Airbnb picked up its highest all-time fourth-quarter profit, and as soon as the earnings report came out, the after-hours stock price rose more than 8%.
On the morning of February 16, Airbnb (ABNB. US) announced fourth-quarter results. Airbnb's fourth-quarter revenue grew 78 percent year-over-year to $1.53 billion, beating market expectations, according to earnings.
Fourth-quarter net income of $55 million, a record fourth-quarter high, with a loss of $3.9 billion in the year-ago quarter, and adjusted EBITDA of $333 million in the fourth quarter of 2021, also hit a record high and exceeded market expectations.
As the world's largest homestay platform, Airbnb's "report card" in the fourth quarter of 2021 can be said to be remarkable, and at the moment when the tourism industry is looking forward to recovery, Airbnb's performance has undoubtedly given the market a shot in the arm.
GBV grew 91% year-on-year, and telecommuting became the norm
In the context of the epidemic, the rise of remote work models.
According to Airbnb's earnings data, in terms of total order value (GBV), thanks to the strong recovery in bookings and the rise in average daily house prices (ADRs), Airbnb's GBV in the fourth quarter of 2021 increased by 91% year-on-year to $11.3 billion, up 32% from the same period in 2019 before the epidemic, and GBV for the whole of 2021 was $47 billion, an increase of 23% from 2019 before the epidemic.
The number of experience and booking nights in the fourth quarter was 73.4 million, lower than the 75.3 million expected by analysts, an increase of 59% year-on-year, down 3% from the same period in 2019 before the epidemic; the number of experienced and booked room nights last year was 300.6 million, an increase of 56% year-on-year, and an 8% decrease from 2019 before the epidemic.
Since the pandemic, telecommuting has become the norm, with many people spending weeks, months, or even entire quarters in different towns, extending their stays in homestays. Nearly half of Airbnb's room nights booked in the fourth quarter came from stays of more than 7 days, 20% were longer stays of more than 28 days, and 175,000 stays were longer than 3 months. Room night bookings in non-urban areas increased by 45% compared to the same period in 2019.
Airbnb CEO Brian Chesky said the traditional nine-to-five work culture in the company's office has been upended by the pandemic, which has brought many opportunities to Airbnb's business model.
Airbnb said in its earnings report that cross-border travel continues to recover in 2021 and continues to accelerate. The share of cross-border travel bookings in the platform's total global room nights increased significantly from 20% in the first quarter of 2021 to nearly 35% in the fourth quarter of 2021.
It is worth noting that the financial report also mentioned that the impact of the epidemic related to the Olmikron variant in the fourth quarter of 2021 on the booking and cancellation of listings was far less than the impact of the surge in new crown cases in Europe, the Middle East and Africa in the fourth quarter of 2020, nor the impact of the Delta variant last summer. Specifically, the total number of room nights booked on the Airbnb platform in December 2021 increased by more than 40% compared to the same period in 2020, and the cancellation rate of listings in that month was also lower than that in the same period in 2020.
Suburban bookings boosted, and net profit turned a profit year-on-year
The pandemic has hit a global hard hit on tourism, but it has also created opportunities for medium- to long-term suburban travel.
In the early days of the pandemic, Airbnb's bookings plunged dramatically. People start short trips in the summer of 2020 and prefer to opt for outdoor activities that are not in urban areas and away from the crowds. Airbnb has also adjusted its business strategy in a timely manner, focusing on short-distance travel and non-urban area listings. During this period, hotel chains in big cities were hit hard, but Airbnb seized the opportunity.
Brian Chesky, founder and CEO of Airbnb, said the pandemic has hit a major setback for the global travel industry, but it has also brought opportunities for medium- to long-term suburban travel. In a letter to shareholders, Airbnb mentioned that while disrupting people's travel plans, the pandemic has also liberated people from everyday office scenarios, and crowds have begun to spread to thousands of towns and cities, and the cycle of stay has begun to be measured in weeks, months and even quarters, "For the first time in history, millions of people can live anywhere." ”
Airbnb's latest quarterly earnings report shows that almost half of the overnight orders in the fourth quarter of 2021 are longer than one week, and one in every five overnight orders is longer than one month. In all of 2021, nearly 175,000 people booked for stays of three months or more.
In the fourth quarter of 2021, Airbnb's experience and overnight orders were 73.4 million, an increase of 59% year-on-year, and the number of experience and overnight orders for the full year of 2021 was 301 million, an increase of 56% year-on-year.
On the one hand, in the context of the COVID-19 pandemic, the number of housing bookings in both domestic and non-urban areas has continued to grow.
Compared to the fourth quarter of 2019 before the pandemic, the total number of listings in non-urban areas increased significantly by nearly 45%. In the past year alone, Airbnb guests have stayed in about 100,000 towns around the world, with nearly 175,000 bookings for three months or more.
On the other hand, Airbnb has been recruiting more hosts to meet suburban housing needs. Airbnb simplified the process of becoming a host by creating Ask a Superhost, pairing potential hosts with Superhosts to answer their questions. At the same time, Airbnb created AirCover top-to-bottom protection, free for every Airbnb host, and only available on Airbnb.
Travelers are repacking their bags, and the first quarter is scheduled to exceed pre-pandemic levels for the first time
Airbnb has recovered from the early days of the pandemic.
Airbnb expects revenue to reach $1.48 billion in the first quarter of this year, well above $887 million in the year-ago quarter. And people are already booking listings this summer. At the end of January, Airbnb said it had 25 percent more summer bookings than it had in the same period in 2019.
Last year, Airbnb broke Wall Street's expectations in terms of revenue and profit. Its fourth-quarter revenue increased 78 percent year-over-year to $1.53 billion, the second consecutive quarter in which its profit reached $55 million. For the full year last year, the company's revenue grew 77 percent, also breaking analysts' expectations.
This recovery actually began last year. "Although it is still in a pandemic period, it is still the best year in the company's history." Airbnb CEO Brian Chesky told analysts on February 15 about last year's record-breaking revenue and order volumes.
Airbnb executives said on the earnings call that the impact of the Opichron variant has weakened, and travelers' confidence in summer travel has been significantly boosted, and the number of bookings for accommodation nights and experiential activities in the European and American markets is expected to return to pre-epidemic levels in Q1 2022, although the recovery in the Asia-Pacific region is relatively slow. With bookings and ADR picking up, Airbnb expects the total booking volume for Q1 this year to hit a new high.
At the same time, cross-border tourism continues to recover in 2021 and continues to accelerate. Cross-border travel bookings accounted for a significant increase in global total room nights from 20% in the first quarter of 2021 to nearly 35% in the fourth quarter of 2021. While short-term uncertainty remains, travelers' long-suppressed desire to travel should not be underestimated.
Airbnb says people are already booking summer stays. The company said that as of the end of January, bookings for summer trips had increased by more than 25% compared to the same period in 2019. Of course, Airbnb also warned: "Given the ongoing Covid-related uncertainty, forecasting the next few quarters remains challenging." ”