Airbnb Inc

Previous wording

We are a community based on connection and belonging—a community that was born in 2007 when two hosts welcomed three guests to their San Francisco home, and has since grown to over 5 million hosts who have welcomed over 1.5 billion guest arrivals in almost every country and region across the globe. Every day, hosts offer unique stays and experiences that make it possible for guests to connect with communities in a more authentic way.

Current wording

We are a community based on connection and belonging—a community that was born in 2007 when two hosts welcomed three guests to their San Francisco home, and has since grown to over 5 million hosts who have welcomed over 2 billion guest arrivals in almost every country and region across the globe. Every day, hosts offer unique stays and experiences that make it possible for guests to connect with communities in a more authentic way.

Previous 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.

Current wording

For the three months ended September 30, 2024, revenue grew by 10% to $3.7 billion, compared to the same period in the prior year. The increase was primarily due to an increase in the number of check-ins relating to Nights and Experiences Booked and a modest increase in Average Daily Rate (“ADR”).

Previous wording

Net income for the three months ended June 30, 2024 decreased by 15% to $555 million, compared to the same period in the prior year, driven by an increase in income tax expense of $100 million, primarily due to 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 decrease was largely offset by our revenue growth and increased interest income.

Current wording

Net income for the three months ended September 30, 2024 decreased by 69% to $1.4 billion, compared to the same period in the prior year, driven by an increase in income tax expense of $3.1 billion, primarily due to the prior year’s valuation allowance release of our U.S. deferred tax assets of $2.8 billion, and the recognition of deferred tax expense related to the utilization of some of those assets in the current year.

Previous 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.

Current wording

Adjusted EBITDA 1 for the three months ended September 30, 2024 increased 7% to $2.0 billion, compared to the same period in the prior year, driven by growth in the number of check-ins relating to Nights and Experiences Booked and a modest increase in ADR.

Previous 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.

Current wording

Cash provided by operating activities was $1.1 billion for the three months ended September 30, 2024, compared to $1.3 billion, in the same period in the prior year. We generated Free Cash Flow 1 of $1.1 billion for the three months ended September 30, 2024, compared to $1.3 billion, in the same period in the prior year.

Previous 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.

Current wording

During the three months ended September 30, 2024, we repurchased 8.7 million shares of Class A common stock for $1.1 billion, leaving $4.2 billion available to repurchase under our share repurchase program.

Previous 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.

Current wording

For the three months ended September 30, 2024, we had 122.8 million Nights and Experiences Booked, an 8% increase from 113.2 million for the same period in the prior year. For the nine months ended September 30, 2024, we had 380.5 million Nights and Experiences Booked, a 9% increase from 349.4 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 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.

Current wording

For the three months ended September 30, 2024, our GBV was $20.1 billion, a 10% increase from $18.3 billion for the same period in the prior year. For the nine months ended September 30, 2024, our GBV was $64.2 billion, an 11% increase from $57.8 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 EMEA.

Previous 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.

Current wording

Adjusted EBITDA increased by $361 million to $3.3 billion while Adjusted EBITDA margin remained consistent at 38% for the nine months ended September 30, 2024, compared to the same period in the prior year. The improvements in Adjusted EBITDA were primarily driven by growth in the number of check-ins relating to Nights and Experiences Booked 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 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.

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 decrease in Free Cash Flow for the three and nine months ended September 30, 2024, compared to the same periods in the prior year, was primarily driven by the decrease in net cash provided by operating activities.

Previous wording

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

Current wording

Comparison of the Three and Nine Months Ended September 30, 2024 with the Same Periods in 2023

Previous 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.

Current wording

Cost of revenue increased $6 million, or 1%, for the three months ended September 30, 2024, compared to the same period in the prior year, primarily due to an increase in merchant fees of $15 million, largely due to an increase in pay-in volumes, partially offset by a reduction in chargebacks of $11 million.

Previous wording

Cost of revenue increased $126 million, or 15%, for the six months ended June 30, 2024, compared to the same period in the prior year, primarily due to an increase in merchant fees of $123 million, 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 $14 million, due to increased server and data storage usage. These increases were partially offset by a reduction in chargebacks of $21 million.

Current wording

Cost of revenue increased $132 million, or 10%, for the nine months ended September 30, 2024, compared to the same period in the prior year, primarily due to an increase in merchant fees of $137 million, 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 $21 million, due to increased server and data storage usage. These increases were partially offset by a reduction in chargebacks of $31 million.

Previous 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.

Current wording

Product development expense increased $105 million, or 25%, for the three months ended September 30, 2024, compared to the same period in the prior year, primarily due to a $93 million increase in payroll-related expenses.

