Airbnb, the global online marketplace for lodging and experiences, is anticipating first-quarter revenue that surpasses Wall Street expectations. The company is banking on strong cross-border travel and longer-duration bookings to boost its earnings. With increased global air connectivity, international travel demand is expected to remain robust.
According to Airbnb, it foresees revenue between $2.03 billion and $2.07 billion. This positive outlook is driven by the company’s expansion into under-penetrated countries, as noted by CFO David Stephenson. Despite beating earnings estimates, shares of Airbnb fell 5% in extended trading.
During the fourth quarter of 2023, travelers booked an impressive 98.8 million nights and experiences, marking a 12% increase compared to the previous year. The Asia Pacific and Latin America regions experienced the strongest growth, with China alone recording a nearly 90% increase in nights booked. This growth is attributed to rising average daily rates, which rose by 3%, and a 20% increase in nights booked for long-duration trips.
However, the company did report a quarterly net loss of $349 million. This loss was primarily due to outstanding income tax obligations in Italy. As a result, Airbnb has agreed to pay $621 million to the Italian Revenue Agency for the 2017 to 2021 tax years. Furthermore, the company warns that there may be additional material amounts to be paid for taxes in 2022 and 2023.
These developments highlight the resilience and growth potential of Airbnb, particularly in emerging markets. Despite the setback in Italy’s tax obligations, the company remains optimistic about its global prospects. With strong international travel demand and strategic expansion efforts, Airbnb is well-positioned to capitalize on the evolving needs of travelers worldwide.
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