Airbnb, Inc. (איירבנב)
Analytical review · Quarter ended June 30, 2026 (Q2 2026)
Bakshi Finance — Family Office | Research Depth: Comprehensive
What this review is based on. Airbnb's quarterly report on Form 10-Q for the quarter ended June 30, 2026, filed August 6, 2026; the shareholder letters for the last four quarters (November 2025 to August 2026); the annual reports on Form 10-K for 2025 and 2023; and the 8-K on the March 2026 notes offering. Market data: closing price on October 9, 2026; Bank of Israel representative USD rate of October 9, 2026.
Company Profile
Airbnb runs a two-sided marketplace: hosts offer homes, rooms, experiences and services, and guests book them through the website and app. The company owns no properties. It charges a service fee as a percentage of the booking value, and those fees, net of incentives and refunds, are its revenue. Revenue is recognized at check-in.
According to the company, the platform has more than 5.5 million hosts, who have welcomed more than 2.5 billion guest arrivals in more than 220 countries and regions. Airbnb is headquartered in San Francisco; at the end of 2025 it had about 8,200 employees, plus about 13,000 third-party workers in customer support.
The company was founded in 2007 and has traded on Nasdaq since December 2020. The founders, including CEO Brian Chesky, hold Class B shares with 20 votes per share; based on the cover page of the quarterly report, these carry about 89% of the voting power.
Financial Performance
Airbnb's reports read in three layers. Nights and seats booked are the volume. Gross booking value (GBV) is volume times price, including what is paid to the host. Revenue is Airbnb's share, recognized only at check-in. In the April–June 2026 quarter, revenue was 13.2% of GBV, the same as a year earlier.
The quarter: faster volume, and currency adding to growth
Nights and seats booked rose 10% to 148.3 million, versus 9% in the prior quarter and 7% a year earlier. Revenue rose 17% to $3,608 million; excluding currency changes, growth was 13%. The gap of about 4 percentage points comes from a weaker dollar. The company notes that its Q3 revenue guidance (+15% to +17%) includes about 3 points of FX tailwind.
Net income rose to $816 million ($642 million a year earlier), and operating income rose 24% to $758 million. Net income includes a $77 million tax benefit related to prior-year taxes, which brought the quarter's tax rate down to 9% (18% a year earlier). Q1 included a $71 million gain on the sale of an investment. For full-year 2026, according to company management, the effective tax rate will be in the "high teens".
Cash flow and stock-based compensation
Free cash flow over the last 12 months was $4,827 million, 37% of revenue. It includes stock-based compensation (SBC) of $1,707 million, 13.0% of revenue — an expense in the income statement that does not leave the company's cash. Free cash flow minus SBC was $3,077 million in 2024, $3,021 million in 2025 and $3,120 million over the last 12 months. Over the same period, revenue rose from $11,102 million to $13,159 million.
| $ millions | Q1-25 | Q2-25 | Q3-25 | Q4-25 | Q1-26 | Q2-26 |
|---|---|---|---|---|---|---|
| Revenue | 2,272 | 3,096 | 4,095 | 2,778 | 2,678 | 3,608 |
| FX-neutral growth | 8% | 13% | 10% | 11% | 15% | 13% |
| Net income | 154 | 642 | 1,374 | 341 | 160 | 816 |
| Free cash flow | 1,781 | 962 | 1,349 | 521 | 1,704 | 1,253 |
| Stock-based compensation | 358 | 424 | 399 | 411 | 410 | 487 |
| $ millions | 2022 | 2023 | 2024 | 2025 | TTM |
|---|---|---|---|---|---|
| Revenue | 8,399 | 9,917 | 11,102 | 12,241 | 13,159 |
| Net income | 1,893 | 4,792* | 2,648 | 2,511 | 2,691 |
| Free cash flow | 3,405 | 3,837 | 4,484 | 4,613 | 4,827 |
| Stock-based compensation | 930 | 1,120 | 1,407 | 1,592 | 1,707 |
| Free cash flow minus SBC | 2,475 | 2,717 | 3,077 | 3,021 | 3,120 |
* 2023 includes a one-time $2,690 million tax benefit from the release of a valuation allowance on deferred tax assets. "TTM" = July 2025 through June 2026.
