Airbnb Inc's quarterly revenue has topped Wall Street expectations and the short-term home rental company has said that a rebound in global travel amid rising vaccination rates in the last three months of the year would drive growth in 2022.
International travel search volumes have been rising as countries, including the United States, start to ease pandemic-related restrictions for fully vaccinated visitors.
Easing lockdowns have helped Airbnb recover from a steep drop in business early last year as leisure-seeking domestic travellers booked homes away from major cities. It now expects cross-border travel to further boost its revenue.
"We are seeing recovery in both longer-distance and cross-border travel this year, while domestic and short-distance travel continue to be more popular than 2019 levels," the company said in a statement.
The vacation rental said the recovery was dominated by North America and Europe - regions with higher average daily rates. It rose 15% to about $149 in the third quarter from a year earlier.
For the Thanksgiving week in the United States, Airbnb said as of Sept. 30, nights booked are 40% higher than same period in 2019.
With the pandemic causing a permanent step up in the lodging industry mix, analysts expect Airbnb to continue to grow in the alternative accommodation market, in which it has a more than 50% share among global online travel agents.
In the third quarter, gross bookings rose 48.8% to $11.9 billion. However, it missed market expectations of $12.23 billion.
Revenue rose 66.7% to $2.24 billion and beat estimates of $2.05 billion. Net income surged nearly four times to $833.9 million from a year earlier.
Airbnb forecast fourth-quarter revenue between $1.39 billion and $1.48 billion. Analysts on average estimated $1.44 billion, according to Refinitiv data.
Airbnb To Launch Translation Tool As Cross-Border Travel Picks Up
Additionally, Airbnb Inc has announced a slew of new features including a translation tool to be launched later this year and expanded insurance for hosts, as easing COVID-19 curbs send more people to its home-rental app.
The features, aimed at facilitating rising cross-border travel and longer stays, will help Airbnb further capitalise on a pandemic-driven shift in consumer preference towards non-urban destinations and alternative accommodations.
"What you're going to see is as the world moves into a post COVID-19 world, people are going to travel a lot more than they did before, certainly a lot more than they do now," Airbnb Chief Executive Officer Brian Chesky told Reuters in an interview.
Chesky expects the new tool, which will be able to translate listing descriptions and reviews in 60 languages, to help in bookings, especially in Europe and Asia Pacific where there is high demand for cross-border travel.
Airbnb said more than 100,000 guests stayed on its rental properties for at least three straight months in the past year.
Its "AirCover" insurance will offer hosts protection against pet damage as global searches surge on its platform for pet-friendly listings.
Truist analyst Naved Khan expects the latest upgrades to drive incremental growth at Airbnb. The brokerage maintains its "hold" rating on the stock.
Months of pent-up demand triggered a major spike in bookings to the United States on Monday, as the country lifted pandemic-driven travel curbs imposed in early 2020.
Overall cross-border travel has risen steadily to 33% of gross nights booked in the third quarter, compared with 27% in the second and 20% in the first quarter, Airbnb said.
As of Nov. 8, the top destinations for inbound foreign travel to the United States include Los Angeles, Miami and New York, according to Airbnb.