Skip to content
CXProWealth

Airbnb

ABNB · Nasdaq

Marketing outgrew revenue, and the margin still widened

Sales and marketing rose 26.6% against revenue's 16.5%, yet operating margin gained 1.24 points to 21.0% because every other cost line grew slower.

Q2 FY2026, the quarter to Jun 30, 2026 · 10-Q filed Aug 6, 2026

Q2 FY2026 · revenue
$3.6B+58.8% on the year
Operating margin
21.0%
Net income
$816.0M
Free cash flow, quarter
—

Largest source of revenue: North America, 44.2% of the total.

Follow the money

Where Airbnb's money goes

Tap the picture to explore the flow: levels, scale, every line and its figures.
Key insights · Q2 FY2026
  1. 01

    Marketing outgrew revenue, and the margin still widened

    Sales and marketing rose 26.6% against revenue's 16.5%, yet operating margin gained 1.24 points to 21.0% because every other cost line grew slower.

    Why it matters

    Sales and marketing was $875M against $691M a year earlier, 24.3% of revenue and up 1.93 points. The filing ties the increase mainly to "higher paid growth marketing initiatives in emerging markets and partnerships" and to higher headcount. It was the only major cost line to grow faster than revenue's 16.5%.1

    The other lines made room for it. Product development grew 10.2%, operations and support 8.7% and general and administrative 0.65%, giving up 1.08, 0.72 and 1.35 points of revenue share. The filing credits lower agent contact volume from "increased use of artificial intelligence" in community support, and lower non-income taxes for the flat administrative line. Total costs and expenses grew 14.7%, so operating income rose 23.9% to $758M.1

    Marketing is now the largest cost line and larger than operating profit itself: sales and marketing of $875M equals 115.4% of operating income of $758M, against 112.9% a year earlier ($691M against $612M).1

    AnalysisThis is analysis. The margin gain came from restraint elsewhere, not from marketing becoming cheaper per dollar of revenue. The filing says headcount is still rising in product development and support, so their slower growth holds only while the platform keeps handling more nights per employee.

  2. 02

    Below operating profit, a lower tax rate did the lifting

    Pre-tax income grew 15.2%, slower than revenue, and net income reached 27.1% growth only because the effective tax rate fell to 9.0% from 17.6%.

    Why it matters

    Operating income rose 23.9%, but income before income taxes rose only 15.2% to $897M. Interest income fell 3.7% to $183M, which the filing attributes to "lower interest earned on our investment portfolio, driven by lower interest rates", and interest expense rose to $37M from $6M, "primarily due to interest on our new long-term notes". Interest income still equals 24.1% of operating income, down from 31.0% a year earlier.1

    The tax provision then fell 40.9% to $81M, an effective rate of 9.0% of pre-tax income against 17.6% a year earlier. The filing attributes the drop primarily to a benefit "related to recently published guidance impacting prior year taxes". That is how net income of $816M grew 27.1%, faster than operating income.1

    Per share the gap widens again. Diluted earnings per share were $1.37 against $1.03 a year earlier, while the diluted share count fell to 597 million from 626 million as the filing reports continued repurchases.1

    AnalysisThis is analysis. A benefit tied to prior years' taxes says nothing about current operations, and interest on the new notes is now a standing cost, so operating income is the cleaner read of this quarter. At last year's effective rate, net income would have grown at about the pace of pre-tax income, below revenue growth.

  3. 03

    The margin gain follows a year of flat operating profit

    Operating income was $2.54B in FY2025 against $2.55B a year before, despite revenue reaching $12.24B, so costs absorbed all of that year's revenue growth.

