Airbnb expects a rebound for travel

Airbnb Inc. provided a revenue forecast for the current quarter that easily surpassed Wall Street estimates as the company sees “substantial demand” for travel heading into the busy summer season after more than two years of due restrictions. at Covid-19. The shares gained around 6% in extended trading.

Revenue for the second quarter will be $ 2.03 billion (R32 billion) to $ 2.13 billion (R33 billion). This exceeded the average analyst’s estimate of $ 1.97 billion (R31 billion), according to data compiled by Bloomberg.

Revenues in the first three months of the year were also better than expected, helping to significantly reduce the net loss on the vacation rental platform.

“As we approach the start of the travel rebound that began last year, we are particularly encouraged by the compound growth we are seeing in North America,” wrote chief executive Brian Chesky in a letter to shareholders.

“US domestic demand this year has so far exceeded our domestic expectations and we are encouraged by US international bookings that surpass 2019 levels.”

Chesky also said Airbnb is seeing “above historical demand” for the fourth quarter, “which indicates that consumer confidence in travel remains strong beyond the summer months.”

Airbnb, along with its rivals Expedia Group Inc. and Booking Holdings Inc., have said they expect this summer to be one of the best the industry has ever seen, as travelers unleash pent-up demand and make their way to faraway destinations and tourist hotspots. .

That vision came under threat earlier this year with the resurgence of the omicron Covid-19 variant and the outbreak of the war in Ukraine, but industry executives have consistently remained optimistic.

There are positive signs that people are looking forward to travel. For example, United Airlines Holdings Inc. is increasing capacity for transatlantic flights, and Southwest Airlines Co. said it expects to be profitable for the remaining three quarters of the year, even with oil prices well over $ 100 a barrel.

In Monday’s Expedia earnings report, which showed an 80% increase in revenue in the first quarter, CEO Peter Kern said he “feels very good about a summer recovery that should be very robust.”

Although the results were reported in line with analysts’ estimates, Expedia shares fell 17%, the highest since March 2020 due to concerns about inflation, which is at its highest in nearly four decades, and risk of recession begins to blur the vision.

Travel companies from hotels to airlines have said consumers are willing to pay the rising prices so far, but there appears to be a limit. Hilton Worldwide Holdings Inc. provided a profit forecast that was below analysts’ expectations.

News from Hilton and Expedia weighed on travel titles on Tuesday, dropping Airbnb shares 5% to close at $ 145.

The booking, which reports Wednesday’s results, dropped 4%. After releasing the earnings, Airbnb’s stock jumped to a high of $ 157 in extended trading.

Airbnb managed to withstand the pandemic and even thrive, getting the best year in the company’s history in 2021, as it says a “new world of travel” has emerged.

The flexibility afforded by the new remote work policies has led to people spreading to thousands of towns and cities, staying for weeks, months, or even whole seasons at a time, Chesky said.

“So far from what I can tell, you are still seeing improvements from 2019 levels in the European and US geographies,” said Justin Patterson, analyst at Keybanc Capital Markets, in an interview before the results were released.

“What I can say today, travel demand has not weakened in the US or Europe.”

San Francisco-based Airbnb said first-quarter revenue increased 70% to $ 1.51 billion (R 24 billion), surpassing analysts’ average estimate of $ 1.45 billion (23 billion R). The company posted a net loss of $ 19 million (R300 million) compared to a loss of $ 1.2 billion (R19 billion) a year ago. The loss per share was 3 cents, while analysts had forecast a loss of 29 cents.

The number of nights and experiences booked surpassed pre-pandemic levels in the first quarter, climbing 59% to 102.1 million and surpassing 100 million for the first time.

Daily rates also increased, bringing gross booking value to $ 17.2 billion (R271 billion) while analysts had forecast $ 15.9 billion (R250 billion).

Earlier this year, Chesky himself started life on Airbnb and staying in rental accommodation across the country for a few weeks at a time to help improve the experience for people who can now live anywhere.

Mirroring its customers’ trends, Airbnb said last week that its employees would be permanently able to work from anywhere, including their home, office, or while traveling to different countries.

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