Airbnb Anticipates Weaker Q2 Revenue Despite Strong Demand for International Travel
Airbnb reports higher quarterly profits but forecasts weaker Q2 revenue. Demand for travel outside of North America boosts earnings in Asia-Pacific and Latin America. Second-quarter revenue falls below analysts' estimates due to currency exchange rates and Easter holiday timing.
However, the company's forecast for second-quarter revenue fell short of Wall Street expectations, causing a decline of 8% in its shares after the bell.
While accommodation companies have experienced a surge in travel demand outside of North America, particularly in Asia-Pacific and Latin America, Airbnb's second-quarter revenue is projected to be between $2.68 billion and $2.74 billion. This is below analysts' estimates of $2.74 billion. The company attributes this shortfall to currency exchange rates and the timing of the Easter holiday.
Although the Easter holiday positively impacted the first quarter, driving increased travel, it may have a dampening effect on bookings in the second quarter, according to Airbnb. Chief Financial Officer Ellie Mertz acknowledged the company's desire for higher growth but stated that the outlook reflects the current trends.
In the first quarter, Airbnb's revenue rose by 18% year-over-year, reaching $2.14 billion. The number of nights and experiences booked during this period increased by 9.5% to approximately 133 million. Notably, bookings in Asia-Pacific and Latin America saw significant growth of 21% and 19%, respectively. However, bookings in North America experienced a slight deceleration.
The average cost per night for an Airbnb stay was $173 in the first quarter, representing a 3% increase compared to the previous year. The company observed a rise in shorter stays and bookings of entire homes, which contributed to margin growth.
Active listings on the platform expanded by 17% year-over-year, with Asia and Latin America leading the way in new additions.
Looking ahead to the summer, Airbnb anticipates a rebound in revenue growth in the third quarter. This is expected to be driven by increased travel demand surrounding international events such as the Olympics and Euro Cup.
Airbnb reports higher quarterly profits but forecasts weaker Q2 revenue
Demand for travel outside of North America boosts earnings in Asia-Pacific and Latin America
Second-quarter revenue falls below analysts' estimates due to currency exchange rates and Easter holiday timing
Source: REUTERS