Balance Sheet & Capital
At June 30, 2026, the company held $6,821 million in cash and $5,248 million in short-term investments. In March 2026 it issued $2,500 million of senior notes in three series (4.40% due 2029, 4.65% due 2031, 5.25% due 2036) and used the proceeds to repay $2,000 million of convertible notes that matured. It swapped the fixed rate on the two longer series to floating. Net cash: $9,569 million. A $1 billion credit facility is undrawn. Moving from zero-coupon converts to interest-bearing notes raised quarterly interest expense from $6 million to $37 million. Interest is paid semi-annually (March and September), so only $3 million of interest was paid in cash in the first half, and trailing free cash flow carries almost none of it.
Customer funds: In addition, the company holds $12,224 million that guests paid before check-in, with an equal liability to hosts and guests. This money is not the company's, but interest earned on it is included in its interest income. Interest income over the last 12 months: $680 million, about 20% of pre-tax income. It fell 14% in 2025 and 7% in the first half of 2026 as rates declined. The report does not split it between company cash and customer funds.
Fees collected in advance: At the end of June, unearned fees collected on future stays were $2,831 million, versus $2,857 million a year earlier, while GBV in the quarter rose 16%. The company attributes this to "Reserve Now, Pay Later" (RNPL), which moves collection closer to the stay. According to the report, RNPL bookings have higher cancellation rates than historical bookings.
Buybacks: Over the last 12 months the company repurchased $4,111 million of stock and paid another $571 million of taxes on employee shares that vested — together 97% of free cash flow. Fully diluted shares fell from 652 to 634 million (−2.8%). In Q2, 7.9 million shares were repurchased at an average price of $135.17. Remaining authorization: $3.4 billion. The company pays no dividend.
Segments
Airbnb reports a single operating segment. The available breakdown is geographic, by listing location.
| Revenue by region, $ millions | Q2-25 | Q2-26 | Change | Share of Q2-26 revenue |
|---|---|---|---|---|
| North America | 1,377 | 1,594 | +16% | 44% |
| Europe, Middle East & Africa | 1,233 | 1,425 | +16% | 39% |
| Latin America | 231 | 291 | +26% | 8% |
| Asia–Pacific | 255 | 298 | +17% | 8% |
According to the shareholder letter, nights in North America grew at a high-single-digit rate, "the highest in almost three years" (full-year 2025: +3%). EMEA recovered after Q1 cancellations related to the Middle East conflict. Latin America nights rose about 20%, and Asia–Pacific in the high teens; origin nights booked in India rose 60%.
Expense structure
Sales and marketing rose 27% in the quarter to $875 million, 24% of revenue (22% a year earlier). Within it, brand and performance marketing rose 30%, according to the company mainly "paid growth marketing initiatives in emerging markets and partnerships". General and administrative rose only 1%. According to the shareholder letter, customer-support cost per booking fell about 16% thanks to an AI assistant; in the report itself, the operations and support line as a whole rose 9% (payroll, make-good payouts and insurance), and savings on third-party service providers came to $17 million.
Competitive Position
The differentiation the company presents is a two-sided network effect: more hosts create more choice for guests, and more guests attract more hosts. Added to this are a brand that has become the name of the category, and a trust system — reviews, verification, host damage protection up to $3 million and liability insurance. In Q2, 64% of nights were booked through the app (59% a year earlier), and first-time bookers rose 11%, according to the company the fastest pace in four years.
Widening the category: The company is adding boutique hotels (according to the company, hotel nights are growing about three times as fast as homes, but are still a single-digit share of nights; featured hotels come with a price-match guarantee and up to 15% Airbnb credit), services (car rental, grocery delivery, airport pickup), experiences (supply +80%) and travel insurance (revenue +60%). The company does not report revenue from these areas in dollars.
What the reports show on the other side: Advertising spend is growing faster than revenue, so part of the growth is paid for. Competition includes online travel agencies and hotel chains, and this review does not include competitor data from primary sources. Many cities regulate short-term rentals; in Spain, for example, the Ministry of Consumer Affairs proposed a €65 million fine, which the company is contesting.
How to Think About This Company
At Airbnb, volume is the cleanest signal. Revenue is affected by exchange rates, nightly rates and the timing of check-ins; cash flow by the timing of collection; net income by tax and interest. Nights and seats booked are the number closest to customer behavior. In Q2 they accelerated to 10% — the fastest pace since the start of 2025.
