Airbnb, Inc.: Category Creator and Leader, Driving Substitution Effect in Lodging Abnb

4 January 2021
Equity Research
Americas | United States
Airbnb, Inc. ABNB

Category Creator and Leader, Driving
Substitution Effect in Lodging Target price (12M, US$)
156.00
Consumer Internet | Initiation Neutral[V]
We initiate coverage of Airbnb, Inc. (ABNB) with a Neutral rating and a $156 target price. Price (31 Dec 20, US$) 146.80
52-week price range 163.19 - 124.80
Beneficiary of ongoing substitution effect away from hotels: Over the past decade,
Enterprise value (US$ m) 83,983
alternative accommodations as a share of total lodging have increased from ~6% to ~11%
[V] = Stock Considered Volatile (see Disclosure Appendix)
dollar share. This represents in our view an ongoing shift in consumer preference away
from traditional to alternative lodging. We expect this substitution effect to accelerate
further due to pandemic-driven changes in behavior, with incremental consumers likely Research Analysts
trying the category for the first time and choosing to stick after a positive experience. Stephen Ju
Category leader on top of secular growth in online travel: Airbnb’s offering launched 212 325 8662
stephen.ju@credit-suisse.com
~5 years before Booking.com and ~7 years before HomeAway/Vrbo’s transition from the
traditional subscription/classifieds revenue model to real time bookings. In 2019, Gross Francoise Yoshida-Are
Bookings were ~2x the size of Booking.com’s alternative accommodations business and 212 325 4347
~3x the size of Expedia’s Vrbo – making it the category leader. francoise.yoshidaare@credit-suisse.com
Optionality from rising monetization: Currently, Airbnb charges the guest 12% and Yoni Yadgaran
individual hosts 3% versus traditional operators levying the entirety of the fees on the 212 325 6206
property owner. We therefore see ample opportunity for the company to increase yoni.yadgaran@credit-suisse.com
monetization in the long term from: 1) payment processing fees – Airbnb as the merchant Tyler Seidman
of record in the transaction bears the payment processing charges, which it can pass on to 212 325 3604
the hosts, and 2) sponsored listings – optionality to launch an advertising tool for hosts, tyler.seidman@credit-suisse.com
similar to Amazon, eBay, and other marketplaces.
Valuation: In-line with the methodology we use to value our US Internet coverage universe,
our $156 target price for ABNB shares is based on DCF that assumes a WACC of 10.5%
and a terminal growth rate of 3%. Risks include competition, macroeconomic uncertainty,
slower-than-expected consumer adoption of alternative accommodations, potential
reacceleration in core short-term stays, and faster-than-expected rollout of ancillary
revenue streams and ensuing rise in profitability.
Share price performance
Financial and valuation metrics

Year 12/19A 12/20E 12/21E 12/22E
EPS (CS adj.) (US$) -0.84 -2.10 -0.43 0.34
Prev. EPS (US$) - - - -
Revenue (US$ m) 4,805.2 3,249.6 4,462.7 6,112.6
EBITDA (US$ m) -253.3 -364.1 -6.6 623.3
P/OCF (x) -43.7 -170.5 143.9
EV/EBITDA (current) -337.7 -234.9 -12,951.0 137.2
Net debt (US$ m) -3,074 -4,262 -3,722 -4,505 On 31-Dec-2020 the S&P 500 INDEX closed at 3742.49Daily
ROIC (%) 109.91 75.49 42.73 -57.25 Dec10, 2020 - Dec31, 2020, 12/10/20 = US$144.71
Number of shares (m) 601.12 IC (current, US$ m) -650.57
Net debt (Next Qtr., US$ m) -4,262.3 Dividend (current, US$) - Quarterly EPS Q1 Q2 Q3 Q4
Net debt/tot eq (Next Qtr.,%) -115.7 2019A -0.74 -0.12 0.87 -0.99
2020E -1.20 -1.45 0.22 -0.53
Source: Company data, Refinitiv, Credit Suisse estimates 2021E -0.68 -0.37 0.42 0.14
DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS,
LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-US ANALYSTS. US Disclosure: Credit Suisse does and seeks to do business
with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could
affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.
student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

4 January 2021
Airbnb, Inc. (ABNB) Analyst: Stephen Ju

Price (31 Dec 2020): US$146.8 Target Price: 156.00 Rating: Neutral
Income Statement 12/19A 12/20E 12/21E 12/22E
Company Background
Revenue (US$ m) 4,805.2 3,249.6 4,462.7 6,112.6
EBITDA (US$ m) (253) (364) (7) 623 Airbnb Inc. is a global travel marketplace that connects Guests with Hosts
Depr. & amort. (114) (122) (108) (112)
EBIT (US$) (367) (486) (114) 512 who offer stays and experiences on the platform.
Net interest exp 76 (141) (224) (221)
PBT (US$) (278) (745) (342) 291 Blue/Grey Sky Scenario
Income taxes (263) 75 (59) (70)
Minorities - - - -
Net profit (US$) (219) (588) (270) 230
Reported net income (US$) (674) (3,916) (1,227) (590)
Other NPAT adjustments (455) (3,328) (957) (820)
Adjusted net income (219) (588) (270) 230
Cash Flow 12/19A 12/20E 12/21E 12/22E
EBIT (367) (486) (114) 512
Net interest 76 (141) (224) (221)
Change in working capital - - - -
Cash flow from operations 223 (1,065) (560) 692
CAPEX (125) (34) (77) (80)
Free cashflow to the firm 97 (1,099) (637) 612
Acquisitions (192) 0 0 0
Divestments - - - -
Cash flow from investments (347) (820) (77) (80)
Net share issue(/repurchase) 6 2,126 135 210
Dividends paid 0 0 0 0
Changes in Net Cash/Debt (255) 1,188 (541) 783
Balance Sheet (US$) 12/19A 12/20E 12/21E 12/22E
Assets
Cash & cash equivalents 3,074 6,091 5,578 6,389
Account receivables 3,145 1,342 765 1,313
Other current assets 342 240 301 368
Total current assets 6,561 7,672 6,644 8,071 Our Blue Sky Scenario (US$) 200.00
Total fixed assets 687 599 599 588
Investment securities - - - - Given the lack of trading history for ABNB, we have decided to use
Total assets 8,310 9,164 8,105 9,500 EV/Bookings multiples as a proxy across its online marketplaces peers.
Liabilities Given we are thinking through where the additional upside potential and
Total current liabilities 5,234 3,081 2,269 3,217 downside risk will be, we are using 2022 multiples on our 2022
Total liabilities 5,886 5,481 4,697 5,674
estimates. For the Blue Sky scenario, we use 2.95x EV/Bookings
Total liabilities and equity 8,310 9,164 8,105 9,500
Net debt (3,074) (4,262) (3,722) (4,505) multiple, at the high end of Airbnb's high-growth comparables to arrive at
Per share 12/19A 12/20E 12/21E 12/22E $200 per share.
No. of shares (wtd avg) 299 317 651 678
CS adj. EPS (0.84) (2.10) (0.43) 0.34 Our Grey Sky Scenario (US$) 104.00
Prev. EPS (US$)
Dividend (US$) 0.00 0.00 0.00 0.00 For the Grey Sky scenario, we use 1.50x, in-line with ABNB's online
Free cash flow per share 0.32 (3.47) (0.98) 0.90
travel and e-commerce marketplace comparables, to arrive at $104 per
Earnings 12/19A 12/20E 12/21E 12/22E
Sales growth (%) 31.6 (32.4) 37.3 37.0 share.
EBIT growth (%) (516.5) (32.2) 76.5 548.2
Net profit growth (%) (338.2) (168.3) 54.1 185.0 Share price performance
EPS growth (%) (370.5) (149.3) 79.3 178.0
EBITDA margin (%) (5.3) (11.2) (0.1) 10.2
EBIT margin (%) (7.6) (14.9) (2.6) 8.4
Pretax margin (%) (5.8) (22.9) (7.7) 4.8
Net margin (%) (4.6) (18.1) (6.1) 3.8
Valuation 12/19A 12/20E 12/21E 12/22E
EV/Sales (x) 17.72 25.84 18.94 13.70
P/E (x) (174.4) (70.0) (338.2) 433.5
Price to book (x) (47.6) 90.5 508.3 160.1
Asset turnover 0.6 0.4 0.6 0.6
Returns 12/19A 12/20E 12/21E 12/22E
ROE stated-return on (%) 102.7 2248.0 (386.9) (151.8)
ROIC (%) 109.9 75.5 42.7 (57.2)
Gearing 12/19A 12/20E 12/21E 12/22E
On 31-Dec-2020 the S&P 500 INDEX closed at 3742.49
Net debt/equity (%) (126.8) (115.7) (109.2) (117.7)
Daily Dec10, 2020 - Dec31, 2020, 12/10/20 = US$144.71
Interest coverage ratio (X) 4.8 (3.4) (0.5) 2.3
Quarterly EPS Q1 Q2 Q3 Q4
2019A -0.74 -0.12 0.87 -0.99
2020E -1.20 -1.45 0.22 -0.53
2021E -0.68 -0.37 0.42 0.14
Source: Company data, Refinitiv, Credit Suisse estimates
Airbnb, Inc. 2

4 January 2021
Investment Case: Category Creator and Leader, Driving

Substitution Effect in Traditional Lodging
We initiate coverage of Airbnb, Inc. with a Neutral rating and a $156 target price. Only valuation
holds us back from a more constructive view, as ABNB shares have more than doubled since
the IPO.
With that in mind, we believe the investment rationale for ABNB should boil down to the
following three key points:
Key Beneficiary of the Substitution Effect from Traditional Hotels to Alternative
Accommodations
Over the past decade, alternative accommodations as a share of total lodging (on a dollar basis)
have increased from ~6% to ~11% per Euromonitor, with the segment growing at a ~9%
CAGR versus the ~4% of the broader market (over the same time period 2009-2019). This
represents an ongoing shift in consumer preference away from traditional lodging/hotels to the
alternative accommodations category. We expect the substitution effect to accelerate further
owing to a pandemic-driven change in behavior, with consumers trying alternative
accommodations for the first time and choosing to stick with the experience. As such, we see
Airbnb as a pure-play into this secular thesis.
Category Winner on Top of Secular Growth in Online Travel
Airbnb in 2007 launched the idea of home sharing as a new category in alternative
accommodations, with the official launch of operations in 2008. The offering launched ~5 years
before Booking.com first began adding alternative accommodations and ~7 years before
HomeAway/Vrbo’s transition from the traditional subscription/classifieds revenue model to real
time bookings, which continued after the Expedia acquisition. By our calculations based on
company disclosure for 2019, Airbnb’s Gross Bookings were ~2x the size of Booking.com’s
alternative accommodations business and ~3x the size of Expedia’s Vrbo – making it the
category leader.
Optionality from Rising Monetization through Payments and Advertising
Currently, Airbnb charges the guest 12% and individual hosts 3% versus Booking.com levying
the entirety of the fees of ~15% to the property owner/manager. As marketplace businesses
typically generate revenue from businesses versus the consumer, we see a long-term
opportunity for the company to increase monetization in two directions at high incremental
margins: 1) Airbnb as the merchant of record in the transaction currently bears the payment
processing charges, which it can pass on to hosts, and 2) optionality to launch an
advertising/promotional tool for hosts, similar to Amazon, eBay, and other marketplaces.
Airbnb, Inc. 3

4 January 2021
Industry Overview and Thinking through the Total

Addressable Market
To contextualize Airbnb’s opportunity, total travel expenditures (defined as total revenue
generated internally within each country by industries that deal directly with tourists) were $6.3
trillion or ~7% of global Gross Domestic Product representing $819 per capita in 2019 per our
analysis of data from the World Travel & Tourism Council for 200+ countries.
Figure 1: Airbnb, Inc. – Global Internal Travel Expenditures and as a Percentage of

GDP (2006 – 2019)
US$ in billions, unless otherwise stated
7000 7%
7% 7%
6000
7%
5000 7% 7%
7%
7% 7% 7%
4000 7% 7%
6%
6% 6% 6%
3000 6% 6%
6% 6%
6% 6%
2000
6%
1000
6%
3403 3794 4069 3720 3984 4589 4717 4947 5138 4899 5039 5416 5892 6279
0 5%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Source: WTTC, World Bank, Credit Suisse
Within this overall travel-related spend, the total travel and experiences market (defined as the
aggregate of accommodations, air, car rental, other transportation, and experiences/attractions
markets) was $2.3 trillion in 2019 or ~3% of GDP representing $306 per capita.
Diving deeper into industry levels of spend, aggregate offline and online global accommodations
spend amounts to ~$809 billion as of 2019, of which ~48% is now online.
Figure 2: Airbnb, Inc. – Global Travel and Experiences Spend Figure 3: Airbnb, Inc. – Global Accommodation Spend and
by Category (2006 – 2019) Online Penetration (2006 – 2019)
US$ in billions, unless otherwise stated US$ in billions, unless otherwise stated
3000 900 60%
800
2500 2349 50%
2287
700 48%
2088 2136
2023 2020 45%
2001
1881 1938 42%
2000
600 40% 40%
1709 1704
1610 1567 37%
1453 500 33%
1500
30% 30%
400 28%
25%
1000 24%
22%
300 19% 20%
18%
500 15%
200
10%
100
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
528 584 617 554 591 636 649 678 702 678 689 729 784 809
0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Accommodations Air Car Rental Other Transport Experiences and Attractions
Source: Euromonitor Source: Euromonitor
Short-term rentals (also offline and online) were ~$91 billion or ~11% of total accommodations
spend, of which ~71% was online in 2019 – according to data from Euromonitor.
Airbnb, Inc. 4

4 January 2021
Figure 4: Airbnb, Inc. – Global Short-Term Rental Spend and As Figure 5: Airbnb, Inc. – Global Online Short-Term Rental Spend
a Percentage of Total Accommodations (2006 – 2019) and Online Penetration (2006 – 2019)
100 12% 70 80%
11%
90 11% 71%
70% 70%
60
10% 10% 66%
80
9% 60% 60%
70 50
8% 8% 54%
49% 50%
60 7%
7% 7% 40
7% 7% 7% 6% 7% 7%
42%
50 6% 40%
30 35%
40
30%
4% 28%
30 20 24%
21% 20%
20 17%
15% 16%
2%
10 10%
10
35 39 41 37 38 42 43 47 51 55 62 73 83 91 5 6 7 8 9 12 15 20 25 29 37 48 58 65
0 0% 0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
As regional travel dynamics as well as online penetration levels differ, we present below the split
between North America, EMEA, Asia Pacific, and Latin America.
Figure 6: Airbnb, Inc. – North America Internal Travel Figure 7: Airbnb, Inc. – North America Total Travel and
Expenditures and As a Percentage of GDP (2006 – 2019) Experiences Spend by Category (2006 – 2019)
US$ in billions, unless otherwise stated In millions, unless otherwise stated
1400 6% 700
632
5% 602
5% 5%
1200 5% 600 566
542
5% 515 527
495
500 478
1000 5% 462
5% 5% 5% 5% 435 439
425
5% 409
386
5% 5% 5% 5% 400
800 5%
5%
300
600
5%
5% 200
5% 5%
400
100
5%
200
5% 0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
821 858 871 762 806 901 938 970 1009 1004 1032 1080 1136 1189
0 5%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Source: WTTC, World Bank, Credit Suisse Source: Euromonitor
Figure 8: Airbnb, Inc. – North America Accommodations Spend Figure 9: Airbnb, Inc. – North America Short-Term Rental
and Online Penetration (2006 – 2019) Spend and As a Percentage of Accommodations (2006 – 2019)
250 60% 45 20%
40 18%
18%
17%
49% 50% 17%
200 47% 16% 16%
35
45% 15%
44%
43% 14% 14% 14%
41% 13% 13% 14%
39% 40% 30 13% 13% 13%
13%
150 37% 37% 12%
36% 35%
33% 25
31%
29% 30% 10%
20
100 8%
20% 15
6%
10
50 4%
10%
5 2%
136 147 149 127 140 146 154 161 169 178 187 195 206 217 18 19 20 18 19 20 21 22 24 27 29 32 35 38
0 0% 0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Airbnb, Inc. 5

