UPDATE 2-Expedia posts net loss on charge, bookings tumble

* Q4 net loss $9.60/shr

* Ex-items EPS 22 cents/share

* Company takes $3 bln charge for goodwill impairment (New throughout. Adds details, background, Analyst comment, share prices)

By Kyle Peterson

CHICAGO, Feb 19 (Reuters) - Expedia Inc (EXPE.O), the largest U.S. online travel agency, posted a fourth-quarter net loss on Thursday due to a hefty accounting charge while weaker travel demand steeply eroded the value of its bookings.

Expedia's results just missed market expectations and shares fell more than 10 percent. Shares of rival Priceline.com (PCLN.O), whose earnings beat forecasts on Wednesday, rose more than 16 percent.

Low hotel occupancy rates and airline capacity cuts have hampered bookings during the recession despite increased demand from bargain-hunter travelers.

Expedia's loss came to $2.76 billion, or $9.60 per share, compared with a year-earlier profit of $65.4 million, or 22 cents per share.

Much of that loss was attributable to a $3 billion charge for goodwill impairment stemming from a decline in its share price. Expedia shares have fallen about 75 percent since late 2007.

Excluding charges, earnings fell to 22 cents per share, missing expectations for 24 cents per share, according to Reuters Estimates.

Total value of its fourth-quarter bookings fell 11 percent to $4 billion. North American bookings fell 13 percent, while European bookings fell 11 percent.

Standard & Poor's said that because of the tough economic environment and Expedia's recent struggles, it is lowering its 2009 earnings per share estimate for the company to $1.25 from $1.35.

Expedia's results were in sharp contrast to those of Priceline, which posted a fourth-quarter net profit and a 23 percent jump in the total value of its bookings.

Morningstar analyst Warren Miller said Priceline has been outperforming Expedia in terms of growth for several quarters, especially internationally.

"Priceline's international expansion has really taken off while Expedia has had difficulty gaining momentum with its expansion efforts," Miller said. "Priceline's value offerings are also more attractive to consumers during this recession."

S&P upgraded Priceline to a buy rating from hold. Citigroup raised its price target for Priceline to $105 per share from $83. (Reporting by Kyle Peterson; Editing by Lisa Von Ahn and Derek Caney)