Airbnb (NASDAQ: ABNB) isn’t your regular travel lodger. Of course, the usual suspects are available in hotels and apartments, but you can rent ‘tiny homes’, islands, towers, boats, shipping containers, castles, and if you really want to, you can stay in a fully-fledged liveable treehouse out in the woods. These stays might not be for everyone, but Airbnb really does have it all.
Airbnb’s Q4 earnings
Airbnb’s total revenues for 2021 surpassed 2019 levels. The company reported $1.5 billion in total revenue in Q4 which was an 80% increase year-over-year (YoY). The company set a new record for Q4 net income, coming in at $55 million — a mighty improvement from the $3.9 billion loss it saw in the same quarter in the year prior.
Since IPO’ing in 2020, Airbnb has now beat on 3 out of its 5 earnings reports all in the midst of a global pandemic. The company has not only coped but continues to produce double-digit revenue growth while raising future guidance. Between $1.41 billion and $1.48 billion is now being projected for Q1 2022, well ahead of analyst estimates of $1.24 billion.
Airbnb’s competitive advantage
Now, not everyone wants to be a property manager, but adding diverse income streams, and those with the means to do so, might well opt to become an Airbnb host.
Airbnb owns no physical properties itself, so it relies on stakeholders to fill the gap for them — and it’s giving them the tools to do so. By offering a range of services such as deep learning photo optimization models and SEO upskilling to streamline enhanced searchability for lettings, it’s making the process easy for anyone. Moreover, AirCover, a free protection service for hosts, gives liability cover, damage cover, and income protection to the people who keep this business ticking.
On top of this, Airbnb has extended its host network, partnering with Hello Alice, a small business owner’s platform, to help create a new source of revenue for business owners to fund ongoing operational costs.
The remote work trend favors Airbnb
Airbnb is set to benefit considerably from changing work environments. Employees are increasingly demanding the option to work remotely. Since the pandemic, 65% of people want to continue working from home, and 58% said they would look for new job opportunities if remote work wasn’t available to them.
Why it matters is because people are looking to move, with 83% of people interested in relocating while having the ability to work remotely. Airbnb gives the option of “living anywhere at any time, for however long”.
More than a good pick for 2022, Airbnb looks like it might be a good pick for 2030. That being said, it still has a number of regulatory hurdles to climb before then, considering some cities around the world have banned the company outright. Keeping that in mind, unique rental options, powerful branding, and its adaptation to the future of travel means it could be a top pick for years to come.
Financial Writer at MyWallSt
David's favorite stock is Google. He's a daily user of its YouTube platform, where you can learn or find something brand new at the touch of a button. He believes the company will continue to grow for many years to come.