ABNB (Trans): Also aiming to be an all-in travel portal?

Dolphin Research's transcript of ABNB FY26 Q1 earnings call highlights is below. For our take on the print, see 'Airbnb: Near-term results fine, but facing a mid-life crisis?'.

I. Core financial highlights

1. Shareholder returns and capital actions: Repurchased $1.1bn of common stock in Q1. Achieved investment-grade ratings from major agencies, followed by a $2.5bn senior unsecured notes issuance for debt repayment and general corporate purposes.

2. Outlook: Raised FY26 revenue growth guide to mid-teens YoY (from low-teens), with Adj. EBITDA margin of at least 35%. Q2 revenue is guided to $3.54–3.60bn (+14%–16% YoY, incl. ~3% FX tailwind). Q2 GBV is expected to grow low-teens YoY, while nights growth will be slightly below Q1's 9% (~100bps headwind from Middle East conflict). Adj. EBITDA and margin are seen up YoY in Q2. Full-year take rate to tick up modestly on single-fee migration and insurance initiatives. Effective tax rate expected in the high-teens in 2026 (down from ~20% in 2025 on the One Big Beautiful Bill Act).

3. Key metrics: Q1 revenue of $2.7bn (+18% YoY), 200bps above the top end of guidance. GBV was $29bn (+19% YoY), accelerating for the fourth straight quarter QoQ. Nights and experiences booked rose 9% YoY (~10% ex-ME conflict), and ADR increased 9% YoY (+4% ex-FX), with North America outperforming. Net income was $160mn (dragged by a ~$70mn one-off DTA adjustment from changes to the US AMT). Adj. EBITDA was $519mn (+24% YoY).

4. Cash flow: Q1 FCF was $1.7bn; LTM FCF was $4.5bn with a 36% FCF margin. The RNPL program shifts some guest payments from booking to pre-stay, lowering unearned fees in Q1 and Q2 and lifting them in Q3.

II. Earnings call details

2.1 Key management comments

1. Core biz growth drivers

a. App nights grew 22% YoY, accounting for 63% of total nights (vs. 58% a year ago). b. First-time bookers accelerated to 10%, the highest since 2022, led by Brazil, Japan, and India. c. Expanded markets' net nights growth is roughly 2x core markets. d. Three initiatives (RNPL, redesigned cancellation policies, single-fee migration) contributed ~3ppt to nights and ~4ppt to GBV growth.

2. RNPL and pricing

a. Expanded RNPL to more global markets in Q1; ~20% of global GBV now comes from RNPL bookings. b. RNPL is driving longer booking windows and mix shift toward larger, higher-priced listings. c. Over 25% of active listings have migrated to the single-fee structure, with tests underway to extend to more hosts.

3. New biz and category expansion

a. Hotels: Currently a single-digit share of nights, but top-line metrics have been growing at more than 2x the overall biz. 55% of guests who book a hotel on Airbnb return to book a home. b. Experiences: ~25% of first-time Experiences customers go on to book stays or services; about one-third book a stay within 90 days. c. Expanded Delta partnership to allow miles accrual on Experiences and services (no impact on take rate). d. Loyalty and air tickets are under consideration, with no specific announcements yet.

4. Major events strategy

a. Winter Olympics (Italy): ~200k guests stayed via Airbnb, with supply and host growth of ~30%, GBV up over 3x, and ~1bn marketing impressions. b. World Cup: Over 100k new listings added since the Oct. kickoff, expected to be the largest event in Airbnb history.

5. AI adoption

a. ~60% of engineers' code output is AI-written, estimated at ~2x industry Avg. b. The AI support assistant now resolves 40%+ of cases without human intervention (vs. ~one-third in Q4), cutting support cost per booking by ~10% YoY. c. Bottom-up AI search strategy: start with support (bottom funnel), then reviews summarization and ranking (mid-funnel), and finally AI search at the top of the funnel. d. More AI features will be showcased at the May 20 summer release.

2.2 Q&A

Q: What drove the 22% growth in app nights, and how is the team re-organizing for the AI era?

A: App nights growth is multi-factor, with no silver bullet. Over the past 18 months we have nudged more mobile web users to download the app, and push notifications are bringing users back. Email strategy created more hooks, and our App Store ranking continues to climb within the global top 50 each year. On organization, it's still early. My principle is ABNB must operate at AI speed, as AI is an acceleration technology where speed is the core attribute. It requires everyone to be more hands-on, adaptable, and fast. Pure 'people manager' roles will diminish—managers who stay at 30,000 feet without diving into details. Data is fully democratized internally, so you don't need a data scientist to fetch it. We are seeing many design and engineering managers go back to coding or use Claude Code. Roughly 60% of code is AI-written, well above peers. It's too early to conclude on formal org changes.

