Are companies like Uber and Airbnb profitable?
In the run-up to the IPO, Airbnb doubled its loss
Airbnb's operating loss more than doubled in the first quarter of 2019 compared to the same period last year and stood at 306 million US dollars, according to the US medium The Information with reference to previously unpublished financial data. According to the report, the reason for this is partly due to the sharp rise in investments in marketing and sales. That could bring new customers - at the same time, potential investors are likely to be unsettled if Airbnb continues to write high lists. Airbnb plans to go public in the coming year.
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Airbnb increased its sales and marketing investments to $ 367 million in the first three months of 2019, a 58 percent increase over the same period last year, according to figures from The Information. These expenses grew faster than any other category: Product development costs, for example, rose 51 percent. Operations and support expenses, which include customer service, increased 30 percent.
Bad IPO experience with Uber, Lyft and WeWork
Investors have now become significantly more skeptical when it comes to the balance sheets of tech companies in the run-up to potential IPOs. That's because of recent experience with such companies: Uber's stock, for example, has fallen around 20 percent since going public, and Lyft's stock has even lost almost half of its value. The coworking chain WeWork even had to cancel its IPO entirely and is now fighting for financial survival.
Airbnb, on the other hand, was believed to have become profitable: in fact, the company had an operating profit of $ 18.7 million before interest and taxes for the full year of 2018. At the same time, it must be emphasized that it is difficult to draw conclusions about the overall situation of a company from one or two quarters - and increased investments in marketing and sales can lead to a significant increase in sales.
This is also confirmed by the figures available to the medium: sales in the second quarter of 2019 were over $ 1 billion, an increase of approximately $ 300 million compared to the same quarter of the previous year Percent to $ 839 million. Airbnb emphasizes to the medium that they do not want to comment on the numbers.
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