Airbnb Inc

Previous wording

For the three months ended March 31, 2024, revenue grew by 18% to $2.1 billion, compared to the same period in the prior year, primarily due to a 9.5% increase in Nights and Experiences Booked of 11.5 million driving a 12% increase in Gross Booking Value (“GBV”) of $2.5 billion, a modest increase in Average Daily Rate (“ADR”), and the shift in timing of Easter from the second quarter of 2023 to the first quarter of 2024. The growth in revenue demonstrated the continued strong travel demand.

Current wording

For the three months ended June 30, 2024, revenue grew by 11% to $2.7 billion, compared to the same period in the prior year. The increase was primarily due to a 9% increase in Nights and Experiences Booked of 10.0 million, driving an 11% increase in Gross Booking Value (“GBV”) of $2.1 billion, a modest increase in Average Daily Rate (“ADR”), and the shift in timing of Easter from the second quarter of 2023 to the first quarter of 2024. The growth in revenue demonstrated the continued strong travel demand.

Previous wording

Adjusted EBITDA 1 for the three months ended March 31, 2024 increased 62% to $424 million, compared to the same period in the prior year, demonstrating the continued strength of our business, a modest increase in ADR, and discipline in managing our cost structure.

Current wording

Adjusted EBITDA 1 for the three months ended June 30, 2024 increased 9% to $894 million, compared to the same period in the prior year, demonstrating the continued strength of our business and a modest increase in ADR.

Previous wording

Our net cash provided by operating activities was $1.9 billion for the three months ended March 31, 2024, compared to $1.6 billion, in the same period in the prior year. We generated Free Cash Flow 1 of $1.9 billion for the three months ended March 31, 2024, compared to $1.6 billion, in the same period in the prior year. The increase was primarily driven by growth in net income, and accrued expenses and other liabilities.

Current wording

Cash provided by operating activities was $1.1 billion for the three months ended June 30, 2024, compared to $909 million, in the same period in the prior year. We generated Free Cash Flow 1 of $1.0 billion for the three months ended June 30, 2024, compared to $900 million, in the same period in the prior year. The increase was primarily driven by our revenue growth and increase in deferred revenue for unearned fees.

Previous wording

During the three months ended March 31, 2024, we repurchased 4.7 million shares of Class A common stock for $750 million, leaving $6.0 billion available to repurchase under our share repurchase program.

Current wording

During the three months ended June 30, 2024, we repurchased 4.9 million shares of Class A common stock for $749 million, leaving $5.3 billion available to repurchase under our share repurchase program.

Previous wording

May 15, Nights and Experiences Booked would be reduced by the cancellation for our quarter ended June 30. A night can include one or more guests and can be for a listing with one or more bedrooms. Nights and Experiences Booked grows as we attract new customers to our platform and as repeat guests increase their activity on our platform. A seat is booked for each participant in an experience. Substantially all of the bookings on our platform to date have come from nights. We believe Nights and Experiences Booked is a key business metric to help investors and others understand and evaluate our results of operations in the same manner as our management team, as it represents a single unit of transaction on our platform.

Current wording

Nights and Experiences Booked is a key measure of the scale of our platform, which in turn drives our financial performance. Nights and Experiences Booked on our platform in a period represents the sum of the total number of nights booked for stays and the total number of seats booked for experiences, net of cancellations and alterations that occurred in that period. For example, a booking made on February 15 would be reflected in Nights and Experiences Booked for our quarter ended March 31. If, in the example, the booking were canceled on May 15, Nights and Experiences Booked would be reduced by the cancellation for our quarter ended June 30. A night can include one or more guests and can be for a listing with one or more bedrooms. Nights and Experiences Booked grows as we attract new customers to our platform and as repeat guests increase their activity on our platform. A seat is booked for each participant in an experience. Substantially all of the bookings on our platform to date have come from nights. We believe Nights and Experiences Booked is a key business metric to help investors and others understand and evaluate our results of operations in the same manner as our management team, as it represents a single unit of transaction on our platform.

Previous wording

For the three months ended March 31, 2024, we had 132.6 million Nights and Experiences Booked, a 9.5% increase from 121.1 million for the same period in the prior year. The increase was driven by growth across all regions, with the strongest growth in Asia Pacific and Latin America, as we continue to focus on international expansion.

Current wording

For the three months ended June 30, 2024, we had 125.1 million Nights and Experiences, a 9% increase from 115.1 million for the same period in the prior year. For the six months ended June 30, 2024, we had 257.7 million Nights and Experiences Booked, a 9% increase from 236.2 million for the same period in the prior year. The increase was driven by growth across all regions, with the strongest growth percentages in Asia Pacific and Latin America, as we continue to focus on international expansion.

