and 2018, respectively. "Net unrealized gains (losses) on marketable equity securities" in the Consolidated Statements of Operations includes unrealized gains of $602 million and $1 million for the years ended December 31, 2019 and 2018, respectively, related to this investment.

Investments in Private Companies

Equity Securities without Readily Determinable Fair Value

The Company held investments in equity securities of private companies of $501 million at both December 31, 2019 and 2018, principally related to the Company's investment of $500 million in 2018 in preferred shares of Didi Chuxing, the leading mobile transportation and ride-hailing platform in China. These investments are measured at cost less impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer and are included in "Long-term investments" in the Company's Consolidated Balance Sheets. The Company determined that no adjustments were required to the carrying value of these investments at December 31, 2019.

Debt Securities

The Company held investments in preferred shares of private companies of $250 million and $200 million at December 31, 2019 and 2018, respectively. These investments are classified as debt securities for accounting purposes and categorized as available-for-sale. The preferred shares are convertible to ordinary shares at the Company’s option and are mandatorily convertible upon an initial public offering. The preferred shares also contain a redemption feature that can be exercised by the Company after certain points of time. These features have been evaluated as embedded derivatives, however, they do not meet the requirements to be accounted for separately. The investments are reported at estimated fair value in "Long-term investments" in the Company's Consolidated Balance Sheets, with the aggregate unrealized gains and losses, net of tax, reflected in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets.

87 6. FAIR VALUE MEASUREMENTS

Financial assets and liabilities carried at fair value at December 31, 2019 are classified in the categories described in the tables below (in millions): Level 1 Level 2 Level 3 Total ASSETS: Cash equivalents and restricted cash equivalents: Money market funds $ 5,734 $ — $ — $ 5,734 Corporate debt securities — 2 — 2 Time deposits and certificates of deposit 29 — — 29 Short-term investments in marketable securities: International government securities — 109 — 109 U.S. government securities — 138 — 138 Corporate debt securities — 751 — 751 Long-term investments: Investments in marketable securities: International government securities — 68 — 68 U.S. government securities — 135 — 135 Corporate debt securities — 963 — 963 Trip.com Group convertible debt securities — 767 — 767 Equity securities 1,793 — — 1,793 Investments in private companies: Debt securities — — 250 250 Derivatives: Foreign currency exchange derivatives — 12 — 12 Total assets at fair value $ 7,556 $ 2,945 $ 250 $ 10,751

LIABILITIES Foreign currency exchange derivatives $ — $ 5 $ — $ 5

88 Financial assets carried at fair value at December 31, 2018 are classified in the categories described in the tables below (in millions):

Level 1 Level 2 Level 3 Total

ASSETS: Cash equivalents and restricted cash equivalents: Money market funds $ 2,061 $ — $ — $ 2,061 International government securities — 21 — 21 U.S. government securities — 1 — 1 Commercial paper — 2 — 2 Time deposits and certificates of deposit 25——25 Short-term investments in marketable securities: International government securities — 314 — 314 U.S. government securities — 656 — 656 Corporate debt securities — 2,681 — 2,681 U.S. government agency securities — 1 — 1 Commercial paper — 7 — 7 Time deposits and certificates of deposit 1 —— 1 Long-term investments: Investments in marketable securities: International government securities — 800 — 800 U.S. government securities — 293 — 293 Corporate debt securities — 4,401 — 4,401 Trip.com Group convertible debt securities — 1,177 — 1,177 Equity securities 1,036 — — 1,036 Investments in private companies: Debt securities — — 200 200 Derivatives: Foreign currency exchange derivatives — 4 — 4 Total assets at fair value $ 3,123 $ 10,358 $ 200 $ 13,681

The table above does not include contingent consideration related to a business acquisition (see Note 20).

There are three levels of inputs to measure fair value. The definition of each input is described below:

Level 1: Quoted prices in active markets that are accessible by the Company at the measurement date for identical assets and liabilities.

Level 2: Inputs that are observable, either directly or indirectly. Such prices may be based upon quoted prices for identical or comparable securities in active markets or inputs not quoted on active markets, but corroborated by market data.

Level 3: Unobservable inputs are used when little or no market data is available.

Investments in corporate debt securities, U.S. and international government securities, commercial paper, government agency securities and certain convertible debt securities are considered "Level 2" valuations because the Company has access to quoted prices, but does not have visibility into the volume and frequency of trading for all of these investments. For the Company's investments, a market approach is used for recurring fair value measurements and the valuation techniques use inputs that are observable, or can be corroborated by observable data, in an active marketplace. See Note 5 for information related to the carrying value of the Company's investments in marketable securities.

The investments in private companies that are accounted for as debt securities with an aggregate fair value of $250 million and $200 million at December 31, 2019 and 2018, respectively, were considered a "Level 3" valuation and measured

89 using management's estimates that incorporate current market participant expectations of future cash flows considered alongside recent financing transactions of the investees and other relevant information. See Note 5 for further information related to these investments.

The Company's derivative instruments are valued using pricing models. Pricing models take into account the contract terms as well as multiple inputs where applicable, such as interest rate yield curves, option volatility and foreign currency exchange rates. Derivatives are considered "Level 2" fair value measurements. The Company's derivative instruments are typically short-term in nature.

At December 31, 2019 and 2018, the Company's cash consisted of bank deposits. Other financial assets and liabilities, including restricted cash, accounts receivable, accounts payable, accrued expenses and deferred merchant bookings, are carried at cost which approximates their fair value because of the short-term nature of these items. See Note 12 for the estimated fair value of the Company's outstanding senior notes and Note 5 for information related to an embedded derivative associated with the $25 million Trip.com Group convertible notes issued in 2016.

Derivatives Not Designated as Hedging Instruments

In the normal course of business, the Company is exposed to the impact of foreign currency fluctuations. The Company mitigates these risks by following established risk management policies and procedures, including the use of derivatives. The Company enters into foreign currency derivative contracts to hedge translation risks from short-term foreign currency exchange rate fluctuations for the Euro, British Pound Sterling and certain other currencies versus the U.S. Dollar. The Company also enters into foreign currency forward contracts to hedge its exposure to the impact of movements in foreign currency exchange rates on its transactional balances denominated in currencies other than the functional currency. See Note 2 for the Company's accounting policy related to derivative financial instruments.

The table below provides fair value and notional amount of foreign currency exchange derivatives outstanding at December 31, 2019 and 2018 (in millions). The notional amount of a foreign currency forward contract is the contracted amount of foreign currency to be exchanged and is not recorded on the balance sheet. December 31, December 31,

2019 2018 Fair value of derivative assets $ 12 $ 4 Fair value of derivative liabilities 5 —

Notional amount: Foreign currency purchases 1,770 1,324 Foreign currency sales 901 921

The effect of foreign currency exchange derivatives recorded in "Foreign currency transactions and other" in the Consolidated Statements of Operations for the years ended December 31, 2019, 2018, and 2017 is as follows (in millions): For the Year Ended December 31, 2019 2018 2017 (Losses) gains on foreign currency exchange derivatives $ (19)$ (44)$ 43

90 7. ACCOUNTS RECEIVABLE, NET

Accounts receivable in the Consolidated Balance Sheets at December 31, 2019 and 2018 includes receivables from customers of $1.2 billion for each period and receivables from marketing affiliates of $110 million and $67 million, respectively. See Note 2 for the Company's accounting policy related to receivables from customers. The remaining balance principally relates to receivables from third-party payment processors.

The Company records a provision for uncollectible receivables from customers and marketing affiliates. See Note 2 for the Company's accounting policy related to allowance for doubtful accounts. Changes in allowance for doubtful accounts for receivables from customers and marketing affiliates consist of the following (in millions):

For the Year Ended December 31,

2019 2018 2017 Balance, beginning of year $ 51 $ 35 $ 21 Provision charged to expense 69 79 46 Write-offs and adjustments (70) (62) (35) Foreign currency translation adjustments (1) (1)3 Balance, end of year $ 49 $ 51 $ 35

8. NET INCOME PER SHARE

The Company computes basic net income per share by dividing net income applicable to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income per share is based upon the weighted-average number of common and common equivalent shares outstanding during the period.

