Airbnb Q4 2022 and full-year financial results
We issued our fourth quarter and full-year 2022 financial results. You can read the details here. Airbnb Co-Founder and CEO Brian Chesky said:
“2022 was another incredible year for Airbnb. We made almost 100 upgrades to our core service, saw record guest demand, and ended the year with our highest-ever number of active listings globally.”
Overview of Q4 and full-year results
2022 was another record year for Airbnb. Revenue of $8.4 billion grew 40 percent year over year (46% ex-FX). Net income was $1.9 billion—making 2022 our first profitable full year on a GAAP basis. Adjusted EBITDA was $2.9 billion while Free Cash Flow was $3.4 billion, growing 49 percent year over year.
Guest demand remained strong throughout 2022. All regions saw significant growth in 2022 as guests increasingly crossed borders and returned to cities on Airbnb.
Supply growth was also strong in 2022. We ended the year with 6.6 million global active listings, which is over 900,000 more listings than we had in the beginning of the year, excluding China. This growth was driven by our global network, where demand drives supply, as well as product innovations that continue to attract new Hosts.
Looking forward to 2023, we’re seeing strong demand in Q1, indicating that consumer confidence to travel remains high. This year, we’re focusing on three strategic priorities:
- Make hosting mainstream. If you’re reading this letter, you have likely traveled on Airbnb or know someone who has. We want hosting on Airbnb to be just as popular. To achieve this, we will continue to raise awareness around hosting, make it easier to get started, and provide even better tools for Hosts.
- Perfect the core service. We want people to love our service, and that means obsessing over every detail. Based on feedback from our guests and Hosts, we’re making a large number of upgrades to our service this year—improving community support, making it easier to find the right home for you, delivering greater value and much more.
- Expand beyond the core. We have some big ideas for where to take Airbnb next, and this year we will build the foundation for future products and services that will provide incremental growth for years to come.
As we continue to innovate and grow, we’re excited to share this journey with you.
Q4 and full-year 2022 financial results
Here is a snapshot of our Q4 and Full-Year 2022 results:
- Q4 revenue of $1.9 billion was our highest fourth quarter ever. Revenue grew 24% year-over-year (31% ex-FX) driven by solid growth in Nights and Experiences Booked. For the full year 2022, revenue increased 40% year-over-year (46% ex-FX) to $8.4 billion driven by the increase in demand and Average Daily Rates (“ADR”).
- Q4 net income of $319 million was our most profitable fourth quarter ever. Net income improved by $264 million compared to Q4 2021 primarily due to our revenue growth and expense discipline. In Q4 2022, we delivered a net income margin of 17%, up from 4% in Q4 2021. For the full year 2022, we generated $1.9 billion of net income—our first profitable full year. This compared to a net loss of $352 million for the full year 2021.
- Q4 Adjusted EBITDA of $506 million was a record fourth quarter. Adjusted EBITDA in Q4 2022 increased 52% compared to $333 million in Q4 2021. Adjusted EBITDA margin was 27% for Q4 2022, up from 22% in Q4 2021. For the full year 2022, Adjusted EBITDA margin was 35%, compared with 27% for full year 2021. This improvement in Adjusted EBITDA demonstrates the continued strength of our business and discipline in managing our cost structure1.
- Q4 Free Cash Flow of $455 million was our highest Q4 ever. Q4 2022 net cash provided by operating activities was $463 million, up from $382 million in Q4 2021. The increase in cash flow was driven by revenue growth and net margin expansion. Our FCF for full year 2022 was $3.4 billion, representing a FCF margin of 41%, and year-over-year growth of 49%2. With our Free Cash Flow, we repurchased $1.5 billion of our stock and reduced our fully diluted share count from 703 million at the end of 2021 to 694 million at the end of 2022.
Our strong quarter was driven by the continuation of a number of positive business trends:
- Guest demand on Airbnb remained strong. Nights and Experiences Booked increased 20% in Q4 2022 compared to a year ago. In Q4 2022, we had our highest number of active bookers yet, demonstrating guests’ excitement to travel on Airbnb despite evolving macroeconomic uncertainties. Globally, we’ve now had 1.4 billion cumulative guest arrivals. And heading into 2023, we see a strong backlog for Q1 with longer lead times for bookings in Q4 2022 compared to a year ago.
- Guests increasingly returned to cities and crossed borders. Cross-border gross nights booked increased 49%, while high-density urban nights booked grew 22% compared to Q4 2021. While the business mix remains different from pre-pandemic levels, we’ve seen consistent growth in both areas. In Q4 2022, high-density urban nights booked was 51% of total gross nights booked (versus 59% in Q4 2019) and cross-border was 44% (versus 47% in Q4 2019). Globally, we saw cross-border travel to all regions increase in Q4 2022 from last year despite continued foreign currency volatility. While Asia Pacific, which has historically been reliant on cross-border travel, has yet to return to 2019 levels, we see China’s recent removal of travel restrictions as an encouraging sign of continued recovery for the region.
- Guests continued to stay longer on Airbnb. Gross nights booked in Q4 2022 for more than a week are 40% higher than Q4 2019. Nights from long-term stays (28 nights or longer) remained stable from a year ago at 21% of total gross nights booked. We’ve seen guests across all regions and age groups use Airbnb for long-term stays.
- Supply on Airbnb grew by over 900,000 active listings. We ended 2022 with 6.6 million active listings—our highest yet. This was an increase of over 900,000 active listings, or 16% compared to 2021, excluding the removal of all mainland China listings in July 2022 based on our decision to close the domestic business in China. Two factors drove this increase in supply. First, demand drives supply. Hosts are attracted to the supplemental income they can earn on Airbnb, which is often critical during times of inflation and recessionary concerns. Second, our product innovation is having an impact. Over the past two years, we’ve made it more attractive and easier to Host—including our most recent introduction of Airbnb Setup. And we’re not stopping there. We will continuously invest in growing our Host community and helping them succeed.