Q: Will the Delta partnership affect take rate, and does it limit ABNB from launching loyalty or selling air tickets?

A: We are excited about Delta. Economically it's a revenue-share model and should not pressure this year's take rate. In fact, take rate should edge up from single-fee migration and insurance. It's a high-ROI acquisition channel. On loyalty and air, both are on the table. I've long believed the best loyalty is making people love your product and return, and it's remarkable ABNB is perhaps the only large travel brand without a loyalty program that has still scaled this way. If we do it, it won't be a cookie-cutter points scheme but something differentiated and unique to ABNB. On air, our vision is enabling people to travel and live anywhere, and how to get there is part of it. There are no specific announcements yet, but we are considering it.

Q: What are the hotel nights trends in test markets?

A: Hotels remain a small piece of the biz (single-digit share of nights), but for several quarters all top-line metrics have been growing at more than 2x the overall biz. Both supply and bookings are scaling quickly. We entered hotels for three reasons. First, to expand TAM—ABNB accounts for roughly a tenth of lodging nights, and hotels can backfill where home supply is constrained by regulation. Second, to serve loyal guests' varied needs—for certain trips (last-minute, one-night stays, solo business), hotels are a better fit. Third, as an acquisition funnel—55% of guests who book hotels on ABNB return to book homes, making hotels a great entry point for travelers who haven't tried Airbnb. We've fundamentally revamped hotel PDPs to show hotel-relevant info. More updates will come on May 20.

Q: Is the hotel UX a mixed feed or a separate tab, and what are the early learnings from AI search?

A: Hotel results are currently mixed in markets like New York, and we're testing carousel modules to embed different inventory types in search results. We may add more tabs for navigation, but the real answer in the post-AI era is deep personalization. Users who only want hotels will see hotels, those who only want homes will see homes, and those open to both will see recommendations tailored to trip type. We have accounts and verified identities for 100% of bookers, so we know their preferences and history. On AI search, our approach differs from peers. Most start at the top of the funnel ('Where should I go?'); we started at the bottom—support—because it's the hardest AI problem: no hallucinations, fast, multilingual, adjudicates disputes, protects private data, and reasons across ~100 policies and millions of historical cases. We are doing well here, with 40%+ self-serve resolution, and I'm confident it's the best AI self-service in travel. We then moved to mid-funnel—AI review summaries, filters, ranking and relevance—and will showcase more on May 20. Top-funnel AI search is in testing. No one has truly cracked AI in travel or e-comm yet. ChatGPT launched third-party apps last year and shut them in Mar this year. Chat interfaces face four fundamental issues in travel and e-comm: too much text (these are image-led), lack of direct manipulation (sliders beat typing for price), poor comparison (100k listings in Paris is overwhelming in chat), and single-user mode (85% of ABNB bookings involve multiple guests while chat is 1:1). So AI is both a risk and an opportunity—if it's our risk, it's everyone's risk.

Q: How is the World Cup booking cadence, and will newly added listings stick post-event?

A: To date, cumulative World Cup bookings point to it becoming the largest event in ABNB history. What's exciting is not just the size but the breadth—16 cities across three countries—driving brand awareness, supply growth, and community policy opportunities. Historically, including prior World Cups and the recent Olympics, a large share of bookings happens closer to the event. As schedules and matchups firm, excitement builds and many bookings occur closer to the stay date. We feel good about the setup. On supply retention, after the Paris Olympics we kept over half of event-onboarded listings six months later. We don't need all to stay, as these are peak moments for cities, but many hosts who join for a mega-event choose to stay after experiencing the benefits.

Q: Where are the growth opportunities and challenges in core home supply, and how can AI help supply acquisition?

A: Think of core stays as two buckets: API host partners (mainly PMCs) and individual hosts of primary/second homes. For API partners, AI primarily accelerates our tooling. We are a bit behind third parties here, and one finding is that more managed listings correlate with lower ratings—guests tend to be happier with individual hosts than PMCs. This is both good news (more unique to ABNB) and an opportunity—partners want to be better hosts but need better tools. We previously lacked resources to build all API features; with AI-driven productivity, we are speeding up. For individual hosts, AI can transform discovery, acquisition, and onboarding. Today onboarding requires manual entry of address, title, and description. In future, you could say 'list my home', provide the address, have AI pull online info, and use photos plus computer vision to draft descriptions. AI lowers the barrier to hosting. It can also help us determine what inventory types are needed in each community and calibrate acquisition incentives by neighborhood.

