Shares of Airbnb (ABNB) tanked in after-hours trading after the online lodging marketplace reported earnings for its second quarter of Fiscal Year 2024 and provided soft guidance. Earnings per share came in at $0.86, which missed analysts’ consensus estimate of $0.91 per share.
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Sales increased by 10.9% year-over-year, with revenue hitting $2.75 billion. This beat analysts’ expectations of $2.737 billion. These results were driven by a 9% growth in Nights and Experiences Booked and a 2.1% increase in the Average Daily Rate.
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 53.89% when compared to the second quarter of 2023.
Looking forward, management now expects revenue for Q3 2024 to be between $3.67 billion and $3.7 billion. For reference, analysts were expecting $3.837 billion in revenue. This guidance miss likely led to the stock’s decline.
Is Airbnb a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Hold consensus rating on ABNB stock based on nine Buys, 21 Holds, and five Sells assigned in the past three months, as indicated by the graphic below. After a 9% decline in its share price over the past year, the average ABNB price target of $153.34 per share implies 17.66% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
