MW Airbnb is wading deeper into politics. It could weigh on profits.

By Bill Peters

Company says travel demand has picked up but warns one profit metric would face pressure from 'investments in new growth and policy initiatives'

Airbnb, led by CEO Brian Chesky, is making a bigger push into services and events while facing steeper competition from hotels.

Vacation platform Airbnb Inc. on Wednesday said travel demand picked up this summer, but it warned of a higher bar for growth and lower profits ahead as it spends on new amenities and efforts toward company-friendly regulations in areas that have clamped down on rentals.

Shares of Airbnb $(ABNB)$ were up around 1.2% after hours.

The company, in its second-quarter earnings release, said it was "encouraged" by travel-demand trends for the third quarter. But following last year's Summer Olympics in Paris and a rebound late last year following the U.S. presidential election, executives said they expected tougher comparisons toward the end of the period.

"This dynamic will continue into [the fourth quarter], putting pressure on growth rates later in the year," the company said.

Airbnb said it expects third-quarter revenue of $4.02 billion to $4.1 billion. Analysts polled by FactSet expected around $4.05 billion. The company also said it expects that adjusted Ebitda margins - one of its preferred profit metrics - "will be lower than in [the third quarter of] 2024, primarily due to investments in new growth and policy initiatives."

Airbnb stood firm on its prior outlook for full-year adjusted Ebitda margin of at least 34.5%. Ebitda stands for earnings before interest, taxes, depreciation and amortization.

That assessment from Airbnb arrived following an overhaul of its app this year and a bigger push into services and an array of events, including hangouts with celebrities and tours led by locals.

But the comfort levels of already stretched consumers have fluctuated with the U.S. trade wars. Travel demand has been wobbly. Competition from hotels is steeper, and some analysts said it could take time for the bottom-line benefits to emerge from Airbnb's expansion.

Moreover, Airbnb has faced restrictions from some cities and towns that say its rentals take up available housing. It is planning a bigger push into state and local politics and backing potential candidates.

Airbnb said its second-quarter revenue was $3.1 billion, a 13% year-over-year gain, helped by growth in nights booked. The figure topped analysts' expectations for $3.03 billion. The company earned $1.03 a share during the quarter, above analyst forecasts for 94 cents.

"Despite global economic uncertainty early in the quarter, travel demand picked up, and nights booked on Airbnb accelerated from April to July," the company said in its release.

Shares of Airbnb are down around 0.8% so far this year, while the S&P 500 SPX is up around 8%.

-Bill Peters

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August 06, 2025 16:27 ET (20:27 GMT)

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