Airbnb saw its net loss shrink in its second quarter and most key metrics exceed or approach pre-pandemic 2019 levels, so Brian Chesky, its co-founder and CEO, boasted about Airbnb’s leadership in travel recovery.
Chesky, speaking to financial analysts from Italy’s Airbnb listing, said that Airbnb isn’t just waiting for travelers to return. Instead it has been creating new products and services for hosts as well as travellers. Chesky stated that Airbnb emerged faster from the crisis than other companies and is better prepared for the future.
Chesky stated that Airbnb was leading the charge in the rebound in travel. He also said, at various points, during the question-and-answer session, about Airbnb’s financial results in the second quarter ended in June.
Despite Airbnb acknowledging in its shareholder letter that the delta variant will render projections about gross bookings, and nights and experiences bookings “volatile and non-linear,” chief financial officer Dave Stephenson told the financial analysts that the current July-August-September quarter will see Airbnb’s “highest-ever” revenue, “while the profits are going to be the highest ever. The business is still very strong.
Airbnb is well-positioned for success during the rebound in travel. Chesky stated that changes to travel patterns such as more flexibility about where and when people travel are tailwinds to Chesky’s company.
Dan Wasiolek, senior equity analyst at Morningstar, said in reaction to Airbnb’s financial results that the company has indeed seen the strongest bounce back among its peers.
Skift reported that domestic road travel continues to lead the recovery. This has benefited whole houses, non-urban hotels, and alternative accommodation. The strongest recovery has been seen in Airbnb, and it’s not surprising.
Wasiolek was curious about the sustainability of Airbnb’s benefits if remote work doesn’t continue at present levels. “And when travel expands out…
Wasiolek stated that traditional hotels operators such as Hilton are likely to lead the way in terms of improving their services. Airbnb is an excellent company with tremendous revenue growth and margin expansion potential, however, it is difficult to adjust for its valuation.
Airbnb had $68 million net loss in its second quarter, which was the lowest among its peer groups. Expedia Group suffered a loss of $301million, while Booking Holdings lost $167 million.
Because their business models are different, it is hard to compare these three companies. Expedia and Booking offer a wider range of travel products than Airbnb, including cruises, vacation packages and flights. It should be noted that Expedia (667%) and Booking (852%) saw their gross bookings increase faster than Airbnb’s (332%) year-over-year in the second quarter.
Chesky cited Airbnb’s second-quarter EBITDA margin improvement as evidence that it has managed to control its marketing and sales expenses and become more efficient.
He stated that the adjusted EBITDA profit reached $217 million. This represents an increase of 16 percent in EBITDA margin. It was more than $600,000,000 of EBITDA improvement from last year and represents 20% or 2,000 basis point margin expansion since 2019. This is an equivalent level of revenue.
Stephenson stated that Airbnb’s growth in revenue was caused by strong room night growth in North America and higher average daily rates.
He also mentioned that Airbnb saw a decrease in its July demand. This could have been due to the peak summer travel season or the delta variant.
After hours trading on Thursday night, Airbnb shares fell nearly 5 percent.
Photo credit: Airbnb’s short-term rental. According to the company, it’s best-positioned for pandemic or post-pandemic travel patterns. Airbnb
Publited Fri, 13 August 2021 at 00:07.56 +0000