    Why it matters

    In FY2025 revenue rose to $12.24B from $11.10B, yet operating income was $2.54B against $2.55B in FY2024. Operating margin fell to 20.8% from 23.0%: costs grew faster than revenue over the full year.1

    This quarter runs the other way. Operating margin was 21.0% against 19.8% in the same quarter a year earlier ($612M on $3.10B), with total costs and expenses at 79.0% of revenue, 1.24 points lower.1

    AnalysisThis is analysis. One quarter does not reverse a year, and Airbnb's quarters differ sharply by season, so the fair test is each quarter against the same quarter a year earlier. What the next filings show is whether the emerging-market marketing push keeps total costs growing faster than revenue over a full year, as in FY2025, or below it, as in this quarter.

Sources

  1. 1.Airbnb 10-Q for the period to 2026-06-30 (the filing), Aug 6, 2026, read Nov 1, 2026

Have a question about Airbnb? Ask CXProWealth on ChatGPT.Free membership required.

Business performance

Growth, profit and margin

Revenue went from $4.8B in FY2019 to $12.2B in FY2025, the operating margin from -10.4% to 20.8%, over 6 years.

  • Revenue$12.2B
  • Operating income$2.5B
  • Operating margin20.8%
Period
Q2 FY2026
Revenue
$3.6B
Operating income
$758.0M
Operating margin
21.0%
Net income
$816.0M
Free cash flow
—
Business performance

Does the profit turn into cash?

  • Operating cash flow$4.6B
  • Capital expenditure—
  • Free cash flow—
  • Net income$2.5B

Capital expenditure is drawn below the axis as cash out. Cash conversion is operating cash flow over net income, shown in the tooltip for years with a profit.

Financial data and sources

How the revenue mix has shifted

Each breakdown the filing reports, as shares of revenue, for every period it restates.

Geographic markets

Supplemental Financial Statement Information - Schedule of Revenue Disaggregated by Listing Location (Details). The filing restates this breakdown for 1 period.

Click a member to isolate it across the years shown.

The figures

Margins, cash and growth for the period, each with what it was computed from.

Gross margin
82.5%
Source10-Q, Derived from Revenue and Cost of revenue in the 10-Q filed 2026-08-06
Operating margin
21.0%
Source10-Q, Derived from Income from operations and Revenue in the 10-Q filed 2026-08-06
Net margin
22.6%
Source10-Q, Derived from Net income and Revenue in the 10-Q filed 2026-08-06
Free cash flow, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Free cash flow margin, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Cash conversion, quarter
1.56x
Source10-Q, Derived from the prior period in the history in the 10-Q filed 2026-08-06
Capital spending, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Revenue growth
+58.8%
From the record's own history, against the prior year.

Not reported, or not derivable

  • free cash flow: the quarter's cash flow is year to date in the filing and could not be differenced from the history
  • fcf margin: the quarter's cash flow is year to date in the filing and could not be differenced from the history
  • capex to revenue: the quarter's cash flow is year to date in the filing and could not be differenced from the history

Where revenue comes from

Every breakdown the filing reports for the period, with each item's share.

Geographic markets

North America$1.6B44.2%
Europe, the Middle East, and Africa$1.4B39.5%
Asia Pacific$298.0M8.3%
Latin America$291.0M8.1%

Source10-Q, us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax, as reported in the 10-Q filed 2026-08-06

What it costs

The cost lines beneath operating income, each as a share of revenue, then the operating result.

Costs are reported by function: what it cost to make what was sold, then the expenses of selling, developing and administering.

Cost lineQ2 FY2026Of revenueSource
Total costs and expenses$2.9B79.0%Source10-Q, us-gaap:CostsAndExpenses, as reported in the 10-Q filed 2026-08-06
Income from operations$758.0M21.0%Source10-Q, us-gaap:OperatingIncomeLoss, as reported in the 10-Q filed 2026-08-06

Operating figures the company states

From the text of the filing rather than its statements, each with the sentence that states it.

