Online travel agency Expedia's second quarter earnings dropped 57 percent, hit by foreign exchange rate changes and a decrease in hotel and air travel bookings. But the the company's adjusted earnings beat analyst expectations, and Expedia shares surged more than 12 percent in early trading today.

Bellevue-based Expedia reported Q2 net income of $40.9 million, or 14 cents per diluted share, down from $96.1 million, or 33 cents per diluted share, the same quarter a year ago. Second-quarter revenue fell to $769.8 million from $795 million a year ago.

The company's net income adjusted for foreign exchange losses, acquisition-related costs and other factors was 38 cents per share, down from 40 cents per share in the year-ago period. Analysts polled by Thomson Reuters First Call had expected adjusted earnings of 31 cents per share. The company's shares jumped more than 12 percent to $20.70 in early trading Thursday.

Expedia, which also operates hotels.com, hotwire.com and other sites, said gross bookings fell 5 percent, driven primarily by lower prices for hotel rooms and airline tickets. Domestic bookings fell 4% and international bookings decreased 8%.

The company in May got rid of booking fees for airline tickets purchased through its site, following the lead of Orbitz, Priceline.com and other rival sites. Expedia did an undisclosed number of layoffs earlier this year.

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