Airbnb announced its third-quarter earnings on Wednesday (Nov. 1), marking a profitable quarter driven by a record summer travel season and robust growth in both active listings and nights and experiences booked.
According to the results, total revenue for Q3 increased 18% year over year (YoY) to hit $3.4 billion, while net income of $4.4 billion was its most profitable Q3. The company also highlighted the addition of 1 million active listings so far this year, with supply growing 19% in Q3 compared to a year ago. Furthermore, more nights than ever were booked through the Airbnb app, with 53% of gross nights booked in the app compared to 48% in the same period last year.
Commenting on the results in a call with investors, Airbnb CEO Brian Chesky said the business has fully recovered to pre-pandemic levels and will “continue growing supply by raising awareness around hosting, making it easier to get started and improving the overall experience for hosts.”
Airbnb’s international expansion markets also showed significant growth. Cross-border night bookings increased by 17% compared to the previous year, highlighting the global reach of the online marketplace for short- and long-term stays and experiences. Markets such as Taiwan, Thailand and Indonesia experienced particularly strong growth.
The firm said it is actively investing in underpenetrated international markets, building upon its successful performance in Germany and Brazil over recent quarters. It also highlighted South Korea as one of its fastest growing markets compared to 2019, where gross nights booked have surged 50.4% higher from Q3 2019.
On AI and generative AI, Chesky emphasized the potential of these advanced technologies to enhance the travel experience and transform the travel industry as a whole. He pointed to digital businesses, including platforms like Airbnb and online travel agencies (OTAs) as particularly well-positioned to benefit from AI due to their inherently digital nature.
He further stressed AI’s potential to drive advancements in customer service, helping to mediate complex issues involving guests and hosts from different parts of the world, speaking different languages, and operating under various policies.
“Imagine you have a Japanese hosting a German guest and there’s a problem and you have these two people speaking different languages calling customer service. There’s a myriad of issues. There’s no front desk. We can’t go on premise. We don’t understand the inventory and we need to try to adjudicate an issue based on 70 different policies that can be up to 100 pages long,” Chesky cited as an example of a complex issue that may arise.
In this scenario, he said AI can easily solve the issue whereby “an agent can supervise a model that can, in seconds, come up with a better resolution and provide front desk level support in nearly every community in the world.”
Beyond customer service, he noted AI’s potential to transform the way travelers search for and book accommodations and experiences, moving travel search from the static and somewhat dated paradigms that have dominated the industry for decades into a more dynamic and personalized experience.
Specifically, AI can create booking models that engage users with questions, learn from their interactions, and provide highly personalized travel options. This level of personalization, previously associated with traditional travel agents, could be delivered on a much larger scale, transforming the way people plan and book their trips.
“Imagine Airbnb being almost like the ultimate travel agent as an app?” Chesky said. “We think [AI] can unlock opportunities that we’ve never seen.”