Countries and regions
220 countries
As of Jun 30, 2026
View source
We operate a global marketplace connecting guests with these offerings, collectively in over 220 countries and regions.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, 10-Q filed Aug 6, 2026
Guest arrivals since founding
2,500,000,000 arrivals
As of Jun 30, 2026
View source
Airbnb was founded in 2007 when two hosts welcomed three guests to their San Francisco home, and has since grown into a global community of over 5.5 million hosts who have welcomed over 2.5 billion guest arrivals in almost every country and region across the globe.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, 10-Q filed Aug 6, 2026
Hosts
5,500,000 hosts
As of Jun 30, 2026
View source
Airbnb was founded in 2007 when two hosts welcomed three guests to their San Francisco home, and has since grown into a global community of over 5.5 million hosts who have welcomed over 2.5 billion guest arrivals in almost every country and region across the globe.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, 10-Q filed Aug 6, 2026
Jurisdictions where Airbnb remits lodging taxes
37,000 jurisdictions
As of Jun 30, 2026
View source
As of June 30, 2026, the Company collected and remitted Lodging Taxes in approximately 37,000 jurisdictions around the world on behalf of its hosts.

The statements, as filed

The income statement, cash flow statement and balance sheet in the company's own order and words. Every line links to the filing.

Income statement18 lines, as presented in the 10-Q
LineQ2 FY2026A year earlierChangeOf revenueSource
Revenues
Revenue$3.61B$3.10B+17%100%Source10-Q, us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax, as reported in the 10-Q filed 2026-08-06
Costs and expenses:
Cost of revenue$633.0M$544.0M+16%17.5%Source10-Q, us-gaap:CostOfRevenue, as reported in the 10-Q filed 2026-08-06
Operations and support$361.0M$332.0M+8.7%10.0%Source10-Q, abnb:OperationsAndSupportExpense, as reported in the 10-Q filed 2026-08-06
Product development$672.0M$610.0M+10%18.6%Source10-Q, us-gaap:ResearchAndDevelopmentExpense, as reported in the 10-Q filed 2026-08-06
Sales and marketing$875.0M$691.0M+27%24.3%Source10-Q, us-gaap:SellingAndMarketingExpense, as reported in the 10-Q filed 2026-08-06
General and administrative$309.0M$307.0M+0.7%8.6%Source10-Q, us-gaap:GeneralAndAdministrativeExpense, as reported in the 10-Q filed 2026-08-06
Total costs and expenses$2.85B$2.48B+15%79.0%Source10-Q, us-gaap:CostsAndExpenses, as reported in the 10-Q filed 2026-08-06
Income Statement
Income from operations$758.0M$612.0M+24%21.0%Source10-Q, us-gaap:OperatingIncomeLoss, as reported in the 10-Q filed 2026-08-06
Interest income$183.0M$190.0M-3.7%5.1%Source10-Q, us-gaap:InvestmentIncomeNonoperating, as reported in the 10-Q filed 2026-08-06
Interest expense-$37.0M-$6.0M+517%1.0%Source10-Q, us-gaap:InterestIncomeExpenseNonoperatingNet, as reported in the 10-Q filed 2026-08-06
Other income (expense), net-$7.0M-$17.0M-59%0.2%Source10-Q, us-gaap:OtherNonoperatingIncomeExpense, as reported in the 10-Q filed 2026-08-06
Income before income taxes$897.0M$779.0M+15%24.9%Source10-Q, us-gaap:IncomeLossFromContinuingOperationsBeforeIncomeTaxesExtraordinaryItemsNoncontrollingInterest, as reported in the 10-Q filed 2026-08-06
Provision for income taxes$81.0M$137.0M-41%2.2%Source10-Q, us-gaap:IncomeTaxExpenseBenefit, as reported in the 10-Q filed 2026-08-06
Net income$816.0M$642.0M+27%22.6%Source10-Q, us-gaap:NetIncomeLoss, as reported in the 10-Q filed 2026-08-06
Net income per share attributable to Class A and Class B common stockholders:
Basic (in USD per share)$1$1+33%0.0%Source10-Q, us-gaap:IncomeLossFromContinuingOperationsPerBasicShare, as reported in the 10-Q filed 2026-08-06
Diluted (in USD per share)$1$1+33%0.0%Source10-Q, us-gaap:IncomeLossFromContinuingOperationsPerDilutedShare, as reported in the 10-Q filed 2026-08-06
Weighted-average shares used in computing net income per share attributable to Class A and Class B common stockholders:
Basic (in shares)592,000,000615,000,000-3.7%Source10-Q, us-gaap:WeightedAverageNumberOfSharesOutstandingBasic, as reported in the 10-Q filed 2026-08-06
Diluted (in shares)597,000,000626,000,000-4.6%Source10-Q, us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding, as reported in the 10-Q filed 2026-08-06
Cash flow statement2 lines, as presented in the 10-Q

