Airbnb reports 15 percent fall in its second quarter profit

Airbnb reports 15 percent fall in its second quarter profit

SAN FRANCISCO
Airbnb reports 15 percent fall in its second quarter profit

Airbnb says its profit fell 15 percent in the second quarter from a year earlier, as higher income taxes cut into the short-term rental giant's bottom line even as bookings and revenue rose.

The profits fell short of Wall Street's expectations. 

The San Francisco-based company reported net income of $555 million. That compares with net income of $650 million in the same quarter last year.

Revenue rose 11 percent from a year earlier to $2.75 billion, slightly higher than what analysts forecast.

The vacation-rental platform said it booked 125.1 million nights and experiences in the second quarter, a 9 percent increase from a year earlier.

The average daily rate rose 2 percent to $170. The company said it expects that to increase modestly on an annual basis in the third quarter.

While booking growth was strong, management said that in July it noticed that many customers were opting to reserve an Airbnb property within a couple of weeks of when they need to stay, rather than doing so months in advance.

“We are seeing shorter booking lead times globally and some signs of slowing demand from U.S. guests,” CEO Brian Chesky said during a conference call with analysts. “We’re watching these trends closely, along with the impact any macroeconomic pressures might be causing."

The company factored the trend into its third-quarter outlook. Airbnb predicts third-quarter revenue between $3.67 billion and $3.73 billion, which would be below Wall Street’s forecast of $3.84 billion, according to FactSet.