Yahoo Finance Airbnb (ABNB) Down 0% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Airbnb, Inc. (ABNB). Shares have lost about 0% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Airbnb due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Airbnb Q1 Earnings & Revenues Beat, Increase Y/Y
Airbnb reported adjusted earnings of 41 cents per share for first-quarter 2024, which jumped from 18 cents per share reported in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 78.3%.
Revenues of $2.14 billion increased 18% on a reported basis, as well as on an FX-neutral basis, year over year. The top line also surpassed the Zacks Consensus Estimate by 3.7%.
The year-over-year increase was driven by continued strength in travel demand and the timing of the Easter holiday. Continuous improvement in Nights and Experiences Booked acted as a tailwind.
Growing gross nights booked, owing to the solid momentum across non-urban areas and increased demand for urban and cross-border travel, remained positive. A modest increase in Average Daily Rate was a plus.
These factors aided growth in the company’s Gross Booking Value (GBV) in the first quarter.
Also, a solid momentum in Airbnb app downloads contributed well.
Quarterly Details
Nights and Experiences Booked were 132.6 million, up 9.5% on a year-over-year basis. The metric was driven by strong performances in all regions, especially the Asia Pacific and Latin America.
GBV amounted to $22.9 billion, which rose 12% from the prior-year quarter’s reported figure.
GBV per Nights and Experiences Booked (or Average Daily Rates) were $172.88, which grew 3% on a year-over-year basis.
In terms of trip length, the category of long-term stays of 28 days or more accounted for 17% of overall gross nights booked.
In the reported quarter, gross nights booked in non-urban areas grew 10% on a year-over-year basis.
Cross-border nights booked was up 10% year over year and accounted for 46% of total gross nights booked.
Operating Results
Adjusted EBITDA was $424 million, up 62% from the prior-year quarter.
Operations and support costs, product development expenses, and sales and marketing expenses were $285 million, $475 million and $514 billion, increasing 1.1%, 13.1% and 14.2%, respectively, year over year. General and administrative expenses were $287 million, up 18.1% year over year.
For the first quarter, Airbnb reported an operating income of $101 million against the operating loss of $5 million reported in the prior-year quarter.
Balance Sheet & Cash Flow
As of Mar 31, 2024, cash and cash equivalents and short-term investments amounted to $11.1 billion compared with $10.1 billion as of Dec 31, 2023.
Long-term debt, as of Mar 31, 2024, was $1.992 billion compared with $1.991 billion as of Dec 31, 2023.
Net cash provided by operating activities was $1.9 billion for the first quarter of 2024, significantly up from $63 million in the previous quarter.
Airbnb generated a free cash flow of $1.9 billion in the first quarter.
Guidance
For the second quarter of 2024, the company expects revenues between $2.68 billion and $2.74 billion, implying year-over-year growth of 8-10% on a reported basis.
Airbnb expects revenues to benefit from robust travel demand. However, the company expects revenue growth to face a significant sequential headwind due to the timing of the Easter holiday and the impact of forex rate changes.
The adjusted EBITDA margin is expected to decrease year over year.
For 2024, the company expects an adjusted EBITDA margin of at least 35%.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in fresh estimates.
VGM Scores
Currently, Airbnb has an average Growth Score of C, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Airbnb has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Airbnb, Inc. (ABNB) : Free Stock Analysis Report
