Airbnb Inc (ABNB)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|
| Gross profit margin | 82.83% | 82.02% | 79.28% |
| Operating profit margin | 15.31% | 21.61% | 7.69% |
| Pretax margin | 21.20% | 23.86% | -5.38% |
| Net profit margin | 48.32% | 22.71% | -6.31% |
Airbnb Inc's profitability ratios indicate a mixed performance over the past five years. The company has shown a consistently high gross profit margin, which has been gradually increasing from 75.10% in 2019 to 82.83% in 2023. This suggests that Airbnb has been effectively managing its cost of sales and generating strong revenues.
However, the operating profit margin has been more volatile, with fluctuations from a negative 102.04% in 2020 to 22.51% in 2022. The significant improvement in 2022 may indicate better cost management and operational efficiency. The pretax margin also displays variability, with positive margins in the past two years after negative figures in 2020 and 2021.
The net profit margin was particularly erratic, showing a loss in 2020 and 2021, followed by a significant increase to 48.32% in 2023. This improvement suggests that Airbnb has managed to enhance its bottom line through cost-cutting measures and revenue growth strategies.
In conclusion, Airbnb Inc has demonstrated strength in its gross profit margin, improving operating efficiency, and a recent turnaround in its net profit margin. However, the company needs to continue monitoring and managing its operational costs to ensure sustained profitability in the future.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | |
|---|---|---|---|
| Operating return on assets (Operating ROA) | 7.35% | 11.24% | 3.13% |
| Return on assets (ROA) | 23.21% | 11.80% | -2.57% |
| Return on total capital | 14.95% | 23.88% | 6.35% |
| Return on equity (ROE) | 58.69% | 34.05% | -7.37% |
Airbnb Inc's profitability ratios show a mixed performance over the past five years.
1. Operating return on assets (Operating ROA) has fluctuated significantly, ranging from -32.86% in 2020 to 11.79% in 2022. This ratio indicates that the company generated operating profits of 7.35% on its total assets in 2023.
2. Return on assets (ROA) improved notably in 2023 to 23.21%, indicating that the company generated $0.23 in profit for every dollar of assets. This signifies a strong financial performance compared to previous years.
3. Return on total capital saw a dip in 2023 but remained positive at 14.95%. This ratio indicates the company's ability to generate profits from both equity and debt capital.
4. Return on equity (ROE) saw a substantial improvement in 2023, reaching 58.69%. This implies that Airbnb Inc generated a high return on shareholders' equity investment, indicating strong profitability and efficient management of equity funding.
Overall, Airbnb Inc demonstrated improved profitability in 2023, with stronger returns on assets and equity compared to previous years. The company's ability to generate profits from its operations and capital is a positive sign for investors and stakeholders.