Previous wording

For the three months ended March 31, 2024, our GBV was $22.9 billion, a 12% increase from $20.4 billion for the same period in the prior year. The increase was primarily due to an increase in Nights and Experiences Booked, combined with a modest increase in ADR. We saw GBV growth across all regions, with the strongest growth in Latin America and Asia Pacific.

Current wording

For the three months ended June 30, 2024, our GBV was $21.2 billion, a 11% increase from $19.1 billion for the same period in the prior year. For the six months ended June 30, 2024, our GBV was $44.1 billion, a 12% increase from $39.5 billion for the same period in the prior year. The increase was primarily due to an increase in Nights and Experiences Booked, combined with a modest increase in ADR. We saw GBV growth across all regions, with the strongest growth percentages in Asia Pacific and Latin America.

Previous wording

The following table summarizes our non-GAAP financial measures, along with the most directly comparable U.S. GAAP measure, for each period presented below (in millions):

Current wording

The following table summarizes our non-GAAP financial measures, along with the most directly comparable U.S. GAAP measure, for each period presented below (in millions, except percentages):

Previous wording

Adjusted EBITDA increased by $162 million to $424 million and Adjusted EBITDA Margin increased from 14% to 20% for the three months ended March 31, 2024, compared to the same period in the prior year. The improvements in Adjusted EBITDA and Adjusted EBITDA Margin were primarily driven by the continued strength in our business, a modest increase in ADR, and discipline in managing our cost structure.

Current wording

Adjusted EBITDA increased by $75 million to $894 million while Adjusted EBITDA Margin remained consistent at 33% for the three months ended June 30, 2024 and 2023. Adjusted EBITDA increased by $237 million to $1.3 billion and Adjusted EBITDA margin increased from 25% to 27% for the six months ended June 30, 2024, compared to the same period in the prior year. The improvements in Adjusted EBITDA and Adjusted EBITDA Margin were primarily driven by the continued strength in our business and a modest increase in ADR.

Previous wording

Our Free Cash Flow is impacted by the timing of GBV because we collect our service fees at the time of booking, which is generally before a stay or experience occurs. Funds held on behalf of our customers and amounts payable to our customers do not impact Free Cash Flow, except interest earned on these funds. The increase in Free Cash Flow for the three months ended March 31, 2024, compared to the same period in the prior year, was primarily driven by growth in net income, and accrued expenses and other liabilities.

Current wording

Our Free Cash Flow is impacted by the timing of GBV because we collect our service fees at the time of booking, which is generally before a stay or experience occurs. Funds held on behalf of our customers and amounts payable to our customers do not impact Free Cash Flow, except interest earned on these funds. The increase in Free Cash Flow for the three and six months ended June 30, 2024, compared to the same periods in the prior year, was primarily driven by growth in stock-based compensation expense, deferred income taxes, and accrued expenses and other liabilities.

Previous wording

Comparison of the Three Months Ended March 31, 2024 with the Same Period in 2023

Current wording

Comparison of the Three and Six Months Ended June 30, 2024 with the Same Periods in 2023

Previous wording

Revenue increased $324 million, or 18%, for the three months ended March 31, 2024, compared to the same period in the prior year, primarily due to a 9.5% increase in Nights and Experiences Booked driving a 12% increase in GBV, a modest increase in ADR, and the shift in timing of Easter from the second quarter of 2023 to the first quarter of 2024.

Current wording

Revenue increased $264 million, or 11%, for the three months ended June 30, 2024, compared to the same period in the prior year, primarily due to a 9% increase in Nights and Experiences Booked driving a 11% increase in GBV, and a modest increase in ADR.

Previous wording

Cost of revenue increased $52 million, or 12%, for the three months ended March 31, 2024, compared to the same period in the prior year, primarily due to an increase in merchant fees of $56 million, largely due to an increase in pay-in volumes, and an increase in cloud computing costs of $8 million, due to increased server and data storage usage. These increases were partially offset by a reduction in chargebacks of $13 million.

Current wording

Cost of revenue increased $74 million, or 17%, for the three months ended June 30, 2024, compared to the same period in the prior year, primarily due to an increase in merchant fees of $67 million, largely due to an increase in pay-in volumes and the impact of certain one-time incentives in 2023, and an increase in cloud computing costs of $6 million due to increased server and data storage usage. These increases were partially offset by a reduction in chargebacks of $7 million.

Previous wording

Operations and support expense was relatively flat compared to the same period in the prior year.

Current wording

Operations and support expense was relatively flat compared to the same periods in the prior year.

Previous wording

Product development expense increased $55 million, or 13%, for the three months ended March 31, 2024, compared to the same period in the prior year, primarily due to a $51 million increase in payroll-related expenses due to growth in headcount and increased compensation costs.

