Airbnb Q2 2025 Earnings Report

Airbnb EPS Results

• Actual EPS: $1.03
• Consensus EPS: $0.92
• Beat/Miss: Beat by +$0.11
• One Year Ago EPS: $0.86

Airbnb Revenue Results

• Actual Revenue: $3.10 billion
• Expected Revenue: $3.02 billion
• Beat/Miss: Beat by +$73.25 million
• YoY Revenue Growth: +12.70%

Airbnb Announcement Details

• Quarter: Q2 2025
• Date: 8/6/2025
• Time: After Market Closes
• Conference Call Date: Wednesday, August 6, 2025
• Conference Call Time: 4:30PM ET

Airbnb (NASDAQ:ABNB), together with its subsidiaries, operates a platform that enables hosts to offer stays and experiences to guests worldwide. The company's marketplace connects hosts and guests online or through mobile devices to book spaces and experiences. It primarily offers private rooms, primary homes, and vacation homes. The company was formerly known as AirBed & Breakfast, Inc. and changed its name to Airbnb, Inc. in November 2010. Airbnb, Inc. was founded in 2007 and is headquartered in San Francisco, California.

Airbnb Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Airbnb delivered strong Q2 results with 134 M nights & seats booked (+7% YoY), $3.1 B revenue (+13% YoY), and $1 B adjusted EBITDA (34% margin), generating $1 B free cash flow.
• Positive Sentiment: The company enhanced its core service—improving checkout, messaging, merchandising, and payment options—and deployed a AI customer service agent that cut human inquiries by 15%.
• Positive Sentiment: Expansion markets like Brazil, Japan, and Germany grew at twice the rate of core markets for six consecutive quarters, with Japan campaigns driving a 15% YoY increase in first-time domestic bookers.
• Positive Sentiment: Airbnb launched Airbnb Services and Experiences, earning 13 K press stories, 660 M social impressions, a 4.93 average guest rating, and attracting 60 K host applications.
• Negative Sentiment: Q3 revenue is guided to grow 8–10% YoY with adjusted EBITDA above $2 B, while tougher back-half comps and new growth investments may pressure margins in Q4.

Presentation

[Operator]

Good afternoon, and thank you for joining Airbnb's Earnings Conference Call for the 2025. As a reminder, this conference call is being recorded and will be available for replay from the Investor Relations section of Airbnb's website following this call. I will now hand the call over to Angela Yang, Director of Investor Relations. Please go ahead.

[Angela Yang, Director - IR at Airbnb]

Good afternoon, and welcome to Airbnb's second quarter of twenty twenty five earnings call. Thank you for joining us today. On the call today, we have Airbnb's Co Founder and CEO, Brian Chesky and our Chief Financial Officer, Ellie Mertz. Earlier today, we issued a shareholder letter with our financial results and commentary for our 2025. These items were also posted on the Investor Relations section of AirBee's website.

[Angela Yang, Director - IR at Airbnb]

During the call, we'll make brief opening remarks and then spend the remainder of time on Q and A. Before I turn it over to Brian, I would like to remind everyone that we will be making forward looking statements on the call that involve a number of risks and uncertainties. Actual results may differ materially from those expressed or implied in the forward looking statements due to a variety of factors. These factors are described under forward looking statements in our shareholder letter and in our most recent filings with the Securities and Exchange Commission. We urge you to consider these factors and remind you that we undertake no obligation to update information contained on this call to reflect subsequent events or circumstances.

[Angela Yang, Director - IR at Airbnb]

You should be aware that these statements should be considered estimates only and are not a guarantee of future performance. Also during this call, we will discuss some non GAAP financial measures. We provided reconciliations to the most directly comparable GAAP financial measures in the shareholder letter posted to our Investor Relations website. These non GAAP measures are not intended to be a substitute for our GAAP results. With that, I'll pass the call to Brian.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

All right. Thanks, Angela, and good afternoon, everyone. Thanks for joining. Airbnb had a strong q two. We exceeded expectations across key metrics, including bookings, revenue, and margin.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And while the quarter started with some global economic uncertainty, travel demand picked up, and nice booked in Airbnb accelerated from April to July. We also made meaningful progress across our three strategic priorities. First, we continue to perfect our core service. In q two, we made improvements to checkout, messaging, merchandising, and more flexible payment options, all of which helped us increase revenue. We also expand our new AI customer service agent in The US, reducing the percentage of hosting guests who need to contact a human agent by 15%.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Second, we accelerated growth in global markets. NICE booked on an origin basis and our expansion markets have now grown at twice the rate of our core markets for six consecutive quarters. And what this shows is that we're achieving product market fit, increasing brand awareness, and driving traffic in key countries outside The United States. So take Japan, for example. Late last year, we launched a brand campaign to raise awareness among Japanese travelers.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

You might wanna take a trip, within Japan, and the early results are really encouraging. In q two, Japanese travelers booked more nights on Airbnb than they did in q one, driven by more domestic travel and a 15% year over year increase in first time bookers. We also announced several major partnerships to help accelerate growth in key markets, including a three year partnership with the Tour de France, a global live partnership, music partnership with Lollapalooza, and our continued partnership to IOC for upcoming Winter Olympics in Milan. And we just announced a three year partnership with FIFA and the World Cup, which is the largest event in the world. Large events have been a part of Airbnb's story from the very beginning.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

They help us build brand awareness and grow supply in key markets. And while many of these partnerships are high profile, the events themselves are often very local, and that's what makes them so powerful. They highlight our ability to disperse travel beyond popular city centers and help strengthen relationships with local governments and communities. Finally, our third strategic priority is expand our business beyond stays. And in q two, we did that in a big way.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

As part of our twenty twenty five summer release in May, we launched Airbnb services and completely reimagined Airbnb experiences. We also introduced an all new app, making it easier to book home, service, and experiences all in one place. Now this was our biggest launch to date, and it generated more than 13,000 press stories and nearly 660,000,000 social media impressions. After the launch, I traveled around the world to amplify the news in key markets. And over the next three weeks, I visited six countries and met with over 600 members of the press, policymakers, Airbnb partners, and Airbnb hosts.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And so far, the response to our summer release has been great. Guests say it's easier to discover new list, offerings on our homepage and find what they're looking for. And when they book a service experience, the feedback has been incredibly positive. The average guest rating for a service and experience since launch is 4.93 stars out of five stars. Now for context, this outperforms the already impressive 4.8 average rating for home during the same period.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And we're also seeing strong interest from potential hosts. Since launch, over 60,000 people have submitted applications to host a service or experience. We are really excited by the momentum. It's still early, but we believe that service and experiences could become sizable businesses for Airbnb. Now with that, I'll turn it over to Ellie for a financial update.

[Ellie Mertz, CFO at Airbnb]

Thanks, Brian, and good afternoon, everyone. I'll start with a review of our q two financial results, and then I'll walk through our outlook for q three. As Brian mentioned, q two marked another strong quarter for us. We had a 134,000,000 nights and seats booked, up 7% year over year. We also saw an acceleration in year over year nights and seats booked with growth rates for May and June both outpacing q one.

