Internet tycoon Barry Diller, who is splitting up his IAC/InteractiveCorp (NASDAQ: IACI) conglomerate, has been adding to his position in Expedia Inc. (NASDAQ: EXPE), the Internet travel site where he's also chairman.

According to Reuters, Diller exercised options to buy 9.5 million shares at $8.59, giving him a 27.7% stake in the company. Judging from the company's recent performance, he may be onto something.

Net income soared 69% to $99.6 million, or 32 cents per share, compared with $59 million, or 34 cents a year earlier, the Bellevue, Washington-based company said today. Revenue rose 24% to $759.6 million. When one-time items are excluded, Expedia said its earnings were 39 cents, beating the 37 cents expected by analysts surveyed by Reuters.

"Expedia succeeded on almost every financial metric during the third quarter," crowed an ecstatic Diller in the earnings release. "These are good results, and our ability to keep them coming depends on the right balance of investment and profitable growth -- and I think we've shown our ability to be in proper cadence with those levers throughout this year."

Though the results were impressive, I am still have my doubts about the online travel business because it's so price competitive. But investors clearly aren't as pessimistic as I am since Expedia shares are up more than 43% this year.