Airbnb Beats Estimates in Debut Earnings, Looks Forward to 2021 ‘Travel Rebound’
Airbnb reported its debut earnings, after going public on December 10, and beat revenue estimates, reporting $858 million for the fourth quarter of 2020, despite the woes the travel and hospitality industry has been in since the pandemic started.
“2020 was a year when nearly everything changed–the way we live, the way we work, and the way we travel. Airbnb changed as well. We started the year preparing for our IPO, only to put it on hold as the world went into lockdown and global travel came to a standstill,” according to a letter to shareholders. “In the face of a crisis, our business proved to be resilient, showing that as the world changes, our model is able to adapt. Through the crisis, we also sharpened our focus. We made many difficult decisions, but stayed true to our core principles and became a stronger company as a result. And we succeeded in going public after all.”
In comparison to the $858 million in revenue it reported, the consensus revenue estimate was $745.37 million, according to Seeking Alpha.
Airbnb says that its Q4 2020 revenue was down only 22% year-over-year, “demonstrating Airbnb’s resilience.”
“At the depth of the pandemic, we forecasted our 2020 revenue could be less than half of what it was in 2019. Yet in the end, total revenue of $3.4 billion for 2020 decreased only 30% compared with $4.8 billion in 2019. In Q4 2020, revenue of $859 million declined only 22% compared with $1.1 billion in Q4 2019, despite the second wave of COVID-19 cases and lockdowns the world experienced in Q4,” according to the letter to shareholders.
Airbnb says it has a “resilient model,” as COVID had a severe impact on the travel industry and its business “declined by nearly 80%.” “However, our asset-light business model proved to be resilient and inherently adaptable,” according to the letter.
In addition, domestic travel quickly rebounded on Airbnb worldwide, which accelerated the pace of its recovery, proving that its “model is able to adapt.”
Airbnb said it is looking forward to 2021 and is preparing for the travel rebound. “As the vaccine is rolled out and restrictions lift, we expect there will be a significant travel rebound. Our single priority in 2021 is to prepare for this travel rebound, perfecting our existing product by improving the entire end-to-end experience of our core service for both Hosts and guests,” it said in the letter.
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