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Few technology companies the pandemic shook them harder than Airbnb. In the spring of 2020, as a result of the cancellation of the trip, the company’s revenue fell 67 percent. By May, he had released a quarter of the staff. “We knew the trip was over,” sadly said CEO Brian Chesky at the time, “And it never comes back.”
The company’s fate, like so many others, was tied to the world’s ability to manage Covid-19. Its richness can be seen as a pandemic-breaker, as a measure of progress towards achieving “normal” activities such as holidays. In that regard, there is good news: In Thursday’s earnings call, Airbnb said its revenue rose 300 percent in the second quarter of 2020, and about 10 percent more than in the second quarter of 2019. Reserves in general have also reached pre-pandemic levels with restrictions on international travel. The rise in summer travel brought other high water marks: The company booked the most quarterly nights in its history and Saturday was the best night on Airbnb since the pandemic began, with more than 4 million guests around the world around Airbnbs.
“After months of being stuck at home, millions of people have wanted to travel,” said Chesky, who was calling from an Italian Airbnb. “Now, we can definitely say that the bounce of the trip has come to us.”
The summer may have pushed the pandemic back to its previous level, but the decline is less certain, along with a rise in contamination. delta variant. In a letter to shareholders, Airbnb shared expectations that the delta variant would affect reserves and cancellations, making the second half of the year “more volatile and non-linear”. However, the company predicts that Q3 will bring in “the strongest quarterly revenue recorded”.
Part of Airbnb’s bet is that although the trip didn’t look like 2019, people will find ways to do so. In 2020 international travel went downhill, but people booked weekend trips within driving distance. Being pre-pandemic, most people came to a travel website like Airbnb with a fixed location and dates. Now, perhaps because many people can work remotely, Airbnb says 40 percent of its guests use a flexible location and date search when booking a place to sleep. People also book longer stays. In its first Q1 earnings, Airbnb said a quarter of bookings came from one-month stays (in 2019, stays of that duration accounted for only 14% of bookings). This trend has continued over the summer, and will probably be maintained to some extent as long as people can work remotely.
These behavioral changes and the almost normal travel have encouraged other companies in the summer sector. Turo, “Airbnb for Cars,” was unveiled last week to make it public. Vacasa, a holiday rental management platform, also plans to make it public through SPAC. VC funding for travel and tourism beginners has also increased, following a pandemic that was the lowest ever during the year. In 2019, investors spent $ 11.1 trillion on 1,125 deals in the sector, according to Crunchbase data. In 2020, it dropped to $ 4.8 billion and 629 agreements. It looks like things are recovering in 2021, as it has already secured 346 deals and $ 6.1 billion in funding.
It’s unclear how long the bounce of the trip will last. The pink outlook could be cloudy variants of coronavirus, which continue to spread and have led to new restrictions in some regions. In the earnings call, Airbnb chief financial officer Dave Stephenson warned that there will likely be fewer bookings in Q3 than in Q2. Summer travel is always reduced at this time of year, but cases of rising coronavirus have also changed the travel plans of some citizens. Already, companies like it Southwest Airlines they are making more optimistic forecasts for early summer.
In a shareholder letter, Airbnb stated that “vaccine progress, retention of new variants and travel restrictions” could affect the final results of the business in the coming months. But if the company had learned anything in the past year, it would have been more efficient: this quarter, losses were reduced by $ 68 million, compared to $ 576 million last year. These lessons can be valuable if there is an even more rocky road ahead.
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