Airbnb becomes profitable for the first time

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

TRD LOS ANGELES /
Jan.January 27, 2017 12:00 PM

From the New York website: 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
Eric Garcetti

California urbanites flee cities amid coronavirus, despite warnings and orders to stay put

California urbanites flee cities amid coronavirus, despite warnings and orders to stay put
Coachella Valley (Credit: Mario Tama/Getty Images)

Coronavirus hits seasonal Coachella Valley tourist economy hard

Coronavirus hits seasonal Coachella Valley tourist economy hard
It’s harder these days to find a short-term stay in L.A.

L.A. short-term rental inventory has plunged in last four months

L.A. short-term rental inventory has plunged in last four months
An illustration of Airbnb's Chief Executive Brian Chesky

Los Angeles No. 1 in country for Airbnb, other short stay rentals

Los Angeles No. 1 in country for Airbnb, other short stay rentals
Airbnb Chief Executive Brian Chesky in front of Los Angeles city hall (Credit: Getty Images, iStock)

A Christmas miracle? LA may loosen key Airbnb restriction

A Christmas miracle? LA may loosen key Airbnb restriction
Council Member Mitch O’Farrell’s motion will not be automatically furled into Airbnb ordinance. (Credit: Getty Images, iStock, and Airbnb)

LA throws Airbnb hosts lifeline at rent-stabilized homes, but there’s a catch

LA throws Airbnb hosts lifeline at rent-stabilized homes, but there’s a catch
The city of Los Angeles is considering allowed rent-stabilized units to be used for home shares. (Credit: Getty Images and iStock)

Last-minute policy tweak could hand Airbnb a key victory in LA

Last-minute policy tweak could hand Airbnb a key victory in LA
LA’s Airbnb hosts seek carveout for looming ban on renting out secondary homes

LA’s Airbnb hosts seek carveout for looming ban on renting out secondary homes

LA’s Airbnb hosts seek carveout for looming ban on renting out secondary homes
arrow_forward_ios

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

Loading...