Airbnb reported record adjusted EBITDA and revenue in 2023 while its inventory grew to 7.7 million properties, with double-digit supply growth across all regions and the highest growth in Asia Pacific and Latin America.
Adjusted EBITDA was up 28% year over year to $3.7 billion, while revenue was $9.9 billion for the year, up from $8.4 billion in 2022.
For the fourth quarter, adjusted EBITDA was $738 million, up 46% compared to Q4 2022. in a letter to shareholders, Airbnb said the figure demonstrates “the continued strength of the business and discipline in managing our cost structure.”
Revenue in the quarter was $2.2 billion, up 17% year over year.
Along with 7.7 million listings, Airbnb said it has passed the mark of 5 million hosts for the first time, with active listings up 18% in the fourth quarter of 2023. The company said the most growth occurred in the Asia Pacific and Latin America regions - which also accounted for the most year-over-year uptick in nights and experiences booked.
In a post on LinkedIn following Airbnb's earnings report, AirDNA chief economist Jamie Lane commended Airbnb for its inventory figures, writing: “The amazing part is that of 5 million hosts, 3.5 million of them only
have 1 listing. Looking at the large operators, only 30k (sic) hosts
have more than 20 listings, or 0.6% of hosts. Airbnb's ability to appeal to individual hosts and
grow unique supply is unparalleled.”
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In a call with analysts to discuss the 2023 fourth quarter and full year results, Airbnb co-founder and CEO Brian Chesky said the inventory figures point to Airbnb’s ability to sustain long-term growth.
“I believe in the long run that supply growth is a long term indication of growth and Airbnb,” said Chesky. “During the pandemic, one of the biggest questions I got asked was ... how we're going to restart supply growth ... The great thing about our supply growth is that most of it comes organic to us. In fact, 36% of our new hosts are prior guests. That's the highest number [it has] ever been.”
Chesky also noted that having more properties on Airbnb is beneficial because "the more supply you have, the more pricing pressure you relieve on the inventory."
For the full year, Airbnb spent $1.76 billion on sales and marketing, up from $1.5 billion in 2022. But as a percentage of revenue sales and marketing expenses dropped slightly to 17.8% from 18% in 2022.
Nights and experiences booked increased 14% for the year to 448 million and were up 12% in Q4 to 98.8 million. Airbnb said growth in nights and experiences booked combined with a modest increase in average daily rate brought in $15.5 billion in gross booking value in the quarter and $73.3 billion for the year, up 16% compared to 2022.
Airbnb looks to ‘reinvent’ itself with international growth
Airbnb had a full year in 2023. The short term rental company saw record earnings, faced industry changes with STR regulations coming into play in New York City, announced plans to implement a “major new marketing campaign next year” which would play off a 2022 initiative, shut down its Plus program, underwent executive team changes and more.
I believe in the long run that supply growth is a long term indication of growth [at] Airbnb.
Brian Chesky, Airbnb
Now, the company is looking ahead to begin “unlocking” growth opportunities in what Chesky identified as “under-penetrated international markets.”
“We're seeing some great results following the success that we've seen in recent quarters in Germany, Brazil and Korea,” he said. “We're now rolling out our playbook in other countries including Switzerland, Belgium and Netherlands. But this is only one piece of a much bigger strategy. Because we've always believed that Airbnb was destined to offer more than just a place to stay. And now's the time for us to expand the … core business and reinvent Airbnb.”
He reiterated he believes there are “massive opportunities” especially in Asia.
“I think the point that should be made is if you look at our penetration, I'd say U.S., Australia, Canada, France and, to maybe a lesser extent, United Kingdom - they're significantly higher than other parts of the world,” he said. “There is no reason why we cannot get to today's U.S. penetration in the equivalent penetration in most of the major tourism markets around the world.”
The idea is to continue to add inventory in countries one by one.
“We're just getting started in Korea,” he said. “We're just getting started in Germany. We're just getting started in Brazil. Brazil is now double the size of the West pre-pandemic, but it's going to double again. And so we're going to continue. We have multiple phases of this playbook and the first phase is playing out in Korea, Japan and Brazil. But we're gonna go on to the next phase as we continue to add more countries.”
Leading with AI
There’s a platform shift happening with artificial intelligence, Chesky said, which he believes will allow Airbnb to “do things we never could have imagined.” He asserted his belief in Airbnb’s capability to become a leader in AI interfaces and pointed to Airbnb’s November acquisition of GamePlanner.AI as a move to accelerate its artificial intelligence strategy, as an example of the company’s initiative in the area.
“With these critical pieces in place, we're now ready to expand on our core business,” he said, noting it would be a “multi-year journey” with updates to come at the end of 2024.