Airbnb Stock Falls Despite Earnings Beat, Analyst Focus Remains on Demand

© Reuters Airbnb (ABNB) Stock Falls Despite Earnings Beat, Analyst Focus Remains on Demand

By Senad Karaahmetovic

Shares of Airbnb (NASDAQ:ABNB) are down almost 7% in premarket trading Wednesday after the company said it expects growth to remain stable even though travel demand is skyrocketing.

ABNB reported Q2 EPS of 56c, compared to a loss per share of 11c in the year-ago period. The company’s Q2 revenue stood at $2.10 billion, in line with the consensus estimates.

Airbnb reported 103.7 million nights and experiences bookings, missing the consensus projection of 106 million.

For Q3, the company expects revenue to be in the range of $2.78 billion to $2.88 billion, beating the estimates of $2.78 billion. Airbnb said it expects Q3 Nights and Experiences Booked to remain stable relative to the year-ago period.

The company also expects slightly higher ADRs in Q3 relative to the same quarter last year, which should lead to a brief GBV growth. The San Francisco-based company expects Q3 EBITDA margin to match or be just below the last year’s all-time high of 49%.

Airbnb announced a $2 billion share repurchase program, saying the company remains very confident in its long-term growth and profitability prospects.

A Citi analyst cut the price target to $140 from $160 but remained Buy-rated on share gains in lodging.

“While we are watching 3Q demand trends, our thesis on ABNB remains unchanged and we reiterate our Buy rating, though lower our target price to $140 from $160 prior to account for potential macro headwinds,” the analyst said.

A Stifel analyst saw “healthy” results from Airbnb.

“Despite encouraging margin progress, we believe visibility into 2H/2023 growth is impaired by macro uncertainty and the potential for normalizing travel demand. We remain Hold rated with a $125 PT,” the analyst wrote in a note.