Airbnb stock plunges after warning of slowdown amid worrying trend
Falling revenue forecast sparks investor concerns
Key Points
- Airbnb shares dropped nearly 7% in afternoon trading on Thursday.
- The slide follows a cautious outlook given by the company for the second quarter.
- Airbnb expects fewer bookings and lower average daily rates in the coming months.
Airbnb shares tumbled nearly 7 in afternoon trading on Thursday after the vacation home-rental company gave a cautious outlook for revenue in the second quarter. The stock fell as investors reacted to the company's forecast of third-quarter revenue below expectations. Airbnb shares had already fallen the most in six months on Wednesday after the company's earnings report.
In its earnings report, Airbnb said it expected fewer bookings and lower average daily rates in the second quarter. The company said this was due to a number of factors, including the impact of the COVID-19 pandemic, rising inflation, and the war in Ukraine. Airbnb also said it was seeing a trend of travelers booking shorter stays and traveling to less expensive destinations.
The company's forecast has raised concerns among investors about the future of the vacation rental market. Some analysts are worried that Airbnb may be facing a slowdown in growth. Others believe that the company is simply being cautious in its outlook.
Airbnb's stock has been volatile in recent months. The stock has fallen nearly 30% from its all-time high set in February. However, the stock is still up more than 100% from its initial public offering price in December 2020.
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