Fendi Bags Can't Hold Up To Airbnb's Travel Demand

As Airbnb moves to improve its core product for the millions of visitors and hosts who have flocked to its platforms since the pandemic hit, it will report its first profitable year in 2022.

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In an interview, Chief Financial Officer Dave Stephenson said: "We're focused on the most critical things right now." 

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According to the annual report of the San Francisco-based firm, last year's revenue was $8.4 billion, while the net income was $1.9 billion. Despite high inflation and a cloudy economic outlook, Airbnb is confident its business will remain strong despite its recent success in attracting vacationers eager to take vacations after years of Covid-19 travel restrictions emerged. In its last quarterly earnings report, the company reported that it had grown 20% over the previous year in terms of bookings in January.

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Stephenson explained that the demand for traveling through other places and experiencing other cultures with other people, in addition to buying a new Fendi handbag, is much more lasting than the desire to travel through different places. There has been a revaluation of priorities in the market since the end of the pandemic. He described the situation as "less of a rebound" after the pandemic.

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As a result, Airbnb has been adding more supply to meet that demand. 6.6 million listings were listed at the end of last year, an increase of 900,000 from the year before. Hosts can get tips on creating listings from the company's "superhosts," as part of an effort to make hosting easier. 

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The company also plans to leverage the ecosystem of independent companies that offer guest and host services, such as fridge stocking, cleaning services, and co-hosting features. These are areas we can grow into over time since they are so adjacent to the core and provide a unique mechanism for connecting guests and hosts," he said. 

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It is more likely that such offerings will be offered as a marketplace designed by the company, Stephenson said, even as he acknowledged the possibility of acquisition. 

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Despite the fact that Airbnb has a substantial amount of cash on hand, the company may still be able to take advantage of it to make deals or invest in its business. It is reported that the company has $7.38 billion of cash and cash equivalents as of the end of 2022. 

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As Stephenson explained, Airbnb's challenge is not accessing funding, but rather figuring out how to spend the money it receives. “We're clearly in growth mode, and we need to determine where our cash needs to go; this is the biggest issue for us since we're in a growth phase," Stephenson said, adding that there are no plans to raise additional funding anytime soon since the company is clearly in growth mode. It has been announced that Airbnb will spend $1.5 billion on repurchasing its stock this year, in addition to the amount it spent on repurchasing stock last year.

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A partnership between Airbnb and some of the country's major apartment landlords has been announced to allow tenants to list their units on Airbnb when they are not using the units when they are not in use. Airbnb provides prospective renters with the chance to browse apartments on its website and assess the potential income they could earn by spending part of their time as a host. According to Stephenson, since Airbnb launched its initiative last fall, dozens of properties have been added to its portfolio in more than 30 markets. As a percentage of the revenue generated by the property, each owner receives a 15%-to-25% cut. 

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As the company continues to grow, Airbnb's average stay length continues to increase, according to Ellie Mertz, vice president of finance. Approximately 21% of the total stays are long-term stays lasting 28 nights or longer, according to company results for the fourth quarter.

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The lingering effects of Covid are waning, and Airbnb guests are returning to cross-border travel in greater numbers. Since Airbnb shut down its domestic business in China last year, the Asia Pacific region is the last to begin to rebound. However, Airbnb said that it is preparing to resume regional flights in the area in order to spur outbound travel from China.