Hotel Reservations Network Reports Record Results for the Second Quarter of 2000 - Over 1,000,000 Hotel Rooms Sold Year to Date; HRN Generates Over $55,000,000 In Operating Cash Flow Year to Date

DALLAS, July 25 /Hotel Reservations Network (HRN) [NASDAQ: ROOM] , www.hoteldiscount.com, the Internet's leading provider of discount hotel accommodations worldwide and supplier of hotel lodging during sold out periods, announced today record financial results for all key financial metrics for the second quarter of 2000.

HRN posted a 107% year-over-year increase in second quarter revenues, driven by strong demand across the company's multiple distribution channels including HRN's websites, more than 2500 affiliate websites, premier search engine alliances and HRN's 24-hour call center. During the quarter, HRN significantly expanded its web presence and international footprint through new affiliate and hotel supplier relationships, as well as new destinations. Leveraging its profitable business model, HRN reported second quarter EBITDA of $12.9 million, a 123% year-over-year increase. In addition, the company reported adjusted net income, excluding the effects of certain non-cash expense, of $9.0 million for the second quarter of 2000, an increase of 126% over adjusted net income of $4.0 million for the second quarter of 1999.

    The financial highlights for 2000 and pro forma financial highlights for
1999, which follow, are in thousands (except per share data):
                            Three months ended            Six months ended
                                   June 30,                   June 30,
                             2000          1999         2000          1999
                                      (Pro forma)                (Pro forma)
    Net revenue            $78,082       $37,798     $133,345       $60,719
    Gross profit (1)        24,032        10,883       40,792        18,166
    EBITDA (2)              12,921         5,803       21,096         9,217
    Adjusted Net Income (3)  9,045         4,012       14,601         6,221
    Adjusted Earnings
     per share, diluted (3)  $0.16         $0.07        $0.29         $0.12
    Weighted average shares
     outstanding,
     diluted (4)            55,882        55,882       50,746        50,746

    (1)  Reflects reclassification of performance based affiliate fees from
         cost of sales to selling, general and administrative expenses,
         resulting in an increase to gross profit of $0.5 million for the
         second quarter of 1999 and $0.8 million for the six months ended
         June 30, 1999.
    (2)  EBITDA is defined as earnings before interest, taxes, depreciation
         and amortization of goodwill, and non-cash marketing expense
         (warrant costs related to affiliation arrangement).  For the three
         and the six months ended June 30, 1999, it also excludes
         non-recurring acquisition related costs of $20,257.
    (3)  Adjusted Net Income and Adjusted EPS exclude acquisition related
         goodwill amortization and warrant amortization and non-recurring
         acquisition related costs of $20,257 incurred in the second
         quarter of 1999.
    (4)  Weighted average shares outstanding for the calculation of
         earnings per share for the six months ending June 30, 2000 assumed
         the 38,999 shares of the Class B Common Stock was outstanding for
         the entire period and the 16,210 shares of Class A Common Stock
         and the diluted effects of options and warrants issued at the time
         of the initial public offering are weighted for the period from
         February 25, 2000 to June 30, 2000.  1999 shares outstanding is
         shown on a pro-forma basis for the same number of shares as 2000
         for comparison purposes.

Commenting on the results, Bob Diener, Hotel Reservations Network's President, said, "Our robust top and bottom line results reflect our success in leveraging our industry leadership position to capitalize on the dramatic growth of the online lodging market. The HRN open business model continues to fuel our expansion across the web as we build upon our network of affiliate web sites, while adding new destinations and extensive hotel supply relationships."

"The tangible value we provide to our room suppliers, distribution partners and customers has created a compounding business engine that benefits all parties. We have consistently increased the occupancy rates of our diversified base of hotels, provided the lowest room rates for our customers and created additional revenue opportunities for our distribution partners. As a result, we have built deep distribution channels that are generating unprecedented demand for our product as travel booked online grows rapidly across the web."

