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On Tuesday, May 9, Airbnb Inc (NASDAQ: ABNB), the online marketplace for homestays, reported results for Q1 2023, with a minor beat on revenue and a miss on bookings.
Airbnb Q1 2023 Performance
For the first quarter, the company reported earnings-per-share (EPS) of 18 cents against 9 cents. Furthermore, it also reported a revenue of $1.82 billion, 20% up year over year. From a loss of $19 million in the year-earlier period, Airbnb swung into a net profit of $117 million.
In the shareholder letter, Airbnb said that it has been a “strong start” to the year and the company is looking for a “strong summer travel season”. Airbnb’s revenue from the nights and experiences booked stood at $121.1 million against the actual $122.4 million. Speaking on this development, the shareholders’ 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.”
Airbnb is currently under pressure since its rival players – Expedia (EXPE) and Booking Holdings (BKNG), reported strong results last week.
To counter this strong competition, Airbnb is also looking to increase its host supply. The shareholder letter reads: “Traveling on Airbnb is mainstream. 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.”
ABNB Stock Tanks 12%
Despite the strong Q1 2023 numbers beating revenue estimates and EPS, the Airbnb stock price tanked by more than 13% in the pre-market hours. This is because the company gave cautious guidance for the current quarter stating that second-quarter comparisons would be tough.
As per the forecast shared by Airbnb, the company is expecting the second-quarter revenue to be anywhere between $2.35 billion and $2.45 billion. As per the analysts’ expectations, the revenue should be around $2.42 billion. However, Airbnb stated that it will be focusing on three strategic priorities:
- Make hosting on the platform just as popular as travel.
- Provide affordable stays for guests.
- Increase presence in “less mature” international markets.
However, the company is optimistic about the summer travel season ahead. Online travel demand has recovered fully after the COVID-19 pandemic. “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. 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,” the company said.
Furthermore, Airbnb also stated that it plans to integrate AI features such as GPT-4 within the next year and so where companies can expect some “big changes”.
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