Airbnb Inc., the online accommodation booking platform that executed one of the largest initial public offerings of 2020 despite operating in a pandemic travel industry, continued to hold up better than other online travel companies during the season on vacation.
Airbnb ABNB,
shares gained about 2% in trading outside of Thursday hours, after falling 9.1% in the regular session to close at $ 182.06, the worst day of shares since its IPO. Airbnb shares have sometimes tripled their $ 68 stock market price since they opened in December, valued at more than $ 100 billion.
The San Francisco-based company reported fourth-quarter net income of $ 3.898 billion, or $ 11.24 per share, compared to a loss of $ 1.34 per share in the prior year period . The giant loss is primarily a function of the IPO that forces the company to account for years of IPOs at a time; Airbnb said the share-based compensation amounted to $ 2.9 billion. Revenue fell 22% to $ 859 million from $ 1.10 billion in the previous quarter.
Analysts surveyed by FactSet had forecast a loss of $ 8.40 per share on revenue of $ 739.4 million.
The company said gross reserves fell 31% in the quarter to $ 5.9 billion. Analysts had expected $ 5.19 billion, a global 35% year-on-year decline, with an even stronger drop of 68% in the region that includes Europe. During the year, Airbnb reported gross bookings of $ 23.9 billion, while analysts expected $ 23.14 million.
Although Airbnb suffered from the pandemic, it held up better than rival online travel sites: Booking Holdings Inc. BKNG,
Wednesday reported a fourth-quarter year-over-year drop of 63% year-on-year, while Expedia Group Inc. EXPE,
earlier this month, there was a 67% year-on-year drop in revenue during the same quarter.
“Our performance in 2020 proved that Airbnb is resilient and intrinsically adaptable,” CEO Brian Chesky said in the announcement. “The trips are back and we’re focused on laser to prepare the bounce of the trip.”
Airbnb reported a loss of $ 4.58 million, or $ 16.12 per share, in revenue of $ 3.38 million in 2020. Analysts had expected a full-year loss of $ 13.40 per share for $ 3.27 million in revenue.
“In the depths of the pandemic, we predicted that our revenue for 2020 could be less than half of what it was in 2019. However, in the end, total revenue of $ 3.4 billion for 2020 only decreased 30% compared to $ 4.8 billion in 2019, ”they wrote in a letter to shareholders.
Fharester analyst Sucharita Kodali said Airbnb is well positioned once this current wave of COVID-19 cases is over: “Most people will return to a significant part of their normalcy. You see it in many other states. “Even though the pandemic is collapsing, they are still alive. You will only see more in the coming months.”
Due to uncertainty surrounding the travel industry and COVID-19, Airbnb executives did not offer a full 2021 forecast and only gave slight clues as to what is expected in the first quarter.
In the short term, we anticipate that year-on-year comparisons of nights and reserved experiences (net of cancellations and alterations), as well as gross reserve value (net of cancellations and alterations), will be volatile and unreliable measures of the growth in the stability of our business, ”they wrote in the letter to shareholders. “This is due to the significant increase in cancellations we experienced during the first and second quarters of 2020. For these two metrics, we anticipate that levels in the first quarter of 2021 will be higher than in the first quarter of 2020, but lower than the first quarter of 2019.
In terms of revenue, the year-on-year decline in the first quarter of 2021 is expected to be lower than in the fourth quarter of 2020, as we continue to see gradual improvements in customers’ willingness to book stays, ”Airbnb said.
In a conference call Thursday afternoon, Chesky also stated that a change in the normal state of travel could benefit Airbnb, as there are more people traveling while they continue to work.
“When travel returns, we believe it will look different than before: we do not believe we will ever return to the world of travel in 2019, it will change, it will be different. And probably the biggest difference we’ve seen is flexibility, ”the CEO said, though he noted that Airbnb was not a home for business travel in the past, but could be a figure in a new form of business travel. “A world of Zoom ZM,
it’s a world where more people can work from home, and in a world where more people have the flexibility to work from home, we see more people saying they can work from home on Airbnb. “
Shares of Airbnb have gained 43% since the company went public in December, while the S&P 500 SPX index,
so far it has risen 3.6%.