Year to date, as a quarterly filing reports it.

LineQ2 FY2026A year earlierChangeSource
Cash flows from operating activities:
Net income$816.0M$642.0M+27%Source10-Q, us-gaap:NetIncomeLoss, as reported in the 10-Q filed 2026-08-06
Statement of Cash Flows
Cash, cash equivalents, and restricted cash, end of period$19.05B$18.44B+3.3%Source10-Q, us-gaap:CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents, as reported in the 10-Q filed 2026-08-06
Balance sheet23 lines, as presented in the 10-Q
LineQ2 FY2026A year earlierChangeSource
Current assets:
Cash and cash equivalents$6.82BSource10-Q, us-gaap:CashAndCashEquivalentsAtCarryingValue, as reported in the 10-Q filed 2026-08-06
Short-term investments$5.25BSource10-Q, us-gaap:ShortTermInvestments, as reported in the 10-Q filed 2026-08-06
Funds receivable and amounts held on behalf of customers$12.22BSource10-Q, us-gaap:FundsHeldForClients, as reported in the 10-Q filed 2026-08-06
Prepaids and other current assets$1.19BSource10-Q, us-gaap:PrepaidExpenseAndOtherAssetsCurrent, as reported in the 10-Q filed 2026-08-06
Total current assets$25.48BSource10-Q, us-gaap:AssetsCurrent, as reported in the 10-Q filed 2026-08-06
Assets
Deferred tax assets$1.91BSource10-Q, us-gaap:DeferredIncomeTaxAssetsNet, as reported in the 10-Q filed 2026-08-06
Goodwill and intangible assets, net$765.0MSource10-Q, us-gaap:IntangibleAssetsNetIncludingGoodwill, as reported in the 10-Q filed 2026-08-06
Other assets, noncurrent$600.0MSource10-Q, us-gaap:OtherAssetsNoncurrent, as reported in the 10-Q filed 2026-08-06
Total assets$28.75BSource10-Q, us-gaap:Assets, as reported in the 10-Q filed 2026-08-06
Current liabilities:
Accrued expenses, accounts payable, and other current liabilities$3.04BSource10-Q, us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent, as reported in the 10-Q filed 2026-08-06
Funds payable and amounts payable to customers$12.22BSource10-Q, us-gaap:ContractWithCustomerLiability, as reported in the 10-Q filed 2026-08-06
Current portion of long-term debt$0Source10-Q, us-gaap:LongTermDebtCurrent, as reported in the 10-Q filed 2026-08-06
Unearned fees$2.83BSource10-Q, us-gaap:DeferredRevenueCurrent, as reported in the 10-Q filed 2026-08-06
Total current liabilities$18.09BSource10-Q, us-gaap:LiabilitiesCurrent, as reported in the 10-Q filed 2026-08-06
Liabilities and Stockholders’ Equity
Long-term debt, net$2.48BSource10-Q, us-gaap:LongTermDebtNoncurrent, as reported in the 10-Q filed 2026-08-06
Other liabilities, noncurrent$387.0MSource10-Q, us-gaap:OtherLiabilitiesNoncurrent, as reported in the 10-Q filed 2026-08-06
Total liabilities$20.96BSource10-Q, us-gaap:Liabilities, as reported in the 10-Q filed 2026-08-06
Stockholders’ equity:
Common stock$0Source10-Q, us-gaap:CommonStockValue, as reported in the 10-Q filed 2026-08-06
Additional paid-in capital$14.43BSource10-Q, us-gaap:AdditionalPaidInCapital, as reported in the 10-Q filed 2026-08-06
Accumulated other comprehensive income (loss)$19.0MSource10-Q, us-gaap:AccumulatedOtherComprehensiveIncomeLossNetOfTax, as reported in the 10-Q filed 2026-08-06
Accumulated deficit-$6.65BSource10-Q, us-gaap:RetainedEarningsAccumulatedDeficit, as reported in the 10-Q filed 2026-08-06
Total stockholders’ equity$7.80B$7.78B+0.2%Source10-Q, us-gaap:StockholdersEquity, as reported in the 10-Q filed 2026-08-06
Liabilities and Stockholders’ Equity
Total liabilities and stockholders’ equity$28.75BSource10-Q, us-gaap:LiabilitiesAndStockholdersEquity, as reported in the 10-Q filed 2026-08-06

