Airbnb Did Not Deliver Vaccines- But It Is Just As Much Of A Hero

Last week, Reuters reported that Airbnb ABNB has offered to provide free, temporary housing to 20,000 Afghan refugees across the globe, helping its shares close up 10% after the announcement. Last Thursday, the company revealed it will allow anyone with available space to sign up to provide housing, with the United Nations High Commissioner for Refugees registering 2.5 million Afghan refugees.

The Initiative

Airbnb will provide free or discounted stays to Afghan refugees through its dedicated website for emergency housing by waiving its fees on all refugee stays. For those who are unable to open up their homes but are still eager to help, they can aid the crisis by donating money to support this noble cause.

Q2 Figures

On August 12^th, the company exceeded Wall Street's expectations for revenue and bookings in the second quarter. Although it did warn the delta variant causing volatility and uncertainty, Airbnb nonetheless expects the third quarter to deliver its strongest quarterly revenue on record.

Over the quarter, 83.1 million nights and experiences were booked, which is an increase of 29% from the prior, first, quarter. Looking back at last year's quarter, it is a YoY improvement of 197% YoY as back then, the travel industry was crushed by a global pandemic. Generated revenue amounted to $1.34 billion, up nearly 300% YoY with net loss improving 88% as it narrowed from last year's quarterly net loss of $575.6 million to this quarter's $68 million.

Sales and marketing expenses rose 175% YoY as they reached $315 million. The increase was attributed to Made Possible by Hosts campaign. This rise in expenses wasn't a surprise as the company warned back in February that expenses as a percentage of revenue will be higher in the first half of the year as opposed to the second half.

Gross booking value which is the company's way of tracking host earnings, service fees, cleaning fees, and taxes, was up 320% YoY as it amounted to $13.4 billion. The average daily rate rose from the previous quarter's $160 to $161, up 41% YoY, reflecting an increase in consumer spending on experiences and travel.

Outlook

Airbnb expects delta to disrupt travel behavior, mostly in terms of the frequency and timing of bookings and cancellations. Despite expecting strong revenue, bookings are expected to be behind the second quarter's as well as 2019's third quarter.

The company's performance will be impacted by both the vaccination progress as well as how successfully the world is able to combat new variants as it is still unknown how willing will customers be to travel in the fall. At the very least, Airbnb has risen as a hero that helped save many lives in its own unique way as there are many other battles besides COVID to be fought.

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