Current wording

Product development expense increased $68 million, or 15%, for the three months ended June 30, 2024, compared to the same period in the prior year, primarily due to a $60 million increase in payroll-related expenses.

Previous wording

Sales and marketing expense increased $64 million, or 14%, for the three months ended March 31, 2024, compared to the same period in the prior year. The increase was primarily due to a $60 million increase in marketing activities associated with ongoing marketing campaigns, and search engine marketing.

Current wording

Sales and marketing expense increased $87 million, or 18%, for the three months ended June 30, 2024, compared to the same period in the prior year. The increase was primarily due to a $64 million increase in marketing activities associated with ongoing marketing campaigns and search engine marketing, and a $13 million increase in payroll-related expenses.

Previous wording

General and administrative expense increased $44 million, or 18%, for the three months ended March 31, 2024, compared to the same period in the prior year, primarily due to a $21 million increase in non-income taxes and a $15 million increase in non-recurring employee taxes.

Current wording

General and administrative expense increased $40 million, or 15%, for the three months ended June 30, 2024, compared to the same period in the prior year, primarily due to a $54 million increase in non-income taxes, including a $27 million increase in digital services taxes, primarily related to Canada’s Digital Services Tax enacted in June of 2024, which was retroactive to 2022. These increases were partially offset by a reduction in professional service fees of $13 million.

Previous wording

Interest income increased $56 million, or 38%, for the three months ended March 31, 2024, compared to the same period in the prior year, primarily due to higher cash and investment balances and higher interest rates.

Current wording

Interest income increased $35 million, or 18%, for the three months ended June 30, 2024, and $91 million, or 27%, for the six months ended June 30, 2024, compared to the same periods in the prior year, primarily due to higher cash and investment balances and higher interest rates.

Previous wording

The provision for income taxes increased primarily due to increased profitability, additional deferred tax expense resulting from last year’s valuation allowance release on our U.S. deferred tax assets and the utilization of some of those assets in the current year, the accrual of interest on certain uncertain tax positions, partially offset by the income tax benefit from excess tax benefits on stock-based compensation arising during the quarter.

Current wording

The provision for income taxes increased primarily due to increased profitability and additional deferred tax expense resulting from last year’s valuation allowance release on our U.S. deferred tax assets and the utilization of some of those assets in the current year, partially offset by the income tax benefit from excess tax benefits on stock-based compensation arising during the three and six months ended June 30, 2024.

Previous wording

In 2021, the Organization for Economic Co-operation and Development (“OECD”) established an inclusive framework on base erosion and profit shifting and agreed on a two-pillar solution to global taxation, focusing on global profit allocation, known to as Pillar One and a 15% global minimum effective tax rate, known as Pillar Two. On December 15, 2022, the EU member states agreed to implement the OECD’s global minimum tax rate of 15%. The OECD issued Pillar Two model rules and continues to release guidance on these rules. The inclusive framework calls for tax law changes by participating countries to take effect in 2024 and 2025. Various countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax. We considered the applicable tax law changes on Pillar Two implementation in the relevant countries, and concluded there was no material impact to our tax provision for the three months ended March 31, 2024. We will continue to evaluate the impact of these tax law changes on future reporting periods.

Current wording

In 2021, the Organization for Economic Co-operation and Development (“OECD”) established an inclusive framework on base erosion and profit shifting and agreed on a two-pillar solution to global taxation, focusing on global profit allocation, known to as Pillar One and a 15% global minimum effective tax rate, known as Pillar Two. On December 15, 2022, the EU member states agreed to implement the OECD’s global minimum tax rate of 15%. The OECD issued Pillar Two model rules and continues to release guidance on these rules. The inclusive framework calls for tax law changes by participating countries to take effect in 2024 and 2025. Various countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax. We considered the applicable tax law changes on Pillar Two implementation in the relevant countries, and concluded there was no material impact to our tax provision for the three and six months ended June 30, 2024. We will continue to evaluate the impact of these tax law changes on future reporting periods.

Previous wording

As of March 31, 2024, our principal sources of liquidity were cash, cash equivalents and short-term investments totaling $11.1 billion. As of March 31, 2024, cash and cash equivalents totaled $7.8 billion, which included $2.2 billion held by our foreign subsidiaries. Cash and cash equivalents consist of checking and interest-bearing accounts and highly-liquid securities with an original maturity of 90 days or less. As of March 31, 2024, short-term investments totaled $3.3 billion. Short-term investments primarily consist of highly-liquid investment grade corporate debt securities, time deposits, commercial paper, certificates of deposit, U.S. government and government agency debt securities (“government bonds”), and mortgage-backed and asset-backed securities. These amounts do not include funds of $8.7 billion as of March 31, 2024, that we held for bookings in advance of guests completing check-ins that we record separately on our unaudited condensed consolidated balance sheet in funds receivable and amounts held on behalf of customers with a corresponding liability in funds payable and amounts payable to customers.

