US Airbnb details years

Business

US Airbnb details years

Wednesday, November 18, 2020

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Airbnb was losing money even before the pandemic struck and cut its revenue by almost a third, the home-sharing company revealed in documents filed yesterday ahead of a planned initial public offering of its stock.

The San Francisco-based company has yet to set a date for the initial public offering (IPO), but it is laying the groundwork by filing financial records with US securities regulators.

The documents show that leading up to the coronavirus outbreak earlier this year, Airbnb was spending heavily on technology and marketing to grow its business.

Its revenue jumped 32 per cent to US$4.8 billion in 2019, but it reported a net loss of US$674 million that year. The company also lost money in 2018 and 2017.

This year, Airbnb said, revenue fell 32 per cent to US$2.5 billion in the first nine months as travellers cancelled their plans after the pandemic crippled travel and forced lockdowns around the world.

In May, Airbnb cut 1,900 employees, or around 25 per cent of its workforce, and slashed investments in programmes, like movie production, not related to its core business.

Airbnb funded operations with US$2 billion from various sources, including a US$1-billion investment from private equity firms Silver Lake and Sixth Street Partners.

Now, the company said, demand is rebounding as some travellers see home rentals as safer than crowded hotels. The number of nights and experiences booked, which plummeted more than 100 per cent in March and April, were down 28 per cent in July, August and September.

Airbnb said that indicates its business model is resilient and can adapt to future travel needs, including an increase in business travellers who want to work from a rental home.

Airbnb said it currently has 7.4 million listings run by four million hosts worldwide. Eighty-six per cent of its hosts are outside the US and 55 per cent are women, the company said.

The company said it had 54 million guests in 2019.


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