4 January 2021
North America internal travel expenditures reached $1.2 trillion in 2019 representing ~5% of
GDP. The accommodations market in total is ~$217 billion, with online accounting for ~49% of
the total. Short-term rentals represent ~18% of the total.
Figure 10: Airbnb, Inc. – EMEA Internal Travel Expenditures and Figure 11: Airbnb, Inc. – EMEA Total Travel and Experiences
As a Percentage of GDP (2006 – 2019) Spend by Category (2006 – 2019)
2500 8% 800
704 714
8% 8% 685 695
700 676
660 650
630 644
613 615 616 612
2000 8%
600
551
8% 8%
500
7%
1500 7% 7%
7% 7%
7% 400
7%
7% 7% 7%
300
1000 7% 7%
7% 7% 7%
7% 200
500 7% 100
6% 0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
1545 1767 1908 1691 1709 1911 1880 1974 2036 1804 1808 1937 2116 2225
0 6%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Figure 12: Airbnb, Inc. – EMEA Accommodations Spend and Figure 13: Airbnb, Inc. – EMEA Short-Term Rental Spend and
Online Penetration (2006 – 2019) As a Percentage of Accommodations (2006 – 2019)
350 60% 35 12%
11%
300 30 10%
50% 10% 10%
48%
46% 9%
250 43% 25
41% 8%
40% 8%
38% 8%
35% 7%
200 20 7%
32% 6% 6% 7%
6% 6% 6%
29% 30% 6%
150 27% 15
24%
21% 20% 4%
100 18% 10
16%
13%
10% 2%
50 5
236 267 288 257 253 267 258 271 281 251 249 266 290 296 15 17 18 16 16 17 17 19 21 21 23 27 30 33
0 0% 0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
EMEA internal travel expenditures reached $2.2 trillion in 2019 representing ~8% of GDP. The
accommodations market was ~$296 billion in 2019, of which ~48% was online. Short-term
rentals represent ~11% of accommodations.
Airbnb, Inc. 6

4 January 2021
Figure 14: Airbnb, Inc. – APAC Internal Travel Expenditures and Figure 15: Airbnb, Inc. – APAC Total Travel and Experiences
As a Percentage of GDP (2006 – 2019) Spend by Category (2006 – 2019)
3000 9% 900
841
822
8% 800 763
8% 715 707 723
2500 685
7% 700 663
7% 7% 7%
7% 613
6% 7%
6% 6% 6% 600
2000 6% 6% 537
6% 6% 6%
500 463 457
5% 433
392
1500 400
4%
300
1000 3%
200
2%
100
500
1%
0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
763 857 942 950 1100 1357 1474 1563 1652 1692 1814 1984 2195 2393
0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Figure 16: Airbnb, Inc. – APAC Accommodations Spend and Figure 17: Airbnb, Inc. – APAC Short-Term Rental Spend and
Online Penetration (2006 – 2019) As a Percentage of Accommodations (2006 – 2019)
250 60% 18 8%
16 7%
7%
49% 50%
200
14 6%
45% 6%
40% 40% 12 5%
5%
150 35%
10
31% 30% 4%
4%
26% 8
100 3%
22% 3%
20% 20% 6 3% 3%
2% 3%
17% 2% 2% 2%
2% 2%
15% 2%
4
50 12%
9% 10%
8% 2 1%
6%
122 132 139 133 157 178 190 195 200 198 203 213 230 236 2 3 3 3 4 4 5 5 5 6 8 12 14 16
0 0% 0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
APAC internal travel expenditures reached $2.4 trillion in 2019 representing ~8% of GDP.
Currently, online penetration is at ~49% for accommodations, and short-term rentals represent
~7% of the market.
Airbnb, Inc. 7

4 January 2021
Figure 18: Airbnb, Inc. – Latin America Internal Travel Figure 19: Airbnb, Inc. – Latin America Total Travel and
Expenditures and As a Percentage of GDP (2006 – 2019) Experiences Spend by Category (2006 – 2019)
500 9% 200
450 180
167 163
8% 160 162
153 157
400 8% 8% 160 151
145 143
8%
140
350 127
121
8% 120 113 111
300 8% 8% 101
7% 100
250
7% 80
200 7% 7% 7%
7% 7% 7% 7% 60
7%
150
40
100 7%
20
50 0
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
273 312 348 318 369 420 425 440 442 399 386 415 445 472
0 6%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Figure 20: Airbnb, Inc. – Latin America Accommodations Spend Figure 21: Airbnb, Inc. – Latin America Short-Term Rental
and Online Penetration (2006 – 2019) Spend and As a Percentage of Accommodations (2006 – 2019)
70 45% 4 7%
40% 4 6%
60 39% 6%
37%
36% 6%
35%
33% 3
50 5%
31% 5%
30%
28% 3
40 25% 4%
24%
2 3%
21% 20%
30 3%
17% 18% 2
15% 15%
14% 2%
20 2%
12% 1
10%
9%
10 1% 1%
5% 1 1%
0% 1% 1%
34 39 40 36 41 45 47 51 53 50 50 56 57 60 0
0% 0%
0 0%
0 0%
0 0 0 0 0 1 1 2 3 3 4
0 0% 0 0%
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
Latin America internal travel expenditures reached $472 billion in 2019, representing ~8% of
GDP. Online penetration is at ~39% for accommodations and short-term rentals represent
~6% of the market.
At ~48% online penetration across the globe, accommodations has less secular growth ahead
versus other, more nascent e-commerce categories such as groceries, furniture, and apparel.
That said, our thesis does not necessarily hinge so much on continued acceleration in online
adoption versus the aforementioned substitution from traditional hotels to alternative
accommodations.
Airbnb, Inc. 8

4 January 2021
Thinking through Airbnb’s Total Addressable Market – Not

as Straightforward or Limited to Just Accommodations
As we think through the total dollars that Airbnb could eventually address, we outline
management’s estimates of a ~$1.5 trillion near-term Serviceable Addressable Market (SAM)
and a $3.4 trillion long-term TAM. These figures contemplate the company operating within the
current core short-term stays market in addition to further expanding into experiences and long-
term stays.
Figure 22: Airbnb, Inc. – Total Addressable Market

3500 3400
210
3000
2500 1365
2000
1487
1500
239
1000
500
1248 1825
0
SAM TAM
ST Stays Experiences LT Stays
Source: Company data, Credit Suisse estimates
Framework for Arriving at $1.8 Trillion in TAM for the Core Short-Term
Accommodations Market
Turning to each category of addressable spend in detail, we begin with the core short-term
accommodations market. Rather than taking the $809 billion in accommodations spend
estimate in 2019 per Euromonitor at face value, we outline Airbnb’s bottom-up framework for
estimating the total size of the market below.
1) Beginning with 14.3 billion total overnight trips taken in 2019, ABNB estimates that all
business trips, 25% of domestic leisure trips, and 69% of international leisure trips
involve paid accommodations, which equates to 6.5 billion paid trips or 45% of the
total. This implies ~0.8x paid trips per capita, which ABNB expects to rise to 1.1x in
the long run.
2) Based on the aforementioned domestic and international split, management estimates
number of nights per trip, guests per trip, and blended regional Average Daily Rate
(ADRs) per Smith Travel Research (STR) to arrive at the respective domestic and
international trip market sizes.
Airbnb, Inc. 9

4 January 2021
Figure 23: Airbnb, Inc. – Short-Term Accommodation Addressable Market Build

SAM TAM Comment / Analysis
2019 2030
ST Stay Market
Total Overnight Trips (b) 14.3 Euromonitor estimate
x Proportion of Paid Trips 45% Mgmt. estimate based on internal data
= Overnight Paid Trips 6.5 9.5
Population (b) 7.7 8.8

x Paid Trips per Capita 0.8x 1.1x Assuming increase in Trips per Capita
= Overnight Paid Trips 6.5 9.5
Overnight Paid Trips 6.5 9.5

x Proportion of Domestic Trips (% ) 83% 83% Mgmt. estimate based on internal data
= Domestic Trips 5.4 7.9
x Nights per Trip 2.5 2.5
/ Avrg. Number of Guests 1.5 1.5
= Room Nights 9.1 13.4
x ADR ($) $102 $102 STR blended estimate
= Domestic Market Size ($b) 933 1364
Overnight Paid Trips 6.5 9.5

x Proportion of International Trips (% ) 17% 17% Mgmt. estimate based on internal data
= International Trips 1.1 1.6
x Nights per Trip 4.0 4.0
/ Avrg. Number of Guests 1.6 1.6
= Room Nights 2.7 4.0
x ADR ($) $116 $116 STR blended estimate
= International Market Size ($b) 315 461
Total ST Stay Market 1248 1825
Potentially another $1.4 Trillion of Addressable Experiences Dollars – Expanding from

the Travel Activities Use Case to the Everyday Use Case
With the entry into the Experiences category in 2016, and the expansion into online experiences
beginning in 2020 spurred by the pandemic, Airbnb is going after a $239 billion near-term
attractions opportunity (ex-casinos, plus spas) and a $1.4 trillion long-term opportunity based on
including spend from local residents on recreational and cultural attractions, including sporting
events, amusement parks, summer camps, and more.
Figure 24: Airbnb, Inc. – Experiences Addressable Market Build

2019 2030
Experiences Market
Attractions 292 292 Euromonitor estimate
- Casinos 121 121 Euromonitor estimate
+ Spas 68 68 Euromonitor estimate
= Addressable Experiences 239 239
+ Recreational and Cultural Services 1126 Euromonitor estimate
= Total Addressable Experiences 239 1365
Airbnb, Inc. 10

4 January 2021
Not Just for Short-Term Stays, as the Pandemic Opens Up Greater Mobility and
another $210 Billion Addressable Dollars from Long-Term Stays
Long-term stays historically represented ~15% of gross room nights. However, growth has
been accelerated by the pandemic. In the long run this is a $210 billion addressable market
consisting of $48 billion of serviced apartments spend and 10% of the residential rental market.
Figure 25: Airbnb, Inc. – Long-Term Accommodation Addressable Market Build

2019 2030
LT Stay Market
Number of Extended Stay Rooms (b) 1.3 Mgmt. estimate
x ADR ($) $102 STR blended estimate
x Occupancy Days 365
= Extended Stay Market ($b) 48
Global Real Estate Rental Market ($b) 1620 The Business Research Company 2020 estimate
x Addressable Proportion 10.0% Mgmt. estimate
= Real Estate Rental Market 162
Total LT Stay Market 210
Against this backdrop, our longer-term estimates contemplate a scenario in which Airbnb will be
able to reach ~10% and ~4% of its SAM and TAM, respectively.
Figure 26: Airbnb, Inc. – Gross Booking Value Forecast and As Figure 27: Airbnb, Inc. – Gross Booking Value Forecast and As
a Percentage of Serviceable Addressable Market a Percentage of Total Addressable Market
160 5% 160 12%
140 4% 5% 140
10% 10%
4% 4%
120 120 9%
4% 4% 8% 8%
100 3% 100
3% 7%
3%
6%
80 2% 3% 80 6%
6%
2% 2% 5%
60 60
2% 4% 4%
2%
40 1% 40 3%
1% 1% 1% 3% 2%
2%
20 1% 20 2%
1%
38 23 35 45 56 69 82 95 109 123 137 152 38 23 35 45 56 69 82 95 109 123 137 152
0 0% 0 0%
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
Source: Company data, Credit Suisse estimates Source: Company data, Credit Suisse estimates
Airbnb, Inc. 11

4 January 2021
Company Overview – Category Creator and Leader

Airbnb Inc. is a global travel marketplace platform that connects hosts with guests to offer
alternative accommodations, lodging options from traditional hotels, as well as destination-
oriented experiences and activities.
As of the end of 2019, the company had 54 million active bookers, who collectively accounted
for 247 million guest arrivals during the year. Airbnb currently has ~4 million hosts with 5.6
million active listings as of 3Q20.
The initial concept dates back to 2007 as the founders looked to supplement their income by
offering their apartment as a bed and breakfast. By 2010, Airbnb had facilitated 700k nights
booked and raised $7.2 million in Series A financing.
It subsequently launched its international expansion as it acquired Accoleo (similar service in
Germany) and opened offices in London, Singapore, and Australia.
Figure 28: Airbnb, Inc. – Company Timeline

Official launch of Reaches 700k Reaches 10mm SF legalizes Launches Launches Airbnb COVID impacts
website nights booked nights and Rentals Experiences Plus offset by
expands in EU product domestic & non-
/APAC urban stays
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Initial idea launch Launches Acquires Accoleo Announces EU Launches Price Acquires Luxury Acquires Gaest
at Industrial Superhost in DE and opens HQ in Dublin Tips and acquires Retreats, and HotelTonight
Design program office in London Vamo AdBasis, and
Conference Accomable
Source: Company data
Beginning in 2014, Airbnb started to launch new products such as Price Tips to help hosts
price inventory and Experiences (2016) listings alongside traditional accommodations.
In 2017, it made a series of acquisitions to bolster its product pipeline:
1) Luxury Retreats – a similar service for high-end/premium vacation homes
2) Tilt – a social payments startup
3) AdBasis – an adtech platform
4) Accomable – a travel accessibility startup
Most recently, Airbnb made moves to enhance its offering within the traditional hotels with the
acquisition of HotelTonight, a last-minute hotels-booking service, as well as shifting pricing for
professional property managers to be more in-line with competitors with only a host fee.
Airbnb, Inc. 12

4 January 2021
Product Offering Overview

Airbnb’s primary product offerings are short-term accommodations stays. The ~7.4 million
available listings include alternative accommodations - private rooms, entire homes, luxury villas,
treehouses, cabins, farms, tiny homes, boats, castles, yurts, treehouses, private islands,
lighthouses, and igloos. The company also has hotel listings, bolstered by the aforementioned
HotelTonight acquisition from April 2019.
Figure 29: Airbnb, Inc. – Alternative Lodging Listing Types
In 2016, the company began adding Experiences, which include various activities such as tours,
field trips, workshops, and others. In April 2020, it launched Airbnb Online Experiences to allow
hosts to offer experiences online as the COVID-19 pandemic largely suspended in-person
activities. Since, launch there are 700+ Online Experiences.
Currently, the majority of the booking dollars are driven by accommodations while Experiences
makes up a small proportion of the overall; we note however that the category should have a
slightly higher mix of revenue (vs. bookings) as the commission rates tend to be higher.
Figure 30: Airbnb, Inc. – Experiences Listing Types
Airbnb, Inc. 13

