Airbnb beats pandemic with ‘best of the year’
(Bloomberg) — Airbnb Inc. beat revenue and profit estimates in the fourth quarter, sparking a resurgence wave of COVID-19 infections and coming out even stronger this year than before the pandemic. Shares rose.
Airbnb said in a statement Tuesday that revenue rose 78% to $1.53 billion. It beat analysts’ estimates by $1.46 billion. The San Francisco-based company reported net income of $55 million compared to a loss of $3.9 billion a year ago, a record for the period. Earnings per share was 8 cents, compared to an estimate of 3 cents.
Chief Executive Officer Brian Chesky called the results “the best year in our company’s history” and said Airbnb was able to weather the pandemic because of its highly adaptable business model. “We have millions of types of homes in almost every community around the world at almost no cost,” he said in an interview Tuesday with Bloomberg Television. “This means that although the journey changes, we are able to adapt.”
Airbnb has recovered since the start of the pandemic, when the company cut thousands of jobs and considered postponing its initial public offering around the world as a travel ground. After the initial setback, business boomed as workers no longer had to stay in traditional offices five days a week and could work from anywhere. “As a result,” Airbnb said in a letter to shareholders, “people are spreading to thousands of towns and cities, living for weeks, months or even entire seasons at a time.”
Nearly half the number of nights booked in the fourth quarter were for stays of one week or more and one in five nights were for stays of one month or more.
In the early days of the pandemic, many people sought homes in more rural areas within driving distance of major cities, although Airbnb said guests are now returning to cities. In Q4, gross nights booked at urban destinations intensified from the previous quarter and almost recovered to 2019 levels for the same period.
Airbnb remained resilient despite the Omicron version of COVID-19 swooping down late last year, shutting down businesses and disrupting flights and holiday plans during the holiday season. The company said it saw less impact on bookings and cancellations with Omicron than the Delta version. Rival Expedia Group Inc., which provides reservations for hotels and alternative accommodation through its Vrbo platform, has also faced a resurgence of Covid, with reported revenue more than doubling in the fourth quarter.
With US inflation hitting a four-decade high, Chesky said it could prompt more people to host. Individuals and families will be looking for economic opportunity to “make it through this time” and they can sometimes host $9,000 to $10,000 a year, he said. Chesky said on a conference call with analysts that the average day rate for Airbnb bookings in high-traffic areas increased, and higher prices helped boost revenue.
In interviews on Tuesday, Chesky said the rate hike was partly due to inflation, but that the primary reason was because of where people are choosing to live – often in more expensive places in the US and with larger numbers of people changing. mix.
Airbnb said it is “encouraged” by what it is seeing so far this year. “Omicron’s influence is fast over and guests are confidently booking early in the year for the summer travel season,” the company said. Airbnb now expects the number of nights and experiences booked in the first quarter to be “significantly higher” than the levels in the first quarter of 2019.
Airbnb said revenue in the first quarter is expected to be $1.41 billion to $1.48 billion.
Shares rose up to 3.5% on Wednesday in New York. The stock has lagged Expedia this year, clocking an 8% gain compared to its rival’s 17% jump. Several analysts raised their price targets on Airbnb stock.
Chesky sees the disruption of the traditional work culture as a boon to the company’s business model as employees have more flexibility to work from anywhere. He’s even spending several months “living” at Airbnb rentals himself. “One thing I learned is that it’s important to have really good Wi-Fi,” he quipped.
Airbnb now lets guests search for listings up to a year in advance, adapting to changes in travel searches during the pandemic. But its futurism has limits. Chesky said Airbnb has no immediate plans to offer crypto payments: “We are fully, as promised, looking into crypto payments,” he said. “I have nothing to announce right now.”
– With assistance from Emily Chang.
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