After the market closed, Airbnb released its Q1 2023 financial results, revealing a small increase in revenue but a decline in bookings. In response, the company's stock decreased by approximately 9% during after-hours trading. Additionally, Airbnb declared a new share buyback program worth $2.5 billion.
The subsequent figures from Airbnb's earnings report are worth noting, as compared to the estimates of Wall Street compiled by Bloomberg:
– Revenue: $1.8 billion actual versus $1.79 billion estimated
– EPS: 18 cents actual versus 12 cents estimated
– Booked Nights and Experiences: $121.1 million actual versus $122.4 million estimated
– Q2 Revenue Guidance: $2.35-$2.45 billion actual versus $2.42 billion estimated.
Airbnb was under pressure this earnings cycle due to the strong financial results reported by other travel companies such as Expedia and Booking Holdings last week.
In an attempt to put into context the miss on nights and experiences booked, the company's shareholder letter reads: “Nights and Experiences Booked grew 19% in Q1 2023 compared to a year ago. Even with continued macroeconomic uncertainties, we have seen our highest number of active bookers, demonstrating both loyalty from our returning guests and a growing base of first-time bookers. Our current backlog of nights is approximately 25% stronger than a year ago.”
Looking ahead, Airbnb is planning to boost host supply. “Traveling on Airbnb is mainstream,” the letter reads. “We want hosting to be just as popular. To achieve this, we are raising awareness around hosting, making it easier to get started, and providing even better tools for Hosts.”
Airbnb is also anticipating a crucial summer travel season, during which online travel demand has recovered fully from the effects of COVID-19, albeit with lingering macroeconomic uncertainties. Airbnb disclosed that it has invested heavily in marketing efforts in preparation for this summer season.
“In 2023, we have pulled forward the timing of marketing spend to be more heavily weighted in the first half of the year as compared to 2022,” according to the company's shareholder letter. “In addition, we are increasing our brand marketing investment in more countries around the world. We believe spending earlier in the year helps to support the peak summer travel season.”
