Airbnb Inc. shares fell on Tuesday after the vacation rental company delivered an unoptimistic revenue forecast for the second quarter. The company suggested that rising prices and a bearish economic outlook have deterred consumers from leisure travel.
Shares fell by 10% to $114.25. This is a significant backtrack for Airbnb, with the company gaining almost 50% since the start of the year. While the company benefitted from shifts in work and travel trends during Covid, the post-pandemic travel boom has since faded.
The company has forecast revenue of $2.35 billion to $2.45 billion for the quarter ending June; an increase of 12% to 16% from the previous year. According to a Bloomberg survey, industry analysts had been expecting revenue of $2.4 billion.
News of Airbnb’s reduced economic outlook comes after a solid first-quarter performance in which the company set several performance records. Adjusted earnings before taxes for the three months ending March 31 was $262 million; a record first-quarter performance that smashed Wall Street estimates.
Revenue for the first quarter stood at $1.82 billion, thereby beating analysts’ estimates of $1.79 billion and setting another first-quarter record as well as a 20% rise from the previous three months.