Airbnb becomes profitable for the first time

The startup hit the milestone in the second half of last year

New York /
Jan.January 26, 2017 04:50 PM

Despite a concerted effort from hotel lobbyists, affordable housing advocates and governments around the world to shut it down, Airbnb just started to turn a profit.

The short-term rental startup became profitable for the first time in the second half of 2016, Bloomberg reported, citing sources close to the company. Airbnb expects to remain profitable in 2017 before interest, taxes and amortization, according to the publication.

The company takes a commission of between 6 percent and 12 percent from guest fees, and charges hosts a small fee. It has no expenses for cleaning and maintaining properties, and the company’s revenue increased more than 80 percent last year. The company still has nearly all of the $3.1 billion in funding it raised and it is looking for make investments and acquisitions, Bloomberg sources said.

In October, New York Gov. Andrew Cuomo signed a bill into law  that raised the fine for hosts with illegal Airbnb listings up to $7,500. It recently settled a lawsuit it filed against the city of the new law.

Attorneys in San Francisco are reportedly hiring private investigators to uncover illegal short-term rentals. Those lawyers work for tenants who claim they were wrongly forced out of their apartments so that their landlords could list the properties on Airbnb.

Affordable housing advocates have argued Airbnb drives up rents in New York City. Analysis from The Real Deal in 2015 found the startup pushed up rents as much as $69 per month in neighborhoods such as Williamsburg and Greenpoint. [Bloomberg]Miriam Hall


Related Articles

arrow_forward_ios
From left: Mayor Bill de Blasio, 54 West 39th Street, 62 Grand Street, and 208 West 30th Street (Credit: Google Maps)
The Airbnb crackdown continues: City targets three more buildings
The Airbnb crackdown continues: City targets three more buildings
Mayor Bill de Blasio and Stanley “Skip” Karol, an Airbnb host (Credit: Getty Images and Youtube)
Airbnb host narrowly clears hurdle in First Amendment claim against city
Airbnb host narrowly clears hurdle in First Amendment claim against city
A West Village Airbnb listing (Credit: Airbnb)
Airbnb Luxe launched without listings in one of their biggest potential markets — why?
Airbnb Luxe launched without listings in one of their biggest potential markets — why?
Airbnb CEO Brian Chesky (Getty)
Airbnb’s losses balloon to $4.6B in 2020
Airbnb’s losses balloon to $4.6B in 2020
Barcelona Mayor Ada Colau (Getty, iStock)
Barcelona may tighten rules on short-term rentals…again
Barcelona may tighten rules on short-term rentals…again
(Photo illustration by The Real Deal)
Hospitality startups pick at carnage of failed rivals
Hospitality startups pick at carnage of failed rivals
Airbnb Brain Chesky and President-elect Joe Biden (Getty)
Airbnb cancels all DC-area bookings for inauguration week
Airbnb cancels all DC-area bookings for inauguration week
Airbnb's Brian Chesky (Getty)
Airbnb says it will ban Capitol rioters ahead of inauguration
Airbnb says it will ban Capitol rioters ahead of inauguration
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...