Airbnb Experiences $4.6B Loss in 2020 Earnings

Airbnb CEO Brian Chesky (Getty)

Airbnb CEO Brian Chesky (Getty)

Regardless of the luster of its eye-popping IPO, Airbnb reported a $4.6 billion web loss in 2020 in its first earnings report as a public firm.

The hospitality startup, which is banking on a journey rebound, generated $3.Four billion in income final yr, a 30 p.c year-over-year decline. Though the pandemic whalloped the journey business, Airbnb’s web loss was additionally pushed $2.eight billion value of inventory compensation bills it incurred in its IPO in December.

Throughout the fourth quarter, these bills led to a staggering $3.9 billion web loss. However that wasn’t the one purpose: Over the past three months of the yr, Airbnb generated $859 million in income, down 22 p.c yr over yr.

Nonetheless, issues may have been far worse.

With most main cities on lockdown final yr, Airbnb projected its 2020 income could possibly be lower than half its $4.eight billion in earnings in 2019. In a single day, the corporate misplaced $1 billion in bookings and was pressured to put off 25 p.c of its workers.

By August, journey started to choose up and Airbnb disclosed it will go public the yr’s finish.

In a letter to shareholders Thursday, Airbnb mentioned 2020 demonstrated the corporate’s “resilience.” The letter struck a hopeful tone that journey would proceed to open up and Airbnb could be prepared when it did.

Throughout Airbnb’s first earnings name as a public firm, CEO Brian Chesky outlined the corporate’s historical past — from its begin in San Francisco via the pandemic and its IPO. “We’re nonetheless in a pandemic and lots of people are hurting,” he mentioned. “We all know how fortunate we’re to be within the place we’re in.”

He mentioned regardless of going through the “greatest disaster the journey business has ever seen,” Airbnb’s enterprise mannequin has been “inherently adaptable.”

“We don’t suppose we’re ever going again to the world of journey in 2019,” Chesky mentioned. “A world of Zoom is a world the place individuals can make money working from home or any dwelling on Airbnb.” With elevated flexibility, individuals are reserving prolonged weekends, or they’re touring for weeks or months at a time. “Many individuals are snow birding,” he mentioned.

Forward of its earnings, Airbnb’s market cap was $108.eight billion, after closing at $200 per share on Feb. 24. The closing value was $182 per share on Thursday, after the Nasdaq Composite dropped Three p.c. (Airbnb reported its earnings after the market’s shut.)

Airbnb’s inventory skyrocketed on its first day of buying and selling in December. Forward of the IPO, the corporate priced shares at $68. The worth instantly shot up to $146.

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