Airbnb (ABNB) Q3 2026 earnings call transcript

I will now hand the call over to Andrew Slaben, Vice President of Investor Relations. Please go ahead. Good afternoon and welcome to Airbnb's third quarter of 2026 earnings call. Thank you for joining us today. On the call with us, we have Airbnb's co-founder and CEO Brian Chesky and our Chief Financial Officer, Ellie Mertz. Earlier today, we issued a shareholder letter with our financial results and commentary for a third quarter of 2026.

These items were also posted on the investor relations section of Airbnb's website. During the call, we will make brief opening remarks and then spend the remainder of time on Q&A. Before we turn it over to Brian, I'd like to remind everyone that we will be making forward-looking statements on this call that involve a number of risks and uncertainties. Actual results may differ materially from those expressed or implied in the forward-looking statements due to a variety of factors. These factors are described under forward-looking statements in our shareholder letter and in our most recent filings with the Securities and Exchange Commission.

That being said, we urge you to consider these factors and remind you that we undertake no obligation to update the information contained on this call to reflect subsequent events for circumstances. You should be aware that these statements could be considered estimates only and are not a guarantee of future performance. Also, during this call, we will discuss some non-GAP financial measures. We've provided reconciliations to the most directly comparable GAP financial measures and the shareholder letter posted to our investor relations website. These non-GAP measures are not intended to be a substitute for our GAP results. And with that, I will turn it all over to Brian.

All right. Hey, everyone. Thanks for joining. When you look back at our results, over to the last several quarters, there is a clear story emerging. Airbnb is back in growth mode. It's rare for a marketplace of our size to re-excelerate growth. But that's exactly what we're doing. 23 was our fastest revenue growth in more than three years. Revenue grew 19% year of a year at a $4.9 billion. Growth's booking value grew 21% to $27.7 billion. And nights in C's book grew 16% to $155 million. We've also exceeded our outlook across every key metric. And we're seeing this acceleration across the business. In Q3, every region developed to deliver double digit nights growth. Growth accelerated to all five of our core markets, the U. S. , France, U. K. , Canada, and Australia, and nearly all of our expansion markets.

In North America, nights booked through at our fastest pace in four years. We're also seeing more guests return to Airbnb and more people try it for the first time. First time Booker growth accelerated 13%. Now this is the highest it's been since early 2022. And the fastest growing segment is Gen Z. Our nights booked in our app grew 20%. And now 66% of our total nights booked are in our app.

Now, I want to start by explaining what's thriving this growth. This did not happen overnight. Airbnb grew incredibly fast when we started. But eventually, our technology and the way we operate couldn't keep up. So a number of years ago, we started by rebuilding the foundation. This was immediately after our IPO. We spent years rebuilding our technology platform. We redesigned the app. We improved our core experience. And a lot of this was you know, pretty thankless at the time because we had to trade in some near term growth to make these very important investments. We did this for the long term growth of the company.

And technology alone was not enough. We also had to fundamentally change how the company operates. So we organized Airbnb around a single roadmap. We brought all these teams together. We focused small teams on very specific problems. Then we developed an entirely new way to build products. And it was inspired by the original early days of Airbnb with my co-founders. And Project Hawaii, this is what I've talked about on prior earnings calls was our first big three point. I took a very small team. I worked with them very nearly daily. We had one job, make it easier to find and book a home. And this team, they worked relentlessly.

They shipped hundreds of improvements that generated hundreds of dollars in revenue. And so we're like, wow, that works. Let's take this approach and we start applying it to other teams. So we took this and we applied it to the pricing team. And they were able to deliver hundreds of dollars in incremental revenue. Then we took it to international expansion. We gave them more autonomy and moved really quickly. And we're seeing results of that team as well. For example, in Q3, a nice book by guests in our expansion markets grew at their fastest pace in the early three years. Brazil grew more than 30%. And India grew more than 60%.

