Earnings season: Airbnb’s 300% revenue jump

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Airbnb is the latest big tech firm to record a Wall Street-beating quarter but see its share price drop.

Airbnb earnings

Airbnb’s headline stats

With revenues totalling $1.34bn in Q2 2021, Airbnb notched up a 300% year-on-year increase. This flew over Wall Street expectations.

Sales were up 175% y-o-y this quarter for a total of $175m. Gross booking value, the key metric Airbnb uses to track host earnings, incorporating taxes and cleaning and service fees, clocked in at $13.4bn. In year-on-year terms, that’s a 320% increase.

83.1 million nights were booked using Airbnb in Q2 2021, measuring 29% growth against the first quarter, and 197% over Q2 2020 when the world entered lockdown. Analysts expected 79.2m nights booked, so again this was another beat.

The key takeaways from Airbnb’s latest earnings report are:

  • Revenues – $1.34bn against $1.26bn estimated
  • Earnings – -$0.11 per share

While a lot of the main measuring metrics were smashing Wall Street estimates, Airbnb shareholders would have lost money, according to these statistics.

That’s fairly odd, given the fact that Airbnb’s net loss has narrowed, falling from $575.6m to $68m. Everything suggests Airbnb is moving in the right direction – but there is still a huge, COVID-19 shaped shadow looming over the rest of the holiday app’s year.

Airbnb stock price

Airbnb shares slid 4% upon publishing its earnings reports. EPS is down too as seen above.

That means it joins other tech stocks like Apple and Tesla posting bumper quarterly results but seeing their share prices dip.

In a letter to investors, the app’s executives stated Airbnb is bracing for Delta variant volatility. Cases continue to rise in the US and around the wider world, meaning travel restrictions and limits on overnight stays could very well make a return.

If that was the case, then stays and revenues may slide in Q3 and Q4.

The company said that although it expects the third quarter to deliver its strongest quarterly revenue on record, it expects Q3 nights and experiences booked to be below that of Q2 and Q3 2019.

“As we exit Q2 and come into Q3, we have a combination of fewer bookings for the fall, just given the nature of some of the seasonality, and any kind of impact potentially on Covid concerns,” Airbnb CFO Dave Stephenson said on a call with analysts.

Vaccination progress and containment of new COVID-19 variants will be key to Airbnb’s sustainability. Summer is also drawing to a close. New bookings in the Autumn and Winter, not the busiest times of the year for holiday-related businesses, have already started to slip as Dave Stephenson points out.

It’s going to be a long six months for Airbnb.