An Upbeat Travel Outlook Sees Airbnb Looking for a Busy Summer Season

    The shares of Airbnb Inc. gained 6% during extended trading after the company forecasted the current quarter earnings that look to surpass the Wall Street estimates. Airbnb sees the coming summer season busy after more than two years of travel restrictions due to Covid-19.

    The positive forecast

    Compared to the average analyst’s estimated revenue of $1.97 billion, the company projected the second-quarter revenue between $2.03 billion and $2.13 billion, as per Bloomberg data. Even the first-quarter revenue was better than expected and helped the company narrow the loss the vacation home rental suffered. 

    As per CEO Brian Chesky’s letter to the shareholders, the company will lap the travel rebound. U.S. domestic demand has been encouraging and more than expected his year. 

    Airbnb, along with rivals Booking Holdings Inc. and Expedia Group Inc, expects this year’s summer to be the best in recent years, thanks to the pent-up demand with travelers heading off to far-flung tourist hot spots and destinations. This outlook was threatened earlier this year after the outbreak of the Omicron variant and the Russia Ukraine war

    The signs are positive, with people itching to travel. United Airlines Inc. is increasing its capacity in its transatlantic flights. Southwest Airlines Co. is expected its following three-quarters results to be profitable despite oil prices above the $ 100 a barrel level. 

    Peter Kern, CEO of Expedia, said that he feels good about a robust summer recovery after the company posted an 80% jump in its first-quarter earnings on Monday.  

    Despite the results being aligned to analysts’ estimates, the shares of Expedia fell 17%, the highest since March 2020, with concerns about recession and inflation clouding the vision. Travel companies, including hotels and airlines, pointed out that consumers are willing to pay high travel costs, but there is a limit. Hilton Worldwide Holdings Inc. has given a profit forecast short of market expectations. 

    Airbnb managed to weather the pandemic storm and even thrived in 2021, achieving its best-ever performance since its inception. According to Chesky, the world of travel is emerging with the flexibility of working from remote places to new work policies. This has resulted in people spending days, weeks, months, or even an entire season in different towns and cities. 

    In an interview, Justin Patterson, an analyst with Keybanc Capital Markets, saw improvements in U.S. and Europe geographies compared to 2019 levels before the results were announced. 

    Based out of San Francisco, Airbnb saw its first-quarter revenue increase to $ 1.51 billion, showing a growth of 70% and surpassing analysts’ estimates of $1.45 billion. The net loss was $ 19 million compared to the $ 1.2 billion loss a year ago. 

    The number of nights booked in the first quarter surpassed pre-pandemic levels rising by 59 % to 102.1 million. The daily rates also increased with a gross booking value of $17.2 billion against analysts’ forecast of $15.9 billion.



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