Common equivalent shares related to stock options, restricted stock units and performance share units are calculated using the treasury stock method. Performance share units are included in the weighted-average common equivalent shares based on the number of shares that would be issued if the end of the reporting period were the end of the performance period, if the result would be dilutive.

The Company's convertible notes have net share settlement features requiring the Company upon conversion to settle the principal amount of the debt for cash and the conversion premium for cash or shares of the Company's common stock, at the Company's option. Under the treasury stock method, if the conversion prices for the convertible notes exceed the Company's average stock price for the period, the convertible notes generally have no impact on diluted net income per share. The convertible notes are included in the calculation of diluted net income per share if their inclusion is dilutive under the treasury stock method.

A reconciliation of the weighted-average number of shares outstanding used in calculating diluted earnings per share is as follows (in thousands):

For the Year Ended December 31,

2019 2018 2017 Weighted-average number of basic common shares outstanding 43,082 47,446 48,994 Weighted-average dilutive stock options, restricted stock units and performance share units 203 236 295 Assumed conversion of convertible senior notes 224 335 665 Weighted-average number of diluted common and common equivalent shares outstanding 43,509 48,017 49,954

91 9. PROPERTY AND EQUIPMENT, NET

Property and equipment, net at December 31, 2019 and 2018 consist of the following (in millions):

Estimated Useful Lives 2019 2018 (years)

Computer equipment $ 736 $ 616 2 to 4 years Capitalized software 442 348 2 to 5 years Leasehold improvements 265 242 1 to 13 years Office equipment, furniture and fixtures 61 55 2 to 7 years Building construction-in-progress 161 88

Total 1,665 1,349

Less: Accumulated depreciation (927) (693)

Property and equipment, net $ 738 $ 656

Depreciation expense was $294 million, $248 million and $187 million for the years ended December 31, 2019, 2018 and 2017, respectively.

10. LEASES

See Note 2 for the Company's accounting policy related to leases.

The Company has operating leases for office space, data centers and the land for Booking.com's future headquarters (see Note 16). As of December 31, 2019, the Company’s weighted-average discount rate and weighted-average remaining lease term were approximately 2.0% and 7.8 years, respectively. The Company had no finance leases as of December 31, 2019.

The Company recognized the following related to leases in its Consolidated Balance Sheet at December 31, 2019 (in millions): December 31, Classification in Consolidated Balance Sheet 2019 Operating lease assets Operating lease assets $ 620 Lease Liabilities: Current operating lease liabilities Accrued expenses and other current liabilities $ 161 Non-current operating lease liabilities Operating lease liabilities 462 Total operating lease liabilities $ 623

As of December 31, 2019, the operating lease liabilities will mature over the following periods (in millions): 2020 $ 172 2021 151 2022 100 2023 62 2024 42 Thereafter 163 Total remaining lease payments $ 690 Less: Imputed interest (67) Total operating lease liabilities $ 623

As of December 31, 2019, the Company has entered into leases that have not yet commenced with future lease payments of approximately $10 million which are not reflected in the table above. These leases will commence by 2021 with lease terms of up to 5 years and will be recognized upon lease commencement. In addition, the Company entered into an

92 agreement to sign a future lease in the city of Manchester in the United Kingdom for the future headquarters of Rentalcars.com (see Note 16). At December 31, 2018, minimum lease payments for operating leases having an initial term in excess of one year under the previous lease standard ("ASC 840") were as follows (in millions):

2019 $ 164 2020 142 2021 110 2022 66 2023 52 Thereafter 190 Total minimum lease payments $ 724

The Company recognized the following related to operating leases in its Consolidated Statement of Operations (in millions): Classification in Consolidated Statement of Year Ended Operations December 31, 2019 Lease expense General and administrative and Information $ 183 technology Variable lease expense General and administrative and Information 56 technology Less: Sublease income General and administrative (2) Total lease expense, net of sublease income $ 237

For the years ended December 31, 2018 and 2017, the Company recognized lease expense of $149 million and $120 million, respectively, under ASC 840.

Supplemental cash flow information related to operating leases is as follows (in millions):

Year Ended December 31, 2019 Cash paid for amounts included in the measurement of lease liabilities $ 189 Operating lease assets obtained in exchange for operating lease liabilities 155

"Operating lease amortization" presented in the operating activities section of the Consolidated Statement of Cash Flows reflects the portion of the operating lease expense from the amortization of the operating lease assets.

93 11. INTANGIBLE ASSETS AND GOODWILL

The Company's intangible assets at December 31, 2019 and 2018 consist of the following (in millions):

December 31, 2019 December 31, 2018

Gross Net Gross Net Carrying Accumulated Carrying Carrying Accumulated Carrying Amortization

Amount Amortization Amount Amount Amortization Amount Period

Supply and distribution agreements $ 1,100 $ (472) $ 628 $ 1,099 $ (408) $ 691 3 - 20 years

Technology 170 (129) 41 173 (121) 52 1 - 7 years

Internet domain names 40 (32) 8 41 (30) 11 5 - 20 years

Trade names 1,811 (534) 1,277 1,810 (439) 1,371 4 - 20 years

Other intangible assets 2 (2) — 3 (3) — Up to 15 years Total intangible assets $ 3,123 $ (1,169) $ 1,954 $ 3,126 $ (1,001) $ 2,125

Intangible assets are amortized on a straight-line basis. Amortization expense was $175 million, $178 million and $176 million for the years ended December 31, 2019, 2018 and 2017, respectively.

The annual estimated amortization expense for intangible assets for the next five years and thereafter is expected to be as follows (in millions):

2020 $ 167 2021 160 2022 157 2023 155 2024 155 Thereafter 1,160

$ 1,954

The changes in the balance of goodwill for the years ended December 31, 2019 and 2018 consist of the following (in millions):

2019 2018 Balance, beginning of year (1) $ 2,910 $ 2,738 Acquisitions 7 212 Foreign currency translation adjustments (4) (40) Balance, end of year (1) $ 2,913 $ 2,910

(1) The balances are net of an OpenTable goodwill impairment charge of $941 million recognized in 2016.

A substantial portion of the Company's intangible assets and goodwill relates to the acquisition of OpenTable and KAYAK. At September 30, 2019, the Company performed its annual goodwill impairment testing and concluded that there was no impairment of goodwill. Since the annual impairment test, there have been no events or changes in circumstances to indicate a potential impairment to the Company's goodwill. In addition, the Company did not identify any impairment indicators for the Company's other long-lived assets at December 31, 2019.

94 12. DEBT

Short-term Borrowing

On December 31, 2018, the Company had a bank overdraft of $25 million, which was repaid in January 2019. The bank overdraft is reported in "Accrued expenses and other current liabilities" in the Consolidated Balance Sheet at December 31, 2018.

Revolving Credit Facility

In August 2019, the Company entered into a $2.0 billion five-year unsecured revolving credit facility with a group of lenders. Borrowings under the revolving credit facility will bear interest, at the Company’s option, at a rate per annum equal to either (i) the London Inter-bank Offered Rate, or if such London Inter-bank Offered Rate is no longer available, the agreed alternate rate of interest ("LIBOR") (but no less than 0%) for the interest period in effect for such borrowing plus an applicable margin ranging from 0.875% to 1.50%; or (ii) for U.S. Dollar-denominated loans only, the sum of (x) the greatest of (a) JPMorgan Chase Bank, N.A.'s prime lending rate, (b) the U.S. federal funds rate plus 0.50% and (c) LIBOR (but no less than 0%) for an interest period of one month plus 1.00%, plus (y) an applicable margin ranging from 0% to 0.50%. Undrawn balances available under the revolving credit facility are subject to commitment fees at the applicable rate ranging from 0.07% to 0.20%.