"Our fundamental outlook is exceptionally strong. We have created a highly efficient and scaleable business engine that generates strong sales with exceptionally low marketing and operating costs. Our growth is not reliant on acquisitions or high capital expenditures and we have no debt. As a result, we are one of the few Internet companies that is generating substantial cash, rather than consuming it. As we strengthen our first-to-market leadership position, we remain well-positioned to create shareholder value as more and more businesses and consumers transition their travel needs to the Internet."

Metric Highlights:

• During the second quarter, HRN increased its cities served to 60, representing a 62% increase over the 1999 second quarter and a 50% increase over the 1999 year-end total. Eleven new markets were added during the second quarter including Albuquerque/Santa Fe, New Mexico; Biloxi, Mississippi; Daytona Beach, Florida; Memphis, Tennessee; Jacksonville, Florida; Minneapolis, Minnesota; Pittsburgh, Pennsylvania; Richmond, Virginia; Tucson, Arizona; Williamsburg, Virginia; and Milwaukee, Wisconsin.
• The company's affiliate web base reached 2500 during the second quarter, an increase of over 500 key affiliates from the first quarter and an increase of 900 from December 31, 1999. The affiliates cover a broad spectrum from travel sites to city information sites to visitor bureaus and e-commerce sites.
• The growth of HRN's city and affiliate base coupled with strong organic growth in online hotel bookings drove hotel room nights sold during the quarter to 586,721, a 102% increase over the second quarter of 1999.
• Internet generated revenues represented 92% of second quarter revenues, as compared to 81% in the second quarter of 1999 and 81% for all of 1999.
• Affiliate generated revenues represented 52% of second quarter revenues, as compared to 41% for the second quarter of 1999 and 41% for all of 1999.
• $55.7 million of operating cash flow generated year to date.

Hotel Reservations Network, Inc. [NASDAQ: ROOM] is the Internet's leading provider of discount hotel accommodations worldwide and supplier of room availability during sold out periods. HRN supplies travelers with an easy-to- use, one-stop source for the guaranteed lowest hotel rates through its Websites, www.hoteldiscount.com and www.180096hotel.com, over 2,500 affiliate Websites and HRN's 24x7 toll-free call center (1-800-96-HOTEL). HRN provides accommodations at over 1,700 hotels in 60 major markets in North America and Western Europe. For more information about HRN, visit the Company's Websites at www.hoteldiscount.com and www.180096hotel.com. Located in Dallas, Texas, HRN is a majority-owned subsidiary of USA Networks, Inc. [NASDAQ: USAI] .

This news release contains "forward-looking statements" within the meaning of section 21E of the Securities Exchange Act of 1934, as amended. The company has based these forward-looking statements on its current expectations and projections about future events, based on the information currently available to it. The forward-looking statements include among other things, statements relating to the company's anticipated financial performance, business prospects, new developments, new strategies and similar matters. These forward-looking statements, are subject to risks, uncertainties and assumptions that may affect the operations, performance, development and results of the company's business and include, but are not limited to, the risk factors described under the section "Risk Factors" in the company's prospectus filed with the SEC on February 25, 2000 (which is available upon request from the company or on the company's websites, www.hoteldiscount.com and www.180096hotel.com, under the heading "Investor Relations.") and the following: 1) material adverse changes in the economic conditions in the company's markets; 2) future regulatory actions and conditions in the company's operating areas; 3) competition from others; 4) product demand and market acceptance; 6) the ability to protect proprietary information and technology or to obtain necessary licenses on commercially reasonable terms; and 7) the ability to obtain and retain key executives and employees. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or any other reason. In light of these risks, uncertainties and assumptions, the forward-looking statements discussed in this press release may not prove correct.

