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Airbnb (NASDAQ:ABNB) Reports Q2 In Line With Expectations But Stock Drops 13.6%


Max Juang /
2024/08/06 4:15 pm EDT

Online accommodations platform Airbnb (NASDAQ:ABNB) reported results in line with analysts' expectations in Q2 CY2024, with revenue up 10.6% year on year to $2.75 billion. On the other hand, next quarter's revenue guidance of $3.7 billion was less impressive, coming in 3.6% below analysts' estimates. It made a GAAP profit of $0.86 per share, down from its profit of $0.98 per share in the same quarter last year.

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Airbnb (ABNB) Q2 CY2024 Highlights:

  • Revenue: $2.75 billion vs analyst estimates of $2.74 billion (small beat)
  • Adj EBITDA: $894 million vs analyst estimates of $863 million (3.6% beat)
  • EPS: $0.86 vs analyst expectations of $0.91 (5.7% miss)
  • Revenue Guidance for Q3 CY2024 is $3.7 billion at the midpoint, below analyst estimates of $3.84 billion (adj EBITDA guide also missed)
  • Gross Margin (GAAP): 81.6%, down from 82.6% in the same quarter last year
  • Adjusted EBITDA Margin: 32.5%, in line with the same quarter last year
  • Free Cash Flow of $1.04 billion, down 45.4% from the previous quarter
  • Nights and Experiences Booked: 125.1 million, up 10 million year on year
  • Market Capitalization: $79.55 billion

Founded by Joe Gebbia and Brian Chesky by renting out a blowup bed on the floor of their San Francisco apartment, Airbnb (NASDAQ:ABNB) is the world’s largest online marketplace for lodging, primarily homestays.

Online Travel

Because of the enormous number of flights, hotels, and accommodations available, travel is a natural fit for marketplaces that aggregate suppliers, simplifying the shopping process for consumers. Online travel platforms today make up over 50% of the industry’s bookings, a percentage that has been rising for 20 years, and will likely continue in the years ahead.

Sales Growth

Airbnb's revenue growth over the last three years has been very strong, averaging 35.6% annually. This quarter, Airbnb reported mediocre 10.6% year-on-year revenue growth, in line with analysts' expectations.

Airbnb Total Revenue

Guidance for the next quarter indicates Airbnb is expecting revenue to grow 8.9% year on year to $3.7 billion, slowing from the 17.8% year-on-year increase it recorded in the comparable quarter last year. Ahead of the earnings results, analysts were projecting sales to grow 11.9% over the next 12 months.

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Usage Growth

As an online travel company, Airbnb generates revenue growth by increasing both the number of stays (or experiences) booked and the commission charged on those bookings.

Over the last two years, Airbnb's nights booked, a key performance metric for the company, grew 14.8% annually to 125.1 million. This is solid growth for a consumer internet company.

Airbnb Nights and Experiences Booked

In Q2, Airbnb added 10 million nights booked, translating into 8.7% year-on-year growth.

Revenue Per Booking

Average revenue per booking (ARPB) is a critical metric to track for consumer internet businesses like Airbnb because it not only measures how much users book on its platform but also the commission that Airbnb can charge.

Airbnb ARPB

Airbnb's ARPB growth has been mediocre over the last two years, averaging 3.9%. However, the company's ability to continue increasing prices while growing its nights booked shows they still find value in its platform. This quarter, ARPB grew 1.8% year on year to $21.97 per booking.

Key Takeaways from Airbnb's Q2 Results

It was good to see Airbnb increase its number of bookings this quarter. Revenue beat slightly and adjusted EBITDA beat by a more convincing amount. On the other hand, its bookings missed and its revenue guidance for next quarter missed Wall Street's estimates. The company said that "...we are seeing shorter booking lead times globally and some signs of slowing demand from U.S. guests." Overall, this was a mediocre quarter for Airbnb. The stock traded down 13.6% to $112.60 immediately after reporting.

Airbnb may have had a tough quarter, but does that actually create an opportunity to invest right now? When making that decision, it's important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it's free.