Airbnb (ABNB) Tops Q2 Estimates But Stock Slips on Delta Warning, Analysts Divided
Shares of Airbnb (NASDAQ: ABNB) are down more than 2% in pre-open Friday after the company issued a warning that the Delta variant is hitting bookings.
Airbnb reported Q2 EPS of negative $0.11, vs analyst estimate of negative $0.48. Revenue for the quarter came in at $1.3 billion versus the consensus estimate of $1.23 billion.
“The travel rebound is upon us and Airbnb is leading the way. For the past year, we’ve benefited from the adaptability of our business model, and we’ve focused on driving product innovations to meet the changing needs of our guests. The strength of our Q2 results indicate two things: people are ready to travel, and Airbnb is ready to host them,” the company said in a press release.
ABNB reported 83.1 million nights and experiences booked to mark a 29% increase compared to Q1. Analysts were calling for 79.2 million nights and experiences booked.
However, shares slipped as the company joined Expedia in warning that it expects the Delta variant to have an adverse impact on bookings.
“We do not yet know how willing people will be to travel in the fall as compared to summer,” the company said in its shareholder letter.
As a result, the Q3 bookings are expected below Q2 levels.
“As we exit Q2 and come into Q3, we have a combination of fewer bookings for the fall, just given the nature of some of the seasonality, and any kind of impact potentially on Covid concerns,” Airbnb CFO Dave Stephenson said on a call with analysts.
JMP analyst Ronald Josey lowered the price target to $180.00 from $190.00 previously to account for increased volatility associated with the Delta variant.
“Following strong 2Q21 results with bookings and revenue 16% and 6% above consensus, respectively, Airbnb continues to take share of the broader travel market and we reiterate our Market Outperform rating,” the analyst said in a note to clients.
Conversely, Needham’s Bernie McTernan raised the PT to $200.00 per share from $194.00 per share and reiterated a “Buy” rating.
“We reiterate our Buy rating and increase our price target to $200 following ABNB reported better than expected metrics for Q2, with better metrics across the board for GBV, revenue and adj. EBITDA. Notably, ABNB has been telegraphing better profitability since their IPO, but the magnitude and timing of adj EBITDA dollars and margins gains continues to surprise to the upside. However, similar to travel peers ABNB warned on some slowness in bookings beginning in July, pressuring expectations for 3Q Nights and Experiences Booked to below 3Q19 levels relative to the two-year stack down only slightly in 2Q. On supply, ABNB noted their first growth in active listings since the pandemic, with supply growing in the areas of the highest demand,” McTernan said in a client note.