                       Hotel Reservations Network, Inc.
                      Condensed Statement of Operations
                                 (Unaudited)
                 (in thousands, except for per share amounts)

                             Three Months Ended           Six Months Ended
                                   June 30,                   June 30,
                              2000         1999          2000          1999
                                       Pro Forma (1)             Pro Forma (1)

    Revenues               $78,082       $37,798     $133,345       $60,719
    Cost of revenues (2)    54,050        26,915       92,553        42,553
    Gross profit            24,032        10,883       40,792        18,166

    Operating expenses:
      Selling, general &
      administrative
      (2) & (3)             11,285         5,189       20,041         9,123
      Amortization of
       non-cash marketing
       and distribution
       expenses              1,271            --        1,721            
      Amortization of
       goodwill             10,591        10,591       17,280        17,280
    Total operating
     expenses               23,147        15,780       39,042        26,403
    Income (loss) from
     operations                885       (4,897)        1,750       (8,237)
    Interest & other
     income, net             1,961           829        2,990         1,072
    Income (loss)
     before income tax       2,846       (4,068)        4,740       (7,165)
    Provision for
     income tax              1,096            --        1,825            
    Net Income (loss)       $1,750      ($4,068)       $2,915      ($7,165)
    Net income (loss)
     per share (basic &
     diluted)                $0.03       ($0.07)        $0.06       ($0.14)
    Weighted average
     shares outstanding
     (basic) (4)            55,209        55,209       50,310        50,310
    Weighted average
     shares outstanding
     (diluted) (4)          55,882        55,209       50,746        50,310

    EBITDA (5)             $12,921        $5,803      $21,096        $9,217


    Adjusted Income
     excluding certain
     Non-Cash charges (6):

    Income before
     income tax             $2,846      ($4,068)       $4,740      ($7,165)
    Adjustment for
     non-cash and
     non-recurring
     expenses:
      Amortization of
       goodwill             10,591        10,591       17,280        17,280
      Amortization of
       non-cash marketing
       and distribution
       expenses              1,271            --        1,721            
    Total non-cash
     expenses               11,862        10,591       19,001        17,280

    Adjusted pre-tax
     Income before
     non-cash expense       14,708         6,523       23,741        10,115

    Provision for
     income tax              5,663         2,512        9,140         3,894

    Adjusted net
     Income (6)             $9,045        $4,012      $14,601        $6,221

    Adjusted EPS Excluding
     Certain Non-Cash
     Charges
     (basic & diluted) (6)   $0.16         $0.07        $0.29         $0.12
    Weighted average
     shares outstanding
     (basic) (4)            55,209        55,209       50,310        50,310
    Weighted average
     shares outstanding
     (diluted) (4)          55,882        55,882       50,746        50,746

    Notes:

    (1)  The pro forma operating statement for the quarter and six months
         ended June 30, 1999 gives effect to the acquisition, of the company's
         predecessor business as if it had occurred on January 1, 1999.

    (2)  Reflects reclassification of performance based affiliate fees from
         cost of sales to selling, general and administrative (SG&A) expenses
         resulting in a reduction of cost of sales and increase of SG&A
         expenses of $0.5 million for the second quarter of 1999 and
         $0.8 million for the six months ended June 30, 1999.

    (3)  Selling, general & administration costs for the quarter and six month
         ended June 30, 1999 exclude non-recurring acquisition related costs
         of $20,257.

    (4)  Weighted average shares outstanding for the calculation of earnings
         per share for the six months ended June 30, 2000 assumed the 38,999
         shares of the Class B Common Stock was outstanding for the entire
         period and the 16,210 shares of Class A Common Stock and the
         dilutive effect of options and warrants issued at the time of the
         initial public offering are weighted for the period from February 25,
         2000 to June 30, 2000.  1999 shares outstanding is shown for the same
         number of shares as 2000 for comparison purposes.

    (5)  EBITDA is defined as earnings before interest, taxes, depreciation
         and amortization.  For the three and the six months ended June 30,
         1999, it also excludes non-recurring acquisition related costs of
         $20,257.

    (6)  Adjusted Net Income and Adjusted EPS information is presented for
         informational purposes only and should not be considered as a
         substitute for the historical financial information presented in
         accordance with generally accepted accounting principles.

                       Hotel Reservations Network, Inc.
                         Selected Balance Sheet Data
                                 (Unaudited)
                                (in thousands)

                                                     June 30,     December 31,
                                                       2000           1999

    Cash and cash equivalents                       $113,119         $6,257
    Short-term investments held for sale              38,228          4,906
    Fixed assets, net                                  2,166          1,988
    Accounts payable                                  28,391         16,252
    Deferred Revenue                                  38,553         16,447