Airbnb Stock Craters — Cofounders Lose $4 Billion In One Day

Topline

Shares of Airbnb crashed Wednesday after the property rental giant projected the busy summer travel season may not be such a boon for its business this year, knocking out billions of dollars from the fortunes of their top executives as the San Francisco-based travel firm loses its luster among investors.

Airbnb coounders Nathan Blecharczyk Joe Gebbia and Brian Chesky (L-R) lost billions Wednesday.

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Key Facts

Though Airbnb beat analyst expectations for quarterly earnings and sales, investors latched onto the company’s projection for “unfavorable” gross booking numbers during the crucial summer quarter and its lowest year-over-year revenue growth in two years.

Airbnb’s stock price will “remain under pressure until…a clear path to meaningful” bookings growth emerges, according to Deutsche Bank analyst Lee Horowitz.

The stock subsequently fell 12% to $112 in early trading, hitting about its lowest price in three months in its largest single-day drop since its $146 initial public offering in December 2020.

Airbnb’s billionaire cofounders Nathan Blecharczyk, Brian Chesky and Joe Gebbia lost a total of $3.5 billion from their net worths amid Wednesday’s stock crash, according to Forbes’ calculations.

Forbes Valuations

Blecharczyk ($7.5 billion), Chesky ($8.6 billion) and Gebbia ($7.1 billion) are each among the 400 wealthiest people in the world. The trio has lost some $13 billion since April 2021, when their combined net worth stood at $38.5 billion.

Key Background

Shares of Airbnb are now down more than 50% from their February 2021 peak of $217. That drop is far greater than the tech-heavy Nasdaq’s 12% decline during the period. Airbnb was a headliner of the IPO boom in 2020 and 2021 and now joins a glut of newly public companies in feeling the pressure from shareholders: Food delivery firm DoorDash and software company Snowflake, the other largest IPOs of 2020, are down roughly 60% and 30% since going public.

Contra

Airbnb’s post-earnings stock slide was an “overreaction,” Bernstein strategists led by Richard Clarke wrote in a Wednesday note to clients, reiterating their buy rating and $140 price target for the company, implying 25% upside. “The best is yet to come” for Airbnb, according to Clarke, who asserts the downward revision to future earnings is merely a “short timing effect” preceding future growth.

What To Watch For

“We’re going to design, hopefully, some of the leading AI interfaces,” Chesky told the Verge this month about Airbnb’s ambitions in the booming generative artificial intelligence space. “We’re going to basically try to deeply understand you, learn about you, care about you, and be able to understand your preferences.”