4 January 2021
A Closer Look at the Guest Side of the Airbnb Marketplace

As of the end of 2019, Airbnb had ~54 million active bookers and recorded ~247 million guest
arrivals for the year.
Figure 31: Airbnb, Inc. – Active Bookers (2017 – 2019) Figure 32: Airbnb, Inc. – Guest Arrivals (2017 – 2019)
In millions, unless otherwise stated In millions, unless otherwise stated
60 300
50 250
40 200
30 150
20 100
10 50
30 41 54 129 185 247
0 0
2017 2018 2019 2017 2018 2019
Source: Company data Source: Company data
The recent key product initiatives for guests are as follows:

1) Pay Less Upfront Program: Under this program, guests have the ability to pay for
50% of the Gross Booking Value (GBV) at the time of booking (versus 100%
normally) with the remainder to be paid before the stay occurs. Airbnb recognizes the
full amount of fees due from the first installment payment (with the rest in funds
receivables/payables) while the second installment payment represents only the
amount that will be remitted to hosts. The program allows for the reduction of
purchase friction and speed up transaction velocity without significantly affecting
working capital.
2) Airbnb Luxe: Launched in 2019 and building on the expertise gained from the Luxury
Retreats acquisition in 2017, Luxe introduced 2000 high-end listings at launch to
target higher-income users.
3) Long-Term Stays: This is a new use case which is taking on greater relevance, as
the COVID-19 pandemic drives more consumers to work-from-home setups, which in
turn affords the opportunity to nomadically/semi-permanently work from Airbnbs.
Stays of 28+ nights are considered long-term stays. Airbnb charges service fees to
facilitate long-term stays on a monthly basis.
We highlight that the majority of the revenues Airbnb generates is from repeat business. In
2019, ~70% of revenue was from repeat guests versus ~50% in 2015 – suggesting that
increasingly, the majority of guests who use the platform tend to stick once they have a positive
experience. In addition, looking at the cohort retention data, after a decline in year 2, the
cohorts typically see steady improvement.
Airbnb, Inc. 14

4 January 2021
Figure 33: Airbnb, Inc. – Revenue from Repeat Guests Figure 34: Airbnb, Inc. – Guest Cohort Revenue Retention
(2015 – 2019)
In millions, unless otherwise stated
6000 100%
66% 69%
58% 62%
5000 52%
75%
4000 1489.6
3000 1241.7
50%
2000 973.5
695.3 25%
1000
441.1 Year 1 Year 2 Year 3 Year 4 Year 5
477.9 960.2 1588.3 2410.3 3315.6
0 2014 Cohort Revenue Retention 2015 Cohort Revenue Retention 2016 Cohort Revenue Retention
2015 2016 2017 2018 2019
Revenue from Repeat Guests ($mm) Revenue from New Guests ($mm) 2017 Cohort Revenue Retention 2018 Cohort Revenue Retention
Attracting and Retaining Hosts

As of 3Q20, the company had 4 million hosts and 5.6 million active listings. Currently, 90% of
the hosts are individuals, of which 79% have only one listing. Hosts typically start listing their
properties organically, with 79% signing up directly in 2019. Twenty-three percent of hosts also
start out as guests.
Figure 35: Airbnb, Inc. – Number of Hosts (2017 – 2019) Figure 36: Airbnb, Inc. – Active Listings (2017 – 2019)
5 6
4 5
4
3
3
2
2
1 1
2.7 3.3 4.0 3.3 4.4 5.7
0 0
2017 2018 2019 2017 2018 2019
The recent key product initiatives for the hosts include:

1) Smart Pricing Tools: Although hosts set their own prices, Airbnb provides Smart
Pricing tools that suggest pricing based on changes in demand. Pricing
recommendations are based on the type/location of a listing, seasonality, expected
demand, and other factors. In addition, the company provides data insights that
include how host occupancy rates compare to others on the platform.
Relevant/competitive pricing should keep purchase friction to a minimum.
2) Superhost Program: The program recognizes the most active/high-quality hosts. To
be eligible, a host must have hosted at least ten stays in the past 12 months or had
three reservations that total at least 100 nights, respond to 90% of new messages
within 24 hours, and maintain a cancellation rate of <1% and an overall guest rating of
at least 4.8 stars. Nearly 20% of hosts have achieved this status. Continued
penetration of this status should improve the quality, lead to a lower number of
Airbnb, Inc. 15

4 January 2021
customer service engagements, which should in turn entail Operations & Support cost
leverage.
3) Airbnb Plus: One step above Superhost, Airbnb Plus is an invite-only program that
recognizes top hosts for their hospitality. Hosts in the program receive upgraded
listings from the company and in certain regions are required to exclusively use Airbnb
as their only 3P distribution channel. Within the program Airbnb takes a more hands-
on role versus strictly serving as a marketplace.
Similar to the guests’ behavior, the majority of the revenues are generated from existing hosts.
In 2019, ~84% of revenue was from existing hosts versus ~68% in 2015 – suggesting that the
supply base is very sticky. In addition, revenue retention for host cohorts are typically over 90%.
Figure 37: Airbnb, Inc. – Revenue from Existing Hosts Figure 38: Airbnb, Inc. – Host Cohort Revenue Retention
(2015 – 2019)
US$ in millions, unless otherwise stated
6000 100%
82% 84%
72% 77%
5000 68%
75%
768.8
4000
50%
657.4
3000
589.2 25%
2000
463.6
1000 0%
294.1 Year 1 Year 2 Year 3 Year 4 Year 5
624.9 1192.0 1972.5 2994.6 4036.4
0 2014 Cohort Revenue Retention 2015 Cohort Revenue Retention 2016 Cohort Revenue Retention
2015 2016 2017 2018 2019
Revenue from Existing Hosts ($mm) Revenue from New Hosts ($mm) 2017 Cohort Revenue Retention 2018 Cohort Revenue Retention
Airbnb, Inc. 16

4 January 2021
Competition Versus Booking’s Alternative Accommodations

and Expedia’s Vrbo
As we have outlined previously, Airbnb’s offerings are substitute goods for traditional
lodging/hotel rooms. As such, the company competes not only with other service providers like
Expedia’s Vrbo and Booking.com’s alternative accommodations but also against online travel
operators in general as well as hotel operators.
On the Experiences side, it competes with other online platforms such as Viator (TripAdvisor),
GetYourGuide, and Traveloka as well as what will likely emerge as integrated/intermodal travel
search offerings from the online travel platforms (Booking’s Connected Trip effort as an
example).
Figure 39: Airbnb, Inc. – Travel Market Competitive Landscape
Alternative Activities /
Airbnb Booking Holdings Expedia Group Other OTA Travel Search Hotel Operators Corporate Travel
Accommodations Experiences
American
Airbnb Booking.com Expedia.com Trip.com Airbnb Google Marriott OpenTable
Express
HotelTonight Priceline.com Hotels.com Ctrip Booking.com Baidu Hilton Booking.com GetYourGuide
Agoda.com Hotwire.com Qunar Vrbo TripAdvisor Accor Egencia Traveloka
Kayak Orbitz.com eLong Flipkey Trivago Wyndham Viator
Meituan
Rentalcars Travelocity Tujia Mafengwo InterContinental Klook
Dianping
OpenTable Wotif Fliggy Meituan B&B Craigslist OYO KKDay
Cheaptickets MakeMyTrip Xiaozhu Kayak Choice Hotels LaFourchette
Yelp
eBookers SkyScanner Traveloka Whitbread
Reservations
eDreams
Carrentals Cheapoair Hyatt Zomato
Odiego
Vrbo Despegar Skyscanner Quandoo
Egencia Opodo HotelsCombined
Travel Republic
Viajanet
Source: Company data, Wikimedia Commons, Credit Suisse
Alternative accommodations operate within the total lodging market, which is estimated to be
$809 billion in 2019 per Euromonitor. This places Airbnb with a ~5% market share behind
Booking Holdings and Expedia based on gross accommodation bookings per our estimates.
We consolidate and present the share of accommodations gross bookings for the online travel
operators in Figure 40. From a usage perspective, we track app installs per SensorTower which
suggest that Airbnb has the second largest cumulative installed base versus the other major
travel apps.
Airbnb, Inc. 17

4 January 2021
Figure 40: Airbnb, Inc. – Accommodations Market Share (2019) Figure 41: Airbnb, Inc. – Cumulative App Installs (Oct. 2020)
US$, unless otherwise stated In thousands, unless otherwise stated
0 50000 100000 150000 200000 250000 300000

ABNB
5% BKNG
Airbnb 190832
HotelTonight 22715
11%
Agoda 58588
Booking.com 256931
EXPE Priceline 17930
5%
Expedia.com 84055
Total Accommodations Hotels.com 80733
$809 Billion Hotwire
Vrbo
7230
17418
(2019) Wotif 2075
Other
79% Skyscanner 94082
Trip.com 16426
Make My Trip 65421

Yatra 15509
Rakuten 6460
Source: Company data, Euromonitor, Credit Suisse estimates Source: SensorTower
Diving deeper into the direct competitors that Airbnb faces, we note that the key competitors
are Booking.com’s alternative accommodations, Expedia’s Vrbo, and TripAdvisor’s FlipKey.
Figure 42: Airbnb, Inc. – Competitive Landscape

In millions, unless otherwise stated
Airbnb Booking.com* Vrbo FlipKey

Total Listings (mm) 7.4 6.5 2.1 0.7
Monthly Visits (mm) 62.2 315.9 26.4 0.639

Monthly Unique Visitors (mm) 26.3 139.6 13.1 0.435
Visits per Unique Visitor 2.4 2.3 2.0 1.5
Visit Duration (mins) ~9 mins ~8 mins ~8 mins ~22 mins
Total Mobile Installs 190.8 256.9 17.4 N/A
Gross Bookings 2019 ($b) 38.0 20.7 11.9 N/A

Guest Fee 12% N/A 10% 8% - 16%
Host Fee 3% 15% 5% 3%
Payment Processing Charged N Y Y Y
Source: Company data, SimilarWeb, Credit Suisse estimates
*Traffic data is Booking.com overall
Airbnb is likely a category leader with the largest supply base of 7.4 million available listings
ahead of Booking.com’s 6.5 million and Vrbo’s 2.1 million. It also has ~2x the Gross Bookings
of Booking’s disclosed alternative accommodations and ~3x of Vrbo (as of 2019).
Within the available listings base, there is also likely a smaller overlap between Airbnb and its
competitors as its hosts are for the most part individual property owners as opposed to the more
professional property managers. As we noted above, 90% of the 4 million hosts are individuals
and 79% of those only have a single listing, assuming the balance has an average of 2.5
listings – this implies that the professionally managed supply is ~36% of the overall listings.
Airbnb, Inc. 18

4 January 2021
Given Booking.com’s previously stated desire to maintain a real time reservations experience
similar to hotels, it likely over-indexes to the professional property managers’ supply base, which
suggests that the majority of long tail inventory on Airbnb is currently unique to its the platform.
Figure 43: Airbnb, Inc. – Professional Listings Estimate

US$, unless otherwise stated
Airbnb Booking.com Vrbo

Individual Hosts 3.6
x Proportion w/ 1 Listing 79%
= Individual Hosts w/ 1 Listing 2.8
x Avrg. Listings per Host 1.0
= Listings 2.8
Individual Hosts 3.6

x Proportion w/ 1+ Listings 21%
= Individual Hosts w/ 1+ Listings 0.8
x Avrg. Listings per Host 2.5
= Listings 1.9
Total Listings 7.4

- Individual Host Listings 4.7
= Implied Professional Listings 2.7 6.5 2.1
Recently, Airbnb has changed its pricing structure for professional property managers and
hoteliers to levy the entire 15% service fee on the host. The rationale is to have pricing in-line
with competitors and to make listings more competitive from the guest perspective on these
properties, which were often found on multiple competing sites.
We note that professional hosts had already often elected to absorb the guest fees in order to
make their pricing uniform across platforms – suggesting that the demand lost from higher list
prices through guest fees is greater than the cost to absorb the full ~15%. As such this pricing
change should not materially impact supply or demand.
For the overwhelming majority of hosts the ROI consideration breaks down as individual hosts
are typically generating incremental rental income from an existing sunk cost asset – a primary
or secondary residence. As such, this places Airbnb in a position with pricing power and
provides the potential for long-term increases in monetization per our thesis.
Airbnb, Inc. 19

4 January 2021
How the COVID-19 Pandemic Impacted Airbnb

One of the key points from our investment thesis is that Airbnb’s use case proved more resilient
than other existing travel options, as consumers sought to keep their families in their own
protected bubble and eliminate the potential for interactions with others in elevators, lobbies,
and other resort activities.
Alternative accommodations have hence been something of a bright spot for the industry as it
helped to offset large declines in the traditional lodging business. We outline ABNB’s monthly
disclosures to contextualize the impact of the pandemic on alternative accommodations and
subsequent sequential recovery. We note that after hitting a trough during April, domestic and
short-distance travel saw positive year-over-year growth.
As such, any further deterioration in the market toward a non-linear recovery should be
somewhat offset by domestic travel, short distance, and non-urban growth similar to what other
travel operators have been reporting throughout the year.
Figure 44: Airbnb, Inc. – Domestic and International Gross Figure 45: Airbnb, Inc. – Gross Nights by Length of Stay and
Nights and Domestic Gross Nights Year-Over-Year Growth Gross Long-Term Nights Year-Over-Year Growth
45 60% 45 70%
40 44% 40
42% 40% 40% 50%
35% 46% 45% 47% 45%
35 35 41%
26%
30 21% 20% 30 30%
18.4 17% 16% 15%
20% 23%
25 15.6 6.9 25 19% 18%
14.3 5.5 6.2 0% 9% 9% 10%
13.3 13.2 5.5 32.5
20 20 27.8
-16% 25.9 23.9 23.2
15 6.7 2.5 -20% 15 24.1 21.3 20.5 -10%
-24% -13% 18.5
14.5 11.8
10 10
1.7 -40% -30%
5 5 5.2
16.2 15.0 15.2 19.9 17.2 12.3 7.0
-55% 13.9 20.5 21.4 19.8 18.4 4.6 4.2 4.5 5.8 5.0 4.5 3.5 4.6 4.7 5.1 5.5 5.4
0 -60% 0 -50%
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
Domestic Gross Nights International Gross Nights 28+ Days 1-27 Days
Figure 46: Airbnb, Inc. – Gross Nights by Distance and 50 to Figure 47: Airbnb, Inc. – Gross Nights by City and Non-Top 20
500 Miles Gross Nights Year-Over-Year Growth Gross Nights Year-Over-Year Growth
45 60% 45 60%
40 36% 39% 40% 40 40%
35% 33% 37%
26% 25% 33% 32%
35 21% 20% 35 27%
15% 19% 20%
9%
30 0% 30
22.3 0%
25 -20% 25 -15%
18.6 -27% 9.4 -17% -17% -19% -20%
17.3 8.3 9.4 33.5
20 16.2 16.4 -38% 9.3 -40% 20
26.6 28.7
24.7 24.9 -40% -40%
15 9.2 -60% 15 -47% 24.2 26.3 24.0
5.2 22.0
-71% 14.6 -60%
10 12.0 13.7 12.4 -80% 10 17.0
9.6 10.7 10.6 -71% 15.1
8.6 8.5 6.2 3.1 7.6
5 -100% 5 7.8 -80%
2.9
3.6 3.5 3.5 4.0 3.5 3.6 3.6 4.0 4.3 4.2 4.0 3.9 3.6 3.5 4.8 4.1 2.0 0.9 1.3 1.8 2.0 2.0 1.9
0 2.7 -120% 0 -100%
Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep
<50 miles 50-500 miles >500 miles Top 20 Other
E-commerce category adoption begins as consumers try a new experience (i.e., ordering
groceries versus going to the market) and accelerate as they have a good experience. Although
overall travel activity did take a downturn through the pandemic, we believe that consumers will
emerge as incrementally more comfortable with alternative accommodations inventory – this
does potentially pave the way for an acceleration of the category’s share gains, to Airbnb’s
benefit.
Airbnb, Inc. 20