The revolving credit facility provides for the issuance of up to $80 million of letters of credit as well as borrowings of up to $100 million on same-day notice, referred to as swingline loans. Other than swingline loans, which are available only in U.S. Dollars, borrowings and letters of credit under the revolving credit facility may be made in U.S. Dollars, Euros, British Pounds Sterling and any other foreign currency agreed to by the lenders. The proceeds of loans made under the facility can be used for working capital and general corporate purposes, including acquisitions, share repurchases and debt repayments. At December 31, 2019, there were no borrowings outstanding and $5 million of letters of credit issued under this revolving credit facility.

Upon entering into this new revolving credit facility, the Company terminated its $2.0 billion five-year revolving credit facility entered into in June 2015. At December 31, 2018, there were no borrowings outstanding and $5 million of letters of credit issued under the prior revolving credit facility. During the first half of 2019, the Company made several short-term borrowings under the prior revolving credit facility totaling $400 million with a weighted-average interest rate of 3.5%, all of which were repaid prior to June 30, 2019.

Outstanding Debt

Outstanding debt at December 31, 2019 consists of the following (in millions):

Outstanding Unamortized Debt Principal Discount and Debt Carrying December 31, 2019 Amount Issuance Cost Value Current Liabilities: 0.35% Convertible Senior Notes due June 2020 $ 1,000 $ (12) $ 988 Long-term debt: 0.9% Convertible Senior Notes due September 2021 $ 1,000 $ (39) $ 961 0.8% (€1 Billion) Senior Notes due March 2022 1,123 (3) 1,120 2.15% (€750 Million) Senior Notes due November 2022 842 (3) 839 2.75% Senior Notes due March 2023 500 (2) 498 2.375% (€1 Billion) Senior Notes due September 2024 1,123 (9) 1,114 3.65% Senior Notes due March 2025 500 (2) 498 3.6% Senior Notes due June 2026 1,000 (5) 995 1.8% (€1 Billion) Senior Notes due March 2027 1,123 (5) 1,118 3.55% Senior Notes due March 2028 500 (3) 497 Total long-term debt $ 7,711 $ (71) $ 7,640

95 Outstanding debt at December 31, 2018 consists of the following (in millions):

Outstanding Unamortized Debt Principal Discount and Debt Carrying December 31, 2018 Amount Issuance Cost Value Long-term debt: 0.35% Convertible Senior Notes due June 2020 $ 1,000 $ (39) $ 961 0.9% Convertible Senior Notes due September 2021 1,000 (61) 939 0.8% (€1 Billion) Senior Notes due March 2022 1,143 (5) 1,138 2.15% (€750 Million) Senior Notes due November 2022 858 (4) 854 2.75% Senior Notes due March 2023 500 (3) 497 2.375% (€1 Billion) Senior Notes due September 2024 1,143 (10) 1,133 3.65% Senior Notes due March 2025 500 (3) 497 3.6% Senior Notes due June 2026 1,000 (6) 994 1.8% (€1 Billion) Senior Notes due March 2027 1,143 (4) 1,139 3.55% Senior Notes due March 2028 500 (3) 497 Total long-term debt $ 8,787 $ (138) $ 8,649

Based on the closing price of the Company's common stock for the prescribed measurement periods for the three months ended December 31, 2019 and 2018, the contingent conversion thresholds on the 2020 Notes (as defined below) and 2021 Notes (as defined below) were not exceeded; therefore, these notes were not convertible at the option of the holder.

Fair Value of Debt

At December 31, 2019 and 2018, the estimated fair value of the outstanding debt was approximately $9.8 billion and $9.3 billion, respectively, and was considered a "Level 2" fair value measurement (see Note 6). Fair value was estimated based upon actual trades at the end of the reporting period or the most recent trade available as well as the Company's stock price at the end of the reporting period. A substantial portion of the fair value of the Company's debt in excess of the outstanding principal amount relates to the conversion premium on the convertible senior notes.

Convertible Senior Notes

If the note holders exercise their option to convert, the Company delivers cash to repay the principal amount of the notes and delivers shares of common stock or cash, at its option, to satisfy the conversion value in excess of the principal amount. If the Company's convertible debt is redeemed or converted prior to maturity, a gain or loss on extinguishment is recognized. The gain or loss is the difference between the fair value of the debt component immediately prior to extinguishment and its carrying value. To estimate the fair value of the debt at the conversion date, the Company estimates the borrowing rate, considering its credit rating and similar debt of comparable corporate issuers without the conversion feature.

Description of Convertible Senior Notes

In August 2014, the Company issued in a private placement $1.0 billion aggregate principal amount of Convertible Senior Notes due September 15, 2021, with an interest rate of 0.9% (the "2021 Notes"). The Company paid $11 million in debt issuance costs during the year ended December 31, 2014, related to this offering. The 2021 Notes are convertible, subject to certain conditions, into the Company's common stock at a conversion price of $2,055.50 per share. The 2021 Notes are convertible, at the option of the holder, prior to September 15, 2021, upon the occurrence of specific events, including but not limited to a change in control, or if the closing sales price of the Company's common stock for at least 20 trading days in the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is more than 150% of the conversion price in effect for the notes on the last trading day of the immediately preceding quarter. In the event that all or substantially all of the Company's common stock is acquired on or prior to the maturity of the 2021 Notes in a transaction in which the consideration paid to holders of the Company's common stock consists of all or substantially all cash, the Company would be required to make additional payments in the form of additional shares of common stock to the holders of the 2021 Notes in an aggregate value ranging from $0 to $375 million depending upon the date of the transaction and the then current stock price of the Company. Starting on June 15, 2021, holders will have the right to convert all or any portion of the 2021 Notes, regardless of the Company's stock price. The 2021 Notes may not be redeemed by the Company prior to maturity. The holders may require the Company to repurchase the 2021 Notes for cash in certain circumstances. Interest on 96 the 2021 Notes is payable on March 15 and September 15 of each year. At December 31, 2019, the if-converted value of the 2021 Notes did not exceed the aggregate principal amount.

In May 2013, the Company issued in a private placement $1.0 billion aggregate principal amount of Convertible Senior Notes due June 15, 2020, with an interest rate of 0.35% (the "2020 Notes"). The 2020 Notes were issued with an initial discount of $20 million. The Company paid $1 million in debt issuance costs during the year ended December 31, 2013, related to this offering. The 2020 Notes are convertible, subject to certain conditions, into the Company's common stock at a conversion price of $1,315.10 per share. The 2020 Notes are convertible, at the option of the holder, prior to June 15, 2020, upon the occurrence of specific events, including but not limited to a change in control, or if the closing sales price of the Company's common stock for at least 20 trading days in the period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is more than 150% of the conversion price in effect for the notes on the last trading day of the immediately preceding quarter. In the event that all or substantially all of the Company's common stock is acquired on or prior to the maturity of the 2020 Notes in a transaction in which the consideration paid to holders of the Company's common stock consists of all or substantially all cash, the Company would be required to make additional payments in the form of additional shares of common stock to the holders of the 2020 Notes in an aggregate value ranging from $0 to $397 million depending upon the date of the transaction and the then current stock price of the Company. Starting on March 15, 2020, holders will have the right to convert all or any portion of the 2020 Notes, regardless of the Company's stock price. The 2020 Notes may not be redeemed by the Company prior to maturity. The holders may require the Company to repurchase the 2020 Notes for cash in certain circumstances. Interest on the 2020 Notes is payable on June 15 and December 15 of each year. At December 31, 2019, the if-converted value of the 2020 Notes exceeded the aggregate principal amount by $488 million.

