Airbnb Files Confidentially for IPO With SEC -- Update
August 19 2020 - 7:07PM
Dow Jones News
By Preetika Rana
Airbnb Inc. said Wednesday it confidentially filed paperwork
with the Securities and Exchange Commission for an initial public
offering, marking a surprising turnaround for a company whose
business was initially ravaged by the coronavirus pandemic.
The Wall Street Journal reported last week that the company was
close to such a filing.
The San Francisco-based home-sharing giant said the number of
shares and the price range for the proposed offering haven't been
determined. Airbnb is leaning toward listing its shares on Nasdaq,
according to people familiar with the matter. There is no guarantee
it will do so, and the company could still opt for the New York
Stock Exchange instead.
Airbnb said late last year that it planned to go public, but its
plans were thrown into disarray as the health crisis shut down
global travel. It initially had planned to make its widely
anticipated debut on the public markets this year via a direct
listing, which wouldn't involve raising any additional money, but
now plans to raise cash through a traditional IPO.
The long-awaited move will bring one of the stalwarts of the
sharing economy into the public domain, alongside ride-sharing
platforms Uber Technologies Inc. and Lyft Inc., and sets up the
next few months to be an especially busy time for big IPOs.
Airbnb joins a rush of companies tapping public investors after
the IPO market emerged from a virtual standstill triggered by the
coronavirus pandemic. Still, its offering will test the public
markets, particularly amid increased wariness for money-losing
startups.
Founded in 2008 after the company's co-founders began renting
guests an air mattress in their downtown San Francisco apartment,
Airbnb grew into one of the most highly valued startups over the
last decade. It was privately valued at more than $30 billion in
2017 and earned $4.8 billion in revenue last year, according to
financial statements reviewed by the Journal.
But its administrative costs also soared in recent years as it
spent big on a trendy corporate headquarters and struggled to
police crime and safety in its rental homes. That led the company
to post a net loss for the first nine months of 2019, down from a
profit in the same period a year earlier.
Then, the pandemic struck this year. Bookings vanished overnight
and the company found itself in the crosshairs of angry hosts who
also saw their earnings evaporate as the company refunded
guests.
Airbnb rushed to secure $2 billion in debt at a steep interest
rate -- and with warrants to its investors that when exercised
would value the company at $18 billion, nearly half of what it was
valued in 2017. In May, Airbnb said it would lay off a quarter of
its staff.
Since spring, however, Airbnb's recovery has been surprisingly
swift. Even as people stayed closer to home, they still sought
rental-home bookings. On July 8, guests booked more than one
million nights of future stays at Airbnb listings around the world,
the company said. It was the first time to hit that level since
March 3.
While bookings are still down year-over-year globally, bookings
in the U.S. in June and July grew 22% and 6.7% year-over year,
respectively, according to AirDNA, an analytics firm that tracks
the short-term rental market.
--Corrie Driebusch and Maureen Farrell contributed to this
article.
Write to Preetika Rana at preetika.rana@wsj.com
(END) Dow Jones Newswires
August 19, 2020 18:52 ET (22:52 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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