Airbnb and DoorDash log losses as they ride out pandemic

In their first financial results as publicly traded companies, Airbnb and DoorDash logged losses as pandemic circumstances battered their business models. — AP

Airbnb and DoorDash on Thursday reported their first financial results as publicly traded companies, each of the tech industry darlings logging losses as they ride out the pandemic.

Home-sharing platform Airbnb lost less money than expected by financial analysts, and was optimistic the travel industry was showing signs of recovery after being crushed by the spread of Covid-19.

Restaurant meal delivery service DoorDash, though, saw trouble ahead, as a growing number of jurisdictions limit the commissions and fees it can charge while dining in restaurants is still not an option.

DoorDash estimated that such price controls cut its revenue and profit by US$36mil (RMM145.82mil) in the final quarter of last year, and could cost it twice as much in the current quarter.

"To date, all of the price controls we operate under are temporary and specifically tied to emergency status or dine-in rates," DoorDash said in an earnings letter. "In order to offset some of this pressure, we have begun implementing incremental consumer fees in many markets with price controls."

DoorDash shares sank more than 12% in after-market trades that followed the release of its earnings figures. But the service said it gained market share in the US and set new records for orders in the quarter.

Revenue soared to US$970mil (RM3.92bil), some 226% higher than the same quarter a year earlier before the pandemic disrupted lifestyles. However, DoorDash's reported loss more than doubled to $312mil (RM1.3bil) in a similar comparison.

DoorDash rivals include UberEats, and the surge in demand for restaurant or grocery delivery service is likely to ebb as pandemic-related restrictions on movement ease.

Focused on 'travel rebound'

Airbnb, on the other hand, expects its business to revive as people feel more confident traveling.

"Our performance in 2020 showed that Airbnb is resilient and inherently adaptable," Airbnb chief executive Brian Chesky said in an earnings release. "Travel is coming back and we are laser-focused on preparing for the travel rebound."

Airbnb said revenue last year did not plunge as deeply as the company had expected due to the pandemic, and said that its revenue in the final quarter of last year declined "only" 22% to US$859mil (RM3.39bil).

The platform reported a loss of US$3.9bil (RM15.80bil) in the quarter, but it was less than financial analysts had predicted. A chunk of that loss was attributed to costs associated with its stock market debut during the quarter.

"As the vaccine is rolled out and restrictions lift, we expect there will be a significant travel rebound," Airbnb said in a letter to investors. "Our single priority in 2021 is to prepare for this."

Airbnb shares were up slightly in after-market trades.

"The results today beat expectations and speak to the resilience of the vacation rentals category through the pandemic, and add to expectations that whole home rentals will power any broader lodgings recovery in 2021," Third Bridge senior analyst Dan Thomas said of Airbnb.

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