4 January 2021
Architecture of the Earnings Model

Within the accommodations and experiences business, and similar to other Internet marketplace
operators, Airbnb generates revenue by connecting supply and demand and charging a
transaction fee in the middle.
Figure 48: Airbnb, Inc. – Lodging Unit Economics Figure 49: Airbnb, Inc. – Experiences Unit Economics
US$, unless otherwise stated US$, unless otherwise stated
Comment / Analysis Comment / Analysis
Demand Side Demand Side
Room Night 1.0 Number of Experiences 1.0
x Price per Night ($) $100 x Price per Person ($) $20
= Booking Value $100 = Booking Value $20
+ Guest Fee (12%) $12 Fees charged to Guest No fees charge to Guest for Experiences
+ Lodging Tax (4% ) $4 Taxes remitted to local authorities; can vary widely by state (4-15% ) No lodging taxes collected/remitted
= Gross Booking Value $116 Total amount collected from Guest for booking = Gross Booking Value $20 Total amount collected from Guest for booking
Supply Side Supply Side

Room Night 1.0 Number of Experiences 1.0
x Price per Night ($) $100 x Price ($) $20
= Booking Value $100 = Booking Value $20
- Host Fee (3%) $3 Fees charged to Host - Host Fee (20%) $4 Fees charged to Host
= Funds Payable $97 Fees collected from Guest paid to host = Funds Payable $16 Fees collected from Guest paid to host
Total Service Fees $15 Total Service Fees $4

Take Rate 12.93% Effective Take Rate comparable to reported revenue/GBV Take Rate 20.00% Effective Take Rate comparable to reported revenue/GBV
In Airbnb’s model, service fees are levied both on the supply (hosts) and the demand (guests)
sides. The economics are slightly different in the Experiences business with fees only levied on
the supply-side, similar to the current OTA models. Fees are also typically higher at ~20% as
well.
In the long run, we expect the Experiences business to become a more meaningful proportion
of the business, which could optically push aggregate take rates higher, although dollar
contributions will be lower as experiences are typically lower ADR versus lodging.
We also highlight two revenue streams that represent meaningful optionalities that we leave out
of the near-to-medium term model for now:
1) Payment Processing: Currently, Airbnb does not charge guests or hosts payment
processing costs, which is atypical versus other travel operators running a merchant
model. As such, this represents a potential one-time take rate uplift if the company
does decide to begin monetizing payments.
2) Sponsored Listings: As marketplaces scale, it becomes progressively more difficult
for suppliers to differentiate and ensure their inventory is seen. As such, many
developed marketplaces have some iteration of a sponsored listing product for
suppliers, or hosts in this case. As Airbnb currently does not offer this type of product,
we see this as a potential high-margin revenue driver in the future. Thinking through
how large this business could potentially be, we look to other operators such as
Amazon, which has managed to scale this offering to ~3% of gross bookings.
Given these two potential revenue streams as well as the aforementioned Experiences business
with a higher take rate, we illustrate below that the take rate could theoretically increase from
the current consolidated ~15% to over 20% in the long run – we also note that this should
arrive at high (almost 100%) incremental margins.
Airbnb, Inc. 21

4 January 2021
Figure 50: Airbnb, Inc. – What Can Drive Potential Increase in Monetization
22%
Passing on payment
processing fee to 21%
21% Hosts
Scaled Ad platforms
have reached ~3%
20%
~1pp potential uplift of GMV
19% 19%
19%
from mix shift to
20% Experiences
18%
17%
16% 16% 16%
16%
15% 15% 15% 15%
15%
Current Mix Shift Advertising Payments
Key Cash Consideration with the Seasonality of the Earnings Model

Within the unit economics illustration above, we highlight that there is a major seasonality/cash
consideration when looking at ABNB’s model. As bookings are typically made ~37 days in
advance of a trip taking place while revenues are recognized post check-in, cash flows will
reflect new business prior to the P&L. The average number of days between a booking and
check-in is seasonally shortest in 3Q.
We note that the number of days between time of booking and trips have been shortening; as
such our model contemplates a smaller dislocation between cash receipts and recognized
revenue in the near term.
We illustrate the cash consideration for our unit economic illustration below.
Figure 51: Airbnb, Inc. – Unit Economics Balance Sheet Flows

Assets Liabilities
Unrecognized in P&L until perf.

Cash from Fees $15 Cash from collected fees Unearned Fees $15
obligations are satisfied
Cash from Tax $4 Cash collected for lodging taxes TOT/VAT Liability $4
Cash collected on behalf of hosts; not

Funds Receivables $97 Funds Payable $97
included in corporate cash
$116 $116
Typically, ABNB sees the highest number of nights booked during 1Q to 3Q versus 4Q, as
guests plan for the peak travel season, which is in the third quarter for North America and
EMEA. As a result, the company achieves seasonally higher GBV in 1Q/2Q with comparatively
lower check-ins. As a result, corresponding increases in unearned fees makes FCF the highest
in these quarters. Seasonal declines in GBV 4Q/3Q and peak check-ins in 3Q result in a
decrease in unearned fees and lower sequential level of Free Cash Flow while adjusted EBITDA
turns positive. As such, in a normalized environment, these accounting considerations create a
negative correlation between the seasonality of FCF and Adjusted EBITDA. We note that this
relationship has dislocated during 2020 due to the shock from the COVID-19 pandemic.
As proponents of DCF we elect to keep our focus on FCF as the ultimate measure of business
performance and profitability.
Airbnb, Inc. 22

4 January 2021
Figure 52: Airbnb, Inc. – Quarterly Adjusted EBITDA and Margin Figure 53: Airbnb, Inc. – Quarterly Free Cash Flow and Margin
US$ in millions, unless otherwise stated US$ in millions, unless otherwise stated
600 60% 400 45% 60%

37%
500 28% 40%
19% 33% 40%
200 30% 24%
400 5% 20% 6% 10%
300 -4% 20%
-15% 0% 287 268 75 277 121 328
-17% -18% 0 -5%
200 -30% -25% 0%
-20% -125
-15% -78 -223 -585 -263 -579
100 -40% -20%
49 360 314 501 -40% (200) -20%
0
-95 -144 -248 -43 -276 -334 -397 -134 -60% -40%
(100)
(400)
-80%
(200) -70% -60%
(300) -100% -78% -79%
-119% (600)
-120% -80%
(400)
(500) -140% (800) -100%
1Q18A
2Q18A
3Q18A
4Q18A
1Q19A
2Q19A
3Q19A
4Q19A
1Q20A
2Q20A
3Q20A
4Q20E
1Q18A
2Q18A
3Q18A
4Q18A
1Q19A
2Q19A
3Q19A
4Q19A
1Q20A
2Q20A
3Q20A
4Q20E
Architecture of the Earnings Model: Revenue Build

As we highlighted previously, Airbnb generates revenues primarily from facilitating transactions
between guests and hosts through its marketplace, collecting a fee from both in the middle.
Revenue consists of service fees, net of incentives/refunds. For stays, service fees, which are
charged to customers as a percentage of the value of the booking, excluding taxes, vary based
on factors specific to the booking, such as booking value, the duration of the booking,
geography, and host type. For experiences, Airbnb only earns a host fee, which is typically 20%.
Substantially all revenues are generated from stays booked on the platform.
As such, the key drivers of topline performance are units net of cancellations, pricing, and the
take rate it is able to extract. While we do not expect to receive granular geographic as well as
cancellation/incentives disclosures on a regular basis, we nevertheless opt to build our model
using the framework shown below.
Airbnb, Inc. 23

4 January 2021
Figure 54: Airbnb, Inc. – Architecture of the Earnings Model

Net Average Daily
Gross Nights & Cancellations
Nights & Experiences Rate Gross Booking Value Take Rate Net Earned Fees
Experiences (Nights x Cancel Rate)
(GBV/Nights)
Consolidated
Nights & Experiences Gross Booking Value Net Earned Fees
Rev. Recognition
Percentage of GBV Adjustment
Advertising as a
Onboarded to
Percentage of GBV
Payment Rails
Discounts/Incentives
Take Rate
Lodging/Experiences
Payments Revenue Advertising Revenue
Revenue
Reported Revenue
The company operates effectively a 100% merchant model as Airbnb is the merchant of record
that collects both the booking value from the guest on behalf of the host and the applicable
guest fees owed using the guest’s pre-authorized payment method.
We highlight that the geographic breakout of Nights and Experiences in our model is by origin
versus destination.
Building our model off of these additional metrics should help investors think about what
between volume and price (as well as take rate) weighs most heavily toward driving revenue by
geography. As such, our quarterly projections on a go-forward basis reflect our expectations for
ongoing unit growth to be one of the primary drivers of Bookings, while we expect pricing and
take rates to be largely flat. We outline our key revenue drivers below.
Airbnb, Inc. 24

4 January 2021
Figure 55: Airbnb, Inc. – Quarterly Revenue Build Metrics

1Q19A 2Q19A 3Q19A 4Q19A 1Q20A 2Q20A 3Q20A 4Q20E 1Q21E 2Q21E 3Q21E 4Q21E
Gross Nights and Experiences Booked (mm) 91.1 100.7 98.9 87.2 90.2 51.0 78.2 56.3 63.1 82.7 101.0 91.1
YOY Growth 27.4% 35.2% 30.8% 31.9% -1.0% -49.4% -21.0% -35.5% -30.1% 62.1% 29.2% 61.8%
Cancellations 9.8 16.8 13.1 11.4 33.1 23.0 16.4 18.9 13.4 14.8 15.0 12.3
Cancellation Rate 10.8% 16.7% 13.2% 13.1% 36.7% 45.1% 21.0% 33.5% 21.3% 17.9% 14.9% 13.5%
Nights and Experiences Booked (mm) 81.3 83.9 85.9 75.8 57.1 28.0 61.8 37.4 49.7 67.9 86.0 78.8
YOY Growth 30.7% 29.5% 30.5% 31.8% -29.8% -66.6% -28.1% -50.7% -13.0% 142.5% 39.2% 110.7%
Average Net Daily Rate ($) $122.36 $117.14 $112.39 $112.63 $118.45 $114.17 $129.95 $131.77 $126.40 $126.52 $121.01 $121.95
YOY Growth -1.4% -1.5% -1.3% -0.6% -3.2% -2.5% 15.6% 17.0% 6.7% 10.8% -6.9% -7.5%
Gross Booking Value 9945.1 9827.8 9651.2 8538.4 6766.5 3195.4 8029.3 4928.2 6275.9 8591.0 10406.8 9609.9
YOY Growth 28.8% 27.5% 28.8% 31.0% -32.0% -67.5% -16.8% -42.3% -7.3% 168.9% 29.6% 95.0%
Consolidated Net Fees 1416.8 1404.7 1376.4 1220.6 964.0 456.7 1145.1 704.0 891.2 1224.5 1484.1 1370.8
Consolidated Take Rate 14.2% 14.3% 14.3% 14.3% 14.2% 14.3% 14.3% 14.3% 14.2% 14.3% 14.3% 14.3%
Gross Revenue 886.9 1283.0 1739.9 1170.0 1022.7 446.9 1396.7 763.3 601.6 929.2 1717.7 1387.2
Revenue Recognition Adjustment 0.6 0.9 1.3 1.0 1.1 1.0 1.2 1.1 0.7 0.8 1.2 1.0
Discounts and Incentives (47.9) (69.3) (94.0) (63.2) (180.8) (112.1) (54.3) (32.7) (27.6) (39.6) (54.6) (51.2)
% of Gross Revenue 5.4% 5.4% 5.4% 5.4% 17.7% 25.1% 3.9% 4.3% 4.6% 4.3% 3.2% 3.7%
Total Revenue 839.0 1213.7 1645.8 1106.8 841.8 334.8 1342.3 730.6 574.0 889.6 1663.1 1336.0
YOY Growth 30.5% 34.3% 30.1% 31.7% 0.3% -72.4% -18.4% -34.0% -31.8% 165.7% 23.9% 82.9%
Effective Take Rate 8.4% 12.3% 17.1% 13.0% 12.4% 10.5% 16.7% 14.8% 9.1% 10.4% 16.0% 13.9%
YOY Increase/Decrease (bps) 11bps 63bps 17bps 7bps 400bps (187)bps (33)bps 186bps (329)bps (12)bps (74)bps (92)bps
Contribution Profit 137.1 418.1 799.6 302.2 126.6 (17.9) 904.3 277.0 30.0 265.8 928.7 688.6
Contribution Margin 16.3% 34.4% 48.6% 27.3% 15.0% -5.3% 67.4% 37.9% 5.2% 29.9% 55.8% 51.5%
Adjusted EBITDA (247.9) (42.6) 313.6 (276.4) (334.3) (397.3) 501.4 (133.9) (433.0) (204.0) 429.6 200.7
Adjusted EBITDA Margin -29.5% -3.5% 19.1% -25.0% -39.7% -118.7% 37.4% -18.3% -75.4% -22.9% 25.8% 15.0%
Airbnb, Inc. 25

