In its first quarterly earnings report as a public company, Airbnb reported declining revenue and a hefty loss of $3.9bn.
Airbnb has felt the brunt of the pandemic with the shutdown of the vast majority of tourist travel.
In the final quarter of 2020, it booked revenue of $859m, which was down from $1.1bn in same period in 2019.
Losses for the quarter tallied at a whopping $3.9bn, which the company said was attributable to its IPO costs, paying out stock-based compensation and an emergency loan of $827m it took out at the start of the pandemic.
The company had forecast that final revenue figures for 2020 would be half of what they were in 2019. In the end, revenue for the full year was $3.4bn – compared to $4.9bn in 2019 – with a loss of $4.7bn.
In early to mid-2020, when the coronavirus pandemic was taking hold in the world, Airbnb lost some $1bn in bookings and was forced to lay off staff to curb rapidly mounting costs.
Despite this unwelcoming atmosphere for travel and tourism, the company ploughed ahead with an IPO in December that valued it at $100bn.
The company is particularly reliant on countries’ vaccine strategeies panning out and travel opening up again as soon as possible. Even prior to the pandemic, questions abound about Airbnb’s ability to turn its heady growth into a profit. Those questions are fiercer now as it weathers Covid-19.
“As the vaccine is rolled out and restrictions lift, we expect there will be a significant travel rebound,” the company said in a statement. “Our single priority in 2021 is to prepare for this travel rebound, perfecting our existing product by improving the entire end-to-end experience of our core service for both hosts and guests.”
In its shareholder letter, it added that it has “limited visibility for growth trends” and provided no outlook for the forthcoming year.
Once the pandemic subsides and some form of normalcy resumes, Airbnb will still have other persistent challenges to its business to contend with, namely increasing regulation of short-term lettings.
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