Shares of Airbnb (NASDAQ:ABNB) sank in after-hours trading after the online lodging marketplace reported earnings for its first quarter of Fiscal Year 2024. Earnings per share came in at $0.41, which beat analysts’ consensus estimate of $0.23 per share.
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Sales increased by 18% year-over-year, with revenue hitting $2.14 billion. This beat analysts’ expectations of $2.06 billion. These results were driven by growth in bookings, the average daily rate, and the timing of Easter, which occurred during the first quarter of 2024 compared to the second quarter of 2023.
Interestingly, investors could have anticipated the solid year-over-year growth by simply looking at Airbnb’s website traffic. As the image below shows, the number of visitors rose significantly during the most recent quarter. In fact, total estimated visits jumped 61.62% when compared to the first quarter of 2023.
Looking forward, management now expects revenue per share for Q2 2024 to be in the range of $2.68 billion to $2.74 billion. For reference, analysts were expecting $2.74 billion in revenue. This guidance miss likely led to the stock’s decline. However, Q3 revenue growth is expected to accelerate due to the company’s growing summer backlog for international events like the Euro Cup and the Olympics.
Is Airbnb a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on ABNB stock based on seven Buys, 18 Holds, and five Sells assigned in the past three months, as indicated by the graphic below. After a 24% rally in its share price over the past year, the average ABNB price target of $150.11 per share implies 4.55% downside risk. However, it’s worth noting that estimates will likely change following today’s earnings report.
