Airbnb has filed paperwork to go public, WSJ reports.
The Backstory: CEO Brian Chesky kicked around the idea of going public for several years, but it had yet to come to fruition. The global pandemic hit just as Airbnb was formalizing its plans to IPO, dealing a crushing blow to its core home-rentals business.
- Airbnb had been under pressure to list as some employees lose their stock options next year. They’ll be allowed to sell 15% when the offering goes through.
Since then, Chesky raised capital to keep things going, laid off roughly a quarter of the staff and “shed non-core businesses.”
- “He ordered a redesign of Airbnb’s app and website so the company could focus on local stays during the pandemic,” a strategy that paid off as people vacationed in neighboring communities.
“The home-sharing platform’s ability to resuscitate to profitability and proceed with an impending public offering show how unpredictable—and yet ultimately navigable—this year has proven for some companies.”
By The Numbers:
- Revenue for the quarter ending Sept. 30 dropped 18% to $1.34 billion — a clear sign of the pandemic’s impact on bookings. But cost cuts allowed Airbnb to turn things around and pull together a $219 million profit in the period.
- Zooming out a bit — Airbnb lost $697 million and saw revenue fall 32% over the first nine months of 2020. Revenue fell 72% in the quarter ending June 30 to $335 million, and the company posted a $576 million loss.
- Airbnb expects an IPO valuation of around $30 billion, even after the pandemic knocked it down to $18 billion earlier this year. It had a $31 billion valuation after a 2017 funding round.
- As of Sept. 30, the company said it had more than “4 million hosts and over 7.4 million listings of homes and experiences, of which 5.6 million were active listings.”
Looking Ahead: Airbnb plans to debut in mid-December, a “fairly quiet window for the IPO market.” It will trade on Nasdaq under the symbol ABNB.
Please see today’s analyst read and the 1.5 hour YouTube Live Stream for more on Airbnb’s IPO.