
Airbnb stock price is falling, and it could get worse soon
- Airbnb share price has crashed by over 32% from its highest point this year.
- The company is facing substantial headwinds as travel growth slows.
- The stock has also formed a death cross chart pattern.
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Airbnb (ABNB) stock price has moved to a deep bear market, falling by over 32% from the highest point this year. It retreated to $115.45 and is hovering near its lowest point this year as concerns about its business strategy continue.
Good company facing headwinds
Copy link to sectionAirbnb, one of the best-known companies in the travel industry, is facing substantial challnges this year.
The first big challenge is based on the macro environment, where spending has slowed down dramatically.
The travel industry, in particular, has been hit hard as the concept of revenge travel fades. This view has been seen in the recent financial results by companies like Expedia, Booking, and airlines like Ryanair and Delta.
The other big headwind is that Airbnb is seeing strong competition and is slowly losing market share. While it maintains a leading share of the vacation rental business, the company is now competing with other names in the sector like Booking, Expedia, and TripAdvisor.
As part of their growth strategies, these firms have made it possible for people to book vacation rentals in their platforms. Expedia has also launched companies like Vrbo and HomeAway that offer the same services.
Altogether, rising competition and low customer spending has had a big impact on Airbnb and related companies. As shown below, stocks like Airbnb, Booking, Expedia, and TripAdvisor have underperformed the S&P 500 index this year.

Airbnb’s disappointing financials
Copy link to sectionFrom a distance, Airbnb’s business seems to be doing well. Its annual revenue has surged from $3 billion in 2020 to over $8 billion in 2023. It has also become a more profitable company.
However, a closer look at its financials shows that its momentum has ended and that its management is looking for new areas to find growth.
A good example of this is in the last financial results, which I previewed here. These results showed that its revenues rose by 11% in the last quarter to over to $2.7 billion. While an annualised growth rate is not bad, it is slightly above the S&P 500 index average of 10%. For a long time, the company was growing by more than 20%
Airbnb’s profits also retreated, with the net income falling to $555 million from the $650 million it made in the same quarter in 2023. It made over $4.7 billion in the third quarter of last year.
Other numbers also showed that the company is not growing as fast. Its gross booking volume rose by 11% to $21.1 billion while the number of nights and experiences rose by just 9%.
Beneath the surface, the numbers also showed that the company’s business was not doing well. The most important figure was that the growth of short-term stays and entire homes was faster than long-term stays and rooms. This means that consumers are no longer spending as they used to in the past.
Analysts are not optimistic about Airbnb’s prospects, with Goldman Sachs maintaining its sell recommendation on the stock. The average revenue guidance for third quarter is $3.72 billion, reflecting a growth rate of just 5.60%.
For the year, they expect that its revenue will come in at $11 billion, a 19% increase from the $9.2 billion.
Major challenges remain
Copy link to sectionTo be clear: Airbnb is still growing while maintaining a market share in the industry. However, its business is not doing as it used to before and I doubt whether the management’s strategies to boost growth will work out.
As part of the growth strategy, the management wants to relaunch the experiences business, which it paused earlier this year.
Experiences is a service that lets users book local activities like guided tours, photography, and cooking. For example, if an American is visiting Tokyo, he could book a local guide to show them around.
To a large extent, this business makes sense. However, since it failed before, there are chances that it will not work out again.
The company also wants to offer a co-hosting marketplace. Ideally, if you have a home and no time to rent, you can use another person who does not have a home. It also plans to launch new services each year going forward, using Apple’s business model.
Airbnb stock price analysis
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The daily chart shows that the ABNB stock price has crashed hard in the past few months. Most recently, it dropped below the key support level at $141, its lowest swing on May 23rd. It has also formed a death cross pattern as the 50-day and 200EMA have crossed each other.
The stock has also moved to the 61.8% Fibonacci Retracement level. Most notably, it has formed a bearish flag pattern, which is a popular negative sign. Therefore, the stock will likely continue falling, as sellers target the next key support at $100, which is at the 78.6% retracement point and 12% below the current level.
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