Shares of online travel agencies (OTAs) like Booking Holdings (BKNG) and Expedia (EXPE) continue to gain ground as fears of a disruption to OTAs from generative AI seem to be dissipating now that OpenAI (OPENAI) is pivoting away from direct checkout on its ChatGPT app.
“We’re evolving how we approach commerce in ChatGPT to better meet merchants and users where they are,” said an OpenAI spokesperson in response to the decision.
The pivot was likely fueled by the technical challenges shopping integration presented for OpenAI. Merchant details such as pricing and availability needed to be constantly updated within the chatbot, and safeguards against fraudulent and erroneous transactions were also more complicated within the AI framework.
This is good news for sites like Booking Holdings (BKNG), Shopify (SHOP) and Etsy (ETSY), all of which underwent a significant correction in the SaaS-pocalypse in early February amid concerns that the sophistication of platforms like ChatGPT would cause a substantial change to how users/travelers shopped on the internet.
“We believe the shift from checkout on ChatGPT into apps on ChatGPT may be just the beginning of the end of this bear case [for names like Booking],” Mizuho analyst Lloyd Walmsley said in his note to clients.
“We have already heard from internet investors drawing up their shopping lists on the news. We believe OTAs, DoorDash, and Google are at the top of the list. We believe a relief rally here will have legs,” Walmsley adds.
Accordingly, shares of Booking Holdings (BKNG), Expedia Group (EXPE), Tripadvisor (TRIP), and Travelzoo (TZOO) are all trading with gains of as much as 9%.