'Tis the season for revenge travel — and it shows no signs of stopping, according to Airbnb.
The travel technology company believes we're going to continue taking vacations, according to its latest quarterly report on Tuesday. Airbnb estimated its revenue for the third quarter of the year will come in at $2.78 billion and $2.88 billion. The projections are ahead of the $2.77 billion estimate from Street Account and would mark a 69 percent to 75 percent increase compared to the second quarter of 2019.
"While we have seen COVID distort the historical patterns of seasonality in 2020 and to a lesser extent, the first half of 2021 as a result of travel restrictions and changing travel preferences relating to the pandemic, we are seeing pre-pandemic patterns of seasonality return in 2022," the company said in a letter to shareholders.
While the company did beat analysts' projections of earnings per share — coming in at $0.56 versus the $0.43 estimate from Refinitiv — revenue came in just shy of the $2.11 billion estimate at $2.1 billion. Despite booking a record 103.7 million nights and experiences during the second quarter of the year, it was still short of the Street's expectations of 106.4 million. Partially to blame was a large number of flight cancellations, especially at the end of the quarter. Shares went down 9 percent in after-hours trading.
Still, Airbnb did notice an uptick in the number of people who were willing to travel internationally, especially as restrictions lift. Gross nights booked for this category were 56 percent higher than Q2 2019 levels. And, North America saw a 37 percent increase in the number of nights and experiences booked compared to Q2 2019.
Airbnb also noted that long-term stays of more than 28 days are now its fastest growing category, up 25 percent from a year ago. It accounted for 19 percent of stays last quarter, meaning the rise of working remotely and hybrid work could provide additional revenue for the company as people look to mix business and leisure travel.
However, there are some headwinds that may affect Airbnb and the greater travel industry. The company warned of foreign exchange currency fluctuations, in particular, the strength of the dollar compared to the euro. In addition, prices for stays are going up. The average price per night hit $164, up 40 percent from Q2 2019 levels.
But the company is confident it can continue its growth, announcing a $2 billion stock buyback as well as continuing with its plans for expansion and hiring that it announced earlier this year.
"During the height of the pandemic, we made many difficult choices to reduce our spending, making us a leaner and more focused company," it wrote. "We've kept this discipline ever since, allowing our hiring and investment plans to remain unchanged since the beginning of the year. Airbnb is well positioned for whatever lies ahead."