Airbnb's revenue grew by 19% - shares surged by more than 10% in pre-market trading

Airbnb's Revenue Grows 19% — Shares Surge More Than 10% in Pre-Market Trading

Airbnb posted third-quarter financial results that beat expectations. Growth in both profit and revenue was driven by sustained travel demand, an increase in bookings on the platform, and improved pricing. The company recorded its fastest revenue growth rate in more than three years.

Following the release of the results, Airbnb shares rose more than 10% in pre-market trading on Friday.

The company's diluted earnings per share came to $3.16, beating analysts' forecast of $2.85 by 31 cents. Revenue grew 19% year-over-year to $4.87 billion, compared with a market consensus of $4.75 billion. By comparison, revenue growth stood at 10% in the same quarter a year earlier.

Gross Booking Value (GBV) on the platform rose 21% to $27.7 billion. The number of nights and experiences booked increased 16% to 155 million. Meanwhile, the average daily rate (ADR) rose 4% year-over-year to $179, reflecting both price increases and changes in booking mix.

Airbnb's net profit grew 38% to $1.89 billion, up from $1.37 billion in the same period last year. Adjusted EBITDA increased 22% to $2.51 billion. The EBITDA margin expanded from 50% to 52%, indicating that the company managed to improve profitability alongside revenue growth.

BTIG analyst Jake Fuller noted that Airbnb beat expectations and raised its guidance at a time when competitors were offering more cautious estimates. According to him, there had been doubts earlier in the year about whether management could strike the right balance between profit margins, investment, and growth, but the latest results showed progress on that front.

According to the company, the improved results were driven by strong travel demand, product updates, and operational discipline. Growth in first-time bookers on the platform accelerated to 13% — the highest rate since early 2022. Nights booked in North America showed the fastest growth rate in the past four years. Growth accelerated across all five of the company's core markets: the US, France, the UK, Canada, and Australia.

Airbnb is also placing particular emphasis on the use of artificial intelligence. The company's AI-powered customer support assistant resolved roughly 40% of customer service issues during the quarter without human intervention. That figure stood at around one-third in the second quarter. As a result, customer support costs per booking fell by more than 17% year-over-year.

The company views the expansion of AI capabilities as an important direction for product improvement and cost optimization. At the same time, Airbnb is seeking to expand beyond home bookings and increase investment in hotels, travel services, and partnerships.

Against the backdrop of strong quarterly results, Airbnb raised its full-year 2026 guidance for revenue growth and adjusted EBITDA margin. For the fourth quarter, the company expects revenue of $3.22 to $3.28 billion, implying year-over-year growth of 16% to 18%. For 2026, it forecasts high-teens revenue growth and an adjusted EBITDA margin of approximately 36%.

In addition, Airbnb allocated an additional $12 billion to its share buyback program. In the third quarter, the company already repurchased $700 million worth of Class A shares. This move reflects management's confidence in the company's growth prospects.