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Airbnb Reaches $47 Billion Value in Above-Range IPO

The smoking hot IPO market rages on.
(AlesiaKan)
(AlesiaKan)
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Airbnb sold 52 million shares Wednesday for $68, as it prepares to start trading Thursday, Bloomberg reports.

Why It Matters: What a year it’s been for Airbnb considering its entire business was thrown into chaos by the Covid-19 pandemic. Instead, the company has overcome the challenges at hand by capitalizing on local travel, and now, it’s pressing forward with its public offering. Airbnb raised roughly $3.5 billion Wednesday, selling shares $8 higher than the marketed range of $56 to $60 each. At that price, Airbnb has a fully diluted value of $47 billion.

And so continues the record year for IPOs, with Airbnb coming hours after DoorDash.

  • In a preview of how Thursday might go for Airbnb, DoorDash’s day one surge skyrocketed its valuation to roughly $71 billion. Airbnb has the chance to eclipse the food delivery company with only a little more than a 51% increase when shares become available.

Some Other Details:

  1. Airbnb has become one of the world’s biggest travel companies after completely upending the market over the last 13 years.
  2. The pandemic nixed earlier IPO plans as room bookings plunged 72% by April, as well as the company subsequently handing out more than $1 billion in cancellation fees.
  3. But while international travel faltered, “short-distance trips and stays outside of the top 20 cities was proving resilient.” Airbnb’s revenue only declined by 18% in Q3 compared to nearly 60% for Expedia and Marriott.
  4. Based on EBITDA, Q3 2020 was Airbnb’s most profitable yet.

Final Word: Look out for the newly minted Airbnb stock Thursday under the ticker “ABNB.”

Justin Oh:

Watch my 14 minute video for all you need to know about Airbnb’s IPO today!

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