Thank you, Glenn, and good afternoon. I'll review our operating results for the second quarter and provide some color on trends we've seen so far in the third quarter. To avoid comparison to pandemic impacted periods in 2020, all growth rates will be relative to comparable periods in 2019, unless otherwise indicated. Information regarding reconciliation of non-GAAP results to GAAP results can be found in our earnings release.
Now, onto our results for the second quarter. On our last earnings call, we discussed the improvement in trends in Q1, which continued into April, driven by strong results in the US and improvements in Europe. On the earnings call, we saw the overall improvements in our trends accelerate in May and continue to get better in June, which resulted in our Q2 reported room nights declining 26% versus Q2 2019, which was significantly ahead of the 54% decline in Q1, the 43% decline we saw in April and the expectations in May.
The improvement in Q2 room nights growth rate versus Q1 was driven by Europe and the US as well as better results in Rest of World. Europe showed the greatest level of recovery in the quarter and actually achieved slight room night growth versus 2019 in June. Booking trends in Europe clearly benefited from a notable improvement in vaccination rates as well as loosening travel restrictions.
The US was again the strongest performing major country in Q2 and head very strong room night growth versus 2019 for the full quarter. Asia partially offset improvements in other regions with greater room night declines in Q2 than in Q1 due to the increase in COVID outbreaks with related travel restrictions. In the month of June, our room nights were down 13% and our monthly active unique customer counts at Booking.com reached 90% of the level we saw in June 2019.
As Glenn mentioned, we are pleased to see the solid rebound in our customer base at Booking.com as well as a healthy mix of new customers, which is only a little lower from the mix of new customers in Q2 2019. Mobile bookings, particularly through our apps represent over 60% of our total room nights. Our app continues to represent an increased percentage of our mobile bookings. Our direct channel increased as a percentage of our room nights year-on-year and relative to Q2 2019.
Domestic room nights grew in the mid-teens in Q2. While international room nights remain down significantly versus 2019, we saw a sequential improvement in our international bookings, resulting in the international mix of our room nights increasing to about 25% in Q2 from about 15% in Q1. Our cancellation rates improved in Q1 and were in line with Q2 2019 levels in the quarter. The percentage of our Q2 2021 bookings made with flexible cancellation policies remain significantly higher than in Q2 2019. The booking window at Booking.com remained shorter than it was in the second quarter of 2019 as we continue to see a higher mix of near-term bookings. However, the booking window contracted less than it did in the prior three quarters.
The mix of alternative accommodation room nights on Booking.com in Q2 was 32% which is 3 points higher than Q1. In June, our alternative accommodation room night growth was flat versus June 2019, the first time we've reached 2019 levels for this segment since the start of COVID. The sequential improvement from Q1 to Q2 was due primarily to the overall improvements in room night growth in Europe in the quarter. As we noted last quarter, Europe is where we have our highest mix of alternative accommodations. Within Europe, our mix of alternative accommodation remained about the same as Q1 and this represents continued increase from 2019 to 2020 and into 2021.
Gross bookings declined 12% in Q2, which is less than the decline in reported room nights due to increase in average daily rates for accommodations by 11% versus 2019 on a constant currency basis, and also due to a few points of changes in FX rates and strong performance in our flights business.
Our accommodation constant currency ADR benefited by about 7% from an increased mix of business in North America, which is a high ADR region, and a decrease of mix of business in Asia, which is a lower ADR region. Excluding regional mix effects, constant currency ADRs were up approximately 4%, driven mainly by rate increases in North America and in Europe. The increase in North America were driven by high level of demand for beach-oriented leisure destinations and in Europe were driven by a higher mix of summer bookings, which have higher ADRs.
Airline tickets booked in the second quarter were up 120% versus 2019, driven by strong growth of Priceline and by flight bookings at Booking.com and Agoda, neither of which have flight products in Q2 2019. We are encouraged to see another record-breaking quarter for air tickets booked through our flights business, which is a key component of our multi-products connected trip strategy. Consolidated revenue for second quarter was $2.2 billion and decreased 44% versus 2019, which is better than our expectations. Revenue in the quarter declined meaningfully more than gross bookings due to bookings made in the quarter are expected to check in the future quarters, at which point the revenue will be recognized.
Take rates in Q2 were about 10%, largely driven by timing differences. As you recall, we discussed the impact of timing on take rates in Q1, Q2 and for the full year during our last call. We continue to expect these timing factors to impact full year take rates, although the second half of the year will be less impacted than the first half of the year. Removing the impact of timing, our take rates on accommodation bookings in Q2 were stable versus Q2 2019.
The better-than-expected top line performance resulted in adjusted EBITDA of $48 million in second quarter, which came in better than our expectations. With the exception of Q3 last year, this is the first EBITDA positive quarter since the first wave of COVID. Marketing expense, which is a highly variable expense line, decreased 29% versus 2019. Marketing expenses declined more than gross bookings due to higher ROIs in the pay channels and the increase in our direct mix. Sales and other expenses in Q2 were significantly higher than they were in Q1 on a dollar basis. Sales and other expenses has a percentage of revenue in Q2 with better than our expectations due to lower than expected bad debts and customer service related expenses.
Personnel expenses in Q2 are higher than they were in Q1 on a dollar basis, primarily due to the $136 million of expenses related to our decision to repay the government aid in the second quarter. Excluding this repayments, personnel expenses in Q2 would have been in line with our expectations.