In March 2012, the Company issued in a private placement $1.0 billion aggregate principal amount of Convertible Senior Notes due March 15, 2018, with an interest rate of 1.0% (the "2018 Notes"). The 2018 Notes were convertible, subject to certain conditions, into the Company's common stock at a conversion price of $944.61 per share. In March 2018, in connection with the maturity of the remaining outstanding 2018 Notes, the Company paid $714 million to satisfy the aggregate principal amount due and paid an additional $773 million in satisfaction of the conversion value in excess of the principal amount.

Cash-settled convertible debt, such as the Company's convertible senior notes, is separated into debt and equity components at issuance and each component is assigned a value. The value assigned to the debt component is the estimated fair value, at the issuance date, of a similar bond without the conversion feature. The difference between the bond cash proceeds and this estimated fair value, representing the value assigned to the equity component, is recorded as a debt discount. Debt discount is amortized using the effective interest rate method over the period from the origination date through the stated maturity date. The Company estimated the borrowing rates at debt origination to be 3.18% for the 2021 Notes, 3.13% for the 2020 Notes and 3.50% for the 2018 Notes, considering its credit rating and similar debt of comparable corporate issuers without the conversion feature. The yield to maturity was estimated at an at-market coupon priced at par.

Debt discount, after tax of $83 million ($143 million before tax) related to the 2021 Notes, $92 million ($154 million before tax) related to the 2020 Notes and $81 million ($135 million before tax) related to the 2018 Notes less financing costs associated with the equity component of the respective convertible notes was recorded in "Additional paid-in capital" in the Consolidated Balance Sheets at debt origination.

For the years ended December 31, 2019, 2018 and 2017, the Company recognized interest expense of $62 million, $66 million and $94 million, respectively, related to convertible notes, which is almost entirely comprised of the amortization of debt discount of $48 million, $50 million and $68 million, respectively, and the contractual coupon interest of $12 million, $14 million and $21 million, respectively. For the years ended December 31, 2019, 2018 and 2017, included in the amortization of debt discount mentioned above was $3 million of original issuance discount related to the 2020 Notes for each period. The remaining interest expense relates to the amortization of debt issuance costs. The remaining period for amortization of debt discount and debt issuance costs is the period until the stated maturity date for the respective debt. The weighted-average effective interest rates for the years ended December 31, 2019, 2018 and 2017 are 3.2%, 3.2% and 3.4%, respectively.

97 Other Long-term Debt

Other long-term debt had a total carrying value of $6.7 billion at both December 31, 2019 and 2018. Debt discount is amortized using the effective interest rate method over the period from the origination date through the stated maturity date. The following table summarizes the information related to other long-term debt:

Effective Interest Period of Rate at Debt Other Long-term Debt Issuance Origination Timing of Interest Payments 0.8% Senior Notes due March 2022 March 2017 0.84% Annually in March 2.15% Senior Notes due November 2022 November 2015 2.20% Annually in November 2.75% Senior Notes due March 2023 August 2017 2.78% Semi-annually in March and September 2.375% Senior Notes due September 2024 September 2014 2.48% Annually in September 3.65% Senior Notes due March 2025 March 2015 3.68% Semi-annually in March and September 3.6% Senior Notes due June 2026 May 2016 3.62% Semi-annually in June and December 1.8% Senior Notes due March 2027 March 2015 1.80% Annually in March 3.55% Senior Notes due March 2028 August 2017 3.56% Semi-annually in March and September

For the years ended December 31, 2019, 2018 and 2017, the Company recognized interest expense of $166 million, $170 million and $145 million, respectively, related to other long-term debt, which was almost entirely comprised of $160 million, $163 million and $139 million, respectively, related to the contractual coupon interest. The remaining interest expense relates to the amortization of debt discount and debt issuance costs. The remaining period for amortization of debt discount and debt issuance costs is the period until the stated maturity dates for the respective debt.

Historically, the aggregate principal value of the Euro-denominated Senior Notes maturing in March 2022, November 2022, September 2024 and March 2027 (collectively the "Euro-denominated debt") and accrued interest thereon had been designated as a hedge of the Company's net investment in a Euro functional currency subsidiary. Beginning in the second quarter of 2019, the Company has only designated certain portions of the aggregate principal value of the Euro-denominated debt as a hedge. For the year ended December 31, 2019, the carrying value of the portions of Euro-denominated debt, including accrued interest, designated as a net investment hedge, ranged from $2.4 billion to $4.3 billion. The foreign currency transaction gains or losses on these Euro-denominated liabilities are measured based upon changes in spot rates. The foreign currency transaction gains or losses on the Euro-denominated debt that is designated as a hedging instrument for accounting purposes are recorded in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The net assets of this Euro functional currency subsidiary are translated into U.S. Dollars at each balance sheet date, with the effects of foreign currency changes also reported in "Accumulated other comprehensive loss" in the Consolidated Balance Sheets. The foreign currency transaction gains or losses on the Euro-denominated debt that is not designated as a hedging instrument are recognized in "Foreign currency transactions and other" in the Consolidated Statement of Operations.

13. TREASURY STOCK

At December 31, 2018, the Company had a total remaining authorization of $4.5 billion to repurchase its common stock related to a program authorized by the Company's Board of Directors in 2018 for $8.0 billion. In the second quarter of 2019, the Company's Board of Directors authorized an additional program to repurchase up to $15.0 billion of the Company's common stock. At December 31, 2019, the Company had a total remaining authorization of $11.5 billion to repurchase its common stock. The Company has continued to make repurchases of its common stock in the first quarter of 2020 and may continue to make repurchases of shares under its stock repurchase program, depending on prevailing market conditions, alternate uses of capital and other factors. Whether and when to initiate and/or complete any repurchase of common stock and the amount of common stock to be repurchased will be determined at the Company's discretion. Additionally, the Board of Directors has given the Company the general authorization to repurchase shares of its common stock withheld to satisfy employee withholding tax obligations related to stock-based compensation.

98 The following table summarizes the Company's stock repurchase activities during the years ended December 31, 2019, 2018 and 2017 (in millions, except for shares, which are reflected in thousands):

2019 2018 2017 Shares Amount Shares Amount Shares Amount Authorized stock repurchase programs 4,358 $ 8,002 3,020 $ 5,850 969 $ 1,744 General authorization for shares withheld on stock award vesting 87 151 80 162 57 100 Total 4,445 $ 8,153 3,100 $ 6,012 1,026 $ 1,844

Shares repurchased in December and settled in following January 19 $ 40 43 $ 74 18 $ 32

For the years ended December 31, 2019, 2018 and 2017, the Company remitted $151 million, $163 million and $101 million of employee withholding taxes, respectively, to the tax authorities, which is different from the aggregate cost of the shares withheld for taxes for each year due to the timing in remitting the taxes. The cash remitted to the tax authorities is included in financing activities in the Consolidated Statements of Cash Flows.

At December 31, 2019, there were 21,762,070 shares of the Company's common stock held in treasury.

14. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT

The table below presents the changes in the balances of accumulated other comprehensive income (loss) ("AOCI") by component for the years ended December 31, 2017, 2018 and 2019 (in millions):

Net unrealized gains (losses) on available-for-sale securities, net Foreign currency translation adjustments, net of tax of tax (1) Total Foreign currency Net Investment AOCI, translation Hedges (2) Total, Total, net of Tax Tax Tax net of (expense) net of tax (3) (expense) (4) Before tax benefit Before tax benefit tax Before tax benefit tax Balance, December 31, 2016 $ (460) $ — $ 258 $ (110) $ (312) $ 186 $ (9) $ 177 (135)

Other Comprehensive Income ("OCI") before reclassifications 670 — (548) 175 297 158 (81) 77 374 Amounts reclassified to net income (5) ————— (1) — (1) (1) OCI for the period 670 — (548) 175 297 157 (81) 76 373 Balance, December 31, 2017 $ 210 $ — $ (290) $ 65 $ (15) $ 343 $ (90) $ 253 $ 238

OCI before reclassifications (319) 41 217 (53) (114) (201) 2 (199) (313) OCI for the period (319) 41 217 (53) (114) (201) 2 (199) (313) Amounts reclassified to retained earnings(2) ————— (299) 58 (241) (241) Balance, December 31, 2018 $ (109) $ 41 $ (73) $ 12 $ (129) $ (157) $ (30) $ (187) $ (316)

OCI before reclassifications (77) 13 71 (17) (10) 161 (37) 124 114 Amounts reclassified to net income (5) ————— (11) 22 11 11 OCI for the period (77) 13 71 (17) (10) 150 (15) 135 125 Balance, December 31, 2019 $ (186) $ 54 $ (2) $ (5) $ (139) $ (7) $ (45) $ (52) $ (191)

(1) Upon the adoption of the accounting update on financial instruments on January 1, 2018, the Company reclassified net unrealized gains, net of tax, of $241 million ($299 million before tax) related to marketable equity securities from AOCI to retained earnings. Changes in fair value of marketable equity securities subsequent to January 1, 2018 are recognized in net income rather than "Accumulated other comprehensive loss" in the Consolidated Balance Sheets (see Note 2).

99 (2) Net investment hedges balance, net of tax, at December 31, 2016, 2017, 2018 and 2019 include accumulated net losses from fair value adjustments of $35 million ($53 million before tax) associated with previously settled derivatives that were designated as net investment hedges. The remaining balances relate to foreign currency transaction gains (losses) and related tax benefits (expenses) associated with the Company's Euro-denominated debt that is designated as a hedge against the impact of currency fluctuations on the net assets of a Euro functional currency subsidiary (see Notes 2 and 12).

(3) The tax benefits relate to foreign currency translation adjustments to the Company's one-time deemed repatriation tax liability recorded at December 31, 2017 and foreign earnings for periods after December 31, 2017 that are subject to U.S. federal and state income tax, resulting from the enactment of the U.S. Tax Cuts and Jobs Act (the "Tax Act"). Prior to January 1, 2018, foreign currency translation adjustments were not subject to U.S. federal and state income taxes as a result of the Company's intention to indefinitely reinvest the earnings of its international subsidiaries outside of the United States.

(4) The tax expense for the year ended December 31, 2017 includes a U.S. deferred tax expense of $63 million related to net cumulative unrealized gains associated with certain international investments.

(5) The reclassified net gains on available-for-sale securities, before tax, are included in "Foreign currency transactions and other" and the reclassified tax expenses are included in "Income tax expense" in the Consolidated Statements of Operations. For the year ended December 31, 2019, the reclassified tax expenses includes a tax expense of $21 million related to the maturity in August 2019 of the Company's investment of $500 million in Trip.com Group convertible notes (see Note 5).

15. INCOME TAXES

International pre-tax income was $5.7 billion, $4.8 billion and $4.5 billion for the years ended December 31, 2019, 2018 and 2017, respectively. U.S. pre-tax income was $213 million and $47 million for the years ended December 31, 2019 and 2018, respectively, and U.S. pre-tax loss was $122 million for the year ended December 31, 2017.

Provision for Income Taxes

The income tax expense (benefit) for the year ended December 31, 2019 is as follows (in millions):

Current Deferred Total International $ 915 $ (12) $ 903 U.S. Federal 22 166 188 U.S. State 34 (32)2 Total $ 971 $ 122 $ 1,093

The income tax expense (benefit) for the year ended December 31, 2018 is as follows (in millions):

Current Deferred Total International $ 887 $ (3) $ 884 U.S. Federal 45 (107) (62) U.S. State 55 (40)15 Total $ 987 $ (150) $ 837

The income tax expense (benefit) for the year ended December 31, 2017 is as follows (in millions):

Current Deferred Total International $ 756 $ (10) $ 746 U.S. Federal 1,327 (57) 1,270 U.S. State 73542 Total $ 2,090 $ (32) $ 2,058

100 U.S. Tax Reform

In December 2017, the Tax Act was enacted into law in the United States. The Tax Act made significant changes to U.S. federal tax law, including a reduction in the U.S. federal statutory tax rate from 35% to 21%, effective January 1, 2018. The Tax Act imposed a one-time deemed repatriation tax on accumulated unremitted international earnings, to be paid over eight years. The Company recorded provisional income tax expense of approximately $1.6 billion during the year ended December 31, 2017 in accordance with Staff Accounting Bulletin No. 118 ("SAB 118"), which included U.S. state income taxes and international withholding taxes, related to the mandatory deemed repatriation of estimated accumulated international earnings of approximately $16.5 billion. The Company also recorded a provisional net income tax benefit of $217 million during the year ended December 31, 2017 related to the remeasurement of the Company’s U.S. deferred tax assets and liabilities due to the reduction of the U.S. federal statutory rate from 35% to 21%. The Company expected to use approximately $204 million of deferred tax assets related to federal net operating loss carryforwards ("NOLs") and approximately $46 million of other tax credit carryforwards, and accordingly, reduced the transition tax liability to approximately $1.3 billion, which was included in "Long-term U.S. transition tax liability" in the Consolidated Balance Sheet as of December 31, 2017.

In 2018, the Company recorded an income tax benefit of $46 million to adjust its provisional income tax expense that was recorded during the year ended December 31, 2017 relating to the federal one-time deemed repatriation liability, as well as U.S. state income taxes and international withholding taxes associated with the mandatory deemed repatriation. In addition, the Company recorded an income tax benefit of $2 million in 2018 to adjust the remeasurement of its U.S. deferred tax assets and liabilities due to the reduction of the U.S. federal statutory tax rate that resulted from the Tax Act.

In 2019, as a result of additional technical guidance issued by U.S. federal and state tax authorities with respect to the Tax Act, the Company recorded an income tax benefit of $17 million to adjust its income tax expense that was recorded during the year ended December 31, 2017 relating to the federal one-time deemed repatriation liability, as well as U.S. state income taxes associated with the mandatory deemed repatriation. The Company utilized $116 million of deferred tax assets related to U.S. federal NOLs and $111 million of other tax credit carryforwards to reduce its transition tax liability as of December 31, 2019.

Under the Tax Act, the Company's international cash and investments as of December 31, 2017, amounting to $16.2 billion, as well as future cash generated by the Company's international operations, generally can be repatriated without further U.S. federal income tax, but will be subject to U.S. state income taxes and international withholding taxes, which have been accrued by the Company.

The Tax Act also introduced in 2018 a tax on 50% of GILTI, which is income determined to be in excess of a specified routine rate of return, and a base erosion and anti-abuse tax ("BEAT") aimed at preventing the erosion of the U.S. tax base. The Company has adopted an accounting policy to treat taxes on GILTI as period costs.

Deferred Income Taxes

The Company utilized $330 million of its U.S. NOLs to reduce its U.S. federal tax liability for the deemed repatriation tax. After utilization of available NOLs, at December 31, 2019, the Company had U.S. federal NOLs of $81 million, which are subject to an annual limitation and mainly expire from December 31, 2020 to December 31, 2021, and U.S. state NOLs of $317 million, which mainly expire between December 31, 2020 and December 31, 2034. In addition, at December 31, 2019, the Company had $97 million of non-U.S. NOLs, and $20 million of U.S. research tax credit carryforwards available to reduce future tax liabilities and the majority of both do not have an expiration date.

The utilization of these NOLs, allowances and credits is dependent upon the Company's ability to generate sufficient future taxable income and the tax laws in the jurisdictions where the losses were generated. The Company periodically evaluates the likelihood of the realization of deferred tax assets, and reduces the carrying amount of these deferred tax assets by a valuation allowance to the extent it believes a portion will not be realized. The Company considers many factors when assessing the likelihood of future realization of the deferred tax assets, including its recent cumulative earnings experience by taxing jurisdiction, expectations of future income, tax planning strategies, the carryforward periods available for tax reporting purposes and other relevant factors.

