Airbnb (ABNB) stock has been confined to a well-defined range over the past year, mainly fluctuating between $110 and $145, with only a brief breakout toward $160 in February before retreating.
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Fast forward to today, and the Q3 earnings, released on November 6, did little to change the market’s perception of the company’s short-term trajectory. The report missed EPS estimates by roughly 5%, but on the other hand, it showed a rebound in gross booking value growth, signaling stronger demand and a potential structural renewal in operational momentum.
Although management has been pursuing initiatives that could sustain this trend over the long term, it’s still too early to say Q3 marked a definitive turning point in Airbnb’s broader thesis. A re-rating will depend on consistent follow-through in GBV growth, so for now, staying on the sidelines and maintaining a Hold rating seems the more prudent call.
Airbnb’s Growth Story Is Evolving, Not Collapsing
To quickly frame Airbnb’s investment thesis, the company’s shares started the year trading at forward EV/EBITDA multiples between 16x and 21x, supported by strong margins and double-digit growth in gross booking value (GBV)—a metric that essentially represents the total dollar value of all bookings on the platform.
At the beginning of 2025, the implicit market expectation was that GBV growth would re-accelerate toward 15%, with free cash flow continuing to rise. However, recent results show a gradual loss of momentum—not a collapse, but enough to trigger a downward repricing of ABNB shares.
Looking at the GBV line, Q3 came in at $22.9 billion (+14% YoY), yet it’s clear that growth has cooled from an average of 16% in 2023 to roughly 10% through 2024–2025.
Meanwhile, ADR (average daily rate) has remained virtually flat (-1% to +3%), reflecting limited pricing power. As a result, Airbnb’s revenue and FCF growth have become more modest—up 9.7% YoY and down 19%, respectively—pushing the market to view Airbnb less as a high-growth tech story and more as a mid-growth compounder.
Strong Fundamentals, but the Market Wants More
I wouldn’t call Airbnb’s outlook negative—far from it. The company continues to deliver robust margins and generate strong free cash flow. Adjusted EBITDA rose from $1.96 billion to $2.05 billion between Q3 2024 and Q3 2025, holding a healthy 50% margin, even if slightly normalized. Meanwhile, Airbnb maintains an impressive free cash flow yield of around 6%, higher than Booking’s (BKNG) roughly 5%.
Still, at 16x price-to-free cash flow, below its 12-month average of 19x, the stock trades at a structural discount. That discount reflects how the market increasingly views Airbnb as a cash-generating compounder rather than a growth disruptor. Part of this shift also stems from investors rotating toward tech names with faster AI-driven and productivity-related growth, which has reduced appetite for digital-consumption plays like Airbnb.
Signs of a New Growth Cycle Emerging
While Q3 results marked a positive inflection point in operational growth—particularly with the jump in GBV—there’s also a strong case that a broader turning point may already be underway.
As Co-founder and CEO, Brian Chesky has emphasized that Airbnb is pursuing four major pillars for “new” growth. The company is sharpening its core product with a stronger focus on user experience to drive higher conversion and more frequent bookings.
It is also expanding into faster-growing international markets such as Japan, India, and Southeast Asia, which are scaling at roughly twice the pace of core regions and contributing meaningful GBV. In addition, Airbnb is expanding its product set, with Experiences attracting new users and Hotels strengthening its presence in previously underserved urban markets. Finally, the company is integrating AI across the platform to enhance trip planning, personalization, and multilingual support.
Based on this, it’s reasonable to infer that management is laying the groundwork for a structural re-acceleration of GBV through late 2025 and into 2026. This suggests that the 14% year-over-year growth in GBV in Q3 wasn’t just a one-off, but rather the start of a new cycle of moderate acceleration—one that seeks to rebalance volume-driven with monetization-driven growth. Naturally, this dynamic could create room for a valuation re-rating if the momentum holds.
Is ABNB a Buy, Hold, or Sell?
Caution still prevails among Wall Street analysts when it comes to Airbnb. Of the 27 analysts covering the stock over the past three months, nine rate it a Buy, 13 a Hold, and five a Sell. The average target price is $142.55, implying an upside potential of approximately 17% over the next 12 months.
Signs of Improvement, but Still Early to Call
It may still be too early to call a clear turning point in Airbnb’s thesis, as the slowdown and near-stagnation in gross booking value growth had been evident between last year and this one. Still, Q3 results brought encouraging signs, with GBV growth coming in above market expectations, supported by strong free cash flow and solid margin stability.
Given that ABNB is currently trading at a discount to its own historical multiples, I believe the downside risk looks limited. That said, more concrete evidence of sustained GBV momentum and pricing power—potentially through the rollout of new product verticals—is needed to turn more constructive on the stock. For now, I view ABNB as a Hold.