[Ellie Mertz, CFO at Airbnb]

Looking at the growth rates by region, Latin America grew in the high teens, Asia Pacific grew in the mid teens, EMEA in the middle single digits, and North America in the low single digits. It is worth highlighting that nights and seats booked is a new metric that now includes the number of nights booked for stays as well as the total number of seats booked for both services and experiences. Now turning to our q two financials. Revenue for the quarter was $3,100,000,000 up 13% year over year. In terms of profitability, we generated $1,000,000,000 of adjusted EBITDA, representing a 34% margin, up from 32.5% last year.

[Ellie Mertz, CFO at Airbnb]

And finally, net income of $642,000,000 and EPS of 1.3 grew 1620% respectively. Next, I'll turn to our balance sheet and cash flow. We continue to generate significant cash in Q2, delivering $1,000,000,000 of free cash flow. Over the past twelve months, we've generated $4,300,000,000 representing a free cash flow margin of 37%. At the end of Q2, we had $11,400,000,000 of corporate cash and investments as well as $11,100,000,000 of funds held on behalf of guests.

[Ellie Mertz, CFO at Airbnb]

Our strong balance sheet allowed us to repurchase $1,000,000,000 of our common stock during the quarter, and we ended Q2 with $1,500,000,000 remaining on our repurchase authorization. And today, we're announcing a new share repurchase program with authorization to purchase up to an additional $6,000,000,000 of our Class A common stock. Now since introducing our share repurchase program in 2022, we've reduced our fully diluted share count by 8%. Now let me shift to our q three and full year 2025 outlook. As we look to q three, we're encouraged by current demand trends, specifically the acceleration of nights booked from April through July.

[Ellie Mertz, CFO at Airbnb]

We've seen this momentum globally with especially strong growth in The US. That said, we do expect year over year comparisons to get tougher towards the end of the quarter and that this dynamic will continue into q four, putting pressure on growth rates later in the year. Specifically for q three, we expect to generate 4,020,000,000.00 to 4,100,000,000.0, representing year over year growth of eight to 10%. This includes minimal impact for foreign exchange after factoring in our hedges. We expect nights and seats booked to grow at a similar rate to q two twenty twenty five and for ADR to increase modestly year over year, primarily driven by FX.

[Ellie Mertz, CFO at Airbnb]

On profitability, we expect adjusted EBITDA in q three to exceed 2,000,000,000, and we anticipate that adjusted EBITDA margin will be lower than in q three twenty twenty four, primarily due to investments in new growth and policy initiatives. And we expect a similar year over year decline of adjusted EBITDA margin in q four twenty five due to growth investments and a tougher year over year top line comparison. For the full year, we continue to expect an adjusted EBITDA margin of at least 34.5%. This includes approximately $200,000,000 of investment towards new businesses in 2025. While we don't expect meaningful revenue from our new businesses in the near term, we expect or excuse me.

[Ellie Mertz, CFO at Airbnb]

We believe the opportunity is significant and are building with a multiyear view. To wrap up, our q two results reflect strong execution across our strategic priorities, perfecting the core, accelerating growth in in global markets, and expanding beyond the core. We are acting with urgency and focus to drive growth of our core business and to scale services and experiences. And with our strong financial position, we are well equipped to invest in the future in order to create long term value for our investors. With that, I will open it up to Q and A.

[Operator]

We will now begin the question and answer session. Our first question will come from the line of Mark Mahaney with Evercore ISI. Please go ahead.

[Mark Mahaney, Senior MD at Evercore ISI]

Okay, thanks. I think I'll just like to ask about Airbnb experiences. And Brian, what have you seen so far? What do you think would be success in terms of, I don't know, an attach rate? Like what's the what do you are there proxies or bogeys out there that you've seen other companies or in other industries with kind of the attach rate to a core offering that you think, yes, that's where Airbnb should be?

[Mark Mahaney, Senior MD at Evercore ISI]

It seems to me like it's a natural cross sell or add on, but what's the goal and how long do you think it'll take to get there? Thank you very much.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Hey, Mark. Maybe I'll just, like, zoom out and just talk about experiences and what we've seen so far. We're very, very impressed and satisfied, personally, with the awareness of Airbnb experiences. The biggest problem we've had historically, even with the tax rate, people didn't know you even had Airbnb experiences. The launch turned over 13,000 articles, 660,000,000 social media impressions.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We've also seen increased visibility of our product through our newly redesigned homepage, and guests really love Airbnb experiences. We talked about, obviously, that they're significantly rated more highly than homes on Airbnb. There's a few things. I mean, attach rate, we're absolutely looking on looking at. We we don't have any numbers to share as far as what we see for potential attach rate.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

But we think that attach rate could be significantly higher for the completely reimagined Airbnb experience than the prior iteration of the product. And the way we're gonna do that is, number one, we need to make sure that we have resident supply, supply that people really, really like. So we're making sure that we have great listings. This includes Airbnb originals, that are the very best experience on Airbnb. The next thing we wanna do is make sure we have significantly greater entry points for the products.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So we've really integrated experiences into the core flow. And the third thing is we're raising awareness about Airbnb experiences, and we think that not only sells experiences but sells more bookings. A couple other things I'll just share about Airbnb experiences. You know, we've had a huge amount of people wanting to list experiences on Airbnb, submit applications. And the other thing, I'll I'll just point out Airbnb originals.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

40% of bookings for Airbnb originals are from locals for people in the kind of local area, where where the where the booking occurs. So what we're seeing with Airbnb experiences is even though they're designed for travelers, we also do expect to start to see more local demand. So I think what we're gonna see is over the next year, you're gonna see us really focusing on honing in on the tax rate in key cities. Right now, like, one of the cities we're really focused on is Paris. It's a really popular corridor from The United States, and we're really trying to see what we can do on attach rate in Paris and few other cities like that.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Once we get that attach rate up, that will give us a better indication of what's possible globally. But I'm very, very bullish. I think a large percent of travelers on Airbnb would love to use Airbnb experiences.

[Mark Mahaney, Senior MD at Evercore ISI]

Thank you, Brian.

[Operator]

Our next question comes from the line of Richard Clarke with Bernstein. Please go ahead.

[Richard Clarke, Analyst at Bernstein]

Hi, good afternoon. Thanks for taking my question. Just want to, pick maybe a little bit of the guidance. What is the size of the headwind you're expecting in Q3 maybe from the events, the Paris Olympics? And you talked about that maybe continuing to Q4.

[Richard Clarke, Analyst at Bernstein]

So should we expect Q4 to be slower than Q3? And maybe in addition to that, you've called out three of your growth markets are now alive and kicking sort of Brazil, Japan and Germany. Any thoughts what you think the sort of right midterm growth rate is now for Airbnb given this sort of success in these newer newer geographies?

[Ellie Mertz, CFO at Airbnb]

Sure, Richard. Let me let me talk a little bit about the trends for both q three and q four, and then we can turn to global markets. Excuse me. Just to remind you, the comps that we're referring to from last year, you you'll probably recall that at this time last year, we and others were seeing quite, depressed bookings in July. And so right now, we're we're kind of comping a a softer period from 2024.

