Airbnb Earnings Preview: Surging Travel Demand Could Signal Booking Rebound   |

  • Reports Q1 2021 earnings Thursday, May 13, after the shut
  • Revenue Expectation: $718 M
  • EPS Expectation: -$1.06

When Airbnb (NASDAQ:) releases its newest quarterly report later immediately, buyers might be keen to search out out whether or not the gradual reopening of the U.S. economic system helps increase gross sales of this various lodging firm after a 12 months of .

The platform’s first-quarter earnings report can also be vital as bookings within the spring season might present some perception into the extent of pent-up travel demand for the summer season interval that’s so essential to revive the ravaged tourism economic system, which was decimated by the COVID-19 pandemic.

Airbnb Weekly Chart.

Early indications recommend that the San-Francisco-based Airbnb is in a very good place to exceed analysts’ expectations. The firm’s CEO, Brian Chesky, informed CNBC in a current interview that the corporate should add thousands and thousands of recent hosts to accommodate friends as travel picks up. 

According to the Chesky interview with CNBC’s “TechCheck,” phase:  

“I think that we probably will have a high class problem, where there will probably be more guests coming to Airbnb than we’ll have hosts for, because … we think there’s going to be a travel rebound coming that’s unlike anything we’ve ever seen.”

The newest earnings studies from different travel-related corporations additionally present that after a 12 months of pandemic-related lockdowns and border closures, the travel sector is beginning to see the inexperienced shoots of restoration. 

Expedia Group (NASDAQ:) final week mentioned its gross bookings have been down 14% in contrast with a 12 months earlier—a pointy rebound from the almost 70% decline within the earlier two quarters. Booking Holdings (NASDAQ:), the largest on-line travel company, additionally reported a big soar within the variety of room-night reservations made at first of the 12 months. 

Relaxed Restrictions

Behind this rebound are relaxed COVID restrictions within the U.S., the place vaccine rollouts accelerated this spring. U.S. President Joseph Biden final week introduced a aim of getting 70% of the nation’s grownup inhabitants obtain not less than one dose of a COVID-19 vaccine by July 4. 

Analysts and business specialists anticipate that the vaccinated U.S. inhabitants might be extra prepared to travel this summer season, serving to Airbnb leases to rebound.

After remaining afloat when liquidity dried up final spring, Airbnb had shortly shifted its techniques to stay related when customers’ preferences started altering.
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The firm began selling its native stays to cater to surging demand from travellers who have been, and are, hesitant to take lengthy flights throughout the pandemic. 

Airbnb’s relative resilience in an traditionally unhealthy 12 months for the travel business is a results of a versatile business mannequin that allowed the corporate to fulfill clients within the locations they needed to go. That meant metropolis dwellers fleeing to much less crowded places or households and teams trying to trip near house.

These steps and the corporate’s value cuts, in line with some analysts, make ABNB the very best asset within the travel sector. In a current report, Mizuho wrote that it expects room-night tendencies for Airbnb to return to the corporate’s 2019 ranges within the second half of 2021. 

According to analysts at Canaccord Genuity:

“Pent-up travel desires and the work-from-anywhere trend has already led to lower supply availability in North America, and management is planning for a material travel rebound this year by prioritizing expanding supply, including a marketing plan targeted at hosts and a simplification of host onboarding.”

Bottom Line

Airbnb inventory has weakened considerably since reaching a report excessive of just about $217 in February, following its early December 2020 IPO. The inventory closed at $140.25 on Wednesday, down 35% from the February peak.

That tumble, in our view, has made this inventory enticing, particularly when travel demand is anticipated to surge this 12 months. Today’s earnings might present additional proof to assist that bullish view.

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