Read on Twitter
Airbnb estimates TAM at 3.4T, 1.8B for short term stays, 210B for long term stays, 1.4T for experiences. These estimates seem high as global hotel revenue ~600B 2019.
What they don't say:
- They get a small fraction of the revenue
- They are stuck in the middle as an arbitrator
What they don't say:
- They get a small fraction of the revenue
- They are stuck in the middle as an arbitrator
From 2015 to end 2019 revenue growth was outpaced by cost growth. Share count has grown by ~6%. Airbnb has been growing revenues quickly but that growth has yet to materialize as profit.
$ABNB looks like it will open at ~$150/share. With ~263M shares, what kind of expectations are being priced in here?
At $150/share, to trade at 20x earnings, Airbnb would need to post a net profit of 5.26B, which is more than they grossed in 2019.
At $150/share, to trade at 20x earnings, Airbnb would need to post a net profit of 5.26B, which is more than they grossed in 2019.
$ABNB did manage to slash its sales and marketing costs from Jun-Sept 2020. Even product development costs have been trimmed a bit. Net income ~83c for Q320. But can growth continue without sales and marketing?
$ABNB states that they see opportunities in long term rentals and experiences. How can they grow those segments without sales & marketing?
In their primary revenue driver (short term accommodations), they have managed growth via lower commissions.
In their primary revenue driver (short term accommodations), they have managed growth via lower commissions.
