Ahead of Airbnb’s (NASDAQ:ABNB) earnings results, ABNB stock formed an uptrend. Shares bottomed at around $135 in May. The company is benefiting from a massive increase in home rentals. Vacation travel volumes are surging.
In Q2, ABNB reported a gross booking value of $11.9 billion, up 49% from last year. Revenue topped $2.2 billion, up 67%. The Y/Y and quarter-on-quarter comparison benefited from the pandemic previously. Now, travelers are spending more time on trips. Stays 28 days or longer are ABNB’s fastest-growing category.
The company also reported strong domestic and short-distance travel. Long-distance and international travel are also rebounding.
For Q4/2021, ABNB expects revenue of up to $1.48 billion.
Growth investors will not pay the premium to hold ABNB stock. It is a dominant player in an emerging industry.
Risks
High fees could hurt ABNB demand after the post-pandemic driving demand eases. Travelers may eventually balk at the high costs. Furthermore, companies like Booking or hotel chains could compete with ABNB, pressuring margins. At current levels, ABNB is expensive. The stock leaves no room for disappointing investors.
Your Takeaway
ABNB does not need to spend much on advertising. It has a strong brand, so it reports strong margins.
