Online accommodations platform Airbnb (NASDAQ: ABNB) reported Q4 FY2021 results topping analyst expectations, with revenue up 78.3% year on year to $1.53 billion. On top of that, guidance for next quarter's revenue was surprisingly good, being $1.44 billion at the midpoint, 18.2% above what analysts were expecting. Airbnb made a GAAP profit of $54.5 million, improving on its loss of $3.88 billion, in the same quarter last year.
Is now the time to buy Airbnb? Access our full analysis of the earnings results here, it's free.
Airbnb (ABNB) Q4 FY2021 Highlights:
- Revenue: $1.53 billion vs analyst estimates of $1.45 billion (5% beat)
- EPS (GAAP): $0.08
- Revenue guidance for Q1 2022 is $1.44 billion at the midpoint, above analyst estimates of $1.22 billion
- Free cash flow of $376.3 million, down 27.2% from previous quarter
- Gross Margin (GAAP): 80.7%, up from 75.5% same quarter last year
- Nights and Experiences Booked: 73.4 million, up 27.1 million year on year
- ARPU: $20.87, up 12.4% year on year
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.
Marketplaces have existed for centuries. Where once it was a main street in a small town or a mall in the suburbs, sellers benefitted from proximity to one another because they could draw customers by offering convenience and selection. Today, a myriad of online marketplaces fulfill that same role, aggregating large customer bases, which attracts commission paying sellers, generating flywheel scale effects which feed back into further customer acquisition.
Sales Growth
Airbnb's revenue growth over the last three years has been incredible, averaging 68% annually. The company took a hit during the pandemic, but sales have rebounded strongly since.
This quarter, Airbnb beat analyst estimates and reported a very impressive 78.3% year on year revenue growth.
Guidance for the next quarter indicates Airbnb is expecting revenue to grow 62.9% year on year to $1.44 billion, improving on the 5.35% year-over-year increase in revenue the company had recorded in the same quarter last year.
There are others doing even better than Airbnb. Founded by ex-Google engineers, a small company making software for banks has been growing revenue 90% year on year and is already up more than 150% since the IPO last December. You can find it on our platform for free.
Usage Growth
As a online marketplace, Airbnb generates revenue growth both by growing the number of buyers using the platform and how much each of those buyers spends.
Over the last two years the number of Airbnb's nights booked, a key usage metric for the company, grew 43.7% annually to 73.4 million users. This is among the fastest growth of any consumer internet company, indicating that users are excited about the offering, after the forced break during the pandemic.
In Q4 the company added 27.1 million nights booked, translating to a 58.5% growth year on year.
Key Takeaways from Airbnb's Q4 Results
With a market capitalization of $106 billion, more than $8.32 billion in cash and with free cash flow over the last twelve months being positive, the company is in a very strong position to invest in growth.
We were impressed by the very optimistic revenue guidance Airbnb provided for the next quarter. And we were also excited to see the really strong revenue growth. Zooming out, we think this was a great quarter and shareholders will likely feel excited about the results. The company is up 4.19% on the results and currently trades at $187.62 per share.
Airbnb may have had a good quarter, so should you invest right now? It is important that you take into account its valuation and business qualities, as well as what happened in the latest quarter. We look at that in our actionable report which you can read here, it's free.
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The author has no position in any of the stocks mentioned.