Airbnb 4Q25: Business Update
The AI Risk, Growth Reaccelerates, AI Changes on the Horizon
Welcome to Speedwell Memos. Our main website is SpeedwellResearch.com.
This is a business update on a company we have previously written an in-depth research report on. To read the full research report become a member today. Members get access all of our research reports and all prior updates (most of which are paywalled). You can see a list of all the companies we have written on here.
(Members can find an extended version of this post here and a PDF here).
4Q25 Update.
Airbnb reported 4Q25 and the stock was up 4%.
Revenues grew +12% y/y to $2.8bn for 4Q, reaccelerating 100bps sequentially.
This marks the second time in the past year that revenues reaccelerated after slowing and puts them above the “at least double digits” revenue goal they set over a year ago.
GBV was even stronger, growing 16% y/y for 4Q (13% FX-adjusted)
This was the strongest growth they had in two years.
Nights and Seats also grew 10% y/y.
On the earnings call Brian Chesky emphasizes that there were “hundreds of improvements the team shipped driving hundreds of millions of dollars in revenue in 2025 alone. And we believe Project Why will deliver hundreds of millions more this year.”
This level of iteration and product improvement is key to their engineering organization and ability to subtly improve customer experience overtime, which shows up in higher booking completion rates.
They also focused this product iteration on localizing for a specific country like Brazil, where they were able to move from a Top 10 Airbnb market to Top 5.
Among one of their newer innovations was “Reserve Now Pay Later”. The ability to book a place without paying has significantly reduced friction. They noted that this increased booking lead time and also led to more larger homes booked.
Another update changed the way their API interacts with PMSs (property management systems). Many hosts cross-list their homes and use software to do that. The software interacts with Airbnb’s API to keep listings from getting double booked. Because of Airbnb’s history of charging the customers most of the commission with an opaque formula, it has been hard for hosts to ensure like for like pricing across platforms. So, they changed the way hosts set prices so it is easier to match it across platforms. This likely had a positive impact on bookings as Airbnb was commonly more expensive as a result of this pricing confusion.
Operating profits for the year were flat at $2.5bn, despite revenues growing 10%. This is because they have increased their product development and marketing costs for Experiences and AI.
However, CEO Brian Chesky is careful to note that they don’t need massive capital investments to take advantage of AI. They are already in the midst of incorporating AI into their app but note that the experience needs to be more compelling than a chatbot.
Right now, text boxes are the most common way users interact with AI, but travel requires more images, so they are reworking how to think about the UI of that interaction. Historically, they have been very strong on UI and so they could potentially come out with a new and novel way for users to book on Airbnb.
The goal is to help users find a listing they will love quicker, while also potentially cross-selling them on Experiences they can book for their trip. Experiences are still in early innings of being launched and they talked about how they are going to focus on city by city to build up listing density, much like how they originally did with Airbnb over a decade ago.
They briefly mentioned how sponsored ads are still a future potential opportunity, but they will have to do it in a way that is native for AI. A loyalty program could also come in the future, but similarly they want to do something different for that. Both have been long-standing opportunities to increase monetization and user loyalty, but Airbnb hasn’t rolled out a product for either yet. In contrast, Booking’s Genius loyalty program has been a strong tool to increase user retention and direct bookings.
The AI Risk.
The big risk investors are now worried about is AI. However, Airbnb is particularly well insulated against AI. Most of their inventory is exclusive to Airbnb with single hosts picking Airbnb for its ease of use. And AI can’t web scrap Airbnb without it’s permission. So, Airbnb already aggregated millions of listings, often with an on the ground effort to do so and replicating that isn’t trivial. AI may be able to book on Airbnb through an API or the “agentic web”, but they won’t be able to easily reach the host otherwise.
Among the inventory that is cross listed to PMS systems, the risk of agents accessing this inventory and circumventing Airbnb is a bit higher. However, users like booking on Airbnb because of the insurance policies and support network. The host also loses insurances if the booking is off platform.
There also is Airbnb’s repository of reviews and rating, which helps weed out lower quality listings and helps hosts feel more comfortable with their guests. AI would need to replicate this and won’t be able to until it has a high level of bookings across millions of properties.
Lastly, what is the interface for this AI? A chatbot seems unlikely to be a great experience so something new will have to be invented. This is exactly what Airbnb is trying to do. As CEO Brian Chesky notes, the AI models are available to everyone to use. So, they will be able to do everything with AI that this theoretical AI agent would be able to.
Now Airbnb does still have some risk here because a very large portion of traffic is direct to them. So, if in the future most travel journeys start with an AI agent, then they may have to pay to acquire that traffic, or the AI agent may be able to book on Airbnb without the user ever going on the site (using the so called “agentic web”). While Airbnb is still a critical piece of infrastructure, providing aggregated listings, review data, insurance, payment facilitation, and support, it does mean that the user will have less loyalty and their margins might be compressed in this sort of transaction.
However, while this is a risk, it doesn’t seem like the most likely of scenarios. When a user wants an Airbnb type home, they think Airbnb and go to Airbnb. It seems unlikely that this behavior will totally change in the future. Users can start these searches today on Google instead of Airbnb, but they pick Airbnb because it is a better experience. With them solely focused on incorporating AI into the travel experience, and other AI companies like Google focusing on bigger opportunities, it makes sense that Airbnb would be able to create a compelling experience before other AI companies.
That’s not to say OpenAI and Google won’t have something for the travel space, but just that it isn’t likely to be such a superior experience that it weighs on Airbnb’s direct traffic. This is especially true because they don’t have access to their inventory as of now.
With technology changing quickly though, there is still risk here.
Valuation.
Airbnb currently...
The rest of this update is only accessible to Speedwell Members.
If you are a Speedwell Member, click here to read the rest of this post.
If you want to become a Speedwell Member and get access to the rest of this update and our Extensive Airbnb Research Report, PLUS access to over a dozen other research reports, become a member below!
For further reading, check out our Airbnb Extensive Research Report.
The Synopsis Podcast.
Follow our Podcast below.
For those that are new to our podcast, we have four episode formats: “company” episodes that breakdown in-depth each business we write a report on, “dialogue” episodes that cover various business and investing topics, “article” episodes where we read our weekly memos, and “interviews”.
Become a Speedwell Research Member to receive our Airbnb report and all of our other research reports, business updates, and Plus members also receive Excels.
We have covered APi Global, Appfollio, Airbnb, Axon, Constellation Software, Copart, Coupang, CoStar Group, Dream Finders Homes, Etsy, Evolution, Floor & Decor, Meta, Perimeter Solutions, Porsche, RH, Shift4, and Walker & Dunlop, with many more coming each year!
(Many members have gotten their memberships expensed. If you need us to talk with your compliance department to become an approved vendor, please reach out at info@speedwellresearch.com).
*At the time of this writing, one or more contributors to this report has a position in Airbnb. Furthermore, accounts one or more contributors advise on may also have a position in Airbnb. This may change without notice.