Airbnb's Q4 Earnings Forecasts Show Mixed Results Ahead

Airbnb's upcoming Q4 earnings report raises mixed expectations. Analysts predict a profit drop and future recovery, alongside cautious investor sentiment due to past performance. This outlook could impact stock trading strategies.

Date: 18-01-2025

AI Rating: 5

Earnings Per Share (EPS)
Analysts have projected that Airbnb will report a profit of $0.58 per share for Q4, which represents a 23.7% decline from the $0.76 per share reported in the same quarter last year. Although there is an expectation for EPS to rebound in fiscal 2025 with an anticipated 10.1% growth to $4.38, the drop in the upcoming quarter and a projected EPS of $3.98 for fiscal 2024, down 9.1% from $4.38 in fiscal 2023, signals a concerning trend for investors.

Stock Performance
Over the past year, shares of Airbnb have seen a decline of 2.1%, which is starkly contrasted by the significant 24.6% increase in the S&P 500 Index and nearly 32% return from the Consumer Discretionary Select Sector SPDR Fund over the same period. The mixed performance showcases Airbnb's struggle within the broader market context.

Market Reactions
The stock experienced a notable drop of 8.7% following the Q3 earnings report, which, despite beating revenue estimates at $3.7 billion, fell short on profit expectations at $2.13 per share. The increase in expenses, particularly for marketing efforts in international markets, further complicates the company's financial standing and discourages investor confidence.

Analysts' Consensus
Currently, the consensus among analysts is cautious, with a substantial majority maintaining a 'Hold' rating on the stock. This sentiment, coupled with the trading price being below the average analyst price target of $139.16, suggests potential instability or lack of conviction in the stock's future performance.
Overall, the factors mentioned indicate mixed signals that could lead to fluctuations in Airbnb's stock price, influenced mainly by further earnings results and economic conditions.

Stocks: ABNB