ABNB Q1 Earnings Miss Expectations, Revenues Increase Y/Y

Airbnb ABNB reported first-quarter 2025 adjusted earnings of 24 cents per share, which missed the Zacks Consensus Estimate by 4%.

Revenues of $2.272 billion increased 6.1% year over year on a reported basis and 8% on a forex-neutral basis. The top line beat the Zacks Consensus Estimate by 0.44%. The year-over-year increase primarily driven by solid growth in nights stayed, partially offset by a slight decrease in Average Daily Rate (ADR). 

ABNB’s Q1 Revenue Details

The first-quarter 2025 Gross Booking Value was $24.5 billion, representing a year-over-year increase of 7%, or 9% excluding the impact of forex. 

Nights and Experiences Booked were 143.1 million, up 8% year over year.

Airbnb, Inc. Price, Consensus and EPS Surprise

Airbnb, Inc. price-consensus-eps-surprise-chart | Airbnb, Inc. Quote

ADR (Gross Booking Value per Night and Experience Booked) was $171, down 1% on a year-over-year basis. Excluding forex, ADR grew 1% and was up across all regions due to price appreciation.

In addition, nights booked on the app in the first quarter increased 17% year over year and comprised 58% of total nights booked (up from 54% in the year-ago quarter).

Airbnb’s Q1 Operating Details

Adjusted EBITDA was $765 million, up 3.7% on a reported basis and 3% on a forex-neutral basis year over year. The adjusted EBITDA margin was 30.8%, down 240 basis points year over year.

Operations and support expenses, product development expenses, and sales and marketing expenses were $290 million, $538 million and $547 million, respectively, up 7%, 24.5% and 29% year over year. General and administrative expenses were $248 million, down 79.4% year over year.

Airbnb reported a first-quarter 2025 operating income of $38 million. The operating margin decreased 3% year over year to 1.7%.

ABNB’s Balance Sheet & Cash Flow

As of March 31, 2025, cash and cash equivalents and short-term investments amounted to $11.492 billion compared with $10.6 billion as of Dec. 31, 2024. ABNB had $9.175 billion of funds held on behalf of guests.

Net cash provided by operating activities was $1.8 billion for the first quarter of 2025, up sequentially from $466 million reported in the fourth quarter of 2024 and down from $1.9 billion in the year-ago quarter.

Airbnb generated a free cash flow of $1.781 billion in the first quarter of 2025 and $4.356 billion over the trailing 12 months.

ABNB repurchased shares worth $807 million in the first quarter of 2025. As of March 31, 2025, the company still has $2.5 billion remaining under repurchase authorization.

ABNB Initiates Positive Q2 Forecast

For the second quarter of 2025, Airbnb expects revenues between $2.99 billion and $3.05 billion, reflecting a year-over-year increase of 9-11%. 

The Zacks Consensus Estimate for revenues is pegged at $2.26 billion, indicating 5.61% growth from the figure reported in the year-ago quarter. The consensus mark for earnings is pegged at 25 cents, unchanged over the past 30 days, suggesting a sharp 39.02% year-over-year decline. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)

Airbnb anticipates ADR to remain approximately flat on a year-over-year basis. 

The company expects a moderate year-over-year growth in Nights and Experiences Booked for the second quarter of 2025.

In the second quarter of 2025, Airbnb expects adjusted EBITDA to increase on a year-over-year basis and EBITDA margins to be flat or slightly down compared with those reported in the second quarter of 2024.

For 2025, ABNB expects an adjusted EBITDA margin of 34.5%, sustaining strong profitability while continuing growth efforts.

Zacks Rank & Stocks to Consider

Airbnb currently has a Zacks Rank #3 (Hold).

Fox FOXA, Atlanta Braves Holdings, Inc. BATRK and Gray Media Inc. GTN are some better-ranked stocks in the broader Zacks Consumer Discretionary sector, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Fox shares have gained 1.3% year to date. FOXA is set to report its third-quarter fiscal 2025 results on May 12.

Atlanta Braves Holdings shares have returned 4.1% year to date. BATRK is slated to report first-quarter 2025 results on May 12.

Gray Media shares are up 6% year to date. GTN is set to post first-quarter 2025 results on May 8.

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This article originally published on Zacks Investment Research (zacks.com).

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