Previous wording

Product development expense increased $123 million, or 14%, for the six months ended June 30, 2024, compared to the same period in the prior year, primarily due to a $111 million increase in payroll-related expenses.

Current wording

Product development expense increased $228 million, or 18%, for the nine months ended September 30, 2024, compared to the same period in the prior year, primarily due to a $202 million increase in payroll-related expenses.

Previous 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.

Current wording

Sales and marketing expense increased $111 million, or 28%, for the three months ended September 30, 2024, compared to the same period in the prior year. The increase was primarily due to a $83 million increase in marketing activities associated with ongoing marketing campaigns and search engine marketing, and a $14 million increase in payroll-related expenses.

Previous wording

Sales and marketing expense increased $151 million, or 16%, for the six months ended June 30, 2024, compared to the same period in the prior year. The increase was primarily due to a $118 million increase in marketing activities associated with ongoing marketing campaigns and search engine marketing, and a $26 million increase in payroll-related expenses.

Current wording

Sales and marketing expense increased $262 million, or 20%, for the nine months ended September 30, 2024, compared to the same period in the prior year. The increase was primarily due to a $200 million increase in marketing activities associated with ongoing marketing campaigns and search engine marketing, and a $40 million increase in payroll-related expenses.

Previous 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.

Current wording

Interest income increased $15 million, or 8%, for the three months ended September 30, 2024, and $106 million, or 20%, for the nine months ended September 30, 2024, compared to the same periods in the prior year, primarily due to higher cash and investment balances.

Previous wording

Other expense, net increased $4 million and $3 million for the three and six months ended June 30, 2024, respectively, compared to the same periods in the prior year, primarily due to an impairment charge on an investment in a privately-held company of $45 million, partially offset by foreign exchange gains.

Current wording

Other income (expense), net increased $9 million, or 16% for the nine months ended September 30, 2024, compared to the same period in the prior year, primarily due to an impairment charge on an investment in a privately-held company of $45 million, partially offset by foreign exchange gains.

Previous 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.

Current wording

The provision for income taxes during the three and nine months ended September 30, 2024 was driven by current tax on U.S. and foreign earnings and 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 income tax benefit for the three and nine months ended September 30, 2023, was primarily due to the release of $2.8 billion of our valuation allowance related to certain of our U.S. deferred tax assets, as a discrete tax benefit during the three months ended September 30, 2023.

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 and six months ended June 30, 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 nine months ended September 30, 2024. We will continue to evaluate the impact of these tax law changes on future reporting periods.

Previous 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.

Current wording

As of September 30, 2024, our principal sources of liquidity were cash, cash equivalents and short-term investments totaling $11.3 billion. As of September 30, 2024, cash and cash equivalents totaled $7.7 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 September 30, 2024, short-term investments totaled $3.6 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 $6.6 billion as of September 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

We have access to $1.0 billion of commitments and a $200 million sub-limit for the issuance of letters of credit under the 2022 Credit Facility. As of June 30, 2024, no amounts were drawn under the 2022 Credit Facility and outstanding letters of credit totaled $25 million.

Current wording

We have access to $1.0 billion of commitments and a $200 million sub-limit for the issuance of letters of credit under the 2022 Credit Facility. As of September 30, 2024, no amounts were drawn under the 2022 Credit Facility and outstanding letters of credit totaled $25 million. See Note 7, Debt, to our unaudited condensed consolidated financial statements included in Item 1 of Part 1 of this Quarterly Report on Form 10-Q additional information.

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 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.

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 nine months ended September 30, 2024, we repurchased an aggregate of 8.7 million and 18.3 million shares of Class A common stock for $1.1 billion and $2.6 billion, respectively through our share repurchase programs. As of September 30, 2024, we had $4.2 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 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.

Current wording

Net cash provided by operating activities for the nine months ended September 30, 2024 was $4.1 billion, which was primarily due to net income of $2.2 billion, additional cash provided by unearned fees of $233 million, resulting from growth in bookings, and an increase in accrued expenses and other liabilities of $218 million, which is net of a $163 million tax payment to the IRS related to a 2013 matter under examination. Additionally, we had adjustments for non-cash charges, primarily consisting of $1.0 billion of stock-based compensation expense.

Previous 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.

Current wording

Net cash used in investing activities for the nine months ended September 30, 2024 was $396 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 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.

Current wording

Net cash used in financing activities for the nine months ended September 30, 2024 was $2.2 billion, primarily due to share repurchases of $2.6 billion and an increase in taxes paid related to net share settlement of equity awards of $422 million, partially offset by an increase in funds payable and amounts payable to customers of $665 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 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.

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 nine months ended September 30, 2024, we recorded a decrease of $117 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.