Reported growth and FX-neutral growth are two stories. In Q1 2026 the gap between them was 3 points, and in Q2 — 4 points. For a company with about 55% of revenue outside North America, a weaker dollar lifts reported revenue. When comparing quarters, the like-for-like comparison is between FX-neutral growth rates: 13% in Q2 2026 versus 13% in Q2 2025.
Free cash flow and stock-based compensation are two sides of one account. Airbnb's free cash flow exceeded net income by about $2.1 billion over the last 12 months, and most of the gap ($1.7 billion) is stock-based compensation. That compensation does not leave the company's cash, but it increases the share count, so the company buys back shares. How much of the cash flow remains for shareholders after these two items is central to reading the company. The answer depends on the window: between 2024 and 2025 the amount stayed around $3.0–3.1 billion, while in the 12 months ended June 2026 it was $3,120 million, versus $2,763 million in the 12 months ended June 2025.
The float is changing shape. Airbnb's historical model collected from the guest at booking and paid the host after arrival, so at any moment the company holds billions of dollars belonging to others. "Reserve Now, Pay Later" is meant to raise conversion, and according to the company it does increase bookings, but it defers collection. The result shows in unearned fees, which were almost unchanged in a year when GBV rose 16%.
A fifth of pre-tax income is interest. $680 million of interest income over the last 12 months, on company cash and on customer funds. This is real income, but it depends on the level of interest rates rather than on operations. In a year when operating income rose, interest income fell. Whoever reads net income is also reading U.S. Federal Reserve policy.
Investment in growth is visible in the income statement. In 2025 the operating margin fell from 23.0% to 20.8%, as sales and marketing rose from 19% to 21% of revenue, and as the company allocated, by its own account, about $200 million to services and experiences. In Q2 2026 the operating margin rose to 21.0% (19.8% a year earlier). For Q3, according to company management, the adjusted EBITDA margin will be slightly lower than a year earlier due to the timing of investments.
Management is revising guidance upward. In February the company guided to growth of "at least low double digits" in 2026; in May — "low to mid teens"; in August — "at least mid teens". Revenue in each of the last three quarters came in above the top of the guided range. Two things are true at once: management delivers what it guides to, and part of the upward revisions includes FX tailwind.
The legal exposures are large in dollars, small relative to the balance sheet. The U.S. Internal Revenue Service claims $1.3 billion of tax, plus penalties and interest, over the value of intellectual property transferred in 2013; according to the company, the claim exceeds its reserve by more than $1 billion, and the case is before the U.S. Tax Court. For non-income taxes, the company estimates an additional reasonably possible loss of $240–260 million that has not been accrued. Together the two amounts are less than a fifth of net cash.
Ownership and control are separate. The founders' Class B shares carry about 89% of the voting power, based on a calculation from report data, and the founders are bound by a voting agreement. For a Class A holder this means a share in the cash flow without influence over board composition or decisions such as capital allocation and expansion into new areas.
This framework is meant to organize the questions. It does not decide and does not take part in the decision — the decision belongs to the reader.
This framework is intended to structure analysis, not to produce an investment conclusion.
Risks & Monitoring
Risks that emerge from the reports
- Short-term rental regulation: according to the company, "global regulatory requirements and challenges... continue to increase". Example: a proposed fine in Spain (€65 million), for which the company posted a €70 million surety bond. City-level restrictions on short-term rentals directly affect supply in core markets.
- Cancelled bookings: nights and GBV are recorded in the quarter of booking, and cancellations are netted in the quarter in which they occur. According to the report, RNPL bookings have a higher cancellation rate than historical bookings; the rate itself is not disclosed.
- Taxes: a dispute with the U.S. Internal Revenue Service ($1.3 billion plus penalties and interest), lodging taxes in about 37,000 jurisdictions, and non-income taxes with an additional reasonably possible loss of $240–260 million.
- Exchange rates: about 3–4 points of revenue growth in recent quarters came from currency. A reversal in the dollar would work the other way.
- Interest rates: about 20% of pre-tax income is interest income, which fell with rates in 2025 and 2026.
- Geopolitics and travel demand: in Q1 the Middle East conflict caused elevated cancellations and, according to the company, took about one point off nights growth.
