Here’s how the Italian tax authorities deflate Airbnb’s accounts
Airbnb's quarterly closes with a loss of $349 million due to the tax dispute in Italy. However, the online portal used for short-term accommodation rentals has seen an increase in revenue and provided a positive outlook for 2024
Italian taxes weigh on the accounts of the online portal for short-term rentals Airbnb.
Yesterday the US holiday rental giant announced its fourth quarter results, declaring that it closed 2023 "with another positive quarter".
The company reported revenue of $2.22 billion, beating estimates, and said guest demand is strong.
But there is a cloud over Airbnb's accounts: the quarter closed in the red with a net loss of 349 million dollars including non-recurring tax withholdings and tax reserves of around 1 billion dollars (the agreement with the tax authorities weighs Italian).
At the same time, Airbnb provided an optimistic forecast for the first quarter. CEO Brian Chesky said on the analyst call that Airbnb is "refining" its business, making pricing more transparent, curbing exorbitant cleaning fees and reducing cancellations by hosts. It now plans to move beyond its core.
As the Financial Times recalls, the San Francisco-based platform has faced increasing scrutiny from regulators of late as its popularity has grown, including in New York, which imposed a ban on it in September. done on short-term rentals. Airbnb did not quantify the impact of the ban on its financials.
All the details.
THE NUMBERS OF THE FOURTH QUARTER
In the final quarter of 2023 the company reported revenue rising 17% to $2.22 billion (driven by continued strength in travel demand and favorable exchange rate), beating forecasts of $2.17 billion of analysts in a FactSet survey. Bookings, at 99 million, were up 12% year-on-year, marking the highest fourth quarter ever, and the average daily rate increased by 3%. Adjusted EBITDA of $738 million represents an adjusted EBITDA margin of 33%, up 6 percentage points from the prior year.
ITALIAN TAXES ARE WEIGHING ON AIRBNB ACCOUNTS
However, the company ended the fourth quarter at a loss of $349 million due to an income tax settlement with Italy. The figure compares with a profit of $319 million a year earlier.
Last December, the short-term rental giant concluded an agreement with the Revenue Agency regarding the withholding tax on the income of non-professional hosts deriving from short-term rentals (the so-called dry tax) in relation to the tax years from 2017 to 2021, for a payment total of 576 million euros (which include 353 million in taxes, 174 million in administrative sanctions and 49 million in interest).
Excluding special charges, Airbnb said it would earn $489 million.
THE 2024 OUTLOOK
The company said “2024 is off to a great start, with more than six million guests ringing in the new year on Airbnb.” For the first quarter of 2024, it expects to generate revenues of $2.03 billion to $2.07 billion, representing year-over-year growth of 12% to 14%, above Wall Street expectations.
MODERATE GROWTH
However, the pace of booking growth is likely to "moderate" from the fourth quarter to the first, and the early timing of Easter could hurt growth in the second quarter, Airbnb said. Due to particularly strong growth in the first quarter of 2023 (19%), impacting year-over-year comparisons, it expects the growth rate of nights booked in the first quarter of 2024 to be moderate compared to the fourth quarter of 2023.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia-on-demand/ecco-come-il-fisco-italiano-sgonfia-i-conti-di-airbnb/ on Wed, 14 Feb 2024 15:14:00 +0000.