- Airbnb (NASDAQ:ABNB) intends to stop hosting listings for properties in mainland China within a few months
- Mainland China listings have generated about 1% of the company’s annual revenue
- The company cited China’s Covid-19 restrictions and tough competition as key reasons for the move
Airbnb (NASDAQ:ABNB) stock is retreating 7% in morning trading after the company announced that it would stop hosting listings for properties in mainland China. The firm, which enables homeowners to rent their residences to travelers, intends to terminate all of its listings in the Asian country within a few months.
Among the reasons commentators have cited for the move are China’s “zero-Covid” policy, along with the tough competition and high expenses that Airbnb has faced in the country. For its part, Airbnb identified “the challenges of the epidemic,” which it said made operating in the country difficult, as the key factor behind its decision. Rentals in mainland China have generated about 1% of Airbnb’s sales “in recent years.”
The company says that it will continue to maintain an office in mainland China to cater to travelers departing the country.
Can ABNB Stock Benefit From Summer Travel Rebound?
On May 5, Susquehanna wrote that Airbnb had reported “big” first-quarter results, contending that the company’s “momentum looks to be accelerating into the peak summer season,” according to The Fly.
The firm cut its price target on ABNB stock to $190 from $235 but kept a “positive” rating on the shares. It recommended that investors own them to benefit from the post-pandemic travel rebound.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.