Airbnb has been preparing throughout the pandemic for a rebound in travel unlike any other in history, and during the second quarter of 2021 reached its highest number of active listings ever, CEO and co-founder Brian Chesky said.
Airbnb ended the second quarter with its largest number of active listings, Chesky said. Demand has been driving supply growth, along with the company’s marketing efforts to attract new hosts, Chesky said during a call with analysts to discuss the company's second-quarter earnings.
In a letter to shareholders, Airbnb reported that active listings in non-urban destinations in Europe and North America increased 8% from the first quarter of 2021 to the second quarter.
During the first quarter, Airbnb launched its first large-scale marketing campaign in five years, and the company expanded the campaign into the second quarter, Chesky said. On May 24, the company launched a redesigned onboarding process that makes it simpler to become an Airbnb host, and that resulted in a growth of listings.
Airbnb has more than 4 million hosts, and 90% of them are individuals rather than professionals, Chesky said.
Travel is different than it was before the start of the COVID-19 pandemic, and Airbnb has benefited from its adaptable business model that has been able to meet the changing needs of guests, he said.
“For the past year, we’ve been relentlessly driving product innovations to meet this historic moment, and as a result, Airbnb has emerged in this crisis faster than others, and we’re better-positioned for the future of travel.”
COVID-19 and the Delta variant continue to present challenges, but Chesky said the company expects its third quarter will be its strongest revenue quarter ever.
Traveler Trends
Despite the ongoing COVID-19 pandemic, there is clear evidence travel is recovering, and the accelerating pace of global travel is encouraging, Chesky said. During the quarter, the company recorded its biggest night since the start of the pandemic, hosting 4 million guests on Aug. 7.
“The way that people travel and live continues to change,” Chesky said. “We believe that many of the new booking trends that emerged over the past year are here to stay.”
People are traveling to more destinations than before, and are staying longer, Chesky said. There also has been a paradigm shift in how people search for travel on the internet, largely as a result of people having more freedom to work remotely, which allows them to be more open about where they go, when they go and for how long, he said.
“I think it’s safe to say the world is never going back to the way it was, and that means travel isn’t going to go back to the way it was,” he said.
Airbnb offers flexible dates and destination features during the booking process, he said. Travelers can click on the “I’m Flexible” button and select a window of a weekend, a week, a month or sometime in the next few months. That feature has been used more than 500 million times since its introduction at the beginning of the year.
“This means that we can point demand to where we have supply. This is a major, major shift for our business,” Chesky said.
By the Numbers
Growing global travel demand, along with supply growth, drove revenue above comparable 2019 levels, Airbnb’s letter to shareholders states. Revenue increased almost 300% year over year to $1.3 billion during the quarter, a 10% increase over the second quarter of 2019.
Nights and experiences booked reached 83.1 million during the second quarter, a 197% year-over-year increase and a 1% decrease compared to the second quarter of 2019. Gross bookings value reached $13.4 billion, a 320% year-over-year increase and a 37% increase over the second quarter of 2019.
Average daily rate in the second quarter was $161, a 41% year-over-year increase. The rate growth was driven by bookings in North America, of entire homes and in non-urban destinations. The secondary driver was an increase in hosts’ pricing in high-demand segments.
The company’s net loss was lower year-over-year and compared to the second quarter of 2019. It reported a net loss of $68 million, an improvement of $507 million compared to the second quarter of 2020 and an improvement of $229 million compared to the second quarter of 2019.
Adjusted earnings before interest, taxes, depreciation and amortization in the second quarter was $217 million, up from a loss of $397 million during the same period a year ago and up from a loss of $43 million in the second quarter of 2019. The adjusted EBITDA margin was 16%, an increase of 20% compared to the second quarter of 2019.
“This substantial improvement in adjusted EBITDA demonstrates the strength of our revenue recovery, as well as a significantly improved cost structure,” the release states.
As of press time, Airbnb’s stock was trading at $151.15, up 3% year to date. The NASDAQ Composite Index was up 15% for the same time period.