Airbnb, Inc.

Good afternoon and thank you for joining Airbnb's earnings conference call for the third quarter of 2021. As a reminder, this conference call is being recorded and will be available for replay from the investor relations section of Airbnb's website following this call. I will now hand the call over to Ellie Mertz, Vice President of Finance. Please go ahead.

Good afternoon and welcome to Airbnb's third quarter of 2021 earnings call. Thank you for joining us today. On the call today, we have Airbnb's co-founder and CEO, Brian Chesky, and our chief financial officer, Dave Stevenson. Earlier today, we issued a shareholder letter with our financial results and commentary for our third quarter of 2021. These items were also posted on the investor relations section of Airbnb's website. During the call, we'll make brief opening remarks and spend the remainder of time on Q&A. Before I turn it over to Brian, I would like to remind everyone that we'll be making forward-looking statements on this call that involve a number of risks and uncertainties. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors. These factors are described under forward-looking statements in our shareholder letter and in our most recent filings with the Securities and Exchange Commission. We urge you to consider these factors and remind you that we undertake no obligation to update the information contained on this call to reflect subsequent events or circumstances. You should be aware that these statements should be considered estimates only and are not a guarantee of future performance. Also, during this call, we will discuss some non-GAAP financial measures. We've provided reconciliations to the most directly comparable GAAP financial measures in the shareholder letter posted to our investor relations website. These non-GAAP measures are not intended to be a substitute for GAAP results. And with that, I'll pass the call to Brian.

All right. Thank you, Ellie, and good afternoon, everyone. Thanks for joining us today. I'm really excited to share our results with you. You know, the travel rebound that began earlier this year accelerated in the third quarter. Q3 was Airbnb's best quarter yet. Revenue of $2.2 billion was our highest ever. surpassing 2019 by 36%. Net income of $834 million was our highest ever, nearly 4x larger than a year ago. Adjusted EBITDA exceeded $1 billion, also our best ever. Our EBITDA margin was 49%, an increase of 30% or 3,000 basis points compared to Q3 2019. Over the summer, we also reached a major milestone with 1 billion cumulative guest arrivals. This means that Airbnb has been used more than 1 billion times since we started. Now, finally, I'm delighted to report that our host earned a record $12.8 billion in the quarter. Our results show that the growing strength of the Travel Rebound is here despite the continued pandemic. We saw continued strength in North American EMEA, and an acceleration in Latin America, despite sequential increase of cancellations. Now, excluding APAC, our total global nights and experiences booked exceeded 2019 levels. Gross booking value of $11.9 billion shot above 2019 levels by 23%, driven by the strength of ADR. But something bigger than a travel rebound is happening. The world is undergoing a revolution in how we live and work. The pandemic has suddenly untethered tens of millions of people from the need to go into an office. Technologies like Zoom make it possible to work from home. Airbnb makes it possible to work from any home. And this newfound flexibility is bringing about a revolution in how we travel. Because for the first time ever, millions of people can now travel anytime, anywhere, for any length, and even live anywhere on Airbnb. And we believe that this trend towards more flexibility will only accelerate. In recent months, some of the world's largest companies, Procter & Gamble, Amazon, Ford, PricewaterhouseCoopers, have announced increased flexibility for employees to work remotely. And we expect many more companies to follow their lead. And so what we're seeing are several trends as a result of this travel revolution. First, people can travel anytime. Because many people don't have to be in the office at specific times, they have more flexibility on when they can travel. So families are increasingly traveling outside the traditional weekend trip. And in fact, Mondays and Tuesdays are currently our highest growing days of the week to travel. This is really interesting. The second trend we're seeing is that people are traveling everywhere, literally everywhere. During the pandemic, over 100,000 cities have had at least one booking on Airbnb. And that includes 6,000 towns and cities that received their first booking ever on Airbnb. The third trend we're seeing is people aren't just traveling in Airbnb, they're now living on Airbnb. Long-term stays of 28 days or more remained our fastest growing category by tripling. People are traveling in Airbnb for extended vacations, relocation, temporary housing, student housing, and many other reasons. Now, finally, more people were also interested in hosting than ever before. We ended 2-3 with the most active listings ever. And there are two reasons for this. First, our demand is driving more supply. In fact, our highest supply growth is in our highest demand destinations, particularly North America and EMEA. And second, our marketing and product initiatives to attract new hosts are working. Now we're constantly improving our service to meet this new way of traveling and the wave of guests it'll bring. On May 24th, we introduced the Airbnb 2021 release, which included more than 100 upgrades across every aspect of the Airbnb service. On November 9th, which is next Tuesday, we'll be announcing the Airbnb 2021 winter release. And this release will include another 50 upgrades and innovations that will make it easier to host and support the changing needs of guests. And you can watch it right on our homepage next Tuesday at 8 a.m. Pacific Standard Time. So I Hope you can tune in to see it. I'm really excited about what we have to share. So now let's turn to our progress on our 2021 plan. Now, as a reminder, our single priority in 2021 has been to prepare for the travel rebound. To do this, we've been perfecting the end-to-end experience of our core service. And this includes educating the world about hosting, recruiting more hosts, simplifying the guest experience, and delivering world-class service. So let me give you an update on each of these. First, we are educating the world about what makes Airbnb different, and that is hosting. Earlier this year, we launched our first large-scale marketing campaign in five years, made possible by hosts. We're educating guests about the benefits of being hosted, and we're also inspiring more people to become hosts, and we continue to be encouraged by the results of this campaign. Second, we're recruiting more hosts and setting them up for success. On May 24th, we launched a completely redesigned host onboarding flow that makes it simpler for anyone to start hosting. Throughout the process, potential hosts can now be paired with super hosts to answer their questions or concerns. We began Ask a Super Host in nine countries, and we've since expanded the program to over 30 languages in 196 countries. Third, we're simplifying every part of the guest experience. Earlier this year, we introduced I Am Flexible, a whole new way to search on Airbnb when guests are flexible about where or when they're traveling. Now, since launch, guests have used I'm flexible more than 500 million times. Now, due to the popularity of this feature, we're soon making it even more flexible by expanding the date range of this feature, as well as adding more categories of unique space. We're really excited about the progress of this feature. And finally, four, whenever a host or guest need us, we must deliver world-class service. In September, we launched dedicated Superhost support in North America, giving our most experienced hosts priority access to our most experienced support agents. We're expanding the support to all Superhosts globally by the end of the year. So that is our plan for 2021. Now, before I go to questions, I have one update that's bittersweet. Three years ago, Anne Mather became the second independent director to join our board after Ken Chenault. Since then, our team has benefited from her guidance. Now, Anne recently made the decision to reduce the number of boards she sits on, and sadly for us, that means she'll be departing our board of directors on December 15th. Now, Anne's been a critical member of our team as we transition from a private to a public company, and we appreciate everything she's done. I look forward to adding another independent director as soon as possible, and I know that being on the Airbnb board in the midst of a global pandemic is no easy task, and I want to once again thank you, Anne, for everything you've done. So, to recap, 2-3 was Airbnb's best quarter ever. Revenue, adjusted EBITDA, and net income were our highest ever. Travel is undergoing a revolution. People are now taking longer trips, traveling to more locations, and even living on Airbnb. As the world changes, we continue to innovate. We've made more than 150 upgrades and innovations this year alone. So with that, Dave and I look forward to answering your questions.