A Probe into Airbnb's Unpleasant Customer Experiences has Caused its Shares to Fall

A new report produced by a European independent online publication probed the unpleasant experiences that customers had while staying through the short-term rental platform Airbnb Inc (ABNB.O). As a result, shares of Airbnb fell as much as 6% on Thursday.

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There are numerous horror incidents reported on the internet by guests staying in Airbnbs which have been managed individually, including unexpected cleaning requirements and last-minute cancellations as well as numerous examples where guests have found hidden cameras in their bedrooms and bathrooms, according to the Bear Cave report.

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The stock price of the company has been declining for the past few hours, with shares down 5%.

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As a result of the company's 40% growth in revenue in 2022, Airbnb was able to achieve its best profit ever. With the fourth quarter of 2022, the San-Fransico based company saw an increase of 16% in active listings over the same period of 2021. While night and experience bookings were 20% higher compared to a year ago, analysts' expectations were not met.

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As recently as this summer, travel companies reported that despite concerns about the slowdown of the economy, they had not yet seen a reduction in demand in the travel industry.

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The fire broke out in an apartment building in Montreal that was used by both long-term residents and short-term visitors who had booked lodging through Airbnb last month. The city said the units had not been intended for such purposes and that they were not supposed to be used for that purpose.

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Several of the company's top host professionals have recently removed their listings from Airbnb in favor of building their own booking platform and are now offering cheaper rates for their guests.

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There is some uncertainty surrounding Airbnb's future, given the increase in professionally managed properties that it is already contending with. The report warns that these increased properties may further threaten the company's revenue. However, some analysts are more optimistic about the company's future.

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In an analysis published by Bernstein, analyst Richard Clarke wrote that Airbnb is sitting in a much more favorable supply market, and looking much more like Amazon: most things on Amazon are pretty much available to purchase elsewhere, but that does not make it any less valuable as a platform than Amazon,"

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As part of its effort to cut costs and protect margins, Airbnb laid off some recruiting workers in March.