101 The tax effects of temporary differences that give rise to significant portions of deferred tax assets and liabilities at December 31, 2019 and 2018 are as follows (in millions):

2019 2018

Deferred tax assets/(liabilities): Net operating loss carryforward — U.S. $ 37 $ 59 Net operating loss carryforward — International 15 20 Accrued expenses 35 50 Stock-based compensation and other stock based payments 49 51 Foreign currency translation adjustment 36 27 Tax credits 14 46 Euro-denominated debt — 5 Operating lease liabilities 38 — Property and equipment 31 6 Subtotal - deferred tax assets 255 264

Discount on convertible notes (10) (22) Intangible assets and other (133) (482) Euro-denominated debt (14)— State income tax on accumulated unremitted international earnings (8) (25) Unrealized gains on investments (191) (2) Operating lease assets (35)— Installment sale liability (284)— Other (11) (15) Subtotal - deferred tax liabilities (686) (546) Valuation allowance on deferred tax assets (45) (36) (1) Net deferred tax liabilities $ (476)$ (318)

(1) Includes deferred tax assets of $400 million and $51 million at December 31, 2019 and 2018, respectively, reported in "Other assets" in the Consolidated Balance Sheets. During the year ended December 31, 2019, the Company recorded a deferred tax asset of $335 million, which is included in “Other Assets” in the Consolidated Balance Sheet, and a deferred tax liability of $325 million, both related to an internal restructuring.

The valuation allowance on deferred tax assets of $45 million at December 31, 2019 includes $30 million related to international operations and $15 million primarily related to U.S. research credits, capital loss carryforwards and Connecticut NOLs. The valuation allowance on deferred tax assets of $36 million at December 31, 2018 includes $20 million related to international operations and $16 million primarily related to U.S. research credits, capital loss carryforwards and Connecticut NOLs.

Pursuant to the adoption of an accounting update on January 1, 2017 related to share-based compensation, the Company recorded a deferred tax asset of $301 million related to previously unrecognized U.S. equity tax deductions, with an offsetting cumulative-effect adjustment to retained earnings, the majority of which was utilized during the year ended December 31, 2017.

The Company does not intend to indefinitely reinvest its international earnings that were subject to U.S. taxation pursuant to the mandatory deemed repatriation or subject to U.S. taxation as GILTI.

102 Reconciliation of U.S. Federal Statutory Income Tax Rate to Effective Income Tax Rate

A significant portion of the Company's taxable earnings is generated in the Netherlands. According to Dutch corporate income tax law, income generated from qualifying innovative activities is taxed at a rate of 7% ("Innovation Box Tax") for periods beginning on or after January 1, 2018 rather than the Dutch statutory rate of 25%. Previously, the Innovation Box Tax rate had been 5%. A portion of Booking.com's earnings during the years ended December 31, 2019, 2018 and 2017 qualified for Innovation Box Tax treatment, which had a significant beneficial impact on the Company's effective tax rate for those years.

The effective income tax rate of the Company is different from the amount computed using the expected U.S. statutory federal rate of 21% in 2019 and 2018 and 35% in 2017 as a result of the following items (in millions):

2019 2018 2017 Income tax expense at U.S. federal statutory rate $ 1,251 $ 1,015 $ 1,539

Adjustment due to: Foreign rate differential 210 210 (458) Innovation Box Tax benefit (443) (435) (397) Tax Act - Remeasurement of deferred tax balances — (2) (217) Tax Act - U.S. transition tax and other transition impacts (17) (46) 1,563 Other 92 95 28 Income tax expense $ 1,093 $ 837 $ 2,058

Uncertain Tax Positions

See Note 2 for the Company's accounting policy on uncertain tax positions. The following is a reconciliation of the total beginning and ending amount of unrecognized tax benefits (in millions): 2019 2018 2017 Unrecognized tax benefit — January 1 $ 45 $ 32 $ 33 Gross increases — tax positions in current period 3 1 5 Gross increases — tax positions in prior periods 11 19 5 Gross decreases — tax positions in prior periods (3) (3) (9) Reduction due to lapse in statute of limitations — (2) (1) Reduction due to settlements during the current period — (2) (1) Unrecognized tax benefit — December 31 $ 56 $ 45 $ 32

The unrecognized tax benefits are included in "Other long-term liabilities" and "Deferred income taxes" in the Consolidated Balance Sheets for the years ended December 31, 2019 and 2018. The unrecognized tax benefits, if recognized, would affect the effective tax rate. The Company does not expect further significant changes in the amount of unrecognized tax benefits during the next twelve months. As of December 31, 2019 and 2018, total gross interest and penalties accrued was $10 million and $8 million, respectively.

The Company's major taxing jurisdictions include: the Netherlands, United States, Singapore and United Kingdom. The statutes of limitations that remain open related to these major tax jurisdictions are: the Company's Netherlands returns from 2014 and forward, U.S. returns for 2014 and forward, Singapore returns from 2017 and forward and U.K. returns for 2015 and forward. An income tax waiver has been executed for the U.S. federal 2015 return that would extend the period subject to examination beyond the period prescribed by statute or for the period just stated above. The Company’s 2015 U.S. federal income tax return is currently under audit by the Internal Revenue Service. See Note 16 for more information regarding tax contingencies.

103 16. COMMITMENTS AND CONTINGENCIES

Competition and Consumer Protection Reviews

At times, online platforms, including online travel platforms, have been the subject of investigations or inquiries by various national competition authorities ("NCAs") or other governmental authorities regarding competition law matters, consumer protection issues or other areas of concern. The Company is or has been involved in many such investigations. For example, the Company has been and continues to be involved in investigations related to whether Booking.com's contractual parity arrangements with accommodation providers, sometimes also referred to as "most favored nation" or "MFN" provisions, are anti-competitive because they require accommodation providers to provide Booking.com with room rates, conditions or availability that are at least as favorable as those offered to other online travel companies ("OTCs") or through the accommodation provider's website. To resolve and close certain of the investigations, the Company has from time to time made commitments to the investigating authorities regarding future business practices or activities. For example, Booking.com has made commitments to several NCAs, including agreeing to narrow the scope of its parity clauses, in order to resolve parity- related investigations. In addition, in September 2017, the Swiss Price Surveillance Office opened an investigation into the level of commissions of Booking.com in Switzerland and the investigation is ongoing. Some authorities are reviewing the online hotel booking sector more generally through market inquiries and the Company cannot predict the outcome of such inquiries or any resulting impact on its business, results of operations, cash flows or financial condition.

NCAs or other governmental authorities are continuing to review the activities of online platforms, including through the use of consumer protection powers. In October 2017 the United Kingdom's NCA (the Competition and Markets Authority, or CMA) launched a consumer protection law investigation into the clarity, accuracy and presentation of information on hotel booking sites with a specific focus on the display of search results (e.g., ranking), claims regarding discounts, methods of "pressure selling" (such as allegedly creating false impressions regarding room availability) and failure to disclose hidden charges. In connection with this investigation, Booking.com, agoda and KAYAK, along with a number of other OTCs, voluntarily agreed to certain commitments with the CMA addressing its concerns in resolution of this investigation, which took effect on September 1, 2019. Among other things, the commitments provided to the CMA included showing prices inclusive of all mandatory taxes and charges, providing information about the effect of money earned on search result rankings on or before the search results page and making certain adjustments to how discounts and statements concerning popularity or availability are shown to consumers. The CMA has stated that it expects all participants in the online travel market to adhere to the same standards, regardless of whether they formally signed the commitments. The commitments concluded the CMA's investigation without finding an infringement or an admission of wrongdoing of the OTCs involved. As a result of additional inquiries from other NCAs in the European Economic Area, Booking.com has made similar commitments with the Consumer Protection Cooperation Network (the "CPCN") to be applicable in the European Union beginning in June 2020. The Company is unable to predict what, if any, effect the commitments made to the CMA and the CPCN will have on its business, industry practices or online commerce more generally.

