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Monday 13 May 2024

The week's top stories from the world of short-term / vacation rentals

 

Airbnb reports most profitable Q1 ever but forecasts Q2 “headwinds”  

US: Airbnb has reported its most profitable first quarter to date in its Q1 earnings report, although it is forecasting "significant sequential headwinds" for the current quarter.

 

EDITOR'S COMMENT

 

• A lot has been said in the industry recently about the need to balance supply and demand and it continues to be an ongoing thread after Airbnb and Vacasa referred to significant "headwinds" and challenges ahead in their respective earnings calls.

 

While Airbnb put the focus on its most profitable first quarter to date, including a 126 per cent year-over-year rise in net income and a 9.5 per cent YoY increase in nights and Experiences booked, one of the key takeaways was how the company was preparing for a "significant sequential headwind" in revenue growth in the current quarter, with a revenue range between $2.68 billion and $2.74 billion falling below analysts' expectations.

 

The home-sharing platform attributes these forecasts to "the timing of the Easter holiday, the inclusion of Leap Day in Q1 2024, and the impact of FX rate changes" but are there any other challenges from a supply and demand angle? We know that Airbnb is intent on growing its supply in "under-penetrated" markets, but in in-demand markets such as Paris [ahead of the Olympics], supply continues to outstrip demand due to the glut of properties emerging on the market and the subsequent pushdown in prices.

 

Vacasa CEO Rob Greyber cited similar "headwinds" in his company's Q1 earnings call this week, particularly in reference to "a softening demand for domestic, non-urban vacation rentals, as well as increases in the supply of short-term rental units". In the same call, Greyber warned that the company was "in for another difficult year", which has led to a drop in the company's portfolio and the laying off of around 800 employees - around 13 per cent of Vacasa's total workforce. 

 

The uptick in international travel, in part due to earlier 'revenge travel', has driven fresh urgency for operators to create demand to meet the abundance in supply, which was added at a time when domestic bookings were on an upwards trajectory. Sadly, more layoff rounds look likely in the coming months as other businesses react to the same headwinds.

 

• Our next STRz webinar is coming up next Tuesday 21 May [4pm BST] on 'Exploring alternative sources of funding'. Don't miss the insights of speakers including Andrew Martyn [Your.Rentals] and Alex Limpert [GuestReady] - sign up now at this link.

 

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Paul Stevens

Editor - short-term rentals, IHM

paul@internationalhospitality.media

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MORE NEWS HERE
 

For more information about advertorial /sponsorship /creative solutions opportunities please contact: 

 

Jordan Ashford

 

+44 (0)7301 115484

 

jordan@internationalhospitality.media

 

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