Shares of Airbnb dropped as much as 6 per cent on Thursday following the release of a report by The Bear Cave, which probed about unpleasant experiences that customers had during stays booked through the platform.
The report highlighted numerous horror incidents, including surprise cleaning requirements, last-minute cancellations, and guests finding hidden cameras in their rooms.
Airbnb has not been able to come clear on the matter. This news pulled the company’s shares down by 5 per cent.
However, Airbnb’s revenue in 2022 was up 40 per cent from a year earlier, making it the company’s most profitable year on record.
In addition, the San-Francisco-based firm reported a 16 per cent increase in active listings in Q4 2022 over the same period in 2021.
Nights and experiences booked also rose 20 per cent year-over-year but missed analysts’ estimates.
Despite concerns about a slowing economy, travel companies said earlier this year that they had not yet seen a decrease in demand.
However, last month, a fire broke out in a building in Montreal used by long-term residents and short-term guests who booked lodgings through Airbnb.
City officials said the units in the residential building were supposed to be rented for other purposes.
The Bear Cave report also noted that some of the company’s top professional hosts have cut out Airbnb and built their own booking platforms, offering cheaper deals.
According to the report, this increase in professionally managed properties will directly compete against Airbnb and may further threaten its revenues.
However, some analysts remain optimistic about Airbnb’s prospects.
“Airbnb sits in a much more favourable supply market and looks much more like Amazon: everything on Amazon is pretty much purchasable another way, but that does not make it a less valuable platform,” said Bernstein analyst Richard Clarke in a note.
Airbnb laid off some recruiting staff in March to protect margins, and with the latest report causing a stir, the company may have to invest more in ensuring customers have positive experiences on its platform.
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