[Ellie Mertz, CFO at Airbnb]

But over the course of q three last year, we saw a nice acceleration and exited q three at a at a much stronger rate than we entered. And so that's the pattern that we are we are comping directly right now. It was a it was a couple point acceleration over the course of the quarter. What I'll also call your attention to is the acceleration that we saw beyond q three through the end of q four. So for our business last year, in q three, we grew approximately 8% in terms of of nights booked.

[Ellie Mertz, CFO at Airbnb]

That accelerated over four points to over 12% in in q four. And so that's the acceleration that we're referring to in terms of the hard year over year comp. So when we look at kind of the history of our data and seasonality on the platform, what we're seeing right now is that 2023 is a is a bit more of a normalized comp for '25. And so when we look at that year over two year comp specifically to '23, what it implies is that the hard comp, that we will face on a year over year basis in q four could, could result in a bit of a decel from q three to q four on a year over year basis, and we would just wanted to highlight that heading into the back half of the year. Your second question was around, expansion markets.

[Ellie Mertz, CFO at Airbnb]

You know, obviously, we called out, the the real success we're having in Brazil, in Japan, in Germany, you know, other places that I would call out that we didn't know in the lender in the letter. India is doing quite well. Rest of Latin America also doing quite well. What we've called out for some time with regard to our expansion market strategy is that the composition of our business historically has been so concentrated in the core markets that it will take a period of, you know, aggregated, business mix shift for the, elevated level of growth in the expansion markets to be a meaningful contributor to the overall consolidated totals. I think the good news is that the success that we have had in these expansion markets has already started to move the needle in terms of diversifying our global business away from North America.

[Ellie Mertz, CFO at Airbnb]

I would say just if you look on a year over year basis, the the acceleration or the the strength of growth that we've seen in Latin America has allowed Latin America to take about 200 basis points of business share within Airbnb from North America and therefore contribute more meaningfully to growth. So, you know, the intent of our strategy is to continue to invest in these markets, continue to gain market share in them. And as they grow as a percent of our overall business, the contribution to growth will, commensurately grow as well.

[Operator]

Our next question will come from the line of Eric Sheridan with Goldman Sachs. Please go ahead.

[Eric Sheridan, Managing Director at Goldman Sachs]

Thanks so much for taking the questions. I'm curious about from a marketing perspective as you continue to sort of reposition or position Airbnb as a brand globally and move into these areas such as services and experiences and new growth markets. What are some of the key learnings about the intensity of marketing spend that's needed to put these dynamics into the market and grow and scale them? And how might sort of the channels of those marketing investments continue to evolve when you think about looking out just beyond 2025 and more of a medium to longer term view about how you bring the platform closer to consumers? Thanks so much.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Hey, Eric. I can start. We we think that, probably going forward, the best way to market services and experiences is to actually market the entire offering of Airbnb. So immediately upon, the launch, we did launch some Airbnb experiences, specific ads.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

But this fall, we're gonna be launching ads that market home services and experiences, the bundled offering. And we think this is a really, really key principle that only Airbnb offers all of this in one app. And so we don't think that the marketing intensity per se has to increase because we think we can get a lot more for our dollar by marketing all of our offerings. And it makes more sense. Right?

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Airbnb, in a sense, is these aren't disparate offerings. If you book a home, you're very likely to want a service or experience. So we can market all three. The second thing is channel. So that's just the strategy.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We think that the channels for service experiences and home is increasing in the shift to social. Now why is this gonna be the case? Well, one of the things we're noticing, obviously, in the whole world seeing is that a lot of travel is switching from desktop to mobile and from Google search to social media. And so increasingly, people are spending time on social media, and social media is gradually taking over as the number one place for travel search from Google. And travel is becoming more of an inspiration base than a high intent search based, destination platform.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So, you know, Airbnb, we think, is really prime for social media. You know, we are probably the most relevant brand for young American travelers that is the kinda heart and soul of kind of the social media audience. And I think that, you know, you're gonna see a lot more of social media native advertising. So we're shifting a lot of our advertising from TV to social. And we are and the great thing about social is we can target.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We know a lot more about the customers. We know if they're Airbnb customers. We can actually, when they watch an ad, we can link it to inventory and get them to go directly to the app. So it's it's actually, we think, very, very performative. So this is, this is what we're gonna be doing with marketing.

[Ellie Mertz, CFO at Airbnb]

Brian, if I could just add, one comment to that. In terms of overall marketing intensity, the $200,000,000 that we have highlighted in terms of investments behind experiences and services for 2025, it is not an increase in programmatic marketing. Our overall programmatic marketing for the year is relatively stable from a percent of revenue basis. Instead, the increase in sales and marketing that you see associated with, services and experiences is focused in particular on our field operations, go to market activities and supply acquisition. It is not spending more to, effectively advertise multiple brands.

[Ellie Mertz, CFO at Airbnb]

Instead, to Brian's point, we are spending behind a single brand.

[Operator]

Our next question comes from the line of John Colottone with Jefferies. Please go ahead.

[John Colantuoni, Equity Research Analyst - Internet at Jefferies]

Great. Thanks for taking my questions. I wanted to ask one about Experiences. I'm curious to get your perspective on the approach that you're taking to building inventory in Experiences. There's a lot of variability in the quality across the Experiences industry.

[John Colantuoni, Equity Research Analyst - Internet at Jefferies]

So I'm curious how you're approaching balancing building supply that's consistent with the differentiation of Airbnb's accommodations offering versus building more commoditized supply that's maybe easier to build scale around? Thanks.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah, John. Actually, we actually are managing the quality of experience and even more than managing the quality of homes. I think the evidence of that is two things. The input is that we actually vet every single experience on Airbnb before it comes on the platform. We do not vet every home to what we vet every experience on Airbnb.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

The result of that is that the average home is got a 4.8 rating. The average experience has a greater than 4.93 rating. So we think this is working. Now as far as scale, we actually think we can do this, like, quite effectively. We are working with a of third party vendors.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We built a fairly sophisticated operation, to do vetting. You know, we vet, through the first thing we do is we vet their profile, make sure everyone's got a verified identity. We vet their credentials. There's a number of third party sites we can do use for that. And we also make sure they have right certifications and licenses, which I think is really, really important for all these nascent different industries.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

But we think we can be very, very efficient with this vetting approach. And we ultimately think that this could actually make the market more effective because quality is critical to customer satisfaction and building trust and people really trying something new on Airbnb.

[Operator]

Our next question comes from the line of Jed Kelly with Oppenheimer. Please go ahead.

[Jed Kelly, MD & Senior Analyst - Online Travel & Internet at Oppenheimer & Co. Inc.]