4 January 2021
Figure 56: Airbnb, Inc. – Annual Revenue Build Metrics

2019A 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E
Gross Nights and Experiences Booked (mm) 378.0 275.7 337.8 456.3 574.0 708.6 831.6 955.1 1081.5 1206.3 1330.1 1453.8
YOY Growth 31.3% -27.1% 22.5% 35.0% 25.8% 23.4% 17.4% 14.8% 13.2% 11.5% 10.3% 9.3%
Cancellations 51.1 91.4 55.5 59.3 74.6 92.1 108.1 124.2 140.6 156.8 172.9 189.0
Cancellation Rate 13.5% 33.1% 16.4% 13.0% 13.0% 13.0% 13.0% 13.0% 13.0% 13.0% 13.0% 13.0%
Nights and Experiences Booked (mm) 326.9 184.3 282.4 396.9 499.4 616.5 723.5 830.9 940.9 1049.5 1157.2 1264.8
YOY Growth 30.6% -43.6% 53.2% 40.6% 25.8% 23.4% 17.4% 14.8% 13.2% 11.5% 10.3% 9.3%
Average Net Daily Rate ($) $116.14 $124.36 $123.55 $114.13 $112.31 $112.56 $113.39 $114.45 $115.64 $116.96 $118.40 $119.90
YOY Growth -1.2% 7.1% -0.7% -7.6% -1.6% 0.2% 0.7% 0.9% 1.0% 1.1% 1.2% 1.3%
Gross Booking Value 37962.6 22919.3 34883.5 45304.2 56089.6 69390.1 82036.7 95098.9 108803.7 122751.7 137013.2 151651.2
YOY Growth 28.9% -39.6% 52.2% 29.9% 23.8% 23.7% 18.2% 15.9% 14.4% 12.8% 11.6% 10.7%
Consolidated Net Fees 5418.5 3269.8 4970.6 6475.9 8000.8 9895.0 11698.4 13561.1 15515.4 17504.4 19538.1 21625.5
Consolidated Take Rate 14.3% 14.3% 14.2% 14.3% 14.3% 14.3% 14.3% 14.3% 14.3% 14.3% 14.3% 14.3%
Gross Revenue 5079.8 3629.6 4635.7 6367.3 7916.5 9383.0 11097.2 12867.6 14725.4 16616.1 18549.2 20533.4
Revenue Recognition Adjustment 0.9 1.1 0.9 1.0 1.0 0.9 0.9 0.9 0.9 0.9 0.9 0.9
Discounts and Incentives (274.5) (380.0) (173.0) (254.7) (316.7) (375.3) (443.9) (514.7) (589.0) (664.6) (742.0) (821.3)
% of Gross Revenue 5.4% 10.5% 3.7% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0% 4.0%
Total Revenue 4805.2 3249.6 4462.7 6112.6 7599.9 9094.4 10960.9 12947.3 15088.4 17332.4 19691.1 22176.4
YOY Growth 31.6% -32.4% 37.3% 37.0% 24.3% 19.7% 20.5% 18.1% 16.5% 14.9% 13.6% 12.6%
Effective Take Rate 12.7% 14.2% 12.8% 13.5% 13.5% 13.1% 13.4% 13.6% 13.9% 14.1% 14.4% 14.6%
YOY Increase/Decrease (bps) 25bps 152bps (139)bps 70bps 6bps (44)bps 25bps 25bps 25bps 25bps 25bps 25bps
Contribution Profit 1656.9 1290.0 1913.2 2770.4 3534.8 4364.7 5552.5 6895.2 8391.6 10018.1 11781.7 13697.9
Contribution Margin 34.5% 39.7% 42.9% 45.3% 46.5% 48.0% 50.7% 53.3% 55.6% 57.8% 59.8% 61.8%
Adjusted EBITDA (253.3) (364.1) (6.6) 623.3 1152.6 1753.2 2721.2 3847.5 5131.5 6552.0 8117.2 9844.1
Adjusted EBITDA Margin -5.3% -11.2% -0.1% 10.2% 15.2% 19.3% 24.8% 29.7% 34.0% 37.8% 41.2% 44.4%
Architecture of the Earnings Model: Operating Cost

Structure
Airbnb’s cost structure is essentially evenly split between fixed and variable items that will largely
vary in-line with GBV – the company achieves its highest GBV in the first and second quarters
of the year with comparatively lower check-ins (resulting in negative EBITDA).
We outline Airbnb’s key cost drivers below:
Cost of Sales: consists of 1) payment processing fees, including merchant fees and
chargebacks, 2) hosting and data center costs (AWS), and 3) amortization of internally
developed software and acquired technology.
Although largely variable with GBV, long-term leverage can be achieved in this cost component
through payment processing efficiencies through network deals, incremental payment methods,
local payment entities, and product development work on payment routing optimization as well
as server cost efficiencies through better capacity planning/utilization improvements. We
understand that these fees vary by geography with the US seeing the highest fees, which
means that a mix shift into international regions should result in gross margin benefits.
Airbnb, Inc. 26

4 January 2021
Figure 57: Airbnb, Inc. – GAAP Cost of Sales Expense Breakout Figure 58: Airbnb, Inc. – Cash Cost of Sales Expense Forecast
and as a Percentage of Revenue
Amortization 2500 30%

4%
26% 25%
2000 24%
Hosting / Data 22%
Center Costs 21% 20% 20% 20%
19%
26% 1500
15%
$1196 million 1000
GAAP COGS 10%
(2019)
500
5%
Payment
Processing Fees
0 0%
70%
2019A
2020E
2021E
2022E
2023E
2024E
2025E
Payment Processing Fees Hosting / Data Center Costs
Operations & Support: primarily consist of 1) personnel-related expenses, 2) third-party

service provider fees associated with customer support provided via phone, email, and chat to
hosts and guests, 3) customer relations costs, which include refunds and credits related to
customer satisfaction and expenses associated with the company’s host protection programs,
and 4) allocated costs for facilities and information technology. These costs are expensed as
incurred.
Leverage should be achieved in this cost component vis-à-vis reduced contact rates through
increased quality initiatives to verify/screen guests/hosts to prevent issues, continued migration
toward lower-cost regions for call center operations and vendor partners, increased quality, and
programmatic changes to insurance offerings.
Figure 59: Airbnb, Inc. – GAAP Operations and Support Figure 60: Airbnb, Inc. – Cash Operations and Support
Expense Breakout Expense Forecast and as a Percentage of Revenue
SBC 1800 25%

0% 22%
Insurance and 1600
20%
Other 19%
17% 1400 17% 17% 16% 15%
14% 15%
1200
1000 10%
$815 million 3P Support / 800 5%

Partner Costs
GAAP O&S 53% 600
0%
(2019) 400
-5%
Personnel 200
30%
0 -10%
2019A
2020E
2021E
2022E
2023E
2024E
2025E
3P Support / Partner Costs Personnel Insurance and Other
Airbnb, Inc. 27

4 January 2021
Product Development: primarily consist of 1) personnel-related expenses, 2) third-party

service provider fees incurred in connection with the development of the company’s platform
and new products as well as the improvement of existing products, and 3) allocated costs for
facilities, software, maintenance and IT. These costs are expensed as incurred.
As a majority of these expenses are personnel-related, leverage will be achieved as hiring
moderates moving forward. In addition, engineering capacity should free up as technical
migration progresses and there remains the opportunity to shift the workforce to lower-cost
geographies/remote work.
Figure 61: Airbnb, Inc. – GAAP Product Development Expense Figure 62: Airbnb, Inc. – Cash Product Development Expense
Breakout Forecast and as a Percentage of Revenue
SW, Maintenance SBC 1600 30%

and Overhead 0%
9% 1400 26% 25%
Professional
1200 22%
Services Fees
5% 20%
1000 19%
18%
800 16% 15%
15%
$977 million 13%
600
GAAP PD 10%
(2019) 400
5%
200
Personnel 0 0%
86%
2019A
2020E
2021E
2022E
2023E
2024E
2025E
Personnel Professional Services Fees SW, Maintenance and Overhead
Sales and Marketing: primarily consist of 1) performance and brand marketing, 2) personnel-
related expenses, including those related to field operations, portions of referral incentives and
coupons, policy and communications, and 3) allocated costs for facilities and information
technology. These costs are expensed as incurred.
Continued leverage should be achievable in this component as Airbnb deploys a unified
marketing channel strategy that leverages the brand across all channels, continued focus to
drive traffic from direct/free channels, maintaining high ROI approach to performance marketing,
and achieving scale efficiencies in personnel-related expenses.
Airbnb, Inc. 28

4 January 2021
Figure 63: Airbnb, Inc. – GAAP Sales and Marketing Expense Figure 64: Airbnb, Inc. – Cash Sales and Marketing Expense
Breakout Forecast and as a Percentage of Revenue
SBC 2500 35%

0% 33%
30%
2000
Field Operations 25% 24% 25%
and Policy 24% 23%
1500 21% 22%
29% 20%
$1622 million 1000 15%

GAAP S&M
10%
(2019) Brand and 500
Performance 5%
Marketing
71% 0 0%
2019A
2020E
2021E
2022E
2023E
2024E
2025E
Brand and Performance Marketing Field Operations and Policy
General and Administrative: primarily consists of 1) personnel-related expenses for

management and administrative functions, including finance and accounting, legal, and human
resources, 2) professional services fees, general corporate and director and officer insurance,
3) allocated costs for facilities and information technology, 4) indirect taxes, including lodging
tax reserves, and 5) bad debt expense.
Cost efficiencies in this line item will be driven by moderated growth in core administrative
functions such as finance, HR, legal and the ability to limit office footprint and associated
workplace expenses in high-cost citifies going forward as more work becomes remote.
Figure 65: Airbnb, Inc. – GAAP General and Administrative Figure 66: Airbnb, Inc. – Cash General and Administrative
Expense Breakout Expense Forecast and as a Percentage of Revenue
Change in Tax 800 18%

Bad Debt Reserves
Expense 5% 700 16% 16%
Personnel
11% 21% 14%
600
SBC 12% 12%
500 12%
2%
10% 10%
400
8%
$697 million 7%
8%
300
GAAP G&A 6% 6%
Other G&A
26% (2019) 200 4%
100 2%
Real Estate,
Workplace & IT 0 0%
2019A
2020E
2021E
2022E
2023E
2024E
2025E
35%
Personnel Real Estate, Workplace & IT Other G&A
Airbnb, Inc. 29

4 January 2021
We Forecast Long-Term Adjusted EBITDA Margins to

Reach ~30% in 2026
Management’s long-term adjusted EBITDA margin target is ~30%. Our model contemplates
that this level of profitability can be reached in ~5 years based on the aforementioned line-by-
line cost leverage/optimization drivers as well as our assumption of a sponsored listing type
revenue stream starting in 2024.
Figure 67: Airbnb, Inc. – Long-Term Margin Structure

2019A 2020E 2021E 2022E 2023E 2024E 2025E 2026E LT Target
Cost of Revenue 24% 26% 22% 21% 20% 20% 19% 19% 18%
Operations and Support 17% 22% 19% 17% 16% 15% 14% 13% 14%
Sales and Marketing 33% 21% 25% 24% 24% 23% 22% 20% 20%
Product Development 19% 26% 22% 18% 16% 15% 13% 12% 14%
General and Administrative 14% 16% 14% 11% 10% 9% 8% 7% 7%
Adjusted EBITDA -5% -11% 0% 10% 15% 19% 25% 30% 30%
Bringing It All Together – What Our Estimates Bake in for

Market Share
Consulting the total short-term rental market by region we outline our GBV estimates by region
and implied market penetration. We note that based on reported FX exposures, the key
international markets for Airbnb are the UK, Australia, Europe, Canada, Japan, China, and
Brazil.
Figure 68: Airbnb, Inc. – North America GBV Forecast and Figure 69: Airbnb, Inc. – EMEA GBV Forecast and
Accommodations Market Penetration Accommodations Market Penetration
25 14% 18 6%
6%
16 5%
12%
11% 5%
20
11% 14
4%
10% 4%
10% 10%
12 4%
4% 4%
15 8% 8% 10
3%
6% 6% 8
10
6 2%
4%
4
5
1%
2%
2
13 18 13 18 20 23 11 13 6 10 14 17
0 0% 0 0%
2018
2019
2020
2021
2022
2023
2018
2019
2020
2021
2022
2023
Source: Company data, Euromonitor, Credit Suisse estimates Source: Company data, Euromonitor, Credit Suisse estimates
Airbnb, Inc. 30

4 January 2021
Figure 70: Airbnb, Inc. – APAC GBV Forecast and Figure 71: Airbnb, Inc. – Latin America GBV Forecast and
Accommodations Market Penetration Accommodations Market Penetration
12 5% 6 12%
5%
4% 11%
10 5 10%
4%
4%
8 3% 4 8% 8%
3%
6 3% 3% 3 6%
6%
2%
2%
2%
4 2 4% 4%
2%
1% 3%
1% 3%
2 1 2%
1%
4 5 2 5 7 11 1 2 1 2 3 5
0 0% 0 0%
2018
2019
2020
2021
2022
2023
2018
2019
2020
2021
2022
2023
Source: Company data, Euromonitor, Credit Suisse estimates Source: Company data, Euromonitor, Credit Suisse estimates
Our assumptions against market estimates imply that Airbnb will continue to take share post-
pandemic primarily in the more nascent international markets as the substitution of traditional
lodging to alternative accommodations continues to accelerate.
Driving down to profitability, we estimate ABNB could eventually address a blue-sky opportunity
of $17 billion in EBITDA dollars per year. This is based on the 7.4 million available listings at an
estimated 65% occupancy throughout the year, which translates to 1.8 billion potential room
nights. Applying the average gross daily rate ABNB saw in 2019, we arrive at $200 billion in
GBV, which we apply to our estimated ~20% take rate outlined in Figure 50. We apply a
premium to management’s long-term ~30% EBITDA margin target, given higher margin
incremental dollars from advertising and payments, to arrive at $17 billion in addressable
EBITDA.
Figure 72: Airbnb, Inc. – Theoretical Blue-Sky EBITDA Dollars On Current Supply
Comment / Analysis
Available Listings (mm) 7.4 Current available listings on the platform
x Occupancy Rate 65% Occupancy estimate
x Days 365
= Annual Fillable Room Nights (mm) 1756
x ADR $114 ABNB 2019 average gross daily rate pre-cancellations
= Gross Booking Value ($b) 200
x Take Rate 21% Theoretical take rate including payments and advertising
= Revenue ($b) 42
x EBITDA Margin 40% Above mgmt. EBITDA target to reflect higher margin advertising
= EBITDA ($b) 17
Airbnb, Inc. 31

4 January 2021
Quarterly Key Performance Indicators

We highlight below the quarterly key performance indicators:
Figure 73: Airbnb, Inc. – Quarterly Gross Booking Value Figure 74: Airbnb, Inc. – Quarterly Nights and Experiences
and Year-Over-Year Growth 1Q19 – 4Q21 Booked and Year-Over-Year Growth 1Q19 – 4Q21
US$ in millions, unless otherwise stated In millions, unless otherwise stated
12000 200% 100 200%

169%
90 142%
10000 150% 150%
80
111%
95% 70
8000 100% 100%
60
32% 39%
6000 29% 27% 29% 31% 30% 50% 50 31% 29% 31% 50%
-7% 40
4000 -17% 0% -13% 0%
-32% 30 -30% -28%
-42%
-51%
-67% 20 -67%
2000 -50% -50%
10
9945 9828 9651 8538 6767 3195 8029 4928 6276 8591 10407 9610 81 84 86 76 57 28 62 37 50 68 86 79
0 -100% 0 -100%
1Q19A
2Q19A
3Q19A
4Q19A
1Q20A
2Q20A
3Q20A
4Q20E
1Q21E
2Q21E
3Q21E
4Q21E
1Q19A
2Q19A
3Q19A
4Q19A
1Q20A
2Q20A
3Q20A
4Q20E
1Q21E
2Q21E
3Q21E
4Q21E
Our Gross Bookings Value for 4Q20 is $4.93 billion, reflecting a 42% year-over-year decline.
We expect Nights and Experiences Booked to reach 37.4 million in 4Q20, reflecting a 51%
year-over-year decline. As a result, our consolidated Net Revenue and Adjusted EBITDA
estimates for 4Q20 stand at $730.6 million and ($133.9) million, respectively.
Figure 75: Airbnb, Inc. – Quarterly Net Revenue and Figure 76: Airbnb, Inc. – Quarterly Adjusted EBITDA and
Effective Take Rate 1Q19 – 4Q21 Margin 1Q19 – 4Q21
1800 17% 17% 18% 600 60%

