Airbnb Q1 Earnings Call Highlights

Key Points

• Airbnb reported a strong Q1 with revenue up 18% YoY to $2.7B and GBV up 19% to $29B, nights and seats booked +9% (about a 100 bps headwind from the Middle East), $1.7B in Q1 free cash flow ($4.5B TTM), $1.1B of buybacks, and raised full‑year guidance to low‑to‑mid teens revenue growth with an adjusted EBITDA margin of at least 35%.
• Product and monetization changes — notably Reserve Now, Pay Later (RNPL), updated cancellation policies and simplified host fees — contributed roughly 3 points to nights growth and ~4 points to GBV, with RNPL representing ~20% of global GBV and shifting demand toward longer lead times and higher‑priced homes despite higher cancellations.
• Airbnb is leaning into AI and new offerings to drive efficiency and expansion: AI assists ~60% of engineers' code and resolves >40% of support issues (helping cut cost per booking ~10% YoY), while the company scales services, experiences, boutique hotels and a Delta partnership and is seeing first‑time booker growth accelerate to 10%, led by Brazil, Japan and India.

Airbnb NASDAQ: ABNB executives said the company started 2026 with momentum across demand, product improvements, and international expansion, while acknowledging an approximate 100 basis point headwind to nights and seats booked from conflict in the Middle East.

First-quarter results and demand trends

Co-founder and CEO Brian Chesky said Airbnb delivered a “strong start to 2026,” pointing to revenue growth of 18% year-over-year to $2.7 billion, above the high end of guidance. Chief Financial Officer Ellie Mertz said Gross Booking Value (GBV) rose 19% year-over-year to $29 billion, supported by growth in both nights and average daily rate (ADR).

Nights and seats booked increased 9% year-over-year, which Chesky said included an estimated 100 basis point impact from the Middle East conflict. Mertz added that nights growth accelerated from January to February and then “saw a slight deceleration in March, largely due to conflict-related cancellations across EMEA and APAC.” Excluding the conflict impact, the company estimated nights and seats booked growth would have been approximately 10% year-over-year.

ADR increased 9% year-over-year, or 4% excluding foreign exchange, with Mertz citing “noticeable strength in North America.” Chesky and Mertz both emphasized that product updates contributed to performance, with Mertz estimating that three initiatives—Reserve Now, Pay Later; updated cancellation policies; and simplifying host fees—contributed about 3 points of nights booked growth and about 4 points of GBV growth in the quarter.

Product updates: payments, search, and hosting tools

Chesky said “Reserve Now, Pay Later” (RNPL) continued to expand internationally, with approximately 20% of global GBV in Q1 coming from RNPL bookings. He said the product is influencing guest behavior, including “longer lead times” and a mix shift toward “larger, higher-priced homes.” Mertz said RNPL adoption increased as it rolled out to more markets and described it as driving “a meaningful lift to all booking metrics, net of cancellation,” while also helping Airbnb “lock in earlier calendar share.” She noted RNPL carries “a very elevated level of cancellations,” but said the net impact remains positive across regions and that the U.S. has the highest adoption so far.

On search and discovery, Chesky said Airbnb improved search relevance in Q1, which has had a “positive impact on bookings.” On the host side, he highlighted a redesigned host sign-up flow, testing of “host insights” that provide personalized listing recommendations, and upgrades to pricing tools to better reflect demand and seasonality.

In response to questions about app booking growth, Chesky said nights booked on Airbnb’s app grew 22% year-over-year and now represent 63% of total nights booked, up from 58% a year earlier. He attributed the trend to long-running consumer shifts to mobile and Airbnb’s efforts to push mobile web users to download the app, increased notification opt-ins, email “hooks” that drive app usage, and improving App Store rankings. Chesky said there was “not…a silver bullet,” calling it the result of broader optimization.

Expansion initiatives: services, experiences, hotels, and big events

Chesky and Mertz pointed to growth outside core markets. Chesky said first-time booker growth accelerated to 10%, the “highest growth rate since 2022,” with particular strength in Brazil, Japan, and India. He said “net nights for expansion markets grew at roughly twice the rate of our core markets,” crediting “Project Hawaii,” an initiative he described as forming small, elite teams with clear mandates that ship improvements quickly and then scale what works. Mertz said the company is localizing marketing and product experiences country-by-country, including 16 local marketing campaigns in Q1 and market-specific product emphasis, such as highlighting cleanliness for German guests.

Airbnb also discussed expanding beyond home stays:

• Services and experiences: Chesky said Airbnb continued piloting new “Airbnb Services” and scaling experiences, where early results suggest a “demand flywheel.” He said nearly a quarter of new guests who book an experience go on to book a stay or service, and about one in three experience bookers book a stay within 90 days.
• Delta partnership: Chesky said Airbnb expanded its partnership with Delta Air Lines, allowing travelers to earn Delta miles on qualifying Airbnb Experiences and services in addition to homes. Mertz described the arrangement as a revenue-share program and said it should not negatively impact take rate this year, calling it a “high ROI way to generate demand.”
• Hotels: Executives said Airbnb is scaling its boutique and independent hotel pilot into more mature markets, particularly where home supply is constrained by regulation or availability. Chesky said hotels currently represent a “single-digit percentage” of nights but that hotel metrics have been growing “more than double” the overall business over recent quarters. He said about 55% of guests who book a hotel on Airbnb return to book a home, framing hotels as an onboarding path for new users. On product experience, Chesky said Airbnb is testing commingled search results in some markets such as New York City alongside UI elements like carousels, with potential for more tabs in the future, but emphasized that personalization—showing hotels or homes based on user intent and trip type—will be the longer-term approach.