Hey, great. Thanks for taking my question. Just on overall company strategy, how do you think about potentially implementing a strategy or acquiring a company that potentially could reaccelerate or reaccelerate your revenue, reaccelerate your nights versus building organically? Thank you.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Hey, Jed. We're always we're always open to buying companies. We've purchased a few companies in the past. Our, you know, Hotel Tonight has been, you know, a successful, application that we acquired a number of years ago before the pandemic. We've historically primarily focused on building organically, but, you know, we absolutely are open to acquisitions, and we are gonna be looking at it.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And I think that we are now, in a better place to consider acquisitions now that we've rebuilt our tech platform from the ground up, and we have this new expanded strategy where we're focused not just on all aspects of traveling, but also living. And so I think there's absolutely acquisitions on the table that we could be looking at. We always wanna make sure that if we do an acquisition, is one of the most perishable opportunities that the integration costs don't outweigh the, like, the benefit of the revenue that we get. But we are absolutely opportunistic when it comes to acquisitions. I think we're more prepared to do them now than before.

[Operator]

The next question comes from the line of Colin Sebastian with Baird. Please go ahead.

[Colin Sebastian, Senior Research Analyst at Baird]

Great. Good afternoon. Thanks for taking the question. Brian, you touched on this a little bit, but curious if you have any more color on the impact or observations on the way homes or nights are booked from the app following the redesign. And just one point of clarification from the release.

[Colin Sebastian, Senior Research Analyst at Baird]

It sounds like booking lead times are now back to a normal level versus what you were seeing earlier in the quarter. Elliot, if can just confirm that. Thank you.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Hey, Colin. What we're seeing with homes is some pretty exciting patterns. We're seeing a giant uptick in the number of people that are booking a home from the homepage on Airbnb. So this has been a major behavioral change from, you know, basically, the last seventeen years of Airbnb's history.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So if you go to most apps, especially OTA, they you open the app, and every single person goes essentially to the search box. They type in something on the search box, and they enter dates, and they get a bunch of search results. And this is how everyone searched for travel over the last twenty, twenty five years. The holy grail is to get more and more people to be in browse and discovery mode, almost like on Netflix or, say, DoorDash. DoorDash was very search driven. They're now more of a browse and discovery application. And it's been a really hard nut to crack within travel, but we think we've done it.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Because what we've seen is that increasingly more and more guests are engaging, not just to service experience from a home page, but with homes. Now this is very strategic. Why is this strategic for us? The reason why is if people can engage with our home page rather than typing in a destination, then we can divert travel more broadly to where we have available supply, thereby increasing conversion rate of our traffic, if this makes sense. So the more intent based our traffic is, people have a very specific destination, very specific dates.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And if they're only going based on high intent, you're gonna lose people that are either lower intent or people where you might have a home, but it's a little bit outside their search radius or a little bit outside their date that they're looking for. So this is one of the things that we've seen. We've also seen, a lot more people engage with a new trip tab. Our trip tab is essentially our itinerary, and, we are seeing a lot more engagement on the itinerary. And this itinerary is really important because this is the application that you use when you're on your trip.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

This is critical because if we can get people to use the application on trip and we can get co travelers to use it on trip, then what we're really saying is we have this point of sale during the trip to cross sell other things. So, for example, one of the things we've seen with experiences and services is a lot of people like to book service experiences last minute, including people often like to book service experiences when they're on a trip. And so, you know, if we can get more people to open our app during a trip and go to the homepage and browse Discover, then this goes to, one of the kind of questions I asked earlier about how we cross sell for Mark and get more people to book services experiences. So there's been many other things that I could call out about the launch, but that would be the key thing. People are engaged on their app while on trip, and they're engaged with their homepage. This is really, really critical to booking more homes, but also to cross selling services experiences.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And I just wanna wrap by saying these are two things I don't think OTAs have cracked. I don't think OTAs have cracked how to get anyone to scroll on their homepage. I don't think OTAs have cracked how to get people to use their app during the trip. So I think that these are distinctly things that Airbnb has started to open the door for.

[Operator]

Next question Oh, comes from the

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

and I think there was a point question, Ali.

[Ellie Mertz, CFO at Airbnb]

Colin, just your second question was about lead times. The question, you know, have they normalized compared to earlier in q two? The answer is yes. As you recall, back in April, lead times were heavily compressed. They were down about 7% year over year.

[Ellie Mertz, CFO at Airbnb]

Over the course of the quarter, as booking confidence rose, bookings accelerated, we saw lead times normalize. And then heading into Q3, they've actually lengthened a little bit compared to last year, which is a great sign in terms of booking confidence and overall guest demand.

[Operator]

Our next question will come from the line of Justin Post with BofA. Please go ahead.

[Justin post, Managing Director at Bank of America Merrill Lynch]

Great. A couple of questions. Fred, I'm sure you would say there's still a lot of room to grow in The U. S. So maybe help us understand why the growth rate is in the single digits, how supply is growing and how you might be able to accelerate that?

[Justin post, Managing Director at Bank of America Merrill Lynch]

And then on Events and Experiences, any thoughts on what you're hoping for or targeting for long term attach rates on on a per trip basis? Thank you.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Ali, don't take the

[Ellie Mertz, CFO at Airbnb]

Brian, take the the acceleration. Yeah. So when we think about, The US, it is our largest market, but it actually has, we believe, a huge amount of room to grow. In particular, when we look at The US, it remains a heavily hotel dominated market. So when we reference that, you know, one in 10 nights that are stayed outside the home are in an Airbnb, that is actually directionally true for The US, and is actually, you know, a lower, percentage penetration in terms of short term rentals than we see in other markets.

[Ellie Mertz, CFO at Airbnb]

So think structurally, The US has a huge area to grow. How are we how are we going to drive incremental growth in The US? It's really consistent with the strategies that we've laid out, in particular, around perfecting the core. We know that there are some user gaps in terms of converting more hotel users to Airbnb guests, and those are the are the gaps that we're working to close. I think, you know, one is is obviously pricing affordability.

[Ellie Mertz, CFO at Airbnb]

We've we've made some, I would say, great progress there in terms of little price display, better pricing tips, but there's, I would say, a lot more work to do to make sure that we are always, you know, the greatest value and are attracting a wide variety of US demographics. Second, you know, another strategy that we've talked about for some time that we are seeing good results from is targeting specific demos that we are underpenetrated in. The two that we've called out and and have made progress against are, one, The US Hispanic population, and second, what we call the Heartland states, you know, states in the middle of the country that we have historically had lower levels of penetration. And then I would say, more broadly, there's a series of things coming in terms of increasing usability, exploring more diversity of payment options that we think will be also incrementally accretive to The US.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Maybe, I can just add on a little bit. Know, we think we're just scratching just to kind of kind of follow-up with what always said. I think, we're just completely scratching the surface of the scale of home sharing in Airbnb. Why do I think this is the case?

