Airbnb traded lower Wednesday despite a quarterly report that showed better-than-expected sales. Some investors may be fretting over the company's warning that room-night booking growth could moderate to start this year.
Airbnb reported late Tuesday an adjusted loss of 55 cents per share on $2.22 billion in sales. On average, analysts polled by FactSet expected the San Francisco-based company to earn 66 cents a share on $2.17 billion in sales.
The net loss, totaling $349 million, included "nonrecurring tax withholding expenses and lodging tax reserves of approximately $1 billion," Airbnb said in a letter to shareholders. The company's adjusted net income was $489 million outside of those charges.
During the year-earlier period, Airbnb earned 48 cents a share and the company reported $1.9 billion in sales.
For the current quarter, Airbnb forecast sales between $2.03 billion and $2.07 billion. Analysts expected $2.02 billion, according to FactSet.
On the stock market today, Airbnb stock slipped 1.7% to close at 148.20. Shares jumped as high as 9% immediately following the report Tuesday before retreating.
Analysts Eye Key Booking Forecast
Some analysts have pinned the negative reaction from investors on Airbnb's forecast for the total nights booked through its platform in the current quarter. In its shareholder letter, Airbnb cautioned investors to "expect the growth rate of nights booked in Q1 2024 to moderate relative to Q4 2023." The company said it is up against tough comparisons after a strong first quarter in 2023, when total nights booked jumped 19%.
"ABNB did guide to a moderation in room night growth in Q1, whereas the Street was looking for consistent growth," wrote Evercore ISI analyst Mark Mahaney in a client note Tuesday. "So, the outlook is somewhat mixed."
Mahaney upped his price target on Airbnb to 140, from 136, but reiterated a neutral rating for the stock.
Airbnb stock last year gained 60% and is up just under 7% this year, factoring in Wednesday's early decline.
Meanwhile, William Blair analyst Ralph Shackart similarly said Airbnb's forecast for night's booked is likely weighing on the stock. But the analysts reiterated a positive outperform rating in a client note Tuesday.
"While there could be cyclicality in the stock's performance should consumers pull back travel discretionary spend in the wake of a potential recession, we believe that Airbnb is the best positioned as a leading platform for short-term rentals and home-sharing through the long term," Shackart wrote.
Airbnb At 'Inflection Point'
Meanwhile, Airbnb said gross bookings reached $15.5 billion for the fourth quarter, up 13% year over year.
Total listings on Airbnb grew 18% to 7.7 million. The company said it is seeing "double-digit supply growth across all regions, with the highest growth in Asia Pacific and Latin America."
Airbnb's overall revenue growth was 17% for the quarter. That topped its previous guidance. In its third-quarter earnings report in November, the company said "greater volatility early in Q4" caused it to be more cautious with its revenue outlook.
To Chief Executive Brian Chesky, the overall results showed Airbnb is at an "inflection point." He said on the company's analyst call Tuesday that the firm will invest in expanding "beyond the core." That includes further focus on international markets, as well as adding artificial-intelligence powered applications.
That could include, he said, "developing a leading AI interface to provide an experience that's so much more personalized than anything you've ever seen before. Imagine an app that you feel like knows you, it's like the ultimate concierge."
Beyond that, Chesky told Airbnb stock analysts only that "you will see some very big announcements later this year."
Some rivals, such as Booking.com, are offering AI-powered travel assistant to more easily link up flights and rental cars with hotel room bookings.
Airbnb Stock: Technical Ratings
Coming into the report, Airbnb stock had a best-possible IBD Composite Rating of 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one easy-to-use rating.
Further, Airbnb's IBD Relative Strength Rating was 88 out of 99. The rating compares a stock's price movement over the last 52 weeks with that of others in IBD's database.
In addition, Airbnb stock had an Accumulation/Distribution Rating of B+, which indicates institutional buying of shares.