16% 37%
1600 15% 16% 26% 40%
14% 19% 15%
400
1400 13% 14% 20%
12% 12% -4%
-18% 0%
1200 10% 10% 12% 200 -25% -23%
-30% -20%
1000 9% 10% 314 -40% 501 430 201
8%
0 -40%
800 8% -248 -43 -276 -334 -397 -134 -433 -204
-75% -60%
600 6% (200)
-80%
400 4% -100%
(400)
200 2% -120%
839 1214 1646 1107 842 335 1342 731 574 890 1663 1336 -119%
0 0% (600) -140%
1Q19A
2Q19A
3Q19A
4Q19A
1Q20A
2Q20A
3Q20A
4Q20E
1Q21E
2Q21E
3Q21E
4Q21E
1Q19A
2Q19A
3Q19A
4Q19A
1Q20A
2Q20A
3Q20A
4Q20E
1Q21E
2Q21E
3Q21E
4Q21E
Airbnb, Inc. 32

4 January 2021
Annual Key Performance Indicators

We highlight below the annual key performance indicators.
Figure 77: Airbnb, Inc. – Annual Gross Booking Value and Figure 78: Airbnb, Inc. – Annual Nights and Experiences
Year-Over-Year Growth (2019 – 2027E) Booked and Year-Over-Year Growth (2019 – 2027E)
US$ in millions, unless otherwise stated In millions, unless otherwise stated
120000 52% 60% 1000 53% 60%

40% 900 41%
35% 40%
100000 29% 30% 40% 800 31%
24% 26% 23%
24%
18% 16% 700 17% 15%
80000 14% 20% 13% 20%
600
60000 0% 500 0%
400
40000 -20% -20%
300
-40% 200 -44%
-40%
20000 -40%
100
250 327 184 282 397 499 616 724 831 941
29441 37963 22919 34883 45304 56090 69390 82037 95099 108804 0 -60%
0 -60%
2018A
2019A
2020E
2021E
2022E
2023E
2024E
2025E
2026E
2027E
2018A
2019A
2020E
2021E
2022E
2023E
2024E
2025E
2026E
2027E
Figure 79: Airbnb, Inc. – Annual Net Revenue and Effective Figure 80: Airbnb, Inc. – Annual Adjusted EBITDA and
Take Rate (2019 – 2027E) Margin (2019 – 2027E)
16000 14% 15% 6000 40%

34%
14% 14% 35%
14000 14% 14% 30%
13% 5000
13% 30%
13% 14% 25%
12000
13% 4000 25%
13% 13% 19%
10000 12% 20%
13% 15%
3000
8000 15%
10%
12%
10%
6000 2000 5%
12%
5%
4000 0%
11% 1000 0%
-5%
2000 11% 171 -11% 623 1153 1753 2721 3847 5131 -5%
3652 4805 3250 4463 6113 7600 9094 10961 12947 15088 0
0 10% -253 -364 -7 -10%
2018A
2019A
2020E
2021E
2022E
2023E
2024E
2025E
2026E
2027E
2018A
2019A
2020E
2021E
2022E
2023E
2024E
2025E
2026E
2027E
(1000) -15%
Airbnb, Inc. 33

4 January 2021
Valuation
In line with our methodology for our Internet sector coverage, we used a discounted cash flow
analysis with weighted average cost of capital and terminal growth rate inputs of 10.5% and
3%, respectively. We have also elected to look to end-of-2022, which suggests $156 as
shown below.
Figure 81: Airbnb, Inc. – Discounted Cash Flow Analysis

2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E
EBITDA 623.3 1152.6 1753.2 2721.2 3847.5 5131.5 6552.0 8117.2 9844.1 11725.2 13744.8
Net Income (590.4) (172.6) 359.4 1341.5 2480.8 3347.3 4199.7 5308.1 6630.5 8071.3 9637.1
Depreciation & Amortization 111.6 117.5 117.1 129.5 149.5 176.6 211.0 252.6 301.9 359.4 426.0
Other Non-Cash Charges (Benefits) 930.7 1043.3 1146.6 1282.5 1394.2 1522.1 1677.7 1825.6 1965.3 2119.3 2264.0
Interest Expense (Income) 221.1 214.6 180.4 (12.0) (177.4) (261.3) (340.7) (432.5) (540.1) (665.5) (809.7)
Changes in Operating Assets & Liabilities 239.8 410.7 927.0 1062.8 1193.7 1338.7 1483.0 1629.4 1778.7 1930.0 2077.9
Unlevered Cash Flows 912.7 1613.5 2730.4 3804.2 5040.9 6123.5 7230.8 8583.2 10136.2 11814.5 13595.2
Capital Expenditures (79.9) (37.9) (64.2) (96.4) (135.5) (179.5) (224.0) (267.2) (314.6) (366.4) (422.0)
Unlevered Free Cash Flows 832.8 1575.6 2666.2 3707.8 4905.4 5944.0 7006.8 8316.1 9821.5 11448.1 13173.2
Y/Y % Change 301.5% 89.2% 69.2% 39.1% 32.3% 21.2% 17.9% 18.7% 18.1% 16.6% 15.1%
Weighted Average Cost of Capital 10.5%

Perpetual UFCF Growth Rate ("G") 3.0%
2022E
NPV of Unlevered Free Cash Flows 36004.9
Present Value of Terminal Value 66656.8
Enterprise Value 102661.7
Off-Balance Sheet Assets 0.0
Adjusted Enterprise Value 102661.7
Year End Net Debt (Cash) (4504.9)
Equity Value 107166.7
Diluted Shares Outstanding 686.8
Equity Value Per Share $156
The weighted average cost of capital of 10.5% we apply in our DCF is in-line with what we
used for Booking Holdings within the travel category as well as other mega cap stocks like
Alphabet, Amazon, and Facebook.
For the terminal growth rate, as our estimated unlevered free cash flow in the terminal year of
our DCF is still growing at a fairly rapid pace (~15% as shown above), in our view, 3% is
appropriate and conservative; to assume a higher rate would suggest that ABNB will over the
longer term be larger than the GDP.
As DCF-based target prices are subject to a wide range of variability based on the weighted-
average cost of capital and terminal growth rate, we present a sensitivity table in Figure 82
based on these two metrics to help investors gauge the direction target prices could head based
on different inputs.
Figure 82: Airbnb, Inc. – Discounted Cash Flow Sensitivity Analysis

Terminal Growth
156.0 2.0% 2.5% 3.0% 3.5% 4.0%
9.0% $182 $191 $203 $216 $232
9.5% $167 $175 $185 $196 $208
10.0% $155 $162 $169 $178 $189
WACC
10.5% $144 $150 $156 $163 $172

11.0% $134 $139 $145 $151 $158
11.5% $125 $130 $134 $140 $146
12.0% $118 $121 $125 $130 $135
Airbnb, Inc. 34

4 January 2021
Blue-Sky and Grey-Sky Scenarios

Given the lack of trading history for ABNB shares, we have decided to use enterprise value to
Bookings multiples as a proxy across its online marketplaces and e-commerce peers. In addition,
given we are thinking through where the additional upside potential and downside risk will be,
we are using 2022 multiples on our 2022 estimates.
Figure 83: Airbnb, Inc. – Comparable Valuation Analysis

EV / BOOKINGS EV / SALES EV / EBITDA
2020 2021 2022 CAGR 2020 2021 2022 CAGR 2020 2021 2022 CAGR
Airbnb, Inc. 4.32x 2.84x 2.18x 40.6% 30.5x 22.2x 16.2x 37.2% NM NM 158.8x NA
Online Travel
Booking Holdings, Inc. 2.64x 1.53x 1.05x 58.7% 13.5x 9.0x 6.4x 45.5% 103.5x 27.0x 16.2x 152.7%
Despegar.com Corp. 0.40x 0.19x 0.14x 72.7% 4.5x 1.6x 1.2x 94.6% NM 99.8x 11.1x NA
Expedia Group, Inc. 0.68x 0.41x 0.29x 54.1% 4.7x 3.3x 2.4x 39.3% NM 20.0x 11.0x NA
Trip.com Group Ltd. 1.93x 1.08x 0.88x 47.8% 8.5x 5.8x 4.2x 42.1% 696.3x 44.9x 21.2x 473.5%
Market Value Weighted Average 2.23x 1.29x 0.91x 56.5% 11.4x 7.6x 5.5x 44.4% 178.1x 29.2x 16.2x 178.4%
Ride Share
Lyft Inc. 1.73x 1.16x 0.93x 36.4% 6.1x 4.3x 3.2x 39.0% NM NM 72.5x NA
Uber Technologies, Inc. 1.67x 1.17x 0.91x 35.7% 7.7x 5.5x 4.2x 35.8% NM NM 72.6x NA
E-Commerce Marketplace
Alibaba Group Holding Ltd. 0.58x 0.50x 0.46x 11.9% 6.6x 4.9x 4.0x 28.3% 21.5x 16.5x 13.5x 26.3%
Amazon.com, Inc. 3.39x 2.81x 2.52x 16.0% 4.5x 3.8x 3.3x 17.5% 32.1x 25.1x 19.9x 27.2%
eBay, Inc. 0.41x 0.40x 0.39x 1.9% 4.0x 3.7x 3.4x 7.5% 10.6x 10.3x 9.5x 5.9%
Etsy, Inc. 2.58x 2.33x 2.02x 13.0% 15.3x 13.7x 11.5x 15.4% 51.4x 49.1x 38.4x 15.6%
Farfetch Ltd. 7.07x 5.48x 4.29x 28.3% 13.7x 10.3x 8.0x 30.7% NM 680.7x 137.6x NA
MercadoLibre, Inc. 4.03x 3.55x 2.83x 19.4% 21.6x 15.8x 11.4x 37.6% 335.8x 272.1x 121.3x 66.4%
Pinduoduo, Inc. 0.84x 0.59x 0.46x 35.4% 25.8x 16.6x 12.1x 46.2% NM 832.4x 97.0x NA
Rakuten, Inc. 0.22x 0.20x 0.19x 9.0% 0.6x 0.6x 0.5x 11.8% 24.7x 9.3x 4.2x 141.5%
The RealReal, Inc. 1.69x 1.26x 1.01x 29.5% 5.4x 4.0x 3.2x 30.4% NM NM NM -32.2%
Source: FactSet, Visible Alpha, Credit Suisse estimates
For the Blue Sky scenario, we use 2.95x, at the higher end of Airbnb's high-growth
comparables to arrive at ~$134 billion in enterprise value and ~$137 billion in equity value,
which is equivalent to ~$200 per share.
For the Grey Sky scenario, we use 1.50x, in-line with ABNB's online travel and e-commerce
marketplace comparables, to arrive at ~$68 billion in enterprise value and ~$72 billion in equity
value, which is equivalent to $104 per share.
We acknowledge that Blue/Grey Sky scenarios for a new issue are not an exact science, but as
ABNB shares begin to build a longer trading history, we are likely to move to either a P/E or
EV/EBITDA-based historical range, in-line with our practice for other companies in our
coverage.
Airbnb, Inc. 35

4 January 2021
Investment Risks
Risks to our price target for ABNB shares include the following factors:
Competition with other travel marketplaces: Greater competitive intensity from other
alternative accommodations providers like Vrbo or Booking.com as well as other traditional
OTAs. In addition, potential for more competitive auctions on Google and other advertising
platforms may inflate customer acquisition costs.
Slower-than-expected consumer adoption of alternative accommodations: Our thesis
hinges on the continued substitution effect between traditional lodging and alternative
accommodations. Post-pandemic slowdown in the switch in consumer preference.
Regulatory risk: Adverse changes to the current regulatory environment that results in greater
restrictions could result in contractions in supply as host willingness to list may decline.
Macroeconomic uncertainty. External or macro-driven events which may alter consumer
willingness to travel, and prolonged impacts from the COVID-19 pandemic.
Reacceleration in core short-term stays: Our estimates contemplate annual deceleration in
room nights, if ABNB is able to reaccelerate unit growth, this poses upside risk to our estimates.
Faster-than-expected rollout of ancillary revenue streams: Our near-term estimates do
not incorporate potential revenues from sponsored listings-type products or the passing of
payment processing fees to Hosts.
Foreign Exchange: Stronger-than-expected US Dollar versus the major global currencies will
exert a headwind on our estimates.
Airbnb, Inc. 36

4 January 2021
Management
Brian Chesky: Mr. Chesky co-founded Airbnb, Inc. in 2008 and serves as Chief Executive
Officer and Head of Community. He is also a member of the board of directors. Mr. Chesky
received a Bachelor of Fine Arts in Industrial Design from the Rhode Island School of Design.
Joseph Gebbia: Mr. Gebbia co-founded Airbnb, Inc. in 2008 and serves as Chairman of
Samara (in-house design and innovation studio) and Airbnb.org. He is also a member of the
board of directors. Mr. Gebbia received dual degrees in Graphic Design and Industrial Design
from the Rhode Island School of Design, where he currently serves on the institution’s Board of
Trustees.
Nathan Blecharczyk: Mr. Blecharczyk co-founded Airbnb, Inc. in 2008 and serves as Chief
Strategy Officer and Chairman of Airbnb China. He is also a member of the board of directors.
Mr. Blecharczyk received a Bachelor of Arts in Computer Science from Harvard University and
held several engineering positions before co-founding Airbnb.
Dave Stephenson: Mr. Stephenson has served as Chief Financial Officer since January 2019.
Prior to joining Airbnb, he spent 17 years at Amazon, where he was Vice President and Chief
Financial Officer of Worldwide Consumer Organization from June 2015 to December 2018.
Prior to that, from September 2013 to June 2015, Mr. Stephenson was the Chief Financial
Officer of Amazon’s International Consumer business and led finance operations across many
areas of the company. Prior to Amazon, he served as President and Chief Financial Officer of
Big Fish Games, from September 2011 to September 2013. Mr. Stephenson received a
Bachelor of Science in Industrial and Management Engineering from Montana State University
and a Master of Business Administration from the University of Iowa.
Aristotle Balogh: Mr. Balogh has served as Chief Technology Officer since November 2018.
Prior to joining Airbnb, Mr. Balogh was Vice President of Engineering at Alphabet from June
2011 to November 2018, where he was responsible for the data and serving systems behind
Google Search. Prior to Google from February 2008 to July 2010, he served as Executive Vice
President and Chief Technology Officer of Yahoo! Mr. Balogh received a Bachelor of Science in
Electrical Engineering and Computer Science and a Master of Science in Engineering in
Electrical and Computer Engineering from Johns Hopkins University.
Catherine Powell: Ms. Powell has served as Global Head of Hosting since July 2020 and
previously served as Head of Experiences since January 2020. Prior to joining Airbnb, Ms.
Powell spent 15 years at the Walt Disney Company where she held multiple roles from June
2004 to December 2019, including President, Disney Park Western Region from March 2018
to December 2019 and Présidente, Disneyland Paris from July 2016 to December 2018. Prior
to joining Disney, Ms. Powell worked for BBC Worldwide in various roles from January 1997 to
June 2004. Ms. Powell received a Master in Arts in Philosophy, Politics, and Economics from
Oxford University.
Airbnb, Inc. 37

