Yahoo Finance Live presenters discuss Airbnb’s quarterly results.
Video transcript
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– Well, here is another company that is affected by the rest of the world. Airbnb, we are also watching this stock this morning, which has fallen. Right now it’s down about 5% actually, not as much as it used to be. Beating in the top and bottom lines in the third quarter, but then giving a disappointing outlook for bookings in the fourth quarter.
And as it faces macroeconomic headwinds, and also, kind of, again, this post-pandemic readjustment normalization process, what does the post-pandemic travel landscape look like? Will people go away for long stays working remotely in other locations? I think people are trying to figure that out. I think Airbnb is trying to figure it out.
We saw a return to more urban bookings in the third quarter, which may indicate a drop in the number of people moving to and staying somewhere in the country and working remotely. And so, you know, I think investors are also trying to figure out this return to what – even – normal means even more. But a return to this environment.
– Yeah. And this is going to have an impact on the average daily rate. You think a lot of the more urban listings they have, it usually comes at a lower rate.
And so, that average daily rate was around $156 during this last quarter. That’s up about 5% year over year. And then you also think of stays, as you said, Julie. Long-term stays, 28 days or more, which represented approximately 20% of nights booked.
And so, overall, when you have the return of city breaks and cross-border travel combined with the improvement in the average daily rate, active listings also increasing, the quarter itself hasn’t been bad. I mean, it was their most profitable quarter in company history. That’s really just the tips for moving forward from here.
They also speak of a jerky return on these cross-border trips. And then, in addition, there will also be high marketing costs to really get more hosts on the platform.
– Right. And you know, I think all of that was summed up in a very good note this morning by Deutsche Bank’s Lee Horowitz saying that next year, basic metrics of Airbnb’s business may be “very volatile “. So you take some of the concerns, maybe, from the recession, you have the fact that Airbnb is going to make tough comparisons.
What does this mean in everyday language? Some of the growth rates are expected to slow. Not good when you have a stock market value like Airbnb. A premium to the wider market. And you don’t have a good setup for the stock.
– Yeah. And if a large portion of their gains came from price increases in that average 5% rate increase you were talking about, how moderate is that going to be, right? If inflation starts to moderate, will there be some resistance to these higher rates? It’s quite a variable environment in terms of rates, isn’t it? For Airbnb. And so, we’ll see if they can sustain those kinds of gains.
– There is historical data to consult with Airbnb, as it is a company that had to operate during the Great Recession. When Airbnb started back then, a lot of people would come to the platform at hosts to get that extra income. It’s just a matter of how much for Airbnb given the scaling they’ve had since then as well.
Where are they able to maintain some of these key metrics that investors are currently analyzing and reviewing to really understand the strength of the company’s health?
– What you’re saying is if we go into a recession, I rent my house and live off my car, basically.
– And it doesn’t even have to be the whole place, it could just be the couch.
– Maybe just the couch. OK, I could do that. It’s awesome.
– Yeah. $5.
– Next time…next time you do your tube from home, we’ll just see someone in the bathroom walking, walking behind you to get something out of the fridge. I can not wait to be there.
– Scary.
– I can not wait to be there.
– Very well. Guys, Sozzi suite.
– Yeah.
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