- Dilution and control: stock-based compensation of $1.7 billion a year; Class B shares with about 89% of the voting power.
Items to monitor for the Q3 report (early November 2026)
| # | Item | Latest reading |
|---|---|---|
| 1 | Revenue vs. guided range, and FX-neutral | Guidance: $4.69–4.77 billion, including ~3 pts of FX |
| 2 | Nights & seats booked growth | +10% in Q2 |
| 3 | Sales & marketing as % of revenue | 24% in Q2 (22% a year earlier) |
| 4 | Free cash flow and SBC, trailing 12 months | $4,827M and $1,707M |
| 5 | Unearned fees | $2,831M (−0.9% YoY) |
| 6 | Revenue as % of GBV | 13.2%; migration to a single 15.5% fee |
| 7 | Interest income | $183M in Q2 (−4%) |
| 8 | Tax dispute with the IRS | Before the U.S. Tax Court since July 2024 |
Scenario Framework
The scenarios below are descriptive, not predictive. They contain no prices, no probabilities and no ranking of outcomes. Their only purpose is to organize the conditions that would have to hold for each state to materialize, so they can be checked against future filings.
Scenarios are descriptive, not predictive.
- If nights growth stays in double digits even when marketing spend stops growing faster than revenue
- If FX-neutral growth rises above 13% over several quarters
- If free cash flow minus SBC moves above the $3.0–3.1 billion level of the last two years
- If hotels, services and experiences reach a size the company reports in dollars
- If nights grow at a high-single to low-double-digit rate, supported by marketing
- If the adjusted EBITDA margin stays around 35% and the operating margin around 21%
- If most free cash flow continues to go to buybacks and taxes on employee shares
- If the legal disputes continue without resolution
- If nights growth slows while marketing spend stays high
- If the dollar strengthens and rates fall, so that both reported revenue and interest income weaken together
- If the tax dispute is decided against the company for an amount above its reserve
- If city regulation reduces supply in core markets
Analytical Lens
The six questions below are the same in every company review we publish. They are deliberately open and do not lead to a single conclusion. Their role is to let the reader examine the company along the same six dimensions as any other company.
Key Observations
1. In the April–June 2026 quarter, Airbnb reported revenue of $3,608 million (+17%; +13% excluding FX), 148.3 million nights and seats booked (+10%), and net income of $816 million, including a one-time tax benefit of $77 million.
2. Over the last 12 months, free cash flow totaled $4,827 million and stock-based compensation $1,707 million. The difference — $3,120 million — compares with $3,077 million in 2024 and $3,021 million in 2025.
3. Sales and marketing rose 27% in the quarter to $875 million, 24% of revenue. For 2026, according to company management, revenue will grow "at least mid teens" and the adjusted EBITDA margin will be at least 35.5%; guidance has been raised twice since February.
4. The company holds $9.6 billion of net cash, in addition to $12.2 billion of customer funds. Over the last 12 months it repurchased $4.1 billion of stock, and the fully diluted share count fell 2.8%. A $1.3 billion tax dispute with the IRS is pending before the U.S. Tax Court.
Bakshi Finance operates as a Family Office for qualified clients only. Mr. Yaron Bakshi held a licensed investment adviser qualification in Israel during 2008–2023. As of the publication date of this document, the firm does not hold an investment advice, investment marketing or portfolio management licence.
This document is intended for research and professional study purposes only. Nothing herein constitutes a recommendation to buy, sell, hold or carry out any transaction in securities. Nothing herein substitutes for advice that takes into account the data and needs of each person. Every decision is the sole responsibility of the investor.
Past performance is not indicative of future results. Data were drawn from official sources: the quarterly report on Form 10-Q for the quarter ended June 30, 2026 (August 6, 2026), the shareholder letters for Q3 and Q4 2025 and Q1 and Q2 2026, the annual reports on Form 10-K for 2025 (February 12, 2026) and 2023, and the 8-K of March 16, 2026. Filings published after this date are not included.
Review for qualified investors — Family Office
The full analytical review of Airbnb (ABNB) for the quarter ended June 2026 is available to Bakshi Finance premium clients.
The review includes a 10-section analysis, "How to Think About This Company", a structured scenario framework and a 6-dimension Analytical Lens.
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