Several technology companies More affected by the pandemic than Airbnb. In the spring of 2020, a large number of cancellations caused the company’s revenue to drop 67%. By May, it has Laid off A quarter of employees. “The journey we know is over,” CEO Brian Chesky said grimly then“It will never come back.”
Like many other companies, the company’s fate is tied to the world’s ability to manage Covid-19. Its wealth can be seen as a weather vane for epidemics, measuring the progress of “normal” activities such as holidays. In this sense, this is good news: on Thursday’s earnings call, Airbnb stated that its revenue increased by 300% from the second quarter of 2020 and was about 10% higher than the second quarter of 2019. Overall bookings have also returned to pre-pandemic levels, even if international travel is restricted. The surge in summer travel has led to other high watermarks: the company has the most booked nights in any quarter in its history, and Saturday was the best night on Airbnb since the pandemic began, with more than 4 million guests staying in the Airbnbs world.
“After being trapped at home for a few months, millions of people have been eager to travel,” said Chesky, who dialed in from Airbnb in Italy. “Now, we can say with certainty that the travel bounce is on us.”
Summer may restore travel to pre-pandemic levels, but with the increase in infectious viruses, autumn is still uncertain Incremental variantIn a letter to shareholders, Airbnb shared expectations that delta variants will affect bookings and cancellations, making the second half of the year “more unstable and non-linear”. Even so, the company predicts that the third quarter will bring “the strongest quarterly revenue ever.”
Part of Airbnb’s bet is that although travel may not be what it was in 2019, people will still figure out how to do it. International travel has dropped sharply in 2020, but people are still booking weekend trips to places within driving distance. Before the pandemic, most people came to travel sites like Airbnb that had locations and fixed dates. Now, perhaps because so many people can work remotely, Airbnb says that 40% of guests use flexible location and date search when booking accommodation. People are also booking longer stays. Airbnb stated in its first-quarter earnings that a quarter of its bookings came from one-month stays (in 2019, one-month stays accounted for only 14% of bookings). This trend has continued throughout the summer, and as long as people can work remotely, this trend may continue to some extent.
These changes in behavior, and the near-normal summer travel, have boosted other companies in the industry. “Car Airbnb” Turo applied for a listing last week. Vacasa, a platform for managing vacation rentals, also plans to go public through SPAC. After hitting a record low in the pandemic year, venture capital funding for travel and tourism startups has also rebounded. According to Crunchbase data, in 2019, investors spent $11.1 billion on 1,125 transactions in the industry. By 2020, this number will drop to 4.8 billion U.S. dollars and 629 transactions. Things seem to rebound in 2021, with 346 transactions and $6.1 billion in funding.
It is not clear how long the travel rebound will last.The optimistic outlook may be due to Variations of Coronavirus, This continues to spread and inspires new restrictions in some areas. During the earnings call, Airbnb’s chief financial officer Dave Stephenson warned that bookings in the third quarter may be less than in the second quarter. Summer travel always decreases gradually at this time of the year, but the rising number of coronavirus cases has also changed the travel plans of some people.There are already companies like Southwest Airlines More optimistic forecasts from early summer.
Airbnb pointed out in its shareholder letter that “the progress of vaccination, the containment of new variants and travel restrictions” may affect the bottom line of the business in the coming months. But if the company learned one thing from last year, it is to become more efficient: this quarter, its loss narrowed to $68 million from $576 million last year. If the road ahead is more bumpy, these lessons may prove valuable.
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