“Airbnb’s business has been hit hard, and sales this year are expected to be less than half of 2019 sales,” said CEO Brian Chesky of the pandemic.
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This story originally appeared on PCMag
The booking page for accommodations Airbnb CEO Brian Chesky announced on Tuesday that around 1,900 jobs will be cut and the company’s investment in transportation, hotels and luxury residences will be reduced.
“Together we are experiencing the most heartbreaking crisis in our lives, and as it began to unfold, global travel came to a standstill,” he wrote to his employees in a note. “Airbnb’s business has been hit hard, and sales this year are expected to be less than half of 2019 sales.”
In response, Airbnb raised an additional $ 2 billion during the pandemic and began to cut costs for all activities. However, the measures were not sufficient to keep the company alive economically without reducing staff. The main problem, according to Chesky, is that Airbnb still can’t predict when that tourist demand. In this case, the travel industry will also look significantly different.
The changing market is forcing Airbnb to change its business strategy, which previously focused on booking hotel rooms, making travel videos, and getting deeper into transportation. The company is now returning to its roots as a provider of family accommodation and short-term rentals. As Chesky says: “People will want options that are closer to home, safer and more affordable. But people will also long for something that seems to have been taken from them: human connection“”
“This means that we have to reduce our investments in activities that do not directly support the core of our host community,” he added. “We are stopping our efforts in the transport and Airbnb studios and we need to reduce our investments in hotels and lux.”
We have to wait and see if the strategy works. But many Airbnb hosts have reported to the media that the pandemic has prevented guests from reserving their properties and little money is available to pay their mortgages. However, Chesky is counting on the tourism industry to recover at some point.