Airbnb Releases Q2 2022 Financial Results

Airbnb has issued its second quarter 2022 financial results. You can read the details here. Airbnb Co-Founder and CEO Brian Chesky said:

"The second quarter of 2022 demonstrates we have achieved growth and profitability at scale.  Over the last year, we generated USD 2.9 billion in free cash flow and Airbnb's Q2 revenue is up more than 70 percent since Q2-2019. Airbnb's strength this quarter is the result of Airbnb's ability to stay focused and disciplined while continuing to relentlessly innovate."

The Q2 results demonstrate that Airbnb has achieved growth and profitability at scale.

From a growth perspective, Airbnb exceeded 103 million Nights and Experiences Booked, Airbnb's largest quarterly number ever. Airbnb generated USD 2.1 billion in revenue, growing 58% year-over-year (or 64% excluding foreign exchange). Airbnb's revenue and GBV are 73% larger than in Q2 2019. Since the beginning of the pandemic, Airbnb has significantly outperformed the rest of the travel industry.

From a profitability perspective, the company had its most profitable Q2 ever with a net income of USD 379 million—a nearly USD 700 million improvement from Q2 2019. Airbnb generated USD 795 million of FCF in the quarter—a nearly USD 1.1 billion improvement from the USD (263) million FCF from the depths of the pandemic two years ago. More importantly, over the last 12 months, Airbnb has generated USD 2.9 billion in FCF, bringing Airbnb's total cash balance to nearly USD 10 billion1.

What explains this massive transformation in Airbnb's business?

First, Airbnb's business model is adaptable. Airbnb has nearly every type of space in nearly every location, so however travel changes, Airbnb is able to adapt. And regardless of the economic environment, Airbnb's guests come to Airbnb because they can find great value, and Airbnb's Hosts can earn extra income.

Second, Airbnb has relentlessly innovated while also staying focused and disciplined. During the height of the pandemic, Airbnb made many difficult choices to reduce its spending, making us a leaner and more focused company. Airbnb has kept this discipline ever since, allowing Airbnb's hiring and investment plans to remain unchanged since the beginning of the year. Airbnb is Airbnbll positioned for whatever lies ahead.

In fact, Airbnb is so confident in its long-term growth and profitability that today it has announced a USD 2 billion share repurchase program.

Here is a snapshot of Airbnb's Q2 2022 results:

Q2 revenue of USD 2.1 billion grew 58% year over year. It also significantly exceeded Q2 2019 revenue by 73%. The strong revenue growth was driven by the combination of growth in Nights and Experiences Booked, and continued strength in ADR.

Q2 net income of USD 379 million was Airbnb's most profitable second quarter. Net income improved by USD 676 million compared to Q2 2019 primarily due to Airbnb's revenue growth and expense discipline. In Q2 2022, Airbnb delivered a net profit margin of 18%, up from (5)% in Q2 2021 and (25)% in 2019, and USD 1.2 billion of net income in the last 12 months.

Q2 Adjusted EBITDA of USD 711 million was more than triple Q2 2021. Adjusted EBITDA in Q2 2022 was a significant improvement from a loss in Q2 2019. Adjusted EBITDA margin was 34% for Q2 2022, up from 16% in Q2 2021 and (4)% in Q2 2019. This substantial improvement in Adjusted EBITDA demonstrates the continued strength of Airbnb's business and discipline in managing Airbnb's cost structure.

Q2 Free Cash Flow of USD 795 million was Airbnb's highest Q2 ever. Q2 2022 net cash provided by operating activities was USD 800 million, up from USD 152 million in Q2 2019. The increase in cash flow was driven by revenue growth and margin expansion, as well as seasonal bookings growth driving increased unearned fees. Airbnb's TTM FCF was USD 2.9 billion, representing a TTM FCF margin of 39%.