We also began building new businesses, including hotels and services. And we brought in experience leaders to help scale them. And then AI changed the speed of everything. We spent years laying the groundwork. But now AI is helping us build, test and improve products faster than we've ever done before. In Q3 alone, we shipped more than 50 products and features, nearly 70% more than a year ago, because of AI. So when you put it all together, that's which driving our growth. We spent years changing how Airbnb operates. And now we're seeing the results.

Now let me share a few updates in the quarter, starting with our fall update. When people book a trip, they don't just care about the home. They care about where it's located. In fact, 75% of our guests use Airbnb maps and deciding where to stay. That's why we introduced neighborhood pages, which helped guests get a better feel for an area before booking, including the best restaurants, activities and more. Now we started these neighborhoods pages in Paris, where we saw a really big meaningful increase in booking. So now what we're doing is we're bringing these neighborhood pages to over 1,500 neighborhoods around the world on Airbnb by the end of the year. Now this is going to be massive, because when you stay in Airbnb, you're often staying in a neighborhood.

And how do you get that information? It's really hard to find on Google. This is going to be really useful. We're also helping guests plan trips with recommendations from friends and family. We expanded connections so guests can see where people they know have stayed and what they recommend. And our new travel map brings those trips and recommendations together in one place.

Now for hosts, we designed our multi-lifting calendar. It makes it easy to manage multiple listings, update pricing and fill up a night. In the first month of early access, nearly one in four eligible hosts adopted in. We're also bringing in world-class leaders to help drive our next phase of growth. In September, the Pine Rivers joined us as Chief Business Officer. I have a Pine with one of the key leaders behind booking. com's growth. He ran his entire accommodations business, including hotels and homes, and led one of the largest foreign marketing operations in the world.

He now leads Airbnb's homes and hotels businesses, as well as our international expansion. Now, one of the biggest opportunities ahead of us is hotels. And we started small with a pilot in just four cities. Today, we have thousands of boutique and independent hotels and Airbnb across more than 60 top definitions. And hotel bookings accelerate again in Q3. Now what's even more exciting is that hotels are bringing new guests to Airbnb. In fact, approximately 35% of guests who first, whose first booking is a hotel, they come back and they book a home within a year.

So hotels aren't just a new business for Airbnb. They're also helping us grow our home's business. Service are also becoming a bigger part of Airbnb. We launched car rentals this summer, and they've quickly become one of our fastest growing services. In Q3, we announced new services, including meal delivery, laundry, baby gear, and we also have local offerings like ski gear if you go in skiing or boat rentals if you're near an ocean or lake. And one of our biggest untapped growth opportunities is actually partnerships. Because for nearly 18 years, partnerships really weren't a major part of how we grew. It was mostly just organic. That's changing because we partner with airlines like Delta, Pontus, and TAP Air to reach millions of travelers through companies they already use.

In October, we launched our biggest partnership ever, an exclusive partnership with American Express, bringing more than one million Airbnb listings to AMX travel. Now it's still early, but we're seeing thousands of bookings through AMX travel, nearly a quarter of them coming from guests who are new to Airbnb. We're seeing a higher share of lux bookings than we typically see on Airbnb. So, of course, we're bringing in a really high-end segment of travelers that we haven't typically had as much access to.

Now, I want to spend a few minutes talking about AI. I believe AI is one of the best things to ever happen to Airbnb. And I want to give you a few examples of what we're doing with it. In Q3, we brought AI into more of the guests and host experience. For guests, we introduced AI search. So, they can describe what we're looking for in their own words and find the right home service experiences for the trip. So, if you want to see AI search, just go to our app or a website and you see the very top of the page, there's a toggle. If you open the turn toggle on, you can basically type entire sentences like natural language, and then it will basically select all the filters.

