Airbnb (ABNB) earnings Q2 2022

Airbnb beat Wall Street estimates for earnings and posted revenue that was in line with estimates for the second quarter. The company also announced a $2 billion share buyback program.

Shares were down about 9% after hours, despite what appeared to be a strong report, suggesting Wall Street was looking for faster growth and a revenue beat. The company also said it was impacted by flight cancellations at the end of the quarter.

Here are the key numbers:

• Earnings per share: $0.56 vs. $0.43 expected by analysts, according to Refinitiv.
• Revenue: $2.10 billion vs. $2.11 billion expected by analysts, according to Refinitiv.

Airbnb, like Uber, benefited from an increase in consumer spending on activities as opposed to goods. Revenue jumped 58% year-over-year to $2.1 billion helping to drive the company’s most profitable second quarter to date. Still, that growth was slower than it was last quarter when revenue surged 70% over the first quarter of 2020.

Airbnb reported net income of $379 million, up from a loss of $68 million in the year-ago quarter.

The company said it tightened spending at the height of the pandemic, which helped make it leaner and more focused, and that it’s adapted its business as travel continues to change. But it wasn’t entirely immune from a surge in canceled flights.

“We did see some elevated cancellations in the back of the quarter relative to our forecast,” Airbnb CFO Dave Stephenson said on a call with investors. “We believe that some of the elevated cancellations were related to flight cancellations around the world, but it was mostly in North America towards the end of Q2 2022”

Airbnb anticipates record revenue during the third quarter despite headwinds from foreign exchange fluctuations, specifically the weakening euro versus the dollar. It guided third quarter revenue to land between $2.78 billion and $2.88 billion, ahead of StreetAccount’s $2.77 billion estimate. The company said it broke a single-day revenue record on July 4, which it says signals a strong summer season ahead.

Airbnb’s free cash flow declined quarter over quarter, which could be one reason shares are in the red.

CEO Brian Chesky addressed that concern with CNBC’s Jim Cramer on “Mad Money.”

“Free cash flow was $795 million, and we had adjusted EBITDA of $711 million.. if you exclude FX, that’s $764 million. So what we’re actually seeing is some metronomic improvements in our free cash flow year over year and I expect that the coming quarter is going to be extremely strong for us.”

For the second quarter, Airbnb reported more than 103 million nights and experiences booked. It’s the company’s largest quarterly number ever, but fell short StreetAccount estimates of 106.4 million nights and experiences booked. 

Gross booking value, which Airbnb uses to track host earnings, service fees, cleaning fees and taxes, totaled $17 billion in the second quarter, up 27%…