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Well, let's look at supply and let's look at demand. On the supply side, we have around 10,000,000 homes. I think we can have tens of millions more on Airbnb. When you ask people, why don't you put your home in Airbnb? The two most common reasons are it's too much work and, like, a k, I don't have the time, or I don't want people I don't know in my home.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Regarding if too much work, you know, we found a lot of success with cohosting. Cohosting, just to remind you, is a marketplace where we connect the best host in Airbnb with people who have homes that don't have time to host. We now have, a 100,000 listings managed by cohost. They posted 10,000,000 nights. I think this could lead to millions and millions more homes on Airbnb.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

It's a very, very successful program, and we are prepared to scale this in the coming years. So this should unlock a lot more supply. Regarding, people just being nervous about guests being in their home, you know, we're the only company that has a 3,000,000, guarantee called Aircover that protects you against theft and property damage. But we're also investing a lot more in trust and safety. You know, we have more than 200,000,000 verified identities on Airbnb, more than almost any other platform of any kind on the Internet, and we're gonna be investing a lot more on Airbnb.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

You know, think on a lot of other platforms, you don't really know who the guests are. Oftentimes, they don't even have accounts. On our platform, they're gonna have rich profiles. They're gonna know a lot more about them. So I think if we do these two things, and then to Ellie's point, if we focus on getting more homes in our top markets where we're supply constrained, we focus on quality, reliability, and continue to make progress on affordability, then I think we're gonna look back and say that we're just scratching the surface of, the growth of our core business in in US.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

I think the other thing I'll just say on growth generally is the following. You know, we are looking to reaccelerate the growth of Airbnb. We are not satisfied with the company growing approximately 10% year over year. We want the company to reaccelerate. We think we have a great plan to reaccelerate.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

The three strategic priorities we have, perfecting our core, expanding global markets, and these new products and services, They're all essentially starting from a small base, but they're gonna be scaling, you know, and they're gonna all pay off in different times, but we're we have a lot of bets that are growing. We have services. We have experiences. We have hotels in Airbnb that are starting to scale. We've got about eight countries globally that, you know obviously, Brazil's been a huge success story, but also Japan, we call that in the letter.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We started marketing Japan late December. November, December, we're starting to see real big growth in Japan. So we're gonna see a lot of these areas really pay off, I think, around the same time. And this is why I feel very confident this company can reaccelerate. And I do not think we're coming close to reaching any type of saturation in any market around home sharing.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

There's a huge amount of homes that aren't listed that could be if you make hosting easier and safer. And I think that, you know, one in nine people, you know, stay or one in 10 people stay in Airbnb. If that was two in 10, that would double our business.

[Operator]

Our next question comes from the line of Doug Anmuth with JPMorgan. Please go ahead.

[Douglas Anmuth, MD & Internet Analyst at JP Morgan]

Thanks for taking the questions. Brian, I have two. There's been a lot of discussion on experiences. I was just hoping you could talk a little bit about the launch of services and just where you're most focused there across supply and building demand or just overall product. And then you talked about the opportunities and partnerships around major events.

[Douglas Anmuth, MD & Internet Analyst at JP Morgan]

How do these help in terms of incremental bookings, but then also on brand and and product awareness? Thanks.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. I mean, on services, services are earlier than experiences, obviously, because experiences existed. We launched in 02/2016, and we basically reimagined it.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Services is essentially 10 different businesses. I mean, every category of services is kind of like a different business. You know? Photography is different than chefs. It's different than masseuse.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So we essentially launched 10 categories, 10 different businesses and services. We launched them around the world. What we're really focused on doing right now is trying to crack in a few key markets. Los Angeles, for example, is a market that we've been spending a lot of time on. We think it's a really great, market to test services in.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And what we're really trying to do is build out the catalog of these services and really increase the attach rate. One of things I'm really excited about with services is about 10% of bookings for services are actually from locals or people that are nearby. Essentially, locals are people booking them in their own city. And I think there could be a huge opportunity for demand of local booking services. You know?

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Think about all the people that would let a chef come to their home, that aren't traveling. So people that want a massage to come to their home, that aren't traveling. So I think there's a huge opportunity here. So we're gonna be looking at attach rate in key markets and also the amount of locals that are booking as well. What we are seeing is that the satisfaction rate of services is similar to the satisfaction rate of homes from guests, and it's higher than, sorry.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Similar to experience and higher than homes. So it's around 4.93 for services versus 4.8 for homes. So we're seeing a lot of promising traction, but it's incredibly early, and it's earlier for services than experiences. So we expect this bet to play out over a longer time horizon. I do think, that services is probably a significantly larger opportunity than experiences because the 10 categories they launched are just the beginning.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

There are dozens and dozens of categories of experience you can book. Imagine getting to Airbnb and there's a catalog of services, anything you can imagine. I think this could be where we can take this product, but we're going to focus on getting these 10 to work in a few markets.

[Operator]

Our next question comes from the line of Trevor Young with Barclays. Please go ahead.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Sorry. Sorry. I did not answer the question about events. Can I just do that real quick?

[Operator]

Please go ahead.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So, yeah, yeah. Sorry about that. With regard to the second part of the question about events, you know, first of all, large events have been part of our history. We launched for, you know, during a design conference in 02/2007, then we launched the Democratic National Convention in 02/2008. And what we've seen with events is a couple of things.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Number one, it's a great way to build supply in Airbnb. We have more than a 50% increase in amount of homes in Paris on Airbnb because we hosted, for the Olympics. We are a sponsor for the Olympics, and they need housing for events. So we think this is really, really strategic to getting supply in cities. And a lot of people that have no intention to become long term hosts become hosts just once for an event.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And what we've seen is events are a great hook. To get people that have no intention to becoming long term hosts to try it, and then a bunch of people actually continue hosting because they said, actually, that was a great experience. So events are kind of like a low commitment, high urgency way to get people to try hosting, And what we found is a number of people continue to host. In fact, this is the entire premise of how the company got started. So that's the first thing.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

It's a great way to build supply. The second thing is it's a great way to build relationships with policymakers, regulators, and increase trust in the brand. For example, Italy is a very strategic market for Airbnb. We certainly had some regulatory challenge in the past to Italy. But Italy, Milan is hosting Cortino are hosting Olympics next year.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We were able to make a lot of progress with Italian policymakers because we're partnering with them on the Olympics. We're a title sponsor. We're providing housing in Milan. They don't have enough housing. They certainly don't have enough housing in Cortino, so we're able to support them.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

FIFA World Cup, gonna be the probably one of the largest, if not the largest event in human history. Think about it. The World Cup is the largest event in the world. This might be the largest World Cup ever. And where are all these people gonna stay?

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So we're now working with cities all over The United States, US, you know, Canada, Mexico. And this, I think, has been a gateway to open relations to regulators. The final thing is I think it just increases, our our trust in our brand by associating with the Olympics, the Tour de France, World Cup, Lollapalooza. We're connecting Airbnb with some of the most beloved brands and some of most passionate fan base and passionate interest. I think Airbnb is such a perfect partner, for these events because many of the events couldn't happen in the same scale without Airbnb.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Tour de France, for example, there aren't very many hotels along the route, but there are homes. So I think events are just a great part of our strategy, and we're gonna continue to do a lot more of them. And they're really part of our roots. So the key question is how do we industrialize this, strategy? And this is something that we're gonna be continuing to focus on.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And maybe the one other thing I'll just say is now that we have home services and experiences, the partnerships are more efficient because we have more things to cross promote.

[Operator]

Our next question comes from the line of Trevor Young with Barclays. Please go ahead.

