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Airbnb Jumps 7% on Exceeding Q4 Expectations

Despite the negative impact of the pandemic, lodging and homestay company Airbnb Inc. (NASDAQ: ABNB) recorded one of the best years in its history. Backed by robust performance across all key metrics, the company’s fourth-quarter earnings and revenue both exceeded expectations.

The results pushed the shares up more than 7% during the extended trading session, and finally closed up 6.1% at $180.07 on February 15.

With relaxations in travel restrictions and lower impact of the Omicron variant, Airbnb witnessed a huge rebound in travel and homestays. Due to the flexibility of the work-from-home culture, Airbnb has seen guests stay for longer durations, even running into weeks and months.

During the quarter, Airbnb reported 73.4 million Nights & Experiences Booked, growing 59% compared to the same period last year. Similarly, gross booking value (GBV) advanced 91% to $11.3 billion. Moreover, Average Daily Rates (ADR) increased 20% year-over-year to $154 in the quarter.

For FY21, Nights & Experiences Booked grew 56% annually to $300.6 million and GBV grew 96% to $46.9 billion.

Best Results to Date

Airbnb reported Q4-diluted earnings of 8 cents per share, significantly higher than analyst estimates of 5 cents per share. ABNB had reported a diluted loss of $11.24 per share for the prior-year quarter.

Furthermore, Airbnb’s quarterly revenue jumped 78% year-over-year to $1.53 billion, and fell marginally in line with the Street’s estimates of $1.5 billion.

For full-year fiscal 2021, Airbnb’s revenue leaped 77% to $6 billion and diluted loss stood at $0.57 per share, a huge improvement compared to FY20’s diluted loss of $16.12 per share.

CFO Comments

Commenting on the results, Airbnb CFO, David Stephenson, said, “Nearly two years into the pandemic, it’s now clear that we are undergoing the biggest change to travel since the advent of commercial flying. Remote work has untethered many people from the need to be in an office every day. As a result, people are spreading out to thousands of towns and cities, staying for weeks, months, or even entire seasons at a time. For the first time ever, millions of people can now live anywhere.”

“But we’re not stopping there. In 2022, we will accelerate our pace of innovation as millions of people live in Airbnbs for weeks, months, or entire seasons at a time. Following in the footsteps of our community, CEO Brian Chesky recently announced that he’ll also be living on Airbnb, staying in a different town or city every couple of weeks,” Stephenson added.

Q1FY22 Outlook

Based on the accelerated recovery of travel demand and homestays, and lead times for bookings returning to normalcy, Airbnb forecasts Q1FY22 revenue between $1.41 billion and $1.48 billion. This reflects a marginal fall over Q4FY21 revenue due to the seasonally long lead times for Q1 Nights & Experiences Booked. The consensus estimate for Q1 revenue is pegged lower at $1.24 billion.

Additionally, Airbnb expects its very first positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in Q1FY22 due to the improvement in cost structure and higher ADRs.

Target Price

Airbnb has a Hold consensus rating based on 3 Buys and 9 Holds. The average Airbnb price target of $186.6 implies 3.63% upside potential to current levels. Airbnb stock has gained 6.4% over the past year.

 Blogger Opinions

TipRanks data shows that financial blogger opinions are 70% Bullish on ABNB, compared to a sector average of 69%.

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