4 January 2021
Figure 84: Airbnb, Inc. – Quarterly Income Statement

2020E 2021E 2022E
1Q20A 2Q20A 3Q20A 4Q20E 1Q21E 2Q21E 3Q21E 4Q21E 1Q22E 2Q22E 3Q22E 4Q22E
Revenue 841.8 334.8 1342.3 730.6 574.0 889.6 1663.1 1336.0 1031.3 1409.9 2148.8 1522.6
Cost of Revenue 277.8 161.2 227.3 200.2 202.9 250.4 293.9 284.4 286.6 315.5 346.8 334.7
Gross Profit 564.1 173.6 1115.0 530.5 371.1 639.2 1369.2 1051.6 744.7 1094.4 1802.0 1187.9
Operations and Support 221.8 160.5 166.1 300.5 174.7 201.9 256.6 227.1 259.7 273.6 291.8 252.1
Product Development 258.8 217.9 213.9 1950.0 389.1 378.3 372.8 363.4 402.1 403.4 404.6 402.0
Sales and Marketing 317.2 114.8 113.5 545.5 304.3 307.6 323.0 270.4 342.0 380.3 458.5 392.7
General and Administrative 91.8 149.3 180.0 675.5 195.7 195.8 210.6 200.4 208.6 212.7 226.1 218.0
Restructuring and Other 0.0 114.2 22.7 300.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Operating Expenses 889.5 756.8 696.3 3772.2 1063.8 1083.6 1163.1 1061.2 1212.4 1270.0 1381.0 1264.8
Total Operating Income (325.5) (583.2) 418.7 (3241.7) (692.7) (444.4) 206.1 (9.6) (467.7) (175.6) 421.0 (76.9)
Interest Income 13.6 5.9 4.3 2.6 4.0 2.8 3.4 4.2 4.4 3.3 4.8 5.7
Interest Expense 1.5 (49.2) (59.9) (59.7) (59.6) (59.6) (59.5) (59.5) (59.4) (59.3) (60.3) (60.2)
Other (46.8) (12.8) (56.1) (2.5) (1.0) (1.0) (1.0) (1.0) 0.0 0.0 0.0 0.0
Pretax Income (357.1) (639.4) 307.1 (3301.3) (749.3) (502.1) 149.1 (65.9) (522.7) (231.6) 365.5 (131.4)
Provision for Income Taxes (16.5) (63.8) 87.7 (82.1) 12.1 14.0 18.7 14.5 17.5 17.5 17.6 17.5
Net Income (340.6) (575.6) 219.3 (3219.3) (761.4) (516.1) 130.4 (80.4) (540.3) (249.2) 347.9 (148.9)
Preferred Dividends 0.0 0.0 (219.0) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Income to Common Stockholders (340.6) (575.6) 0.3 (3219.3) (761.4) (516.1) 130.4 (80.4) (540.3) (249.2) 347.9 (148.9)
Basic Shares Outstanding 262.5 263.5 265.1 330.3 602.6 617.7 631.4 636.9 642.7 648.8 655.3 661.6
Diluted Shares Outstanding 301.0 302.0 299.8 365.1 638.2 647.4 655.7 661.7 668.4 675.1 681.2 686.8
GAAP Diluted EPS ($1.30) ($2.18) $0.00 ($9.75) ($1.26) ($0.84) $0.20 ($0.13) ($0.84) ($0.38) $0.51 ($0.23)
Pro Forma Diluted EPS ($1.20) ($1.45) $0.22 ($0.53) ($0.68) ($0.37) $0.42 $0.14 ($0.38) ($0.03) $0.65 $0.07
EBITDA Reconciliation
Operating Income (325.5) (583.2) 418.7 (3241.7) (692.7) (444.4) 206.1 (9.6) (467.7) (175.6) 421.0 (76.9)
Stock-based Compensation 41.6 37.8 29.4 2926.7 230.9 211.5 194.3 181.0 214.2 202.5 195.6 187.0
Net Changes in Lodging Tax Reserves (84.3) 2.2 0.9 0.8 1.8 2.2 2.4 2.2 2.9 2.9 2.9 2.9
Restructuring 0.0 114.2 22.7 300.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Other Nonrecurring Items 0.0 1.8 0.1 (148.5) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Pro Forma Operating Income (368.1) (427.3) 471.8 (162.0) (460.0) (230.7) 402.8 173.6 (250.6) 29.8 619.5 113.0
Depreciation and Amortization 33.9 29.9 29.6 28.1 27.0 26.7 26.8 27.1 26.1 26.3 29.7 29.5
Adjusted EBITDA (334.3) (397.3) 501.4 (133.9) (433.0) (204.0) 429.6 200.7 (224.6) 56.2 649.2 142.5
Pro Forma Net Income Reconciliation

Pro Forma Operating Income (368.1) (427.3) 471.8 (162.0) (460.0) (230.7) 402.8 173.6 (250.6) 29.8 619.5 113.0
Interest Income, Expense, and Other (31.6) (56.2) (111.7) (59.6) (56.6) (57.8) (57.1) (56.3) (55.0) (56.0) (55.5) (54.5)
Pro Forma Pretax Income (399.7) (483.4) 360.1 (221.7) (516.6) (288.4) 345.8 117.3 (305.7) (26.2) 564.0 58.5
Pro Forma Income Tax Provision (83.9) (101.5) 75.6 (46.5) (108.5) (60.6) 72.6 24.6 (64.2) (5.5) 118.4 12.3
Pro Forma Net Income (315.8) (381.9) 65.5 (175.1) (408.1) (227.9) 273.2 92.7 (241.5) (20.7) 445.5 46.2
Y/Y % Change
Total Revenue 0.3% -72.4% -18.4% -34.0% -31.8% 165.7% 23.9% 82.9% 79.7% 58.5% 29.2% 14.0%
Gross Profit 1.0% -80.7% -16.6% -34.8% -34.2% 268.3% 22.8% 98.3% 100.7% 71.2% 31.6% 13.0%
Operations and Support 33.0% -23.8% -25.7% 40.2% -21.2% 25.8% 54.5% -24.4% 48.7% 35.5% 13.7% 11.0%
Product Development 39.8% -6.2% -22.6% 589.3% 50.3% 73.6% 74.3% -81.4% 3.3% 6.6% 8.5% 10.6%
Sales and Marketing -13.5% -70.4% -73.6% 24.8% -4.1% 167.9% 184.6% -50.4% 12.4% 23.6% 41.9% 45.2%
General and Administrative -37.2% -11.8% 2.9% 226.5% 113.2% 31.1% 17.0% -70.3% 6.6% 8.6% 7.4% 8.8%
Operating Income -6.4% -482.3% 80.1% -888.5% -112.8% 23.8% -50.8% 99.7% 32.5% 60.5% 104.2% -699.4%
Net Income -16.6% -93.5% -99.9% -815.8% -123.5% 10.3% 39895.7% 97.5% 29.0% 51.7% 166.8% -85.3%
Adjusted EBITDA -34.9% -832.9% 59.9% 51.5% -29.5% 48.7% -14.3% 249.9% 48.1% 127.5% 51.1% -29.0%
Pro Forma Net Income -65.3% -1155.7% -75.0% 32.5% -29.2% 40.3% 317.1% 152.9% 40.8% 90.9% 63.1% -50.2%
Adjusted EPS - Diluted -62.2% -1141.2% -74.9% 46.4% 43.7% 74.5% 90.7% 126.4% 44.5% 91.4% 57.0% -52.0%
Margins
Gross Margin 67.0% 51.8% 83.1% 72.6% 64.6% 71.9% 82.3% 78.7% 72.2% 77.6% 83.9% 78.0%
GAAP Operating Margin -38.7% -174.2% 31.2% -443.7% -120.7% -49.9% 12.4% -0.7% -45.4% -12.5% 19.6% -5.1%
Pro Forma Operating Margin -43.7% -127.6% 35.1% -22.2% -80.1% -25.9% 24.2% 13.0% -24.3% 2.1% 28.8% 7.4%
Adjusted EBITDA Margin -39.7% -118.7% 37.4% -18.3% -75.4% -22.9% 25.8% 15.0% -21.8% 4.0% 30.2% 9.4%
Net Income Margin -40.5% -171.9% 0.0% -440.6% -132.6% -58.0% 7.8% -6.0% -52.4% -17.7% 16.2% -9.8%
Pro Forma Net Income Margin -37.5% -114.1% 4.9% -24.0% -71.1% -25.6% 16.4% 6.9% -23.4% -1.5% 20.7% 3.0%
Airbnb, Inc. 38

4 January 2021
Figure 85: Airbnb, Inc. – Annual Income Statement

2019A 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E
Revenue 4805.2 3249.6 4462.7 6112.6 7599.9 9094.4 10960.9 12947.3 15088.4 17332.4 19691.1 22176.4
Cost of Revenue 1196.3 866.5 1031.6 1283.7 1551.5 1819.5 2116.6 2406.2 2698.7 2983.4 3261.6 3534.4
Gross Profit 3608.9 2383.1 3431.2 4828.9 6048.4 7274.9 8844.3 10541.1 12389.7 14349.0 16429.5 18642.1
Operations and Support 815.1 848.8 860.3 1077.2 1259.8 1423.2 1593.5 1733.7 1864.7 1986.8 2101.5 2203.3
Product Development 976.7 2640.7 1503.7 1612.1 1811.9 1992.1 2213.1 2415.2 2621.4 2849.5 3075.2 3297.8
Sales and Marketing 1621.5 1091.0 1205.2 1573.4 1909.6 2202.0 2480.8 2755.6 3034.6 3302.1 3554.6 3791.7
General and Administrative 697.2 1096.6 802.4 865.5 940.9 1014.0 1091.5 1165.9 1243.3 1327.2 1411.5 1496.4
Restructuring and Other 0.0 437.7 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Total Operating Expenses 4110.5 6114.8 4371.7 5128.2 5922.1 6631.3 7378.9 8070.4 8764.0 9465.6 10142.8 10789.2
Total Operating Income (501.5) (3731.7) (940.5) (299.3) 126.3 643.6 1465.4 2470.7 3625.7 4883.3 6286.7 7852.9
Interest Income 85.9 26.4 14.4 18.2 26.8 63.2 115.6 191.4 275.3 354.7 446.5 554.1
Interest Expense (10.0) (167.2) (238.1) (239.3) (241.4) (243.6) (103.5) (14.0) (14.0) (14.0) (14.0) (14.0)
Other 13.9 (118.3) (4.0) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Pretax Income (411.7) (3990.8) (1168.3) (520.3) (88.3) 463.2 1477.4 2648.1 3887.0 5224.0 6719.2 8393.0
Provision for Income Taxes 262.6 (74.7) 59.2 70.1 84.3 103.8 135.9 167.3 539.7 1024.3 1411.0 1762.5
Net Income (674.3) (3916.1) (1227.5) (590.4) (172.6) 359.4 1341.5 2480.8 3347.3 4199.7 5308.1 6630.5
Preferred Dividends 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Income to Common Stockholders (674.3) (3916.1) (1227.5) (590.4) (172.6) 359.4 1341.5 2480.8 3347.3 4199.7 5308.1 6630.5
Basic Shares Outstanding 260.5 280.4 622.2 652.1 677.4 695.4 709.4 723.7 738.3 753.2 768.3 783.8
Diluted Shares Outstanding 299.4 317.0 650.8 677.9 700.8 717.2 731.2 745.5 760.1 774.9 790.1 805.6
GAAP Diluted EPS ($2.59) ($13.97) ($1.97) ($0.91) ($0.25) $0.50 $1.83 $3.33 $4.40 $5.42 $6.72 $8.23
Pro Forma Diluted EPS ($0.84) ($2.10) ($0.43) $0.34 $0.92 $1.60 $2.81 $4.11 $5.42 $6.81 $8.30 $9.89
EBITDA Reconciliation
Operating Income (501.5) (3731.7) (940.5) (299.3) 126.3 643.6 1465.4 2470.7 3625.7 4883.3 6286.7 7852.9
Net Changes in Lodging Tax Reserves 36.6 (80.5) 8.7 11.7 14.2 20.7 19.6 20.3 21.3 21.7 22.1 22.7
Restructuring 0.0 437.7 0.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Other Nonrecurring Items 0.0 (146.6) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Pro Forma Operating Income (367.4) (485.6) (114.2) 511.7 1035.1 1636.1 2591.7 3697.9 4954.9 6341.0 7864.6 9542.2
Adjusted EBITDA (253.3) (364.1) (6.6) 623.3 1152.6 1753.2 2721.2 3847.5 5131.5 6552.0 8117.2 9844.1
Pro Forma Net Income Reconciliation

Pro Forma Operating Income (367.4) (485.6) (114.2) 511.7 1035.1 1636.1 2591.7 3697.9 4954.9 6341.0 7864.6 9542.2
Interest Income, Expense, and Other 89.8 (259.1) (227.7) (221.1) (214.6) (180.4) 12.0 177.4 261.3 340.7 432.5 540.1
Pro Forma Pretax Income (277.6) (744.7) (341.9) 290.6 820.5 1455.7 2603.7 3875.3 5216.2 6681.7 8297.1 10082.3
Pro Forma Income Tax Provision (58.3) (156.4) (71.8) 61.0 172.3 305.7 546.8 813.8 1095.4 1403.1 1742.4 2117.3
Pro Forma Net Income (219.3) (588.3) (270.1) 229.6 648.2 1150.0 2056.9 3061.5 4120.8 5278.5 6554.7 7965.0
Y/Y % Change
Total Revenue 31.6% -32.4% 37.3% 37.0% 24.3% 19.7% 20.5% 18.1% 16.5% 14.9% 13.6% 12.6%
Gross Profit 29.4% -34.0% 44.0% 40.7% 25.3% 20.3% 21.6% 19.2% 17.5% 15.8% 14.5% 13.5%
Operations and Support 33.8% 4.1% 1.3% 25.2% 17.0% 13.0% 12.0% 8.8% 7.6% 6.6% 5.8% 4.8%
Product Development 68.6% 170.4% -43.1% 7.2% 12.4% 9.9% 11.1% 9.1% 8.5% 8.7% 7.9% 7.2%
Sales and Marketing 47.2% -32.7% 10.5% 30.5% 21.4% 15.3% 12.7% 11.1% 10.1% 8.8% 7.6% 6.7%
General and Administrative 45.4% 57.3% -26.8% 7.9% 8.7% 7.8% 7.6% 6.8% 6.6% 6.7% 6.4% 6.0%
Operating Income -2775.8% -644.0% 74.8% 68.2% 142.2% 409.7% 127.7% 68.6% 46.7% 34.7% 28.7% 24.9%
Net Income -3899.6% -480.7% 68.7% 51.9% 70.8% 308.2% 273.3% 84.9% 34.9% 25.5% 26.4% 24.9%
Adjusted EBITDA -248.4% -43.8% 98.2% 9539.2% 84.9% 52.1% 55.2% 41.4% 33.4% 27.7% 23.9% 21.3%
Pro Forma Net Income -338.2% -168.3% 54.1% 185.0% 182.3% 77.4% 78.9% 48.8% 34.6% 28.1% 24.2% 21.5%
Adjusted EPS - Diluted -370.5% -149.3% 79.3% 178.0% 173.1% 73.4% 75.4% 46.0% 32.0% 25.6% 21.8% 19.2%
Margins
Gross Margin 75.1% 73.3% 76.9% 79.0% 79.6% 80.0% 80.7% 81.4% 82.1% 82.8% 83.4% 84.1%
GAAP Operating Margin -10.4% -114.8% -21.1% -4.9% 1.7% 7.1% 13.4% 19.1% 24.0% 28.2% 31.9% 35.4%
Pro Forma Operating Margin -7.6% -14.9% -2.6% 8.4% 13.6% 18.0% 23.6% 28.6% 32.8% 36.6% 39.9% 43.0%
Adjusted EBITDA Margin -5.3% -11.2% -0.1% 10.2% 15.2% 19.3% 24.8% 29.7% 34.0% 37.8% 41.2% 44.4%
Net Income Margin -14.0% -120.5% -27.5% -9.7% -2.3% 4.0% 12.2% 19.2% 22.2% 24.2% 27.0% 29.9%
Pro Forma Net Income Margin -4.6% -18.1% -6.1% 3.8% 8.5% 12.6% 18.8% 23.6% 27.3% 30.5% 33.3% 35.9%
Airbnb, Inc. 39

