Airbnb 2025 Q1 Earnings Misses Targets, Net Income Falls 41.7%
Friday, May 2, 2025 1:36 am ET
46min read Airbnb (ABNB), ranking 177th by market capitalization, reported its fiscal 2025 Q1 earnings on May 01st, 2025. Airbnb's first-quarter earnings came in below expectations, with net income dropping 41.7% to $154 million and earnings per share (EPS) declining to $0.25 from $0.41 in the previous year. The company also provided guidance for Q2 2025, anticipating revenue between $2.99 billion and $3.05 billion, reflecting a year-over-year growth of 9% to 11%. The guidance indicates that marketing expenses are expected to grow faster than revenue as the company invests in growth initiatives.
Revenue
Airbnb's total revenue rose by 6.1% in the first quarter of 2025, reaching $2.27 billion, compared to $2.14 billion in the same quarter of the previous year.
Earnings/Net Income
Airbnb reported a decline in EPS by 39.0%, falling to $0.25 in 2025 Q1 from $0.41 in 2024 Q1. Net income also decreased significantly to $154 million, a drop of 41.7% from $264 million the previous year. The decline in EPS signals a challenging quarter for the company.
Price Action
The stock price of airbnb edged up 1.71% during the latest trading day, increased 1.89% during the most recent full trading week, and climbed 3.81% month-to-date.
Post-Earnings Price Action Review
Following the earnings report, Airbnb's stock price displayed mixed responses. The 3-Day win rate for revenue, net income, and EPS stood at 51.52%, 48.93%, and 49.72% respectively, indicating that the stock price moved positively approximately half the time in the short term after the earnings report. However, the 10-Day and 30-Day win rates were lower, suggesting that the positive momentum might not sustain in the longer term. The maximum return observed after the earnings report was -0.12% for EPS and 0.85% for revenue, indicating a slight average decline in stock price post-report, with rare instances of positive return.
CEO Commentary
Brian Chesky, Co-Founder & Chief Executive Officer, stated, "We had a strong start to 2025," with guests spending nearly $25 billion on Airbnb. He highlighted the company's adaptability, recalling its origins during the Great Recession and the pandemic. Chesky emphasized the ongoing transformation of Airbnb, focusing on enhancing the core service before launching new offerings. He noted significant improvements, such as the introduction of Guest Favorites and total price displays, aimed at affordability and reliability. Looking ahead, he expressed confidence in Airbnb's resilience amid uncertainties, stating, "Airbnb will continue to adapt," and underscoring the importance of the upcoming 2025 Summer Release.
Guidance
For Q2 2025, Airbnb expects revenue between $2.99 billion and $3.05 billion, representing 9% to 11% year-over-year growth. Adjusted EBITDA margin is anticipated to be flat to slightly down compared to Q2 2024, with marketing expenses expected to grow faster than revenue due to investments in growth initiatives. For the full year, the company maintains an adjusted EBITDA margin expectation of at least 34.5%, factoring in $200 million to $250 million for launching and scaling new businesses in 2025, which will impact margins in the second half of the year.
Additional News
Airbnb is set to launch its highly anticipated Summer Release 2025, featuring significant updates aimed at enhancing guest experiences and streamlining host operations. The release will introduce AI-powered customer support, revamped Airbnb Experiences, and complementary travel services like airport transfers and grocery delivery. These updates are designed to strengthen Airbnb's position as a full-service travel brand and provide hosts with new opportunities for upselling and increased revenue. The company is also planning a big announcement on May 13, signaling a strategic move to expand beyond traditional accommodations.
Revenue
Airbnb's total revenue rose by 6.1% in the first quarter of 2025, reaching $2.27 billion, compared to $2.14 billion in the same quarter of the previous year.
Earnings/Net Income
Airbnb reported a decline in EPS by 39.0%, falling to $0.25 in 2025 Q1 from $0.41 in 2024 Q1. Net income also decreased significantly to $154 million, a drop of 41.7% from $264 million the previous year. The decline in EPS signals a challenging quarter for the company.
Price Action
The stock price of airbnb edged up 1.71% during the latest trading day, increased 1.89% during the most recent full trading week, and climbed 3.81% month-to-date.
Post-Earnings Price Action Review
Following the earnings report, Airbnb's stock price displayed mixed responses. The 3-Day win rate for revenue, net income, and EPS stood at 51.52%, 48.93%, and 49.72% respectively, indicating that the stock price moved positively approximately half the time in the short term after the earnings report. However, the 10-Day and 30-Day win rates were lower, suggesting that the positive momentum might not sustain in the longer term. The maximum return observed after the earnings report was -0.12% for EPS and 0.85% for revenue, indicating a slight average decline in stock price post-report, with rare instances of positive return.
CEO Commentary
Brian Chesky, Co-Founder & Chief Executive Officer, stated, "We had a strong start to 2025," with guests spending nearly $25 billion on Airbnb. He highlighted the company's adaptability, recalling its origins during the Great Recession and the pandemic. Chesky emphasized the ongoing transformation of Airbnb, focusing on enhancing the core service before launching new offerings. He noted significant improvements, such as the introduction of Guest Favorites and total price displays, aimed at affordability and reliability. Looking ahead, he expressed confidence in Airbnb's resilience amid uncertainties, stating, "Airbnb will continue to adapt," and underscoring the importance of the upcoming 2025 Summer Release.
Guidance
For Q2 2025, Airbnb expects revenue between $2.99 billion and $3.05 billion, representing 9% to 11% year-over-year growth. Adjusted EBITDA margin is anticipated to be flat to slightly down compared to Q2 2024, with marketing expenses expected to grow faster than revenue due to investments in growth initiatives. For the full year, the company maintains an adjusted EBITDA margin expectation of at least 34.5%, factoring in $200 million to $250 million for launching and scaling new businesses in 2025, which will impact margins in the second half of the year.
Additional News
Airbnb is set to launch its highly anticipated Summer Release 2025, featuring significant updates aimed at enhancing guest experiences and streamlining host operations. The release will introduce AI-powered customer support, revamped Airbnb Experiences, and complementary travel services like airport transfers and grocery delivery. These updates are designed to strengthen Airbnb's position as a full-service travel brand and provide hosts with new opportunities for upselling and increased revenue. The company is also planning a big announcement on May 13, signaling a strategic move to expand beyond traditional accommodations.
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