Airbnb reports its most profitable quarter ever

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Net income for the third quarter of 2022 reached $1.2 billion, up 46% from the same period last year, representing a 42% net income margin.
Net income for the third quarter of 2022 reached $1.2 billion, up 46% from the same period last year, representing a 42% net income margin. Photo Credit: ilikeyellow/Shutterstock.com

The third quarter was Airbnb's most profitable quarter ever, the company reports.

Revenue for the period ending Sept. 30, 2022, was $2.9 billion, up 29% from the third quarter of 2021, while adjusted EBITDA was $1.5 billion -- a 32% climb.

Net income reached $1.2 billion, up 46% from the same period last year, representing a 42% net income margin. Gross booking value climbed 31%, to $15.6 billion.

Year-over-year, Nights and Experiences booked rose 25% in the third quarter to nearly 100 million. Q3 2022 represented Airbnb's biggest third quarter of Nights and Experiences booked, the company reported.

Asia Pacific saw the most growth in Nights and Experiences booked due to the easing of Covid-19 restrictions that were in place in 2021.

Long-term stays and non-urban travel are still strong thanks to remote and hybrid work, Airbnb said. Nights booked for long-term stays remained stable from a year ago at 20% of total gross nights booked, with the majority occurring in the Europe, the Middle East and Africa region and North America.

Urban and cross-border travel, which comprised the vast majority of the company's business before the pandemic, have shown recovery. Cross-border travel to all regions increased 58% from last year, while high-density urban nights booked grew 27% during the same period -- but neither has returned to pre-pandemic levels.

Sales and marketing expenses for the three months ending Sept. 30 totaled $380 million, up from $290 million year-on-year.

In a call with analysts, Airbnb co-founder and CEO Brian Chesky said he anticipated more long-term and cross-border stays as people travel domestically and abroad for remote and hybrid work.

"Flexibility is here to stay," Chesky said. "I think more people are going to work remotely or in a hybrid way five years from now than they do today."

Related: Working during vacation: Hotels respond to bleisure's flipside

Airbnb is seeing a growing number of hosts due to a softening economy. Just like during the Great Recession people have turned to Airbnb as a form of supplemental income, Chesky said.

"Q3 was another record quarter despite macro-economic headwinds," he said.

The Q3 2022 results "demonstrated that Airbnb continues to drive growth and profitability at scale, and even with the macroeconomic certainty, we believe that we're well positioned for the road ahead."

The company added that it is updating its pricing tools for hosts and search algorithm to make the platform more competitive.

In June, Airbnb launched the "$10,000,000 OMG! Fund" to finance 100 unique property ideas -- the aim being to help designers, architects and DIY enthusiasts bring their ideas to life and potentially host the properties on Airbnb. 

Airbnb announced in May it was enabling "split stays" as part of a wider platform update.

Source: PhocusWire

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