Airbnb anticipates a raise of up to $2.6B in the upcoming IPO

The vacation rental online marketplace company shared that it expects to offer 51.9 million common shares priced between $44 and $50 each.

Airbnb anticipates a raise of up to $2.6 billion in its initial public stock offering in mid-December. Betting investors will find its home-sharing model as the future of travel. 

“We believe that the lines between travel and living are blurring, and the global pandemic has accelerated the ability to live anywhere,” Airbnb said in a recent financial filing with securities regulators.

The vacation rental online marketplace company further shared that it expects to offer 51.9 million common shares priced between $44 and $50 each. On December 10, the company may debut on the Nasdaq stock exchange, trading under the symbol “ABNB.”

Stock options, restricted stock units, and other securities classes add up to approximately 696 million Airbnb shares. The company has a value of approximately $35 billion at the high end of its offering price, or $31 billion at the low end.

Hailed as a remarkable comeback for the company that delayed its IPO when the COVID-19 pandemic hit the global travel industry. Airbnb has over 7 million listings on its platform, run by 4 million hosts over the world.

The company’s revenue dropped by 32 per cent to $2.5 billion in the first nine months of this year due to cancellation of reservations. Hosts raised their voices against the cancellation by Airbnb without penalties. In May, the company slashed 1,900 jobs i.e., around 25 per cent of its workforce. Moreover, the company cut investments in projects unrelated to its core business, like movie production.

However, the San Francisco-based company is on the route to speedy recovery since travellers opt for whole homes in rural areas, secluded from crowds. The number of nights and experiences booked had fallen 72 per cent in April, further plummeted by about 20 per cent in July, August, and September.

The short-term rental occupancy in Miami reached 83 per cent in October. At the same time, the average occupancy for hotels was 42 per cent, according to STR, a hospitality data firm. The rental occupancy in Nashville was 59 per cent, whereas the hotel occupancy was 44 per cent.

Airbnb expects more businesspeople to book vacation rentals as working from home is becoming the new norm.

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