Airbnb has filed confidential IPO paperwork after losing around $1 billion in revenue and axing 25 percent of its workforce amid the coronavirus pandemic.
The short-term property rental company announced Wednesday it had submitted a draft IPO registration to the US Securities and Exchange Commission, as founder and CEO Brian Chesky moves forward with plans to take the firm public.
It is not yet clear what the company will been valued at or how many shares will be offered.
The move comes after a rocky year for the Silicon Valley giant and as the pandemic-related challenges for the travel and tourism industry continue to rumble on.
Airbnb has filed confidential IPO paperwork after losing around $1 billion in revenue and axing 25 percent of its workforce amid the coronavirus pandemic. Pictured founder and CEO Brian Chesky
‘Today, Airbnb confidentially submitted a draft Registration Statement on Form S-1 to the Securities and Exchange Commission (the ‘SEC’) relating to the proposed initial public offering of its common stock,’ the company said in its brief statement on the matter.
‘The number of shares to be offered and the price range for the proposed offering have not yet been determined.’
The company added: ‘The initial public offering is expected to take place after the SEC completes its review process, subject to market and other conditions.’
The IPO doesn’t come as a surprise, after sources told the Wall Street Journal last week it was close to a filing with plans to go public by the end of the year.
Airbnb first announced plans in 2019 to become a publicly listed company in 2020.
Before the pandemic ravaged the travel industry this year, Airbnb was privately valued at $31 billion.
But its value is estimated to have been slashed in half, standing at just $18 billion following its latest funding round in April.
Airbnb has been hard hit by the pandemic, as borders shuttered, planes were grounded, travel bans were issued and officials implemented stay-at-home orders back in March in efforts to slow the spread of the deadly virus.
Chesky, who said in April he would not take a salary for six months, estimated earlier this month the company lost a staggering $1 billion as a result of the outbreak.
The founder told The Times the losses came after the company was forced to do a u-turn on its no-refund policy and give guests back their deposits when their holidays were canceled due to travel restrictions.
The short-term property rental company announced Wednesday it had submitted a draft IPO registration to the US Securities and Exchange Commission
Chesky propped up the company with an injection of $250 million and raised $2 billion in funds from investors to help cover the huge loss but it wasn’t enough to prevent job losses across the business.
In May, the company laid off almost 2,000 employees, accounting for around 25 percent of its workforce.
The cuts were made across its Americas, European, and Asia-Pacific teams.
The company also slashed marketing costs and put a pause on any investments it said didn’t support its core business, including transportation and plans to produce travel-related entertainment.
‘We are collectively living through the most harrowing crisis of our lifetime, and as it began to unfold, global travel came to a standstill,’ Chesky said in an internal memo at the time.
‘Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half of what we earned in 2019.’
Its been a rocky year for Airbnb with 2,000 jobs axed and an estimated $1 billion lost due to the pandemic
The company has rebounded somewhat since coronavirus lockdowns lifted as people are eager to travel again after staying at home for several months.
Wealthy travelers also helped prop up the business as they fled cities such as New York for long-term rentals in more rural areas where they can continue to work remotely.
‘Our business for last month has been at or above last year’s levels from a gross booking value (standpoint),’ Chesky told The Times this month.
The CEO said he plans to go back to basics and focus on hosting properties in lesser-known destinations in a bid to save his company.
He said that as part of a ‘serious audit’ he has suggested prioritizing everyday hosts over larger operators.
‘We stand for accommodation and services that are unique. Whether they are offered by a business or sole proprietor, they have to feel authentic,’ he said.