The archive · Consumer Apps · Financial decision · 2017–2019
Airbnb posts a second straight EBITDA-profitable year as it prepares to go public
The home-sharing giant says 2018 was its second straight EBITDA-profitable year, with Q3 revenue above $1B, ahead of a 2019 IPO.
Airbnb
What the business is
Airbnb runs a global home-sharing marketplace where hosts rent rooms and homes to travelers and Airbnb earns a cut of each booking; by January 2019 TechCrunch called it "the home-sharing giant" preparing for an IPO.
How it started
Airbnb had become the "home-sharing giant" of travel — a marketplace where hosts rent out rooms and homes and Airbnb takes a cut — and by 2019 the public markets were the expected next act. The runway to an IPO ran through a management reset: CFO Laurence Tosi left in early 2018 amid reported tension between him and CEO Brian Chesky, and in November 2018 Airbnb hired Dave Stephenson, a long-time Amazon executive, to lead the company into its public phase.
What happened
The financial picture Airbnb took into the IPO process was unusual for a consumer marketplace at that scale: the company said it was profitable on an EBITDA basis for the second year in a row in 2018, and Q3 2018 was its strongest quarter ever, with "substantially more" than $1 billion in revenue. Airbnb expected to pass 500 million cumulative arrivals by the end of Q1 2019, and a June 2018 memo it had sent staff — cited by TechCrunch — set the goal of being "ready" to go public from June 30, 2019, with a cash bonus program for employees. The press memo announcing Stephenson said he would use his experience growing large businesses quickly at scale "to ensure we are investing for both growth and long-term profitability."
No ending yet — it is still running.
Background
Airbnb is a home-sharing marketplace where hosts rent out rooms and homes to travelers and Airbnb earns a cut of every booking. By January 2019 TechCrunch described it as "the home-sharing giant," with the public markets its expected next step.
The numbers framed the IPO story: Airbnb said it was profitable on an EBITDA basis for the second year in a row in 2018, and Q3 2018 was its strongest quarter ever, with "substantially more" than $1 billion in revenue.
The management arc mattered as much as the numbers: CFO Laurence Tosi had left in early 2018 amid reported tension with CEO Brian Chesky, and in November 2018 Airbnb hired Dave Stephenson, a long-time Amazon executive, saying he would balance growth with long-term profitability as the company prepared to list.
Airbnb expected 500 million cumulative arrivals by the end of Q1 2019, and its own June 2018 memo set the goal of being "ready" to go public from June 30, 2019, with a staff cash bonus program tied to the milestone.
What has to be true
- The disclosure reversed the usual script: Airbnb claimed a second straight EBITDA-profitable year while still promising growth — 500 million arrivals by Q1 2019 — not losses until some future scale.
- Profitability came before the IPO, not after it: the company aimed to be "ready" to go public from June 30, 2019, so an offering could be priced against a working model rather than a promise.
- The metric mattered: EBITDA excludes interest, taxes, depreciation and amortization, and TechCrunch reported the claim as Airbnb's own — a reminder of what "profitable" meant pre-IPO.
- The CFO succession was part of the bet: Tosi's exit amid reported tension with Chesky and the hire of Amazon's Stephenson signaled a turn toward public-market discipline while claiming growth.
What can be applied
Claiming growth and profit at once only works if the market believes the mechanism; a dated IPO-readiness goal made Airbnb's profitability claim something investors could check, not just cheer.
Aftermath
As of 2019-01-15 Airbnb had announced milestones but not an IPO date or filing: it expected 500 million cumulative arrivals by the end of Q1 2019, had posted a second straight year of EBITDA profitability, and — per the June 2018 memo TechCrunch cited — wanted to be "ready" to go public from June 30, 2019, with a cash bonus program for staff. The public-markets push was being led by new CFO Dave Stephenson, hired from Amazon in November 2018.
Sources
- Ahead of IPO, Airbnb achieves profitability for second year in a row
- Ahead of IPO, Airbnb achieves profitability for second year in a row
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