Airbnb is now anticipating a weaker second quarter than it initially expected despite a record-setting start to the year.
The San Francisco-based online marketplace for short- and long-term homestays now projects revenue of $2.68 million to $2.74 billion in the three months through June. Analysts had forecast revenue to come in at $2.74 billion for the company considered a competitor to traditional lodging providers such as hotels and inns.
Airbnb faces significant headwinds in the second quarter after its first-quarter earnings benefited from Leap Day, the April 8 solar eclipse and having the Easter holiday in March, company executives said during an earnings call Wednesday. Airbnb also provided guidance in a letter to shareholders that said the third quarter, July through September, will also be better than the current second quarter.
"Looking ahead to the peak summer travel season, we are already experiencing robust demand for travel around international events such as the Olympics and Euro Cup," Airbnb said in the letter. "Due in part to the strength of our Summer backlog, we expect year-over-year revenue growth to accelerate in" the third quarter of 2024 compared to the second quarter of 2024.
In the first three months of the year, Airbnb had a record 133 million nightly bookings and generated $2.1 billion in revenue, an 18% percent increase over the same time last year. Planning for events such as the upcoming Olympics in Paris in late July and early August and the Euro Cup that takes place in June and July brought five times more nightly bookings in Paris and Germany, the company said.
Airbnb is crediting the eclipse with providing a boost to bookings. About 500,000 reservations were made ahead of the event.
The Asia-Pacific and Latin American regions saw the most booking growth during the reporting period. North American bookings growth was "stable," the company said, with group bookings growing popularity.
A priority for Airbnb in the first quarter was to highlight top performing listings and eliminate underperforming ones, it said. The company removed over 1,000 accounts in the quarter, but it saw listings grow by 17%, including a 40% jump in Paris.
The company also added a feature to showcase the site's most-popular listings.