4 January 2021
Figure 86: Airbnb, Inc. – Balance Sheet

2019A 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E
ASSETS
Cash and Cash Equivalents 2013.5 4204.2 3691.7 4503.0 6128.8 8604.6 10369.5 15452.3 21657.6 29005.0 37753.5 48115.2
Restricted Cash 0.1 55.6 55.6 55.6 55.6 55.6 55.6 55.6 55.6 55.6 55.6 55.6
Marketable Securities 1060.7 1830.8 1830.8 1830.8 1830.8 1830.8 1830.8 1830.8 1830.8 1830.8 1830.8 1830.8
Funds Receivable 3145.5 1342.0 764.9 1313.1 2739.3 3308.5 3918.9 4549.4 5211.3 5884.9 6573.7 7280.8
Prepaid and Other Current Assets 341.6 239.7 300.7 368.0 431.4 482.8 542.0 599.0 656.4 711.9 766.0 818.3
Total Current Assets 6561.4 7672.2 6643.8 8070.6 11186.0 14282.4 16716.9 22487.2 29411.6 37488.3 46979.7 58100.7
Property and Equipment, Net 301.3 244.7 244.2 233.4 168.1 116.8 83.7 69.6 72.6 85.6 100.1 112.9
Operating Lease ROU Asset 385.6 354.5 354.5 354.5 354.5 354.5 354.5 354.5 354.5 354.5 354.5 354.5
Intangible Assets, Net 102.9 67.0 36.8 15.9 1.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Goodwill 652.1 653.8 653.8 653.8 653.8 653.8 653.8 653.8 653.8 653.8 653.8 653.8
Other Non-current Assets 306.8 172.2 172.2 172.2 172.2 172.2 172.2 172.2 172.2 172.2 172.2 172.2
Total Assets 8310.1 9164.4 8105.2 9500.4 12536.1 15579.7 17981.0 23737.3 30664.7 38754.4 48260.3 59394.1
LIABILITIES & STOCKHOLDERS' EQUITY

Accounts Payable 151.4 106.5 134.7 164.5 192.5 214.2 238.7 261.0 282.8 306.1 328.7 350.6
ST Debt 0.0 10.0 10.0 10.0 10.0 1940.7 0.0 0.0 0.0 0.0 0.0 0.0
Operating Lease Liabilities, Current 38.0 62.7 62.7 62.7 62.7 62.7 62.7 62.7 62.7 62.7 62.7 62.7
Accrued Expenses and Other Current Liabilities 1224.1 1260.1 1125.6 1373.9 1612.1 1818.1 2032.1 2239.6 2449.0 2653.1 2852.8 3047.3
Funds Payable 3145.5 1342.0 764.9 1313.1 2739.3 3308.5 3918.9 4549.4 5211.3 5884.9 6573.7 7280.8
Unearned Fees 674.8 299.5 170.7 293.1 611.4 1498.7 2543.9 3752.1 5131.1 6684.1 8415.0 10328.4
Total Current Liabilities 5233.8 3080.7 2268.6 3217.3 5228.0 8843.0 8796.2 10864.7 13136.9 15590.9 18233.0 21069.8
Operating Lease Liabilities, Non-current 381.4 380.1 380.1 380.1 380.1 380.1 380.1 380.1 380.1 380.1 380.1 380.1
LT Debt 0.0 1818.3 1846.4 1874.5 1902.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Other Long-Term Liabilities 271.2 201.8 201.8 201.8 201.8 201.8 201.8 201.8 201.8 201.8 201.8 201.8
Total Liabilities 5886.3 5480.9 4696.9 5673.7 7712.5 9424.9 9378.1 11446.6 13718.8 16172.8 18814.9 21651.7
Redeemable Convertible Preferred Stock 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5 3231.5
STOCKHOLDERS' EQUITY
Common Stock 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Additional Paid-In Capital 617.7 5791.9 6744.2 7753.0 8922.5 9894.3 11001.0 12207.9 13515.8 14951.8 16507.5 18174.1
Accumulated Other Comprehensive Income (4.4) (2.9) (2.9) (2.9) (2.9) (2.9) (2.9) (2.9) (2.9) (2.9) (2.9) (2.9)
Retained Earnings (1421.0) (5337.1) (6564.6) (7155.0) (7327.6) (6968.2) (5626.7) (3145.9) 201.4 4401.1 9709.3 16339.7
Total Shareholder's Equity (807.7) 452.0 176.8 595.2 1592.1 2923.3 5371.4 9059.2 13714.3 19350.0 26213.9 34511.0
Total Liabilities and Shareholder's Equity 8310.1 9164.4 8105.2 9500.4 12536.1 15579.7 17981.0 23737.3 30664.7 38754.4 48260.3 59394.1
Airbnb, Inc. 40

4 January 2021
Figure 87: Airbnb, Inc. – Cash Flow Statement

2019A 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E
Cash Flows from Operating Activities:
Net Income (674.3) (3916.1) (1227.5) (590.4) (172.6) 359.4 1341.5 2480.8 3347.3 4199.7 5308.1 6630.5
Bad Debt Expense 77.1 102.0 67.7 93.3 110.5 136.6 161.6 187.3 214.3 241.7 269.8 298.7
Deferred Income Taxes (5.6) 0.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Impairment of Investments 27.8 82.1 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
(Gain) Loss on Investment, Net (38.5) 24.4 (4.0) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Noncash Interest (Income) Expense, Net 4.2 26.9 38.1 38.1 38.1 38.1 14.3 0.0 0.0 0.0 0.0 0.0
FX (Gain) Loss 2.9 (63.2) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Other, Net (2.8) 81.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Changes in Working Capital 620.4 (559.9) (359.8) 239.8 410.7 927.0 1062.8 1193.7 1338.7 1483.0 1629.4 1778.7
Net Cash Provided by Operating Activities 222.7 (1065.2) (560.3) 691.6 1398.9 2550.0 3816.3 5218.3 6384.8 7571.4 9015.7 10676.3
Cash Flows from Investing Activities:

Purchase of Property and Equipment (125.5) (33.5) (76.8) (79.9) (37.9) (64.2) (96.4) (135.5) (179.5) (224.0) (267.2) (314.6)
Purchase of Marketable Securities (1016.2) (1999.7) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Sales of Marketable Securities 609.4 206.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Maturities of Marketable Securities 551.6 1005.9 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Payments for Equity Investments (208.2) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Acquisitions, Net of Cash (192.1) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Other, Net 33.7 0.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Cash Used in Investing Activities (347.2) (820.1) (76.8) (79.9) (37.9) (64.2) (96.4) (135.5) (179.5) (224.0) (267.2) (314.6)
Cash Flows from Financing Activities:

Proceeds from Exercise of Stock Options 5.9 13.5 134.7 209.5 274.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Proceeds from Issuance of Redeemable Convertible Preferred 0.0
Stock 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Proceeds from Issuance of Common Stock 0.0 2112.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Repurchase of Common Stock 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Issuance / Repayment of Debt 0.0 1923.9 (10.0) (10.0) (10.0) (10.0) (1955.0) 0.0 0.0 0.0 0.0 0.0
Dividends 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Changes in Funds Payable 848.7 (1749.8) (573.6) 545.0 1417.6 569.2 610.4 630.5 661.9 673.7 688.8 707.1
Other 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Cash from Financing Activities 854.6 2300.3 (448.9) 744.5 1682.4 559.2 (1344.6) 630.5 661.9 673.7 688.8 707.1
Effect of Exchange Rates (25.3) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Net Increase (Decrease) in Cash 704.9 450.2 (1086.0) 1356.2 3043.4 3045.0 2375.3 5713.3 6867.1 8021.1 9437.3 11068.7
Cash, Cash Equivalents and Restricted Cash BOP 4438.6 5143.4 5593.7 4507.7 5863.9 8907.3 11952.3 14327.6 20040.9 26908.0 34929.1 44366.4
Cash, Cash Equivalents and Restricted Cash EOP 5143.4 5593.7 4507.7 5863.9 8907.3 11952.3 14327.6 20040.9 26908.0 34929.1 44366.4 55435.2
Airbnb, Inc. 41

4 January 2021
Valuation, Methodology and Risks

Target Price and Rating
Valuation Methodology and Risks: (12 months) for Airbnb, Inc. (ABNB.OQ)
Method: Our $156 target price for Airbnb is based on a discounted cash flow analysis with a weighted average cost of capital and terminal
growth rate inputs of 10.5% and 3% respectively. Our Neutral rating is predicated on valuation.
Risk: Risks to our Neutral rating and $156 target price for Airbnb are 1) competition with other travel marketplaces, 2) slower than expected
consumer adoption of alternative accommodations, 3) regulatory risk, 4) macroeconomic uncertainty, 5) reacceleration in core short-
term stays, 6) faster-than-expected rollout of ancillary revenue streams, and 7) foreign exchange.
Airbnb, Inc. 42

4 January 2021
Companies Mentioned (Price as of 31-Dec-2020)

Accor (ACCP.PA, €29.6)
Airbnb, Inc. (ABNB.OQ, $146.8, NEUTRAL[V], TP $156.0)
Alibaba Group Holding Limited (9988.HK, HK$232.6)
Alibaba Group Holding Limited (BABA.N, $232.73)
Alphabet (GOOGL.OQ, $1752.64)
Amazon com Inc. (AMZN.OQ, $3256.93)
American Express Co. (AXP.N, $120.91)
Baidu (BIDU.OQ, $216.24)
Booking Holdings Inc. (BKNG.OQ, $2227.27)
Choice Hotels (CHH.N, $106.73)
Despegar.com (DESP.K, $12.81)
Etsy, Inc. (ETSY.OQ, $177.91)
Expedia (EXPE.OQ, $132.4)
Facebook Inc. (FB.OQ, $273.16)
Farfetch Limited (FTCH.N, $63.81)
Hilton Grand Vacations Inc. (HGV.N, $31.35)
Hyatt Hotels (H.N, $74.25)
Intercontinental (IHG.L, 4690.0p)
Kayak Software (KYAK.OQ^E13)
Lyft (LYFT.OQ, $49.13)
MakeMyTrip (MMYT.OQ, $29.53)
Marriott Intnl (MAR.N, $29.53)
Meituan Dianping (3690.HK, HK$294.6)
MercadoLibre Inc. (MELI.OQ, $1675.22)
OYO Corp (9755.T, ¥1,225)
Pinduoduo Inc (PDD.OQ, $177.67)
Rakuten (4755.T, ¥994)
Trip.com Group (TCOM.OQ, $33.73)
TripAdvisor, Inc. (TRIP.OQ, $28.78)
Trivago (TRVG.OQ, $2.42)
Uber (UBER.N, $51.0)
Whitbread (WTB.L, 3100.0p)
Wotif.com Hldg (WTIFY.PK, $3100.0)
Wyndham Destinations Inc. (WYND.N, $44.86)
Yelp (YELP.N, $32.67)
ctrip.com Intl (CTRP.W, $45.83)
eBay Inc. (EBAY.OQ, $50.25)
eDreams Odigeo (EDRE.MC, €4.155)
eLong (LONG.PH, $17.91)
Disclosure Appendix
Analyst Certification
I, Stephen Ju, certify that (1) the views expressed in this report accurately reflect my personal views about all of the subject companies and
securities and (2) no part of my compensation was, is or will be directly or indirectly related to the specific recommendations or views expressed
in this report.
As of December 10, 2012 Analysts’ stock rating are defined as follows:
Outperform (O) : The stock’s total return is expected to outperform the relevant benchmark* over the next 12 months.
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Airbnb, Inc. 43

4 January 2021
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See the Companies Mentioned section for full company names
Credit Suisse currently has, or had within the past 12 months, the following as investment banking client(s): ABNB.OQ, 9988.HK, AMZN.OQ,
EXPE.OQ, TRIP.OQ, AXP.N, FB.OQ, GOOGL.OQ, WYND.N, BABA.N, MELI.OQ
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FB.OQ, GOOGL.OQ, WYND.N, BABA.N, MELI.OQ) within the past 12 months.
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Airbnb, Inc. 44

4 January 2021
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Airbnb, Inc. 45

4 January 2021
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Airbnb, Inc.: Category Creator and Leader, Driving Substitution Effect in Lodging Abnb

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Airbnb, Inc. ABNB

Share price performance

Financial and valuation metrics

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Airbnb, Inc. (ABNB) Analyst: Stephen Ju

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Investment Case: Category Creator and Leader, Driving

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Industry Overview and Thinking through the Total

Figure 1: Airbnb, Inc. – Global Internal Travel Expenditures and as a Percentage of

Source: WTTC, World Bank, Credit Suisse

Accommodations Air Car Rental Other Transport Experiences and Attractions

Source: Euromonitor Source: Euromonitor

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Accommodations Air Car Rental Other Transport Experiences and Attractions

Source: WTTC, World Bank, Credit Suisse Source: Euromonitor

Source: Euromonitor Source: Euromonitor

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Source: WTTC, World Bank, Credit Suisse Source: Euromonitor

Source: Euromonitor Source: Euromonitor

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Source: WTTC, World Bank, Credit Suisse Source: Euromonitor

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Source: WTTC, World Bank, Credit Suisse Source: Euromonitor

Source: Euromonitor Source: Euromonitor

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Thinking through Airbnb’s Total Addressable Market – Not

Figure 22: Airbnb, Inc. – Total Addressable Market

ST Stays Experiences LT Stays

Source: Company data, Credit Suisse estimates

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Figure 23: Airbnb, Inc. – Short-Term Accommodation Addressable Market Build

Population (b) 7.7 8.8

Overnight Paid Trips 6.5 9.5

Overnight Paid Trips 6.5 9.5

Total ST Stay Market 1248 1825

Source: Company data, Credit Suisse estimates

Potentially another $1.4 Trillion of Addressable Experiences Dollars – Expanding from

Figure 24: Airbnb, Inc. – Experiences Addressable Market Build

Source: Company data, Credit Suisse estimates

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Figure 25: Airbnb, Inc. – Long-Term Accommodation Addressable Market Build

Total LT Stay Market 210

Source: Company data, Credit Suisse estimates

160 5% 160 12%

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Company Overview – Category Creator and Leader

Figure 28: Airbnb, Inc. – Company Timeline

Source: Company data

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Product Offering Overview

Figure 29: Airbnb, Inc. – Alternative Lodging Listing Types

Source: Company data

Figure 30: Airbnb, Inc. – Experiences Listing Types

Source: Company data

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

A Closer Look at the Guest Side of the Airbnb Marketplace

Source: Company data Source: Company data

The recent key product initiatives for guests are as follows:

student17@lancaster.ac.uk Student 17 10/03/21 06:42:44 PM Lancaster University

Source: Company data Source: Company data

Attracting and Retaining Hosts