Airbnb’s business is booming—and rates are rising

The home-sharing platform posted revenue of $1.5 billion, up 70% from the prior year and higher than the $1.45 billion expected by analysts surveyed by Refinitiv. Revenue also shows an 80% increase from the same quarter in 2019, before its business was hit by the pandemic. Airbnb posted a net loss of $19 million, down from a loss of $1.2 billion in the same quarter in 2021.

Airbnb said in a letter to shareholders that revenue growth was driven by an increase in bookings as well as “continued strengthening” in average daily rates. Airbnb said average daily rates in the first quarter were $168, an increase of 37% compared to the same quarter of 2019, pre-pandemic, and 5% compared to the first quarter of 2021.

Shares of Airbnb were up more than 5% in after-hours trading, after falling 5% during normal hours.

Airbnb attributed the increase in rates compared to the pre-pandemic period partly to more bookings in “homes throughout North America, and non-urban destinations” that have higher rates. It said last year’s growth was “entirely driven by price appreciation.”

On a call Tuesday to discuss earnings, CEO Brian Chesky noted that the platform has offerings “at all price points,” and CFO Dave Stephenson said Airbnb “only sees price appreciation negatively impacting our business.” Not looking,” and quoted similarly. the diversity of its offerings”.

The company said profits in its business had come “despite the ongoing pandemic, the war in Ukraine and widespread economic headwinds”. Airbnb noted in its shareholder letter that more than 34,000 people have signed up to provide homes to refugees fleeing Ukraine through the company’s philanthropic arm, Airbnb.org. The company announced in late February that it would offer free, temporary housing for 100,000 Ukrainian refugees.

When Airbnb debuted on Wall Street in December 2020, it was the start of a remarkable comeback to its business after the initial devastation of the pandemic, which caused it to cut a quarter of its workforce. The company’s revenue grew 25% in 2021 compared to the year before the pandemic. In its letter to shareholders, Airbnb said it expects to post revenue of more than $2 billion in the second quarter, which includes the start of the summer travel season.

On Tuesday’s call, Chesky said last year was “probably the travel rebound of the century … I think this year is going to be even bigger,” citing the emergence of new strains of the coronavirus in the later part of 2021 Giving. affected demand

Chesky said he was focused on gaining “as much market share as possible,” including people who haven’t traveled since the start of the pandemic, to book with Airbnb.

The company has also teased changes to its product that it will announce at an event next Wednesday.

In January, Chesky said he thought the biggest travel trend in 2022 would be “people spread across thousands of towns and cities, living for weeks, months, or even entire seasons at a time.” The company said on Tuesday that long-term stays of 28 days or more remain its fastest-growing category compared to 2019 (however, such stays were down 24% compared to the first quarter of last year). . Airbnb said nearly half of all bookings were for at least seven nights.

Last week, Chesky informed employees that he would not need to return to the office – ever – if he chose not to, freeing him up to live a more nomadic lifestyle. Chesky said on the earnings call that he thinks “flexibility is here to stay,” a trend he undoubtedly sees as beneficial to Airbnb.

Chesky said he believes that after compensation, flexibility is one of the most important ways companies will be able to attract talent.

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