Q: How are RNPL adoption and awareness evolving in new markets, and how do cancellations and conversion uplift compare to the US?

A: Timeline recap: launched in the US in Q3 last year with strong results; in Q4 we marketed upstream to raise awareness, driving incremental uplift; in Q1 we rolled out to most global markets. Uplift varies slightly by region but not materially. In every RNPL market, total bookings rose meaningfully. While RNPL does have a higher cancellation rate, we've tested thoroughly across regions to ensure net bookings are positive. The US has the highest adoption, with other markets not far behind.

Q: What must be solved before scaling hotels to more cities, and how will ABNB compete in hotels?

A: On the back end, we've built solid hotel partner products and will keep adding differentiated tools. The bigger opportunity is front end—showing the right hotel to the right guest at the right time. ABNB competition in hotels starts with best price guarantees and best presentation. If you search New York now, our hotel UI may already be the best among major travel sites—and that's just V1. We already have billions of visits and don't need users to come just for hotels to build a multi-billion-dollar hotel biz. Our conversion is well below Booking.com, so there's huge upside just by converting existing traffic—guests already in our 'store' will book elsewhere if they can't find what they want, but if we have that product on another 'shelf', many will book with us. Hotels want to join ABNB. Boutique and independent hotels often pay higher OTA commissions and feel pressure from chains due to lack of loyalty programs and bargaining power. ABNB can be a very attractive channel for them.

Q: Which regions and demographics drove the acceleration in first-time bookers, and what powers growth in expanded markets?

A: First-time bookers come from two cohorts: expanded markets—newer geos with large greenfield opportunity—and younger demos, notably Gen Z. Our expanded market playbook is working. Brazil was our earliest focus; after years of marketing and product investment, it now compounds at 20%+, rising from outside the top 10 to a steady No. 3–5. This gives us confidence that country-by-country tailored marketing and product can drive penetration beyond core markets. In Q1 alone we ran 16 localized campaigns synced to cultural moments. On product, we localize as well—e.g., redesigned home pages in Italy for local B&B formats, and emphasized cleanliness in Germany where guests care deeply. The goal is to make ABNB feel local and personalized on open.

Q: What underpins the raised full-year revenue and EBITDA margin outlook, and what other payments innovations are there beyond RNPL?

A: The revenue raise reflects three factors: greater confidence in full-year nights, stickiness of modest ADR tailwinds, and traction in monetization, implying a slightly higher 2H take rate. On EBITDA, there is top-line upside and we are reinvesting part of it to drive growth—high-ROI channels, expanded markets, policy work, and increased internal AI usage costs. With years of P&L discipline and efficiency gains, we can absorb these while keeping strong margins. On payments, RNPL is still early—global rollout continues, desktop is coming, and upstream marketing is still light. We also see installments (working very well in Brazil), support for local payment methods, and more flexible cancellations. The payments and pricing roadmap could add hundreds of millions of dollars in annual revenue. RNPL is the largest single lever, but dozens of other initiatives can drive growth.

Q: What are the biggest obstacles to hotel expansion, and is ABNB considering ancillary revenues like air, car rental, groceries, or AI agents?

A: On the second part—is this too big? Absolutely not. We think very big, and Amazon is a good analogy for category expansion from books to retail. We see many category extensions, some owned (e.g., photography) and some third-party (e.g., grocery delivery with Instacart—they've done it for a decade, so we don't need to relearn). We position ourselves as building an ecosystem. Today homes are seen as the sun of the ABNB solar system. In future it should orbit around 'members' and 'guests', with a suite of services built around them. Homes, hotels, services, and experiences are just the start. Each subsequent category requires less incremental work—the next is only ~20% different, then ~10%. Each new category brings in different guests; some may start with an Experience or a hotel before a home. We envision offering everything a traveler needs—or what someone needs to live somewhere for up to a year. On hotel obstacles, there are no major blockers. It's about continuous optimization and execution—having the right hotels, best prices, best presentation, and robust features to ensure discovery. This takes time, but we can move fast. Hotels are eager to join ABNB—especially boutiques and independents that want another channel and pay high OTA commissions without chain affiliations.

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