Chesky also highlighted big events as a growth lever. He cited the Winter Olympics in Italy, where Airbnb hosted nearly 200,000 guests, with supply and host metrics up about 30% and GBV “more than tripling,” alongside marketing campaigns that generated around one billion impressions. For the upcoming World Cup, Mertz said Airbnb expects it to be the largest event in its history, with more than 100,000 first-time listings added across the 16 host cities. She noted that event-related bookings tend to occur closer to the games and said Airbnb feels good about performance so far. On supply retention, she pointed to Paris as a reference point, saying that more than half of event-driven listings remained active six months after the games.

AI and operating efficiency

Chesky said AI is materially changing how Airbnb builds products and supports customers. He said nearly 60% of engineers’ code is now written by AI, which he estimated is about twice the industry average. He also said customer support is seeing increased automation, with more than 40% of issues resolved through the AI assistant without a human agent, up from about one-third in Q4, contributing to faster resolution times.

Chesky said Airbnb saw cost per booking decline about 10% year-over-year in Q1 and expects further benefits as AI customer support improves. He also discussed how AI may influence company structure, saying it is “really, really early,” but adding that Airbnb must “move at the speed of AI” and that leaders and managers may need to be more hands-on as access to data becomes more democratized.

On AI in search, Chesky said Airbnb started with “bottom of funnel” applications like customer service due to the need for accuracy, privacy, escalation, and policy adherence, then moved into “mid-funnel” features like AI review summaries and improved matching and relevance. He said top-of-funnel “AI search” is still in testing and exploration mode, adding that “I don’t think anyone’s figured out AI for travel or e-commerce yet” and raising concerns with chatbot-style interfaces, including too much text, lack of direct manipulation, difficulty comparing large inventories, and the “multiplayer” nature of travel planning.

Profitability, cash flow, capital returns, and outlook

Mertz said net income was $160 million and adjusted EBITDA was $519 million, up 24% year-over-year and above guidance. She said net income included a one-time adjustment of about $70 million to certain deferred tax assets tied to changes in the U.S. corporate alternative minimum tax effective in Q1. For 2026, she said the company expects an effective tax rate in the high teens, down from 20% in 2025, attributing the change primarily to how foreign earnings are taxed under the “One Big Beautiful Bill Act.”

Airbnb reported $1.7 billion of free cash flow in Q1 and $4.5 billion over the trailing twelve months, representing a 36% free cash flow margin. Mertz noted that RNPL shifts the timing of guest payments, reducing unearned fees in Q1 and Q2 and increasing them in Q3, and said unearned fees and free cash flow would have grown year-over-year in Q1 absent RNPL timing effects.

The company repurchased $1.1 billion of common stock in Q1. Mertz also said Airbnb received investment-grade ratings from major agencies and completed a $2.5 billion senior unsecured debt offering for debt repayment and general corporate purposes, describing it as a step to expand access to financing and optimize cost of capital.

Looking ahead, Mertz guided to Q2 revenue of $3.54 billion to $3.6 billion, implying year-over-year growth of 14% to 16%, including an estimated 3% FX tailwind after hedging. She said GBV should rise in the low double digits, with moderate ADR growth and a smaller FX tailwind to ADR than in Q1. Nights and seats booked growth is expected to “decelerate slightly” versus Q1’s 9% growth, again including an approximate 100 basis point headwind related to the Middle East conflict. She said adjusted EBITDA and margin should be up year-over-year in Q2.

For full-year 2026, both Chesky and Mertz said Airbnb raised guidance, now expecting year-over-year revenue growth to accelerate to the low-to-mid teens and adjusted EBITDA margin to be at least 35%. Mertz said the higher revenue outlook reflects confidence in nights booked, “durability of slightly higher ADRs,” and monetization efforts expected to lift take rate, including a simplified fee structure and the company’s insurance program. She also said Airbnb plans to reinvest in high-ROI marketing, expansion markets, policy initiatives, and AI.

Chesky said additional product updates would be shared at Airbnb’s summer release event on May 20.

About Airbnb NASDAQ: ABNB

Airbnb, Inc NASDAQ: ABNB operates a global online marketplace that connects travelers with hosts offering short-term lodging, unique accommodations and related travel experiences. The company's core platform enables individuals and professional property managers to list private homes, apartments, single rooms and entire properties, while providing search, booking and payment processing for guests. Airbnb earns revenue primarily through service fees charged to guests and hosts and offers tools to facilitate reservations, communications, and logistics between parties.

Beyond accommodations, Airbnb has expanded its product portfolio to include curated experiences led by local hosts, higher-end offerings such as Airbnb Luxe, and programs aimed at enhancing quality and safety like Airbnb Plus.

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