The Company is unable to predict how any current or future investigations or litigation may be resolved or the long- term impact of any such resolution on its business. For example, competition and consumer-law-related investigations, legislation or issues have and could in the future result in private litigation. More immediate results could include, among other things, the imposition of fines, commitments to change certain business practices or reputational damage, any of which could harm the Company's business, results of operations, brands or competitive position.

Tax Matters

French tax authorities conducted an audit of Booking.com for the years 2003 through 2012 and are conducting audits for the years 2013 through 2018. They are asserting that Booking.com has a permanent establishment in France and are seeking to recover what they claim are unpaid income and value-added taxes. In December 2015, the French tax authorities issued Booking.com assessments related to tax years 2003 through 2012 for approximately 356 million Euros, the majority of which represents penalties and interest. As a result of a formal demand from the French tax authorities for payment of the amounts assessed for the years 2003 through 2012, in January 2019, the Company paid the assessments of approximately 356 million Euros ($403 million) in order to preserve its right to contest those assessments in court. The payment, which is included in "Other assets" in the Consolidated Balance Sheet at December 31, 2019, does not constitute an admission that the Company owes the taxes and will be refunded (with interest) to the Company to the extent the Company prevails. If the Company is unable to resolve the matter with the French tax authorities, the Company plans to challenge the assessments in the French courts. In December 2019, the French tax authorities issued an additional assessment of 70 million Euros ($79 million), including interest and penalties, for the 2013 year asserting that Booking.com has taxable income in France attributable to a permanent establishment in France. Furthermore, the French tax authorities issued assessments totaling 39 million Euros ($44 million), including interest and penalties, for certain tax years between 2011 and 2015 on Booking.com's French subsidiary 104 asserting that the subsidiary did not receive sufficient compensation for the services it rendered to Booking.com in the Netherlands. The Company has not recorded a liability in connection with any of the French tax assessments as the Company believes that Booking.com has been, and continues to be, in compliance with French tax law, and the Company is contesting the assessments. Additional assessments could result when the French tax authorities complete the outstanding audits.

Italian authorities are reviewing Booking.com's activities for the years 2011 through 2018. They are reviewing whether Booking.com has a permanent establishment in Italy and Booking.com's transfer pricing policies in Italy. The Company is cooperating with the investigation but intends to contest any allegation that Booking.com has a permanent establishment in Italy or that its transfer pricing policies are inappropriate. In December 2018 and December 2019, respectively, the Italian tax authorities issued assessments on Booking.com's Italian subsidiary for approximately 48 million Euros ($53 million) for the 2013 tax year and 58 million Euros ($65 million) for the 2014 tax year asserting that its transfer pricing policies were inadequate. The Company has not recorded a liability in connection with these assessments. The Company believes that Booking.com has been, and continues to be, in compliance with Italian tax law. The company paid 10 million Euros ($11 million) in December 2019 as a partial payment of the 2013 assessment. The payment, which is included in "Other assets" in the Consolidated Balance Sheet at December 31, 2019, does not constitute an admission that the Company owes the taxes and will be refunded (with interest) to the Company to the extent the Company prevails. It is unclear what further actions, if any, the Italian authorities will take. Such actions could include closing the investigation, assessing Booking.com additional taxes, imposing interest, fines and penalties and/or bringing criminal charges.

In addition, Turkish tax authorities have asserted that Booking.com has a permanent establishment in Turkey and have issued tax assessments for the years 2012 through 2017 for approximately 544 million Turkish Lira ($91 million), including interest and penalties. The Company believes that Booking.com has been, and continues to be, in compliance with Turkish tax law, and the Company is contesting these assessments. The Company has not recorded a liability in connection with these assessments.

As a result of an internal review of tax policies and positions at one of the Company's smaller subsidiaries, the Company identified two issues related to the application of certain non-income-based tax laws to that subsidiary's business. In 2018, the Company accrued related travel transaction taxes totaling approximately $46 million, based on the Company's estimate of the probable travel transaction tax owed for the prior periods, including interest and penalties, as applicable. At December 31, 2019, the Company had $67 million accrued related to these travel transaction taxes. The related expenses are included in "General and administrative" expense in the Consolidated Statement of Operations. The Company currently estimates that the reasonably possible loss related to these matters in excess of the amount accrued is approximately $25 million. The Company's internal review is ongoing, and, to the extent the Company determines that the probable taxes owed related to these matters exceed what has already been accrued or new issues are identified during this review, the Company may need to accrue additional amounts, which could adversely affect the Company’s business, results of operations, financial condition and cash flows.

During the second quarter of 2019, the Company identified the nonpayment in prior periods of a wage-related tax under Netherlands' law on compensation paid to certain highly-compensated former employees in the year of their separation from employment with Booking.com. The Company has informed the Dutch tax authorities of the nonpayment and, to correct this immaterial error, has paid an amount of $61 million based on the Company's estimate of the probable tax owed for prior tax years, including interest (but not including any potential penalties, which cannot reasonably be estimated). This expense is recorded in "Personnel" expenses in the Consolidated Statement of Operations for the year ended December 31, 2019.

From time to time, the Company is involved in other tax-related audits, investigations or proceedings, which could relate to income taxes, value-added taxes, sales taxes, employment taxes, etc. For example, the Company is subject to legal proceedings in the United States related to travel transaction taxes (e.g., hotel occupancy taxes, sales taxes, etc.).

Any taxes or other assessments in excess of the Company's current tax provisions, whether in connection with the foregoing or otherwise (including the resolution of any tax proceedings), could have a materially adverse impact on the Company's results of operations, cash flows and financial condition.

Other Matters

Beginning in 2014, Booking.com received several letters from the Netherlands Pension Fund for the Travel Industry (Reiswerk) (“BPF”) claiming that Booking.com is required to participate in the mandatory pension scheme of the BPF with retroactive effect to 1999, which has a higher contribution rate than the pension scheme in which Booking.com is currently participating. BPF instituted legal proceedings against Booking.com and in 2016 the District Court of Amsterdam rejected all of BPF’s claims. BPF appealed the decision to the Court of Appeal, and, in May 2019, the Court of Appeal also rejected all of 105 BPF’s claims. BPF has appealed to the Netherlands Supreme Court. The Company expects the Supreme Court to rule in early 2021. The Company believes that Booking.com is in compliance with its pension obligations. The Company has not recorded a liability in connection with a potential adverse outcome to this litigation. However, if Booking.com were to lose and all of BPF’s claims were to be accepted (including retroactivity to 1999), the Company estimates that as of December 31, 2019 the maximum loss, not including any potential interest or penalties, would be approximately $200 million. Such estimated potential loss increases as Booking.com continues not to contribute to the BPF and depends on Booking.com’s applicable employee compensation after December 31, 2019.

The Company accrues for certain legal contingencies where it is probable that a loss has been incurred and the amount can be reasonably estimated. Such accrued amounts are not material to the Company's balance sheets and provisions recorded have not been material to the Company's results of operations or cash flows.

From time to time, the Company has been, and expects to continue to be, subject to legal proceedings and claims in the ordinary course of business, including claims of alleged infringement of third-party intellectual property rights. Such claims, even if not meritorious, could result in the expenditure of significant financial and managerial resources, divert management's attention from the Company's business objectives and adversely affect the Company's business, results of operations, financial condition and cash flows.

