Airbnb expects holiday-quarter bookings to moderate; shares fall

By Aishwarya Nair

(Reuters) -Airbnb Inc forecast holiday-quarter revenue that could fall short of market expectations, saying a strong dollar had started to pressure its business and bookings would moderate, sending its shares down 7% after the bell.

The San Francisco-based vacation rental company posted estimate-beating third-quarter profit and revenue.

But growth slowed to 29% in the July-September period, down from 58% in the second quarter and 67% a year earlier when people started traveling with a vengeance as COVID-19 cases fell and people who were working remotely booked longer-term stays.

Airbnb said in a letter to shareholders on Tuesday that it expected a continued, albeit choppy, recovery of cross-border travel as macro conditions persisted.

"This is really kind of a hard year-over-year comp," Chief Financial Officer David Stephenson told a post-earnings call.

"If you go back and compare back to 2019, we're seeing stable to increasing demand across the globe."

The travel industry has seen a big recovery this year on the back of the best summer travel season in three years, but it faces risks from the global surge in inflation.

Airbnb's shares have slumped more than a third this year, versus a roughly 19% fall in the broader market.

Chief Executive Brian Chesky sought to assuage concerns on the call, saying the company expected "really strong demand" next year, especially from U.S. travelers going to Europe.

Airbnb guided fourth-quarter revenue between $1.80 billion and $1.88 billion, versus analysts' expectations of $1.85 billion, according to Refinitiv.

The company recorded its highest ever third-quarter bookings, with nearly 100 million nights and experiences booked. Average daily rates climbed 5% year-over-year to $156.

The company, which generates half its revenue from listings outside the United States, said the rates were significantly higher excluding the impact of foreign currency fluctuations.

Major U.S. airlines have pointed to a rise in international trips, especially to Europe, as travelers took advantage of a strengthened dollar. Airbnb said, however, the majority of travelers in North America and Europe had booked domestic stays.

(Reporting by Aishwarya Nair in Bengaluru; Editing by Devika Syamnath, Sayantani Ghosh and Leslie Adler)