G&A and IT expenses were both higher in Q2 than they were in Q1 on a dollar basis and were in line without expectations. We recorded a non-GAAP loss of $105 million in the quarter.On a GAAP basis, we had an operating loss of $56 million in Q2. We recorded a GAAP net loss of $167 million in the quarter, which includes income tax expense of $126 million. On a GAAP and non-GAAP basis in Q2, we recorded a tax expense on a pre-tax loss due to higher earnings expectations for the full year relative to our expectations for Q1. For the full year, we expect our GAAP and non-GAAP tax rates were slightly higher than in 2019.
Now onto our cash and liquidity position. Our Q2 ending cash and investment balance of $16.1 billion was down based on Q1 ending balance of $16.4 billion. However, our Q1 ending balance benefited from the timing of the $2 billion raised in our Eurobond offering which we completed in March and the subsequent redemption of the two higher coupon senior notes occurring in April.
Adjusting on Q1 ending cash balance for the redemption of the two notes that happened in April would've resulted in an adjusted Q1 cash balance of $14.4 billion. Our Q2 ending balance was higher than this adjusted Q1 balance primarily due to operating cash flow of $1.2 billion and a $0.5 million unrealized gain on long-term investments. $0.2 billion operating cash flow in the quarter was driven almost entirely by change in working capital rather than the source of cash of $1.2 billion in the quarter due to the increase in our deferred merchant bookings and other current liabilities, partially offset by the increase in our accounts receivable.
We'll continue to focus on maintaining a strong liquidity position, given the continued uncertainty created by the COVID pandemic. Of the $16.1 billion of cash and investments at the end of Q2, $4.3 billion was related to long-term strategic investments and $11.7 billion was cash and short-term investments. We ended the quarter with about $12.3 billion in debt, which is about $3.6 billion higher than our pre-pandemic levels. We have a $1 billion convertible note maturing in Q3.
While return of capital to shareholders will be an important component of our value creation strategy in the future, we remain on pause and we'll wait to reinitiate until we believe each of our three major regions is beyond the risk of a significant reversal in trends due to COVID. We're not there yet, given the current trends we're seeing in Asia and with our current close watch on how things are developing in Europe.
Now onto our thoughts for third quarter. With the recent rising case counts driven by the Delta variant in many countries, some governments around the world have responded with new travel and leisure restrictions as well as some stricter vaccination and testing requirements for tourists. However, there are indications that authorization rates are lagging the recent increase in case counts, particularly in countries with high vaccination rates, which could be an important factor in how governments plan their responses to the recent increase in COVID cases.
With closely watching the UK where the vaccination rate is high and the government moved forward with relaxing travel restriction despite rising case counts in the country, which are among the highest in Europe. We're encouraged by the recent declining new case counts and by the continued low level of hospitalizations in the UK compared with other outbreaks. We saw booking trends improved in the UK in July leading up to an after travel restrictions lifted on July 19. July room nights declined about 22% versus 2019, which was a modest pullback from the 13% decline in June, primarily just softening booking trends in Europe.
Looking within Europe, we saw reductions in room nights in July across several of our key countries including Germany, France and Italy. But despite the recent pullback in these countries at the end of July, we had a high amount of gross bookings on the books for the remaining summer period in Europe than we did at this same point in time in 2019.
Outside of Europe, the US continued to have a very strong room night growth in July, although modestly below Q2 levels, while Asia and rest of world room night declines were about the same in July as they were in June. Asia continues to be the least recovered region in July and continues to be down significantly from 2019 levels. The changing growth rates from June to July were similar for domestic and international room nights, with domestic remaining positive and international room nights remaining down significantly versus 2019. Given the recent additional uncertainty around COVID driven primarily by the Delta variant, it's difficult to predict exactly how room nights in August and September will compare with a 22% reduction we saw in July.
Turning to the income statement, we expect Q3 gross bookings to decline several points less than room nights, driven by expected improvements in reported ADRs and by flight bookings. We expect that the Q3 revenue decline will significantly improve from Q2, reflecting the strong improvement in bookings in the last few months.
I just mentioned, we have more gross bookings for summer than this time in 2019 for Europe, the same is also true for North America. We expect our Q3 revenue as a percentage of gross bookings will increase meaningfully from Q2 due to the high concentration of check-ins expected in the third quarter and will be about in line with Q3, 2019.
As a reminder, the exact relationship between revenue gross bookings in Q3 will be impacted by how our bookings trend in August and September. We expect marketing expenses in Q3 will decline several points less than gross bookings as we expect to invest in capturing demand and increasing awareness during the peak travel season and ahead of the continued global recovery of travel demand.
We expect sales and other expenses in Q3 to be up significantly versus Q2 on a dollar basis due to higher gross booking volumes in the third quarter as well as an increase in the mix of gross bookings processed on a merchant basis. However, we expect sales and other as a change of revenue in Q3 will be a bit lower than in future. We expect our more fixed expense categories in Q3 in aggregates to be about in line with Q2 on a dollar basis. We expect Q3 EBITDA will be the highest since Q3 2019.
In conclusion, we are pleased with our better-than-expected results in Q2, which benefited from a recovery in travel demand and also reflects the strong fundamentals of our business and the good execution by our teams. We remain confident in the eventual full recovery of travel demand globally and we're looking forward to a strong summer travel season this year in North America and Europe.
We will continue to responsibly invest in our business to ensure we are well positioned for the full recovery of travel and for building a larger and faster growing business that generates more earnings than prior to the pandemic. We will now take your questions.
Maria, if you could open the lines for questions, please.