By Priyamvada C and Doyinsola Oladipo<\/p>\n\n\n\n
(Reuters) -Airbnb forecast third-quarter revenue above market estimates on Thursday, but industry fears of softening U.S. domestic demand sent the vacation rental firm’s shares down 1.2% in after-hours trading.<\/p>\n\n\n\n
The San Francisco-based company forecast quarterly revenue between $3.3 billion and $3.4 billion, ahead of analysts’ average estimate of $3.22 billion, according to Refinitiv data.<\/p>\n\n\n\n
The company expects to gain from a rebound in urban and international travel but firms with significant U.S. exposure are losing domestic business as more consumers opt for vacations abroad.<\/p>\n\n\n\n
Airbnb, which receives a majority of its revenue from outside the United States, said global cross-border bookings rose 16% in the second quarter from a year earlier and more guests were returning to cities, with urban nights booked increasing by 13% year-over-year.<\/p>\n\n\n\n
“We continue to see signs of travelers returning to cities, historically one of the strongest areas of our business,” the company said.<\/p>\n\n\n\n
However, its average daily rate (ADR) globally rose just 1% to $166, as the company said it was looking to moderate price hikes for consumers. Daily rates in North America decreased 1%.<\/p>\n\n\n\n
The demand for domestic hotels has been flat in the United States as pandemic restrictions ease and a strong U.S. dollar encourages consumers to book flights and stays overseas, according to analysts.<\/p>\n\n\n\n
But short-term rental company Airbnb, which has a large presence in cities, said it saw an acceleration in the total growth of nights booked from the first to second quarters in North America.<\/p>\n\n\n\n
“I think that was telling, just the strength and resiliency of the North American consumer and we’re continuing to see that strength lead into Q3,” said Airbnb CFO David Stephenson on a call with investors.<\/p>\n\n\n\n
Airbnb’s second-quarter revenue rose 18.1% to $2.48 billion, ahead of analysts’ estimates of $2.42 billion.<\/p>\n\n\n\n
Gross bookings rose 13% to $19.1 billion, in line with expectations.<\/p>\n\n\n\n
The short-term rental company reported a profit of 98 cents per share, compared with estimates of 78 cents.<\/p>\n\n\n\n
Online travel agency Booking Holdings (NASDAQ:BKNG)’ shares rose 10.25% in extended trading after the company raised its annual forecast as it benefits from international travel demand to Europe.<\/p>\n