S&P Global Ratings on April 8 affirmed Booking Holdings Inc.'s ratings but revised its outlook on the online booking platform to negative, reflecting the risk of prolonged distressed industry conditions to the company's business.

The rating agency affirmed Booking's ratings, including its A- issuer credit rating. Ratings also assigned an A- rating to the company's $4 billion debt issuance, consisting of $3.25 billion in senior unsecured notes and $750 million in convertible notes.

Ratings said the outlook revision to negative from stable also reflects the agency's expectation that Booking's EBITDA, cash and liquid investments could decrease meaningfully, raising leverage toward 1.5x for an extended period. Additionally, Ratings said it took into account the risk of long term reduction in global travel and changed travel patterns as a result of the pandemic, which it believes would weaken Booking's business.

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Despite this, Ratings said Booking has significant surplus cash and net cash position that provide the company with a sizable cushion.

The agency said it could lower Booking's rating if global travel conditions remain distressed into 2021, causing a meaningful reduction in the company's EBITDA, cash and liquid investments.

An outlook revision to stable is also likely if the outlook for global travel improves, Ratings said.

In March, Moody's also changed its outlook on Booking to negative from stable due to the impact of COVID-19 on the hotel and travel industries.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.