The company will maintain an office in Beijing with hundreds of employees to serve Chinese outbound travel.
Vacation rental company Airbnb Inc (NASDAQ: ABNB) is shutting down its domestic business in China, including all listings and experiences. According to a letter on its official WeChat account, the company told its Chinese consumers that it is exiting its business from China beginning on the 30th of July.
Airbnb began its China operation in 2016 and has since then served over 25 million guests. The coronavirus pandemic is choking the company’s survival in China. Moreover, the country is still strict with lockdowns and movement restrictions in many cities. There are rigid restrictions in places like Shanghai and Beijing that represent the country’s economic hub. This has resulted in a severe economic downturn, forcing the exit of many companies. China persists with the zero-COVID policy despite the rest of the world adopting the new norm of living with the coronavirus.
During the early days of the global health crisis, Airbnb revealed plans to lay off almost 1,900 employees. The workers represented around 25% of its entire staff which consisted of 7,500 people. CEO Brian Chesky said that the company was going through a difficult time with sinking revenue. However, the company noted that the laid-off US employees will receive compensations like 12 months of healthcare.
Airbnb Is Shutting Domestic Operations in China
CNBC noted details provided by a source regarding Airbnb shitting domestic operations in China. The source revealed that Airbnb would not focus on offering listings to Chinese traveling abroad. The company will maintain an office in Beijing with hundreds of employees to serve Chinese outbound travel.
Airbnb is beginning to see gradual improvement as people start to travel again. Amazingly, bookings reached a new quarterly record in the first quarter of 2022. In an earnings report, the company said the recovery indicates that the coronavirus is not having as much power over people’s movement as before. Even with complete lockdowns in some places and the Omicron surge, Airbnb bookings and traveling experiences grew to 102 million in Q1 2022. The company told shareholders in a letter:
‘Guests are booking more than ever before. Looking ahead, we are strong sustained pent-up demand.”
Airbnb has also lost over 31% since the year amid the global crash across tech stocks. Not only is the company down since the year started, but Airbnb has also recorded losses over the past year. In the last twelve months, the company’s stock has shed more than 15% and declined 31.45% in the last three months. The vacation rental operator has plunged 25.98% over the past month and 3.59% in the last five days. MarketWatch data shows that Airbnb stock is trading at $111.48 in extended trading sessions. This is a loss of $1.59% over its previous close of $113.28%.
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Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience.
Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.
Source: https://www.coinspeaker.com/airbnb-close-business-china/