[Trevor Young, Director & Internet Research Analyst at Barclays Capital]

Great. Thank you. First one on the 200,000,000 investment baked into the full year EBITDA guide. Was there a change in expected spend there? I think last quarter you'd said it was 200,000,000 to $250,000,000 for the new 25 business launches and now you're saying 200,000,000 just for services and experiences.

[Trevor Young, Director & Internet Research Analyst at Barclays Capital]

So just wondering should we interpret that to mean there are no other launches this year or is there 50 earmarked for something maybe to be announced? And then second question, just on the change in definition on nights and seats booked, can you just level set how much of that today is actually like experiences in seats versus stays? Is it 1%? Is that essentially zero? Investors always ask, you know, what's kind of the breakout of that mix.

[Ellie Mertz, CFO at Airbnb]

Yes. Let me let me comment on the $200,000,000 investment. So at the beginning of the year, we gave a range of 200 to $250,000,000 for our new businesses. We have launched those new businesses. It was the reimagined experiences and services.

[Ellie Mertz, CFO at Airbnb]

We're obviously more than halfway through the year, and so we've just refined the estimate in terms of the the total investment. There's there's no change to strategy or, you know, a a incremental business that is that is truly focused on, experiences and services. We wanted to give you an updated number, now that we have more visibility. In terms of nights and seats booked, we have not historically broken out nights booked versus, experiences booked. We we were not going to do that, today.

[Ellie Mertz, CFO at Airbnb]

What I can tell you is that, the seats booked today are indeed immaterial. The intent, obviously, with the launch and our investments here is to scale those businesses such that they are a material contributor to the total.

[Operator]

Our next question will come from the line of Brian Nowak with Morgan Stanley. Please go ahead.

[Brian Nowak, Managing Director at Morgan Stanley]

Thanks for taking my question. I wanted to come back to The U. S. Room night growth and I was also going to end me a little bit. So I guess if we look at The U. S. Growth on room nights excluding services and experiences, Ryan, can you just sort of talk us through the one or two key priorities in your mind to sort of accelerate that growth, into into '26? And the same question on EMEA. You know, I think you're growing slower than even your your more scaled competitor in EMEA at this point. How do you think about sort of the keys to driving faster growth in EMEA as you go into 2026?

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Alright. So, sorry. The question was, the first question was about US, our core market?

[Brian Nowak, Managing Director at Morgan Stanley]

That's right. Yep.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Yeah. I think that there's, like, really a few pillars. So one that we've seen a lot of traction on is making Airbnb easier to use. We've made hundreds of improvements.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We highlighted a bunch of them, on the most recent release, and, that has led to hundreds of millions of dollars incremental revenue. So we've made a lot of traction, a lot of progress around making it be easier to use. I think pricing and affordability is the next one. We are seeing a huge opportunity around increasing competitiveness of pricing on Airbnb. You might notice that we moved to, total price display.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

That's been very successful. We're now exploring, you know, different ways to present pricing, moving towards a host only fee. We're doing a lot around giving hosts more tools to make their listings more competitive. We announced, we we announced a new calendar, on the May launch that has better price suggestions. We're seeing hosts adopt that.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

When hosts adopt that, they have more competitiveness. And they have more competitive. They earn more money. That's accretive to our business. So I think pricing is gonna be a huge opportunity for us.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And then I think increasing supply. You know? And the way we're gonna increase supply is we're not gonna be looking at just the overall top line supply globally. We're focusing on our most supply constrained markets and really targeting adding supply in those markets. Additionally, you know, people looking for homes, if we don't get that home, we wanna be able to have a place for them to stay.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So we're also gonna be increasing the onboarding of hotels, especially in supply constrained top markets as well. So I think these are some of the things you're going to see that are going to absolutely be able to help accelerate growth in The United States.

[Operator]

Our next question comes from the line of Justin Patterson with KeyBanc. Please go ahead.

[Justin Patterson, Managing Director at KeyBanc Capital Markets]

Great. Thank you. Going back to some of the $200,000,000 investment you were talking about, all that sounded like people costs for this year. As we head into 2026, how should we think about that cost potentially scaling up? Do you feel like you have the right number of people in place right now to keep stealing experiences and services, or or is that something that you're gonna have to kinda keep adding to to bring on more supply?

[Justin Patterson, Managing Director at KeyBanc Capital Markets]

And then just from the the marketing standpoint, you know, we'd love to hear about how you're thinking about using, performance marketing a bit more, perhaps search to augment, sort of the broader brand campaigns, for the overall business. Thank you.

[Ellie Mertz, CFO at Airbnb]

Yeah. So, Justin, on that 200,000,000, yes, indeed, it is. A good portion of it is headcount, split across both product development as well as, our field operations team as well as some investments in terms of vendors helping us curate and onboard the new supply. When we think about, you know, scaling the investment over time, I'm not gonna I'm not gonna give a, you know, particular figure for next year, but what you should assume is that we will continue to invest in 26 behind these businesses in order to scale them. And some of the, you know, investments this year will carry into next year as, you know, fixed headcount that we brought on to support these businesses.

[Ellie Mertz, CFO at Airbnb]

In terms of the second question, Brian, let let me know if you wanna jump in here. You know, we continue to use performance marketing as a, I would say, surgical topper to the majority of our spend being in brand. You know, we've talked about this quite a bit over time. Our strategy in terms of the marketing channel mix is obviously quite a bit different from others in that we're able to benefit from our the strength of our brand and the singularity of our brand to put money in a hard a larger allocation of our marketing spend behind brand versus performance. That being said, we do continue to use performance surgically across the world to, you know, get good returns on those incremental nights.

[Ellie Mertz, CFO at Airbnb]

And I would say the the overall intensity, you know, as compared to competitors remains relatively low in that, you know, the metric that we've shared over the years, 90% of our traffic coming from direct and, unpaid sources continues to be the the the state of the business, which allows us obviously to spend a lot less on performance marketing than others.

[Operator]

Our next question comes from the line of Ron Josey with Citi. Please go ahead.

[Ron Josey, Managing Director at Citi]

Great. Thanks for taking the question. I wanted to follow back up on the experiences side, Brian, and ask about the merchandising, given the Airbnb knows who's traveling, when you're traveling, the age of the people traveling, etcetera. You talked a little bit about the test and learn of experiences in cities like Paris. So help us understand if you see just applications continue to balloon for experiences, how you can scale the learnings in Paris to better merchandise overall.

