10-QPeriod: Q1 FY2021

Airbnb, Inc. Quarterly Report for Q1 Ended Mar 31, 2021

Filed May 14, 2021For Securities:ABNB

Summary

Airbnb's first-quarter 2021 report shows a notable recovery from the previous year, with revenue increasing by 5% year-over-year to $886.9 million. This growth was driven by a significant increase in Gross Booking Value (GBV), which rose 52% to $10.3 billion, signaling a strong rebound in travel demand, particularly in North America. Nights and Experiences Booked also saw a healthy increase of 13%. Despite revenue growth, the company reported a net loss of $1.17 billion for the quarter, a considerable increase from the prior year's loss of $340.6 million. This widened loss was largely influenced by a substantial increase in interest expense and other expenses, including a significant loss on extinguishment of debt related to the repayment of term loans and a large fair value remeasurement on warrants. The company also saw a dramatic increase in stock-based compensation expense and restructuring charges. Financially, Airbnb strengthened its balance sheet by issuing $2.0 billion in convertible senior notes. The company ended the quarter with a robust cash position of $4.5 billion and marketable securities of $2.1 billion, totaling $6.6 billion in liquid assets. The repayment of prior term loans and the issuance of new debt reflect strategic financial management to optimize the capital structure. While the company is experiencing a recovery in travel and booking values, investors should note the substantial net loss and the significant one-time expenses impacting profitability in this quarter.

Financial Statements
Beta
Revenue$886.94M
Cost of Revenue$254.51M
Gross Profit$632.42M
R&D Expenses$363.06M
Operating Expenses$1.33B
Operating Income-$446.94M
Net Income-$1.17B
Shares Outstanding (Basic)600.96M
Shares Outstanding (Diluted)600.96M

Key Highlights

  • 1Revenue increased by 5% to $886.9 million for Q1 2021 compared to Q1 2020.
  • 2Gross Booking Value (GBV) surged by 52% to $10.3 billion in Q1 2021, indicating a strong recovery in travel demand.
  • 3Nights and Experiences Booked increased by 13% year-over-year in Q1 2021.
  • 4The company reported a net loss of $1.17 billion for Q1 2021, significantly wider than the $340.6 million loss in Q1 2020, driven by increased interest and other expenses, including debt extinguishment losses.
  • 5Airbnb issued $2.0 billion in 0% convertible senior notes due 2026 and used proceeds to repay existing term loans.
  • 6Total cash and cash equivalents and marketable securities stood at $6.6 billion as of March 31, 2021, providing significant liquidity.
  • 7Stock-based compensation expense increased substantially to $229.5 million in Q1 2021 from $41.6 million in Q1 2020.

Frequently Asked Questions

The net loss for Q1 2021 widened significantly to $1.17 billion from $340.6 million in Q1 2020 primarily due to substantial non-operational expenses. Key contributors included a $377.2 million loss on extinguishment of debt related to the repayment of term loans, a $292.0 million fair value remeasurement of warrants, and a significant increase in stock-based compensation expense to $229.5 million. Additionally, restructuring charges of $112.0 million were incurred in the quarter.

Airbnb is showing positive momentum in revenue and booking activity. Revenue increased by 5% year-over-year to $886.9 million in Q1 2021. More significantly, Gross Booking Value (GBV) saw a robust 52% increase to $10.3 billion, and Nights and Experiences Booked grew by 13%. This indicates a strong recovery in travel demand and platform utilization compared to the prior year.

Airbnb maintains a strong liquidity position. As of March 31, 2021, the company held $4.5 billion in cash and cash equivalents and $2.1 billion in marketable securities, totaling $6.6 billion. This substantial liquid asset base provides flexibility for operations, investments, and debt management.

In March 2021, Airbnb issued $2.0 billion in 0% convertible senior notes due 2026. The net proceeds from this issuance, along with existing cash, were used to repay the outstanding principal amount of term loans that were entered into in April 2020. The company also entered into capped call transactions to mitigate potential dilution related to these notes.