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The Norwalk, Connecticut-based company's second-quarter net income applicable to common stockholders was $67.0 million or $1.38 per share, compared to $49.8 million or $1.00 per share in the year ago period.

On a pro forma basis, net income applicable to common stockholders of the company increased to $99.0 million or $2.02 per share from $78.5 million or $1.55 per share a year earlier.

On average, 15 analysts polled by Thomson Reuters expected the company to earn $1.75 per share. Analysts' estimates typically exclude special items.

Among competitors, Expedia Inc. (EXPE) last month reported a sharp decline in second-quarter profit on lower domestic air revenues. Net income attributable to Expedia was $40.9 million or $0.14 per share, compared to $96.09 million or $0.33 per share in the year-earlier quarter. Revenue dropped 3% to $769.77 million from the previous year.

Another competitor, Orbitz Worldwide, Inc. (OWW) last week reported a swing to profit for the second quarter on lower operating expenses. Net income was $10 million or $0.12 per share, compared to a loss of $5 million or $0.06 per share in the prior year. However, revenue declined 19% to $188 million from the comparable year-ago period.

Priceline President and Chief Executive Officer Jeffery Boyd said, "Despite a difficult economic climate, leisure travel demand for the summer peak season has been stronger than expected, driven in part by the availability of compelling discounts. 2nd quarter performance reflects the impact of improving demand, but also shows the impact of lower year over year unit prices."

Priceline's gross profit for the second quarter increased 20.3% to $305.2 million and operating income increased 35.1% to $109.4 million from previous year.

In the preceding first quarter, Priceline posted a net income applicable to common stockholders of $25.0 million or $0.53 per share, compared to $13.8 million or $0.28 per share a year back. Pro forma net income applicable to common stockholders for the first quarter increased to $51.3 million or $1.09 per share from $37.3 million or $0.76 per share a year before.

Total revenues for the second quarter increased to $603.7 million from $514.0 million last year. Analysts expected the company to report revenues of $575.12 million.

Merchant revenues for the quarter increased to $392.8 million from $336.2 million, while agency revenues increased to $204.5 million from $173.2 million in the prior year.

The company's gross travel bookings for the quarter, which refers to the total dollar value, inclusive of all taxes and fees, of all travel services purchased by consumers, increased 12.8% to $2.38 billion year over year. The contribution of international operations increased 20.1% to $197.6 million from a year ago.

In the first quarter, the company reported a 14.6% increase in revenues to $462.1 million from the previous year.

For the first six months of the year, the company posted a net income applicable to common stockholders of $92.0 million or $1.92 per share,compared to $63.6 million or $1.28 per share in the previous year.

Pro forma net income applicable to common stockholders of Priceline.com for the six months was $150.3 million or $3.11 per share, compared to $115.8 million or $2.32 per share in the previous fiscal.

Total revenues for the six months increased to $1.07 billion from $917.1 million in the prior year.

Looking ahead, the company said it expects net income for the third quarter in the range of $2.15 - $2.30 per share. On a pro forma basis, net income is expected to be in the range of $2.70 - $2.85 per share.

The company expects an year-over-year increase in revenue of about 19% to 23% with an increase in total gross travel bookings of about 20% - 26% and an increase in international gross travel bookings of about 21% - 29%.

Analysts currently anticipate the company to earn $2.52 per share on revenues of $613.49 million for the third quarter.

"Unemployment and the global economic downturn continue to affect travel spending, particularly high yield business travel, which places considerable strain on travel suppliers. Suppliers have responded with promotions and discounts to spur leisure demand and we have offered distribution and advertising support for those efforts, which we believe has helped bolster occupancy and load factors," said Boyd.

PCLN is currently trading at $149.76, up $18.44 or 14.04% with a volume of 1.55 million shares. In the past 52-week period, the stock has traded in the range of $45.15 - $135.10, with an average 3-month volume of 1.0 million shares.

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