Airbnb (ABNB) recently reported the highest quarterly revenue and earnings figures in its history, observes growth stock specialist Todd Shaver, editor of the Bull Market Report.
Revenue hit $2.25 billion, 70% higher than the previous year. Revenue is actually 35% higher than the level two years ago prior to the pandemic. The company is quite profitable. Income was $835 million, or $1.34 a share, the company’s highest quarterly profit ever, quadrupling from a year ago.
Total booked nights were up 10% from pre-pandemic levels in North America. Bookings were $12.0 billion in the quarter, up 48% from last year and 25% higher than two years ago. 80 million nights and experiences were booked on the platform in the third quarter alone.
This is no small company as it is now worth $120 billion. And cash of $8.0 billion and debt of just $2.4 billion shows us a strong balance sheet.
The company announced a host of new features and upgrades, fundamentally altering customer experience and the overall value proposition of its service. The company revealed various new refinements across its systems and processes, with plenty to offer for remote workers, digital nomads, and Airbnb hosts.
With the announcement coming a day after the US removed its travel ban that had been in place since the beginning of the pandemic, the company aims to capitalize on the secular tailwinds that will persist even as the world moves back to normal. Airbnb has made a big bet on the continued shift towards remote work and flexible travel.
Airbnb announced over 100 new features and upgrades during its new feature day, with many of them in support of major travel trends such as the blending of work and leisure, with many employees still staying away from offices. It also includes verified internet speeds at host residences, along with detailed amenities, arrival guides and more.
The company recently introduced Flexible Matching, Destinations, and Dates, giving travelers options beyond their specified search, giving traction to new and unique stays. This along with curated wish lists, and various new search attributes and experiences filters, will unlock significant value for the company and the entire ecosystem that relies on it.
Bringing on new hosts has now become remarkably easy, with a simple 10-step process with automated prompts and auto-filled details. This along with the company’s persistent investments in new technologies, co-branded buildings, and partnerships with travel service providers will be strong growth drivers over the next few quarters.
Airbnb has successfully weathered an unprecedented storm over the past year, with exceptional capital management, and now with revenues and bookings already past pre-pandemic levels, the company’s strong network effects, scalability and robust balance sheet will propel it a lot higher.
We are excited about the future of this company, which is creating a new reality for leisure travel. Our Price Target for the stock remains at $255, and the Sell Price of $150 is hereby raised to $175.
