Mar 13, 2020 - Technology

Coronavirus hits Airbnb, already facing widening losses

Photo illustration: Axios Visuals

The coronavirus pandemic is already posing a drag on Airbnb bookings and revenue, according to new data from research firm AirDNA.

Why it matters: This can't be good news for Airbnb, which has been planning to go public in 2020, in part because some employee stock grants will expire by year's end.

The big picture: Despite touting its healthy business and billions in cash, Airbnb last quarter ramped up its spending—and thus, losses—on growth and marketing in preparation for its IPO, according to Bloomberg.

  • It had a loss of $276.4 million excluding interest, taxes, depreciation and amortization, compared with $143.7 million a year earlier.
  • Revenue grew 32% over the same period to $1.1 billion.
  • The company expected bookings to grow 25% during the first quarter of 2020 — likely underestimating COVID-19's impact, Bloomberg reported.

By the numbers, per AirDNA:

  • Overall short-term rental supply: Largely unchanged between January and March, except for a small decline in China.
  • Weekly Airbnb revenue: There's been a downward trend since roughly mid-February across various major cities globally, and so far for the beginning of May, most destinations are averaging about half of the bookings made back in February.
  • Reservations by date booked (change between early January and early March): 96% drop for Beijing, 71% in Shanghai, 46% in Seoul, 41% in Rome, 29% in both Tokyo and Milan.
  • Beijing Airbnb revenue: While it grew nearly 130% year-over-year in January, February saw a 22.2% drop from 2019, and March saw a decline of nearly 43%.

Go deeper

Rural areas see short-term rental boom amid coronavirus spread

Illustration: Sarah Grillo/Axios

While the travel industry and accommodations are taking a major hit amid the coronavirus pandemic, short-term rentals in U.S. rural (and suburban, to a less extent) areas are seeing an uptick, according to new data from AirDNA.

The big picture: People are fleeing densely populated areas, especially on the coasts, and taking up shelter in isolated rentals in rural and more "destination" type of locales.

Airbnb looks for backups to going public amid coronavirus downturn

Illustration: Aïda Amer/Axios

Airbnb may not be through with the private markets after all, as CNBC reports that the room rental giant is fielding offers from large investment firms, although pricing remains unclear.

Why it matters: 2020 was supposed to be the year that Airbnb went public, either through an IPO or a direct listing (or a combination of the two).

Airbnb to spend $250 million to partially refund hosts

Photo Illustration: Thomas Trutschel/Photothek via Getty Images

After recently allowing all customers to cancel reservations due to the coronavirus pandemic, Airbnb says it will spend $250 million to refund 25% of the cancellation fees that hosts would have otherwise received depending on their select policy. It also created a $10 million relief fund for select hosts, which includes $9 million donated by Airbnb's founders.

The big picture: Airbnb has been in the unpleasant position of having to please both sides of its marketplace, while also managing its own finances. It recently cut marketing spend to save $800 million, among other moves, as its business takes a huge hit, a source tells Axios.

Go deeper: The gig economy's coronavirus test