[Ron Josey, Managing Director at Citi]

And then just as a follow-up, you know, we've talking about loyalty programs for some time and how the goal is for Airbnb to launch one that's differentiated, not just a points program. Any any updated thoughts on this would be helpful. Thank you.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Absolutely. With experiences, you know, we are doing a lot around testing carousels. If you open the app in, right now, you go to the experiences tab, you'll see, that we merchandise totally differently. These smaller cards, the different carousels, and the carousels are gonna get more and more personalized.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

So as we know more about you, we might know where you're coming from, what kind of price homes you're searching for, which experience you recently viewed. And the basic idea is to show you a high density amount of experiences that you're very, very interested in potentially booking. And I think also increasing the touch point. So we're gonna have the homepage. We're gonna open right to the homepage if you're on trip or post booking on home.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We're gonna have other entry points, through the trips tab where we're merchandising, highlighting. And we're really just you know, we're gonna be doing a lot around making sure that we can continue to pull pull hooks in to get people to see the right type of experience on Airbnb. And, you know, we're we're obviously if we figure something out in one city, we can immediately roll it out to every city globally that we have the product in. So we think we can do quite a quite a rapid iteration. We have a team in Paris right now, like, kind of a team of product development leaders, designers, engineers into the city to really do really, really tight feedback loop and to figure out the kind of supply that people really want.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And we're really doing a lot with testing ranking to figure out how to make sure that the right people see the right supply and book it. I think that was the first question. The second question was, I think, around loyalty. I think, you know, a loyalty or membership program is a very, very compelling thing for Airbnb. I mean, number one, one of the great things about our business is we have loyal customers.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

The vast majority our customers come back direct to Airbnb. Hence, why 90% of our traffic is direct or unpaid. It's because the majority of our bookings come for repeat bookers. We have to pay them to come back. So the best loyalty, of course, is to have a product people love.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

That being said, I do think we're sometimes at a competitive disadvantage vis a vis OTAs and hotels because they have a lot of programs we don't. So I think there's a lot of upside if we were to have a program. If we were to do something, I don't think it would be, a traditional points program. I think it would be something much more interesting and novel. But I absolutely think you should see something from us in the future, not imminently, but in the future.

[Operator]

Our next question comes from the line of Steven Ju with UBS. Please go ahead.

[Stephen Ju, Analyst at UBS Group]

K. Thank you. So, wanted to follow-up on your commentary on the trips tab because yeah. I mean, from a design perspective, since it is an itinerary, the optimist in me wants to believe that Airbnb will be and should be taking a greater role in the aggregated door to door travel experience. So, you know, are we wrong to think that the expanded travel agent opportunity here?

[Stephen Ju, Analyst at UBS Group]

And I I realized that, you know, you just launched experiences, so asking you what's next, you know, probably sounds a little bit demanding, but sort of the bigger picture of what the itinerary can evolve into will be interesting. And, secondarily, there was a commentary in the letter regarding the new payment methods in Brazil. Do you think the experience that you've picked up from doing this initial batch of expansion countries will help you speed up the product development and the cadence of updates for, you know, what must surely be the next batch of new market? Thank you.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. I mean, I I think I can answer both, and maybe I'll start with the second because it's kind of tactical. You know, we are massively wrap ramping up development of a product development pace at Airbnb. You know, we do these typically biannual releases, but we are now iterating very, very quick even between these releases. So you're gonna see and I think the Brazil installment has been a huge example of something that's been really pop great really, really powerful.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Pay zero upfront is starting has been very, very successful. We have an updated cancellation policy that's rolling out. That's gonna be success we think it's gonna be accretive to growth. So we have a real, huge amount of momentum around a lot of optimizations. I think we got a great flywheel.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

With regards to TripsCab, the itinerary product development, maybe this is an opportunity to talk a little bit more about the long term product vision and where we're going. And you we couldn't talk about long term product vision without talking about AI. I haven't been asked about it, but, I might as well talk about it because I think you can't do travel planning without AI going forward. We've chosen a very specific way to approach AI. A lot of companies have chosen what I would say is the lower stakes part of travel, which is travel planning and inspiration.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

For AI, we actually start with the hardest problem, which is customer service. Customer service is the hardest problem because the stakes are high. You need answers quickly, and the risk of hallucination is, very, very high. You cannot have a high hallucination rate. And when people are locked out, they wanna cancel reservation, they need help, you need to be accurate.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And so what we've done is we built a custom model or we've we've we've built a custom agent built on 13 different models that have been tuned off of tens of thousands of conversations. We've rolled this out throughout The United States in English, and this is reduced, as I mentioned in the opening remarks, 15% of, people needing to contact human agent when they interact instead with this, AI agent. We're gonna now, over the course of this year, bring this to more languages. And throughout next year, it's gonna become more personalized and more agentic. So what this means is that when you reach out to an agent, the AI agent, it will not only tell you how to cancel your reservation, it will know which reservation you wanna cancel.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

It can cancel it for you, and it could be agentic as in it can start to search and help you plan and book your next trip. Next year, we're gonna bring AI into travel search. So all this brings us back to the question you asked about travel planning. Over the next couple years, I think what you're gonna see is Airbnb becoming an AI first application. And this leads to the bigger question around AI.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Over the last almost three years since ChatGPT has been out, if you look at the top 50 apps in the App Store, almost none of them are AI apps. The number one app in the App Store, I think, as if as we speak is ChatGPT. And if you go through two through 50, maybe only one or two others are AI native applications. So you've got basically AI apps and kinda non AI native apps. And Airbnb would be a non AI native application.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Over the next couple years, I believe that every one of those top 50 slots will be AI apps, either start ups or incumbents that transform into being AI native apps. And I think that Airbnb, we are going through that process right now of transitioning from a pre generative AI app to an AI native app. We're starting a customer service. We're bringing into travel planning. So It's really setting the stage.

[Operator]

Our next question will come from the line of Kevin Kopelman with TD Cowen. Please go ahead.

[Kevin Kopelman, Managing Director - Equity Research at TD Cowen]

Thanks. I appreciate it. I wanted to ask, could you give us your first thinking on the and this is a bit of a follow-up perhaps on the one to two major product launches that you're thinking about for 2026. Key focus areas is the AI travel search you just mentioned, one of those major product launches. And how are you planning to manage overall company margins next year? Thanks.

[Operator]

Is Dion here on Capital One.

[Ellie Mertz, CFO at Airbnb]

Do you repeat taking We've your some we've had some audio issues. Sorry.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Sorry. Yeah. We just got dropped in the call. So I don't I don't I don't think I was able to finish my answer, should we just go right to the next question?

[Ellie Mertz, CFO at Airbnb]

Sure.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Okay. Sorry. So can you ask the question again? We're really sorry. We both got dropped

[Ellie Mertz, CFO at Airbnb]

off

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

the phone.

[Kevin Kopelman, Managing Director - Equity Research at TD Cowen]

Yeah. Yeah. No worries. Can you hear me okay?

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yep.

[Ellie Mertz, CFO at Airbnb]

Now we can.

[Kevin Kopelman, Managing Director - Equity Research at TD Cowen]

Okay. Great. Yeah. So I wanted to ask you and maybe a follow-up to what you just you were just talking about. So your first thinking on the one to two major product launches, for 2026 key focus areas is the AI travel search you just mentioned, one of those major product launches.

[Kevin Kopelman, Managing Director - Equity Research at TD Cowen]

And, how are you planning to manage overall company margins, next year taking into account the new launches and also the continued investment in, experiences and services? Thanks.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Well, you know, generally, we don't talk about or preview what we're gonna launch when. So but we are bringing AI more into the app next year so we can confirm that, but we're not gonna be able to preview what will be and what's launched. So I'll let Ellie, though, talk about the second part.

