Airbnb stock slumps as consumer headwinds weigh on travel demand

Airbnb reported mixed second-quarter results on Tuesday, but shares tumbled 13% in after-hours trading as the company's third-quarter revenue forecast fell short of analyst expectations.

The vacation rental platform posted revenue of $2.75 billion for the second quarter, slightly above the consensus estimate of $2.74 billion and up 11% YoY.

However, adjusted earnings per share came in at $0.86, missing analyst projections of $0.91.

Airbnb's outlook for the third quarter disappointed investors. The company expects revenue between $3.67 billion and $3.73 billion, below the $3.84 billion analysts were anticipating.

Management cited "some signs of slowing demand from U.S. guests" and shorter booking lead times globally as factors impacting the forecast.

"We're seeing shorter booking lead times globally and some signs of slowing demand from U.S. guests," said Brian Chesky, CEO of Airbnb. "However, Latin America and Asia Pacific continue to be our fastest growing regions."

Net income for the second quarter was $555 million, representing a 20% margin. Adjusted EBITDA rose 9% YoY to $894 million, while free cash flow jumped 16% to $1.0 billion.

While Airbnb expects modest year-over-year ADR growth in Q3, it anticipates Adjusted EBITDA to be flat compared to the same period last year, with margins declining as marketing expenses outpace revenue growth.

The company continued its share repurchase program, buying back $749 million of stock in Q2. Over the past 12 months, Airbnb has repurchased $2.75 billion of shares, reducing its fully diluted share count from 686 million to 673 million.