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Airbnb Inc Ordinary Shares - Class A ABNB

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Morningstar’s Analysis

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Airbnb Continues to See Industry-Leading Demand, With Robust Profit Improvement; Shares Not Cheap

Dan Wasiolek Senior Equity Analyst

Analyst Note

| Dan Wasiolek |

Narrow-moat Airbnb saw stout second-quarter demand and profit improvement, aided by continued strength in the U.S., flexible working, and a broadening of travel to regions like Europe. Specifically, bookings reached 137% of 2019’s level, up from 104% in the prior quarter. Bookings were driven by rates that were 138% of the prepandemic level, with room nights reaching 99% of 2019’s level. Rates have been pushed higher by a travel mix of U.S. and larger home bookings. This driver should moderate as travel broadens out to other regions like Europe and if traveler flexibility is reduced by return to work. Looking at the rest of 2021, Airbnb commented it was starting to see some increased cancellation rates and slowdowns in booking volume due to pent-up demand already realized and the Delta variant. But we expect demand to remain buoyant. This view is supported by the resilience of U.S. travel demand during the case spikes around the July Fourth, Labor Day, and Thanksgiving holidays in 2020, as well as U.S. hotel and air volumes remaining strong into early August.

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Company Profile

Business Description

Started in 2007, Airbnb is the world’s largest online alternative accommodation travel agency, also offering booking services for boutique hotels and experiences. Airbnb’s platform offered 5.6 million active accommodation listings in 2020. Listings from the company’s 4 million hosts are spread over 220 countries and 100,000 cities. In 2020, 53% of revenue was from the North American region, 30% from Europe/Middle East/Africa, 10% from Asia-Pacific, and 7% from Latin America. Transaction fees for online bookings account for all its revenue.

888 Brannan Street
San Francisco, CA, 94103
T +1 415 510-4027
Sector Communication Services
Industry Internet Content & Information
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Distressed
Employees 5,597