[Ellie Mertz, CFO at Airbnb]

Yeah. On margins, I'm I'm not gonna guide right now to 26. What you can assume is that we are, one, continuing to invest in our new businesses and, two, continuing to drive efficiencies across the core business. We'll give you color in upcoming quarters in terms of, you know, how that nets out with regard to sequential margins.

[Kevin Kopelman, Managing Director - Equity Research at TD Cowen]

Okay. Understood. And maybe just a quick follow-up. When you talked about accelerated development pace, is the new tech stack that you rolled in May out in May playing a part in that? And, you know, are you seeing also benefits to customer conversion rates from, what you what this new tech stack has enabled? Thanks.

[Ellie Mertz, CFO at Airbnb]

I'd say yes. Absolutely. The new tech stack, we are seeing benefits from that. I would say, more broadly, the investments we've made across our infrastructure over the last couple of has really improved the development environment for our team, allowing them to do more and to do more quickly. Obviously, that is increasingly aided by AI as well.

[Ellie Mertz, CFO at Airbnb]

And so we hope to see, you know, an increased velocity across our product development road map in coming quarters.

[Operator]

Our next question comes from the line of Ken Gorelski with Wells Fargo. Please go ahead.

[Ken Gawrelski, MD & Senior Internet Analyst at Wells Fargo]

Yes. Thank you. Two, if I may, please. And you build on some of the other questions. First, Brian, on the AI side, do you anticipate there's seems like there's going to need to be a choice made, whether to be open to agents and kind of agent agentic traffic and who will own that relationship versus being more of a closed platform.

[Ken Gawrelski, MD & Senior Internet Analyst at Wells Fargo]

And given that you have much of your traffic today is direct, and that you have a lot of exclusive supply, you probably have your choice in the matter. So I'd love if you could talk a little bit about that. And then second, maybe, again, bigger picture on strategy. You're operating against a $90,000,000,000 booking space. And it seems to me that, as you go into things like experiences and services, it's tough to move the needle.

[Ken Gawrelski, MD & Senior Internet Analyst at Wells Fargo]

I can understand the ancillary benefits, but it's tough to move the needle. I guess the question is why you don't go to really double down on accommodations in the hotel space in at least in your core five markets where, you know, 70 or so of your bookings are? Thank you very much.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. I don't I don't think it's either or. We are doing that, and we're gonna be going significantly more aggressively into hotels. You know, we've we spent a lot of time looking at hotels as a business. We think it's really compelling, and we think that there's gonna be a lot more to do with hotels on Airbnb.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Our take rate is very, very competitive. We've spoken with hotels around the world, especially independents boutiques in bed and breakfast. A huge percent of hotels in Europe are independents. And one of the things they said is they really want incremental travelers. They'd not they have another booking channel.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

They would love to have high income American young travelers. We're probably the biggest travel brand in The United States. So I think we're really, really compelling. And, you know, when we have, you know, I think homes and accommodations or homes will be the heart and soul of Airbnb. But that being said, in our top markets, top top markets, especially during high season, people often don't find a home.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

We think hotels would be a great supplement. And so I think there's a huge amount of growth there. Long term stays, you know, a large percent of our nights booked are for stays longer than thirty days. We think there's a huge market there as well. Going back to service experiences, you know, I think each of these could easily be a multibillion dollar business.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And then the holy grail for services is if it gets happened to local demand. If we didn't happen to local demand, then it's not an ancillary service. It's a standalone service.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And there is no Amazon for services. Not to say we will become that, but there's a lot of opportunity there. So it's an and, not an or. What we're trying to do is build a platform, a platform that has home, services, experiences, hotels, of course, and much more. And we're gonna try to be, expanding this platform and continue to launch new businesses, over and over again.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

I think the other question was sorry. What was the other question?

[Ken Gawrelski, MD & Senior Internet Analyst at Wells Fargo]

Sorry. My question was on on AI, the whether

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Oh, yeah. Sorry. AI is closed. Closed. Yeah.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Yeah. Yeah. I think we're still kinda feeling out the state. I think I I the thing I wanna caution is I don't think that AI agents I don't think we should think of chatbots like Google. I don't think we should think of them as the new Google, yet.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

And the reason why is, like, is an incredibly compelling product. But we also have to remember that the model powering ChatuchuBT is not proprietary. It's not exclusive to ChatuchuBT. We, Airbnb, can also use the API, and there are other models that we can use. So as I said, in the coming years, you're gonna have a situation where these large AI models can take more and more, a lot more and more people start there, and people won't often go to one chatbot to do more and more things.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

At the same time, you're gonna also have startups that are gonna be custom built to do a specific application, and you're gonna have incumbents that make the shift to AI. You know, one of the things we've noticed is it's not enough to just have, it's not enough to just have, like, the best model. You have to be able to tune the model and build a custom interface for the right application. And I think that's the key. And the the models are not proprietary.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

I mean, very few every company that makes a model is selling the model or open sourcing the model in addition to using it themselves. And so I think that the key thing is gonna be for us to lead and become the first place for people to book travel on Airbnb. As far as whether or not we integrate with AI agents, I think that's something that we're certainly open to. Remember that to book an Airbnb, you need to have an account. You need to have a verified identity.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Almost everyone who books uses our messaging platform. So I don't think that we're gonna be the kind of thing where you just have an agent or operator book your Airbnb for you because we're not a commodity. But I do think it could potentially be a very interesting lead generation for Airbnb. So I think it could be really interesting, but I don't think it's like a commodity like booking a flight. I think that's it. I think we're over time. So

[Operator]

Yes. I'll turn it back to you, Brian, for closing remarks.

[Brian Chesky, Co-Founder, CEO & Chair of the Board at Airbnb]

Alright. Well, thank you everyone very much, for joining us today. I'm incredibly proud of the results and momentum we've built. The launch of service experiences really marks just the beginning of new chapter for Airbnb, and what excites me most is that we are just getting started. Morning and see you next quarter.

[Operator]

That concludes our call for today. Thank you all for joining. You may now disconnect.

Participants

Executives

• Angela Yang, Director - IR
• Brian Chesky, Co-Founder, CEO & Chair of the Board
• Ellie Mertz, CFO

Analysts

• Mark Mahaney, Senior MD at Evercore ISI
• Richard Clarke, Analyst at Bernstein
• Eric Sheridan, Managing Director at Goldman Sachs
• John Colantuoni, Equity Research Analyst - Internet at Jefferies
• Jed Kelly, MD & Senior Analyst - Online Travel & Internet at Oppenheimer & Co. Inc.
• Colin Sebastian, Senior Research Analyst at Baird
• Justin post, Managing Director at Bank of America Merrill Lynch
• Douglas Anmuth, MD & Internet Analyst at JP Morgan
• Trevor Young, Director & Internet Research Analyst at Barclays Capital
• Brian Nowak, Managing Director at Morgan Stanley
• Justin Patterson, Managing Director at KeyBanc Capital Markets
• Ron Josey, Managing Director at Citi
• Stephen Ju, Analyst at UBS Group
• Kevin Kopelman, Managing Director - Equity Research at TD Cowen
• Ken Gawrelski, MD & Senior Internet Analyst at Wells Fargo