Airbnb chief predicts ‘travel rebound of the century’

Airbnb’s chief executive on Thursday predicted the “travel rebound of the century” as the home-rental company reported first-quarter revenues that pointed to a strong recovery in the US holiday market.

Airbnb’s quarterly revenue of $887m was up 5 per cent on the same period last year as guests paid higher rates for bigger and more rural properties. Wall Street had expected $721m in revenue for the quarter.

The number of bookings — 64.4m — was up 13 per cent on last year’s first quarter, while the average daily rate was $160, up 35 per cent year-on-year.

Pointing to Thursday’s guidance from US health officials who said fully vaccinated people could stop wearing masks in most settings, Brian Chesky, chief executive, told investors: “We expect travel to be very different than before. People are discovering that they don’t have to be tethered to one location to live and work.”

Gross booking value — the total amount of all nights and experiences booked — came in at $10.3bn, up 52 per cent on the same period in 2020 when the pandemic started to dampen travel, and 3 per cent higher than in 2019. According to FactSet, analysts had expected $7.87bn.

The company said the increase was driven by a shift towards more expensive bookings: more trips that included entire families, more bookings of entire homes, and more non-urban destinations. The supply of active listings had remained flat the fourth quarter of last year, the company said, although there had been an increase in the number of hosts offering non-urban properties.

Despite exceeding revenue expectations, Airbnb posted a first-quarter net loss of $1.8bn, significantly more than Wall Street forecasts of a $680m loss.

Airbnb said a number of one-off costs had contributed to the loss, including stock-based compensation, costs related to emergency funding it secured during the pandemic, and the ending of an office lease in San Francisco.

Discounting those costs — as well as interest, taxes, depreciation, and amortisation — Airbnb said its adjusted ebitda was minus $59m, beating analysts’ expectations, according to consensus data from Capital IQ.

The shares were trading nearly 1 per cent lower in after-hours trading on Thursday.

Airbnb said it expected bookings in the second quarter to be significantly higher than in 2020, given the heavy impact of the pandemic in that period last year. It said it expected inflated prices to persist.

“With the increased availability of vaccines and the easing of some travel restrictions, there has been greater willingness by guests to search for and book travel later in the year,” Airbnb said.

It cautioned that its business was less predictable outside the US. A recovery in Europe, in particular, was dependent on the “severity and duration” of travel restrictions.

“We saw a sharp increase in bookings in the UK immediately after British Prime Minister Boris Johnson announced plans to exit lockdown in February,” the company said, “as well as a sharp increase in bookings in France following the easing of travel restrictions in May.”

The quarter was a “testament to Airbnb’s adaptable model and strength of brand”, said Sooho Choi from consultancy Publicis Sapient.

“The strength of Airbnb’s [first-quarter] results are indicative of the travel rebound and is a positive sign for the entire travel industry,” he said.

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