Nights booked on Airbnb hit record high in Q1 but still miss estimates; cautious growth forecast issued for Q2
Nights booked on Airbnb Inc. hit a record high in the first quarter as more guests traveled overseas and returned to cities, leading to the company’s first profitable start to the year on record, executives announced Tuesday.
But executives’ forecast was less bullish, even though they expect a strong summer travel season and second-quarter revenue growth. They cautioned that growth in nights and experiences booked will be “unfavorable” compared with the year-ago quarter, when there was a surge in travel demand as fears about…
Today, the well-known short-term rental platform, Airbnb, saw its stock drop sharply following the release of its Q3 earnings. The earnings report showed a record nights booked of 67 million, however, this figure was short of analyst expectations of 69 million. In addition, the company’s forecast of slowing growth has investors concerned.
Airbnb’s stock fell by nearly 6% in after-hours trading following the announcement of the earnings. The company reported a meager growth of just 2% in gross bookings for the quarter, a far cry from its prior levels which ranged from over 40% in the first half of 2020. Bookings in Europe, which are often seen as a bellwether for the company’s overall performance, fell by 5%. Airbnb’s CEO, Brian Chesky, said: “We’re not expecting to see the kind of growth we’ve seen in the past. We will be disciplined and conservative in our investments as we move forward.”
Analysts have expressed concern about the company’s outlook for 2021. While Airbnb said it expects demand for travel to pick up again in 2021, it cautioned that the recovery may take time and could be uneven. Analysts have suggested that the company may need to adjust its pricing or introduce a loyalty program to spark a rebound in bookings.
Given the uncertainty surrounding the global travel economy, investors remain cautious about the future of Airbnb. The company is expected to have to take some drastic steps in order to grow its business in 2021. Whether or not these steps can help the company turn its fortunes around remains to be seen.