# U.S. OTAs pass $100B revenue mark for first time

**Publisher:** Phocuswright  
**Published:** 2023-10-15  
**Category:** Research, media & analysts  
**Type:** Report  
**Access:** Free  
**Official source:** https://www.phocuswright.com/Travel-Research/Research-Updates/2024/4-key-takeaways-from-latest-us-ota-research  
**Canonical:** https://tourismintel.ai/reports/u-s-otas-pass-100b-revenue-mark-for-first-time-phocuswright

## At a glance
- U.S. OTA sector exceeded $100 billion in revenue for the first time in 2023, driven by strong travel demand and elevated pricing.
- Double-digit year-over-year growth continued but at a slower pace than the two preceding years as post-pandemic demand moderated.
- Hotels now account for 58% of OTA gross bookings, reinforcing their status as the sector's primary revenue driver.
- Expedia and Booking, along with their portfolio brands, maintained 21% share of U.S. travel gross bookings despite Expedia's slight deceleration.
- OTAs represent approximately one fifth of the total U.S. travel market and one half of the online travel segment.

## What the report covers
Phocuswright's U.S. Online Travel Agency Market Report 2023-2027 provides market sizing, analysis and forecasts for the OTA sector through 2027. The research examines all major OTA segments—hotel, air, car rental, cruise and packaged travel—and tracks market concentration among leading players. Published in October 2023, the report forms part of a broader U.S. Travel Market Report series covering five key segments and projections from 2021 to 2027.

## Key findings
U.S. OTAs crossed the $100 billion revenue threshold in 2023, achieving double-digit year-over-year growth. However, the report notes this growth decelerated compared with the two years prior, reflecting softening consumer demand as the travel market normalised post-pandemic. This marks a transition from exceptional recovery-driven expansion to sustainable market growth.

Hotel bookings drove sector performance, now representing 58% of OTA gross bookings. Air and hotel segments both benefited from favourable market conditions: record average daily rates (ADRs) in accommodation and elevated airfares. These price increases, combined with sustained travel demand, lifted revenue across all OTA segments.

Market concentration remained high among major players. Expedia and Booking, together with their subsidiary brands (Travelocity, Hotels.com, Priceline and others), maintained a 21% share of U.S. travel gross bookings. Notably, Expedia experienced slight deceleration during 2023 as it invested in a new platform to consolidate its brand portfolio.

OTAs have solidified their position in the U.S. travel distribution landscape, now accounting for roughly one fifth of the total travel market and one half of the online market. This dual metric underscores both the sector's maturity within online channels and its continued growth relative to traditional and direct-booking channels.

## Key numbers
| Metric | Value | Note |
|---|---|---|
| U.S. OTA sector revenue | $100 billion | 2023 data; first time threshold exceeded |
| Year-over-year growth rate, U.S. OTAs | double-digit | 2023 observed; slower pace than previous two years |
| Hotel bookings as share of OTA gross bookings | 58% | 2023 observed |
| Expedia and Booking combined share of U.S. travel gross bookings | 21% | 2023 observed; includes subsidiary brands |
| OTA share of total U.S. travel market | approximately one fifth | 2023 observed |
| OTA share of online U.S. travel market | one half | 2023 observed |

## Why it matters
**DMOs & destinations** — OTA concentration continues to deepen distribution power among a small number of platforms. With hotel bookings at 58% of OTA volumes and the sector controlling roughly one fifth of U.S. travel bookings, destination marketing organisations must maintain strategic partnerships with leading OTAs while developing direct-to-consumer and alternative distribution channels to reduce dependency on intermediaries.

**Hotels & hospitality** — Hotels remain the primary value driver for OTAs at 58% of gross bookings, but this dominance carries risk. As OTA sector growth moderates from post-pandemic peaks, hotels face continued pressure to negotiate favourable commission rates and terms. Direct booking incentives and loyalty programme investment become more critical to offset OTA dependency.

**Travel tech & distribution** — The $100 billion OTA market represents a mature, consolidated segment with Expedia and Booking holding 21% of total U.S. travel bookings. Incumbent platforms investing heavily in technology consolidation signal a shift toward operating efficiency. Challengers and emerging tech must identify niches underserved by giants—metasearch, vertical segments, or B2B—to gain meaningful market share.

## Methodology and limits
This brief is based on the publicly available summary only. Phocuswright's U.S. Online Travel Agency Market Report 2023-2027 employs proprietary market sizing models and historical data spanning 2021 to 2027, combining observed 2023 results with forecasted projections through 2027. The full report methodology, sample scope and detailed data specifications are not detailed in the public summary and may be available to paid subscribers.

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© Phocuswright for the original report. This brief is an original editorial summary by TourismIntel (https://tourismintel.ai). Read the original: https://www.phocuswright.com/Travel-Research/Research-Updates/2024/4-key-takeaways-from-latest-us-ota-research