About this data

Source
Airbnb 10-Q, accession 0001559720-26-000027, filed Aug 6, 2026, read on Nov 1, 2026.
History
From the SEC's XBRL company facts, the value from the latest filing that stated each period.
Reading
Paragraphs marked Analysis are CXProWealth's reading; everything else is the filing's own numbers and words, or a cited source.
Version
methodology business-lens-1.0 · schema 1.2.0 · run business-lens-2026-11-01
Edge and risks

What holds Airbnb's model up, and what could bend it

Competitive edge

  • Guests pay first, so cash runs ahead of profit

    Operating cash flow of $1.27B was 1.56 times net income of $816M, helped by service fees that guests pay at booking, before they stay.

    The detail

    The filing says "we generally collect our service fees at booking, which typically occurs before a stay, experience, or service", while revenue is recognized at check-in. Operating cash flow of $1.27B was 35.2% of revenue this quarter, against 31.5% a year earlier ($975M on $3.10B).1

    Money waiting for check-in also earns. Funds held for customers do not affect free cash flow, the filing notes, "except for interest earned on those funds". Interest income of $183M equalled 20.4% of income before income taxes of $897M.1

    Caveat: operating cash flow also adds back non-cash costs, chiefly stock-based compensation, so not all of the gap over net income comes from prepayments.1

    AnalysisThis is analysis. A hotel company has to build rooms before it can sell nights. Airbnb collects before it delivers, so growth in bookings adds cash rather than consuming it, for as long as guests keep paying at booking.

  • Hosts own the rooms, leaving an 82.5% gross margin

    Cost of revenue was 17.5% of revenue, mostly merchant fees, chargebacks and servers, because over 5.5 million hosts supply the property.

    The detail

    Cost of revenue was $633M on $3.61B of revenue, and the filing names merchant fees, chargebacks and server costs as the main parts of its increase. That leaves a gross margin of 82.5%, little changed from a year earlier as cost of revenue grew 16.4% against revenue's 16.5%.1

    The supply belongs to others: a community of over 5.5 million hosts, in over 220 countries and regions. Capital spending was $25M in FY2022 against revenue of $8.40B, 0.3%.1

    AnalysisThis is analysis. Because Airbnb neither builds nor owns the rooms, adding nights needs payments, servers and support rather than property. Its largest costs are the ones it chooses: sales and marketing and product development are each bigger than cost of revenue.

What to watch

  • Tax and rule disputes sit outside this quarter's costs

    Airbnb remits lodging taxes in about 37,000 jurisdictions, some localities claim joint liability with hosts, and an IRS dispute and a Spanish fine remain contested.

