Airbnb Soars 13% After Strong Q4 Earnings Beat – Is $170 the Next Stop?

Airbnb delivered a strong fourth-quarter earnings report that exceeded Wall Street expectations, sending shares surging in after-hours trading. The company reported adjusted earnings per share of $0.73, handily beating the consensus estimate of $0.58. Revenue came in at $2.48 billion, representing a 12% year-over-year increase and surpassing analyst expectations of $2.42 billion. The solid performance was fueled by robust travel demand, continued expansion across global markets, and an increasing number of first-time bookers on the platform.

One of the key highlights of the report was Airbnb’s gross booking value, which reached $17.6 billion, up 14% from the prior year and ahead of expectations of $17.19 billion. The company reported 111 million nights and experiences booked, a 12% increase year-over-year, reflecting strong user engagement and continued growth in key travel markets. Average daily rates (ADR) rose modestly to $158, up just 0.9% from the prior year, suggesting pricing power remains stable even as travel demand normalizes. Additionally, free cash flow for the quarter came in at $458 million, a significant increase from $46 million in the prior year, showcasing the company’s strong cash generation ability.

Airbnb highlighted several travel trends that contributed to its performance. Growth was widespread across all regions, with particularly strong momentum in Asia-Pacific and Latin America. The company noted that cross-border bookings in the Asia-Pacific region grew 27% year-over-year, as travel restrictions continued to ease and demand rebounded. North America saw mid-single-digit growth in bookings with a 3% increase in ADR, while Europe, the Middle East, and Africa (EMEA) experienced low double-digit growth in nights booked, with ADR rising 6%. Latin America led the way with a low-20s percentage increase in nights booked, benefiting from strong domestic travel trends.

Airbnb provided guidance for the first quarter of 2025, forecasting revenue between $2.23 billion and $2.27 billion, slightly below analyst expectations of $2.3 billion. The company expects adjusted EBITDA and EBITDA margin to be lower year-over-year due to planned investments. Management also indicated that ADR is expected to decline slightly in the first quarter, driven by foreign exchange headwinds and changes in booking mix. Additionally, Airbnb announced plans to invest $200 million to $250 million in launching and scaling new businesses in 2025, signaling a commitment to long-term growth beyond its core rental business. For the full year, the company guided for an adjusted EBITDA margin of at least 34.5%, slightly above the consensus estimate of 34.4%.

Shares of Airbnb soared in after-hours trading, jumping from $142 to as high as $163, reflecting investor enthusiasm over the company’s strong results and resilient travel demand. The stock is now approaching its 2024 high of $170, a key technical level that traders will be watching closely. Despite slightly softer-than-expected Q1 guidance, investors appeared to focus on the strong Q4 results and the company’s ability to drive growth across all regions.

Analysts largely viewed the report positively, noting that Airbnb's continued expansion in global markets and increasing engagement from first-time bookers bode well for future growth. The company’s emphasis on product enhancements, including over 535 new platform features, was also seen as a key factor in driving higher conversion rates. While the stock had been under pressure in recent months, down 7% over the past year before this report, the strong earnings beat and positive travel trends have reignited bullish sentiment.

Looking ahead, Airbnb’s stock will likely remain sensitive to broader travel trends, changes in ADR, and the company’s ability to execute on its strategic investments. While the post-earnings rally has been strong, traders will be watching whether the stock can break through the $170 resistance level. Overall, Airbnb’s Q4 report demonstrated that the company remains a dominant force in the travel industry, with strong user engagement, expanding international demand, and a robust financial profile heading into 2025.