Airbnb shares more than double in price in IPO
Airbnb proved its resilience in a year that has upended global travel. Now, it needs to prove it can live up to investors’ sky-high expectations.
The San Francisco-based home-sharing company made a triumphant debut on the public market Thursday. Its shares closed at $144.71 apiece, more than double the $68 price that Airbnb had set. The closing price gave the company a valuation of just over $100 billion. The shares are trading on the
Nasdaq Stock Market under the symbol “ABNB.”
Instead of the traditional ringing of the bell prior to the trading day, Airbnb presented a video of Airbnb hosts from around the world ringing their doorbells. In a video message, CEO Brian Chesky also thanked the millions of guests who have stayed at its listings. In 2019 alone, 54 million guests stayed at an Airbnb.
“You gave us hope that the idea of strangers staying together, in each others’ homes, was not so crazy after all,” Chesky said. “Airbnb is rooted in the fundamental idea that people are good and we’re in this together.”
Airbnb raised $3.7 billion in its offering, making it the biggest U.S. IPO this year, according to Renaissance Capital, which tracks IPOs. The company had initially set a price range of $44 to $50 for it shares, but raised that to a range of $56 to $60 this week indicating rising investor demand.
Airbnb’s listing comes a day after another San Francisco-based company, DoorDash, soared through it initial public offering, the second-largest in 2020. DoorDash’s stock jumped 85.8% to close at $189.51. The meal-delivery app raised $3.4 billion with its offering.
Airbnb — which has never posted an annual profit — said its revenue fell 32% to $2.5 billion in the first nine months of this year as the COVID-19 pandemic forced travelers to cancel their plans. The company delayed its IPO — initially planned for the spring — and funded operations with $2 billion in loans. In May, Airbnb cut 1,900 employees — or 25% of its workforce — and halted programs not related to its core business, like movie production.
But in the months since, Airbnb’s business rebounded faster than hotels as travelers felt safer booking private homes away from crowded downtowns during the pandemic.