Airbnb profit jumps to $650 million in 2Q, as bookings increase and rental rates hold steady
Airbnb says its second-quarter profit rose more than 70% from a year ago to $650 million thanks to strong bookings for summer-vacation rentals
Airbnb said Thursday its second-quarter profit jumped more than 70% over last summer, to $650 million, as revenue rose on strong bookings for summer-vacation rentals.
The San Francisco company said bookings grew 11% over the same period last year. Still, they were a bit lighter than analysts expected.
The shares fell about 1% after three hours of late trading.
Airbnb has been battling complaints that high cleaning fees have pushed prices closer to, or even above, hotels for short rentals. It changed its site to display cleaning fees upfront, when consumers are price-shopping.
Prices, however, remain stubbornly high. Airbnb had forecast that average rates customers pay per night would fall slightly in the second quarter compared with last year. Instead, the average nightly rate rose 1% to $166.
CEO Brian Chesky said on a call with analysts that the price customers book is lower than list prices on average.
“So we do see people gravitating toward more affordable stays,” Chesky said. He said some of the modest increase over last year's average rate is due to people booking bigger homes.
Chesky argued that hotels are raising prices faster, but Airbnb is trying to nudge many hosts to drop their rates.
“Most hosts are not booked most nights,” he said. “If they lower the price just a little bit, they will add more bookings, more nights, and they'll end up making more money.”
The company said new tools that make it easier for hosts to compare prices they charge to the nearby competition “had a moderating effect” on rates in the second quarter. However, it expects third-quarter average
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