Underlining the fact that online travel firms have prospered despite the slump, market leader Expedia has announced results hugely ahead of Wall Street expectations.

For the last three months of last year, Expedia saw its net income surge to $19m (�13m), compared with a loss of $2.6m in the same quarter of 2000.

The firm's revenues, at $82m, were almost 20% ahead of analysts' forecasts, and double the level seen a year before.

Earlier on Monday, shares in all online travel firms leapt, after discount travel operator Hotel Reservations Network reported strong bookings.

Expedia's shares jumped by 7% ahead of its earnings announcement, which came after the market closed.

Keep on growing

Expedia said it expected the upward trend to continue, forecasting revenues of about $87m for the next quarter.

For the quarter just ended, agency revenues, mostly made up of booking fees from airlines, were $42m, up from $24m a year earlier.

Merchant revenues, mainly accounted for by custom travel packages, tripled to $34m.

"We've had a phenomenal growth run across the board, but it's really led by these merchant businesses, especially our discount hotel business and dynamic vacation business," chief executive Rich Barton said.

"People are... on the web even more than before."

Leaner, fitter, faster

As results from traditional travel companies have sagged since 11 September, theories abound as to why online firms have done so well.

One is that they are able to advertise discount fares much more efficiently than their old-economy rivals, thereby appealing to wallet-conscious customers.

Since all online firms suffered tough times early in 2001, some analysts say that they have become hardened to downturns.

And as many consumers have postponed their holiday and travel bookings in recent months, online agents are better-placed to serve the "last minute" business.