Why is Booking stock sliding today?

Booking Holdings' stock declined 4.1% during midday trading on September 22, 2023, reaching a low of $155.37 per share. The decline follows the announcement of a partnership between Expedia and Meta's Muse AI agent, which allows users to plan and book travel through the AI assistant without visiting Booking's properties. This development has raised concerns about Booking's competitive position in the online travel agency sector, as AI agents like Muse could potentially disrupt the direct customer relationships that form the foundation of the OTA business model.

Muse reached the top spot on the U.S. App Store on September 22 and is considered by some analysts to be one of the most widely used consumer AI products since ChatGPT. Without a similar integration from Booking, investors are reevaluating the company's competitive landscape. Additionally, Erste Group Bank reduced its fiscal 2027 earnings-per-share estimates for Booking in the previous session, and the EU antitrust decision blocking Booking's acquisition of ETraveli Group remains a factor weighing on the company's growth outlook.

The broader market also contributed to the decline, with the NASDAQ dropping 1.1% and the S&P 500 falling 0.6%. Within the travel sector, Booking experienced one of the largest declines, trading closer to its 52-week low of $150.14 than its 52-week high of $225.00. The convergence of Expedia's Muse partnership, regulatory headwinds, a lower earnings forecast, and a weak market environment has created a compounding selloff, leaving Booking trading at $157.56 as of mid-day on September 22.