Building Construction

In September 2016, the Company signed a turnkey agreement to construct an office building for Booking.com's future headquarters in the Netherlands for 270 million Euros. Upon signing this agreement, the Company paid 43 million Euros for the acquired land-use rights, which was included in “Other assets” in the Consolidated Balance Sheets for periods prior to January 1, 2019. The land-use rights were reclassified from "Other assets" to "Operating lease assets" on January 1, 2019 as part of the adoption of ASC 842, Leases (see Note 2). In addition, since signing the turnkey agreement the Company has made several progress payments principally related to the construction of the building, which are included in "Property and equipment, net" in the Consolidated Balance Sheets. At December 31, 2019, the Company has a remaining obligation of 109 million Euros ($123 million) related to the building construction, which will be paid through mid-2022, when the Company anticipates construction will be complete. In addition to the turnkey agreement, the Company has a remaining obligation at December 31, 2019 to pay 71 million Euros ($80 million) over the remaining term of the acquired land lease. The Company will also make additional capital expenditures to fit out and furnish the office space. Operating lease obligations (see Note 10)

Other Contractual Obligations and Commitments

In 2018, the Company entered into an agreement to sign a future lease related to approximately 222,000 square feet of office space in the city of Manchester in the United Kingdom for the future headquarters of Rentalcars.com. The Company's obligation to execute the lease is conditional upon the lessor completing certain activities, which are expected to be completed in 2021. If these activities are completed, the lease will commence for a term of approximately 13 years and the Company will have a lease obligation of approximately 65 million British Pounds Sterling ($86 million), excluding lease incentives. The Company will also make capital expenditures to fit out and furnish the office space.

As of December 31, 2019, the Company had issued $155 million of standby letters of credit or bank guarantees in addition to those issued under the revolving credit facility, primarily related to payment guarantees to third-party payment processors. See Note 12 for information related to letters of credit issued under the revolving credit facility.

17. BENEFIT PLANS

The Company maintains a defined contribution 401(k) savings plan (the "Plan") covering certain U.S. employees. In connection with acquisitions, effective at the date of such acquisitions, the Company assumed defined contribution plans covering the U.S. employees of the acquired companies. The Company also maintains certain other defined contribution plans outside of the United States for which it provides contributions for participating employees. The Company's matching contributions during the years ended December 31, 2019, 2018 and 2017 were $26 million, $22 million and $15 million, respectively.

106 18. GEOGRAPHIC INFORMATION

The Company's international information consists of the information of Booking.com, agoda and Rentalcars.com in their entirety and the information of the international businesses of KAYAK and OpenTable. This classification is independent of where the consumer resides, where the consumer is physically located while using the Company's services or the location of the travel service provider or restaurant. For example, a reservation made through Booking.com at a hotel in New York by a consumer in the United States is part of the Company's international results. The Company's geographic information is as follows (in millions):

International United The Total States Netherlands Other Company

2019

Total Revenues $ 1,537 $ 11,686 $ 1,843 $ 15,066 Intangible assets, net 1,552 94 308 1,954 Goodwill 1,813 461 639 2,913 Other long-lived assets (1) 201 1,278 345 1,824

(2)

2018 Total Revenues $ 1,536 (3) $ 11,348 $ 1,643 $ 14,527 (3) Intangible assets, net 1,665 112 348 2,125 Goodwill 1,807 461 642 2,910 Other long-lived assets 152 436 196 784

(2)

2017 Total Revenues $ 1,620 (4) $ 9,735 $ 1,326 $ 12,681 (4) Intangible assets, net 1,790 44 343 2,177 Goodwill 1,807 342 589 2,738 Other long-lived assets 124 311 151 586

(1) Other long-lived assets at December 31, 2019 reflects operating lease assets of $620 million recognized as a result of the adoption of the current lease standard on January 1, 2019 (see Notes 2 and 10) and the Company's payment of $403 million in 2019 to French tax authorities in order to preserve its right to contest the assessments in court (see Note 16).

(2) Geographic information for 2018 and 2017 has been recast to conform to the current year presentation.

(3) Total revenues are reported on a net basis for Name Your Own Price® transactions under the current revenue recognition standard, which have been reduced for cost of revenues of $170 million in the year ended December 31, 2018 (see Note 2).

(4) Total revenues were reported on a gross basis for Name Your Own Price® transactions under the previous revenue recognition standard, which were not reduced for cost of revenues of $242 million in the year ended December 31, 2017 (see Note 2).

107 19. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)

First Second Third Fourth Quarter Quarter Quarter Quarter

(In millions, except per share data)

2019

Total revenues $ 2,837 $ 3,850 $ 5,040 $ 3,339

Net income 765 979 1,950 1,171

Net income applicable to common stockholders per basic common share $ 17.01 $ 22.62 $ 46.01 $ 28.07

Net income applicable to common stockholders per diluted common share $ 16.85 $ 22.44 $ 45.54 $ 27.75

First Second Third Fourth Quarter Quarter Quarter Quarter

(In millions, except per share data)

2018

Total revenues $ 2,928 $ 3,537 $ 4,849 $ 3,213

Net income 607 977 1,768 646

Net income applicable to common stockholders per basic common share $ 12.56 $ 20.34 $ 37.39 $ 14.00

Net income applicable to common stockholders per diluted common share $ 12.34 $ 20.13 $ 37.02 $ 13.86

20. ACQUISITIONS

Acquisition activities in 2018

In April 2018, the Company paid $139 million, net of cash acquired, and issued shares of the Company's common stock in the amount of $110 million in connection with the acquisition of FareHarbor, a leading provider of business-to- business activities distribution services. In respect to the shares issued, as shown in the supplemental disclosure in the Consolidated Statement of Cash Flows, $59 million relates to purchase price consideration and $51 million relates to shares restricted for trading purposes until the required post-acquisition services are completed by certain employees.

In November 2018, the Company paid $134 million, net of cash acquired, to complete the acquisition of HotelsCombined, a hotel meta-search company.

The Company's Consolidated Financial Statements include the accounts of these businesses starting at their respective acquisition dates. Revenues and earnings of these businesses since their respective acquisition dates and pro forma results of operations have not been presented separately as such financial information is not material to the Company's results of operations.

108 Acquisition activity in 2017

In July 2017, the Company completed the acquisition of the Momondo Group, which operates the travel meta-search websites Momondo and Cheapflights, for $556 million, and which is managed as part of the Company's KAYAK business.

The aggregate purchase price was allocated to the assets acquired and liabilities assumed as follows (in millions):

Current assets (1) $50 Identifiable intangible assets (2) 333 Goodwill (3) 288 Property and equipment 1 Total liabilities (4) (116) Total consideration $ 556

(1) Includes cash acquired of $15 million. (2) Acquired definite-lived intangible assets, consisted of distribution agreements of $214 million with a weighted- average useful life of 15 years, trade names of $104 million with a weighted-average useful life of 13 years and technology of $15 million with a weighted-average life of 4 years. (3) Goodwill is not tax deductible. (4) Includes deferred tax liabilities of $70 million and third-party senior debt of $15 million.

The Company's Consolidated Financial Statements include the accounts of the Momondo Group beginning July 24, 2017. Revenues and earnings of this business since the acquisition date and pro forma results of operations have not been presented separately as such financial information is not material to the Company's results of operations. The Company incurred $5 million of professional fees for the year ended December 31, 2017 related to this acquisition. The acquisition- related expenses were included in "General and administrative" expenses in the Company's Consolidated Statement of Operations.

Liability associated with the Earnout Arrangement for Business Acquisition

At December 31, 2018, the Company's Consolidated Balance Sheets included a liability of $28 million for estimated contingent payments for a business acquired in 2015. The fair value of the liability, which is considered a "Level 3" fair value measurement (see Note 6), was based upon probability-weighted average payments for specific performance factors from the acquisition date through the end of the performance period on March 31, 2019. In 2019, the Company paid $37 million to settle this liability.

109