In Trends

First full year of profitability for Airbnb

Airbnb China head exits after four months

Airbnb announced it generated earnings of about $100m in 2017 while bookings grew around 150 percent, in a streak of profitability that marks a contrast with heavily lossmaking peers such as Uber and Lyft.

The 2017 year marks the first full year of generating income for the San Francisco-based company, which became profitable in the second half of 2016, as it managed to defy some of the disruptions in global travel in 2017.

SEE ALSO : Luxury hotel incorporates technology to compete with Airbnb

Airbnb’s earnings before tax, interest, depreciation and amortisation were $100m for the full year, according to a source close to the company, compared with an earnings loss the previous year.

Airbnb also announced that Ken Chenault, chief executive of American Express, would be joining its board as the first independent director. He will be the sixth board member of the company, joining the three co-founders and two early investors who sit on the board.

Airbnb’s chief executive Brian Chesky also announced on Thursday a new set of values for the ten-year-old company, which include “having an infinite time horizon” and “serving all of our stakeholders”.

In a public letter, Mr Chesky said that he wanted to build a company that would last not only through the 21st century, but also the 22nd, without providing specific details about how the company would do that.

Over the past 18 months, the company has expanded beyond accommodation into areas such as guided tours, and has hinted that it will add services like flight booking and car rentals in the future.

In his letter Mr Chesky said that Airbnb would continue to grow these newer areas. “If people are good and mostly the same, then we should be able to offer more than people sleeping in one another’s homes,” he wrote.

Airbnb’s main source of revenue is the commission it takes from accommodation bookings, and it take a cut of between 9 percent and 15 percent per booking.

SEE ALSO : Airbnb China head exits after four months

The company’s revenues last year were more than $3.5bn, according to FT calculations and previously reported quarterly figures. Gross bookings grew by about 150 per cent, according to a person close to the company.

The company raised a $1 funding round in 2017, at a valuation of $30bn, and its investors include General Atlantic and Andreessen Horowitz.

(Source: FT)

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