Airbnb (ABNB) Surges After Earnings, Aiming to Expand Beyond Vacation Rentals
ABNB shares soared over 14% on Friday after the company's earnings report exceeded expectations. CEO Brian Chesky outlined plans to transform the Airbnb app into a comprehensive platform for all travel and lifestyle needs, similar to Amazon's approach.
"We see Airbnb as more than a destination for accommodation," Chesky said. "It's a place where users can handle all aspects of their travel and living requirements."
Airbnb's shareholder letter announced intentions to launch multiple new businesses adjacent to travel in the coming years. While specifics weren't disclosed, Chesky cited Amazon's diversification strategy, which began with books and expanded to include various consumer products.
Airbnb currently boasts 1.6 billion annual device users, with an average usage frequency of one to two times per year. Chesky aims to increase this engagement to a weekly basis.
Launching and scaling new businesses will require investments of $200-$250 million, potentially impacting short-term margins. Analysts remain cautious, with JPMorgan forecasting margin compression and execution risks associated with new ventures.
Despite the strong earnings report, JPMorgan maintains a Neutral rating and a $160 price target. Jefferies recommends a Hold with a $165 target, citing uncertainty over the impact of new products and timing of sponsored listings.
In Q4, Airbnb's revenue grew 12% YoY to $2.48 billion, exceeding estimates. Gross bookings surged 14% to $17.6 billion, topping Wall Street expectations.