    The detail

    Airbnb collected and remitted lodging taxes in approximately 37,000 jurisdictions on behalf of hosts. Some states and localities are asserting that "the Company is liable or jointly liable with hosts to collect and remit Lodging Taxes", and the filing says such taxes "could increase the cost of a guest booking and potentially cause a reduction in the volume of bookings".1

    The IRS has challenged the value Airbnb placed on international intellectual property sold to a subsidiary, and Airbnb has petitioned the U.S. Tax Court. The filing says an outcome beyond its reserves could require "a significant cash payment".1

    Airbnb disputes a fine in Spain over short-term rental listing rules and has arranged a surety bond while the court case proceeds. The filing states that "Global regulatory requirements and challenges affecting the Company's business continue to increase."1

    AnalysisThis is analysis. These are exposures in the notes, not costs in this quarter's income statement. General and administrative barely grew partly because non-income taxes fell, a reminder that this line moves with disputes and settlements rather than with bookings.

  • Pay-later bookings loosen the cash advantage

    Reserve now, pay later moves payment closer to the stay, and the filing says those bookings cancel more often than bookings paid at booking.

    The detail

    The filing says RNPL bookings, "which require no payment at the time of booking, have experienced higher cancellation rates than historic bookings", and that as flexible payment grows "the timing among GBV, revenue, and cash receipts may become less correlated".1

    The effect already shows in the six-month cash flow discussion: unearned fees grew more slowly than gross booking value, which the filing attributes to guests choosing to pay closer to check-in. It also says RNPL is "changing the typical seasonal dynamics" between bookings and free cash flow, and that it helped lift the average daily rate.1

    AnalysisThis is analysis. RNPL trades part of the prepayment edge for more bookings. It pays off only if the bookings it adds outweigh the cash it delays and the cancellations it brings, and that balance shows in operating cash flow relative to net income over full years, not single quarters.

  • Fixed costs make profit swing far more than revenue

    Operating margin was 39.7% in the Q3 FY2025 peak and 9.7% in Q4 FY2025, so a travel shock would hit profit much harder than sales.

    The detail

    In Q3 FY2025 revenue was $4.10B and operating income $1.63B; in Q4 FY2025 revenue was $2.78B and operating income $269M. The filing says revenue has "historically been highest in the third quarter and lowest in the first quarter".1

    The extreme case is on record: in FY2020 revenue fell to $3.38B from $4.81B in FY2019, and the operating loss was $3.59B. The filing now names inflation, currency, tariffs and wars, and says the conflict in the Middle East "has had and may continue to have an impact on booking trends", while stating these conditions have not had a material impact on results to date.1

    AnalysisThis is analysis. Engineers, support staff, overhead and brand marketing do not shrink with a quarter's nights, so a fall in travel lands almost entirely on operating income.

Sources

  1. 1.Airbnb 10-Q for the period to 2026-06-30 (the filing), Aug 6, 2026, read Nov 1, 2026
Go deeper

Airbnb, further in

Member research, then your own questions on ChatGPT.

What could change the outlook

What Airbnb's numbers depend on from here, read from the filing: the conditions behind this period's margins and growth, and where a change would show first.

  • What has to hold for the margin gain to last

    Which cost lines carried this quarter's margin, which of them can keep growing slower than revenue, and what the marketing push needs to show in the newer regions.

  • How much of the cash engine survives pay later

    How prepayments, customer funds and interest income fit together, and the signs in each filing that reserve now, pay later is changing the cash profile.

Loading…

CXProWealth on ChatGPT

Have a question about Airbnb?

Explore its profit drivers, competitive edge, risks, or your own investment and business questions with CXProWealth on ChatGPT.

Ask CXProWealth on ChatGPTFree CXProWealth membership required. Learn more
Questions to start with
  • How much of Airbnb's 27.1% net income growth in Q2 FY2026 came from the lower tax rate rather than from operations?
  • Which Airbnb cost lines must keep growing slower than revenue for its 21.0% operating margin to hold while marketing rises?
  • How could wider use of reserve now, pay later change Airbnb's operating cash flow compared with its net income?

Business Lens describes Airbnb from its own filings with the SEC. It is not a view on its shares, a target, or advice to buy, sell or hold anything; figures are as filed and may be restated by the company later. The filing, the dates and the version are under the financial data above.