Current wording

As of June 30, 2024, our principal sources of liquidity were cash, cash equivalents and short-term investments totaling $11.3 billion. As of June 30, 2024, cash and cash equivalents totaled $7.9 billion, which included $2.1 billion held by our foreign subsidiaries. Cash and cash equivalents consist of checking and interest-bearing accounts and highly-liquid securities with an original maturity of 90 days or less. As of June 30, 2024, short-term investments totaled $3.4 billion. Short-term investments primarily consist of highly-liquid investment grade corporate debt securities, time deposits, commercial paper, certificates of deposit, U.S. government and government agency debt securities (“government bonds”), and mortgage-backed and asset-backed securities. These amounts do not include funds of $10.3 billion as of June 30, 2024, that we held for bookings in advance of guests completing check-ins that we record separately on our unaudited condensed consolidated balance sheet in funds receivable and amounts held on behalf of customers with a corresponding liability in funds payable and amounts payable to customers.

Previous wording

In February 2024, our board of directors approved an additional share repurchase program to purchase up to $6.0 billion of our Class A common stock. During the three months ended March 31, 2024, we repurchased an aggregate of 4.7 million shares of Class A common stock for $750 million through our share repurchase programs. As of March 31, 2024, we had $6.0 billion available to repurchase shares of Class A common stock under our share repurchase program.

Current wording

In February 2024, our board of directors approved an additional share repurchase program to purchase up to $6.0 billion of our Class A common stock. During the three and six months ended June 30, 2024, we repurchased an aggregate of 4.9 million and 9.6 million shares of Class A common stock for $749 million and $1.5 billion, respectively through our share repurchase programs. As of June 30, 2024, we had $5.3 billion available to repurchase shares of Class A common stock under our share repurchase program.

Previous wording

Net cash provided by operating activities for the three months ended March 31, 2024 was $1.9 billion, which was primarily due to net income of $264 million, additional cash provided by a $1.0 billion increase in unearned fees resulting from growth in bookings, and accrued expenses and other liabilities of $325 million. Additionally, we had adjustments for non-cash charges, primarily consisting of $295 million of stock-based compensation expense.

Current wording

Net cash provided by operating activities for the six months ended June 30, 2024 was $3.0 billion, which was primarily due to net income of $819 million, additional cash provided by unearned fees of $1.2 billion, resulting from growth in bookings, and increase from accrued expenses and other liabilities of $230 million. Additionally, we had adjustments for non-cash charges, primarily consisting of $677 million of stock-based compensation expense.

Previous wording

Net cash used in investing activities for the three months ended March 31, 2024 was $84 million, which was primarily due to purchases of short-term investments, partially offset by proceeds resulting from sales and maturities of short-term investments.

Current wording

Net cash used in investing activities for the six months ended June 30, 2024 was $194 million, which was primarily due to purchases of short-term investments, partially offset by proceeds resulting from sales and maturities of short-term investments.

Previous wording

Net cash provided by financing activities for the three months ended March 31, 2024 was $2.1 billion, primarily due to a decrease in funds payable and amounts payable to customers of $3.0 billion, partially offset by share repurchases of $750 million and an increase in taxes paid related to net share settlement of equity awards of $155 million.

Current wording

Net cash provided by financing activities for the six months ended June 30, 2024 was $2.9 billion, primarily due to an increase in funds payable and amounts payable to customers of $4.7 billion, partially offset by share repurchases of $1.5 billion and an increase in taxes paid related to net share settlement of equity awards of $309 million.

Previous wording

The effect of exchange rate changes on cash, cash equivalents, and restricted cash on our consolidated statements of cash flows relates to certain of our assets, principally cash balances held on behalf of customers, that are denominated in currencies other than the functional currency of certain of our subsidiaries. For the three months ended March 31, 2024, we recorded a decrease of $111 million in cash, cash equivalents, and restricted cash, primarily due to the strengthening of the U.S. dollar. The impact of exchange rate changes on cash balances can serve as a natural hedge for the effect of exchange rates on our liabilities to our hosts and guests.

Current wording

The effect of exchange rate changes on cash, cash equivalents, and restricted cash on our consolidated statements of cash flows relates to certain of our assets, principally cash balances held on behalf of customers, that are denominated in currencies other than the functional currency of certain of our subsidiaries. For the six months ended June 30, 2024, we recorded a decrease of $202 million in cash, cash equivalents, and restricted cash, primarily due to the strengthening of the U.S. dollar. The impact of exchange rate changes on cash balances can serve as a natural hedge for the effect of exchange rates on our liabilities to our hosts and guests.