Airbnb posts biggest decline in a year on weak travel outlook
Airbnb shares slid by the most in a year after the home rental company gave lackluster guidance for a second straight quarter, indicating that growth in travel spending will slow ahead of the peak summer season.
Revenue for the current quarter ending in June will be $2.68 billion to $2.74 billion, the company said wednesday in a letter to shareholders. Analysts had been expecting $2.74 billion. In its statement, Airbnb blamed the earlier timing of the 2024 Easter holiday, as well as currency headwinds.
The stock was down 6.87 percent Thursday, its biggest drop since may 10, 2023.
Airbnb and its rivals have been working to establish a new normal since the world emerged from the COvID-19 pandemic. The industry’s recovery has been choppy, with demand growing faster in some regions and tapering off in others due to the different pace of reopening from lockdowns. Last week, booking holdings Inc. gave worse-than-expected guidance and Expedia Group Inc. issued disappointing results.
Airbnb, which specializes in shared homes and vacation rentals both in urban cities and rural destinations, saw a deceleration in north American nights booked in the first quarter. It has been making an effort through its marketing to differentiate its rentals from hotels in the hopes that people traveling in groups will opt to rent homes with multiple bedrooms. The company said that bookings for groups of six or more people were the fastest-growing segment in the region.
Growth in the current period for nights and experiences booked — a key industry metric — will be “relatively stable” compared with the 9.5 percent gain it posted in the first quarter. That falls short of analysts’ expectations for a roughly 12 percent increase. It also represents the slowest rate of growth since 2020, suggesting that overall demand has normalized after an initial post-pandemic travel boom.
The outlook overshadowed an otherwise better-than-expected re
Airbnb, which specializes in shared homes and vacation rentals both in urban cities and rural destinations, saw a deceleration in North American nights booked in the first quarter.
port for the first quarter, which saw revenue surpass estimates, growing 18 percent to $2.14 billion thanks to particularly strong gains in Asia and Latin America.
The company is expecting revenue growth to re-accelerate in the third quarter, as key international events like the summer Olympics in Paris and the Euro Cup in Germany are fueling travel demand in the peak summer season.
The continued recovery in international travel has been a bright spot for the travel industry including Airbnb, whose businesses in Latin America and Asia have seen faster growth than in the United States. It has also been investing more in less mature markets in those regions to drive nearterm gains, including the introduction of limited-edition stays inspired by local cultural icons.
Chief executive brian Chesky has said that the company he cofounded in 2007 is ready to expand beyond its core product after spending the past year refining existing offerings. In particular, the company has been focused on making listings more reliable and affordable for guests, as well as encouraging more people to host.
That work has been paying off. The number of active listings in the first quarter grew 15 percent year-over-year and supply has continued to grow at a double-digit pace across all regions.