It's working really well. It's especially popular with Gen Z and younger travelers are very AI-native. AI can also suggest relevant search filters. It can summarize important details of homes and help guests compare places they're saving. They're saving. For hosts, we're using AI to make it easier to create 3D4 plans. These are really cool. They can help you price your homes competitively and understand how the listings are performing. Now, we're all using AI to transform customer support. Our AI system is now available in more than 50 languages, and this next stat is really key. In Q3, approximately 40% of all customer support issues were resolved without a human agent, and this is up from a third in Q2.

So, this has been a huge for us, and we're expanding our assistant to voice support in the U. S. , so guests and hosts can help get faster help over the phone. What this means is that customer support cost per booking has declined more than 17% year to year, driven in large part by improvements to our AI assistant. And if you're wondering, customer service MPS is as high as it's ever been. But these improvements are just the beginning. You know, there's a lot of discussion about whether people will eventually use one AI agent to do everything. And if they do, what does that mean for Airbnb? Are we going to be cut out? Well, I don't think people are going to use one AI agent for everything.

You see, today's AI agents, like Muse and Instinct, are good at simple routine tasks like making a restaurant reservation or sketching an appointment. But planning a trip is different. Travel is aspirational. Discovering where to go and where to stay is part of the experience. In fact, 80% of travelers say they enjoy spending time researching trips. People want to look at photos. They want to compare home. They want to make this into the people they're traveling with.

And I don't think the general purpose agents is the best to do that. So, that is why we are building our own AI agent. And we have three distinctive advantages when we build our own agent.

First, we understand that Airbnb marketplace is better than anyone. For nearly 20 years, we've helped guests to host and host fine places to stay with. We've helped guests play state with millions of hosts. Every home is different. Guests care about the home, the location, the reviews, and the person hosting them. And we spend years learning how guests make decisions and how to operate. So, the understanding gives us a significant advantage in building an AI agent to help people find the book the right place to stay.

Second, we are part of the reservation itself. Now, this is important because we know that travel doesn't end with the booking. In fact, that's when it starts. Because Airbnb handles reservations, payments to customer support, our agent is able to help guests throughout the trip. This means we can manage reservations.

We can help you make changes to your plans and accessing Airbnb support and protections when they need them. These are things an outside agent cannot do easily on their own. And third, and perhaps most importantly, we're building a new interface specifically for travel. We don't think the traditional chatbot is the right way to plan travel. It's the wrong interface.

So what we are doing is developing a custom designed AI native experience to respond to what guests are looking for. So, instead of relying on traditional chat alone, which is very tech-savvy, which again, is definitely not the way you should plan travel, our agent draws from a library of hundreds of travel-specific interface components, maps, photos, comparisons, calendars, itineraries, and compose them in real-time to match what they're looking for. This is going to feel a little bit like generative UI in the sense that it's going to offer up the right interface at the right time for your specific travel needs. Now, it can help guests explore options, make decisions with people they're traveling with, and take action directly on Airbnb.

And over time, we want our agent to help guests plan their entire trip on Airbnb all in one place. We're going to start rolling it out to guests in the first half of next year. So, I'm going to end where I started. Airbnb is back in growth mode. We're excited about what we're building with the momentum we're seeing across the business. We're raising our full year outlook.

With that, I'm going to turn over to Ellie.

Thanks, Brian, and good afternoon, everyone. We'll start with Q3 results and then cover our outlook for Q4 in the full year 2026. At Brian's share, Q3 was a strong quarter with a meaningful acceleration across the business. Growth booking value was nearly $28 billion of 21% year over year, of 5 percentage point acceleration from Q2. This is driven by strong growth in nice and steep books and a moderate increase in ADR. Nice and steep books grew 16% year over year, accelerating significantly from Q2, with strength across all major regions and market types. Q3 nights benefited from a 3% net lift from the expansion of reserve down pay later. But excluding the impact of RPL, nice and steep books growth was approximately 13%, still accelerating from Q2.

ADR was a 4% year of year or 5% excluding FX, who was up across all regions with notable strength in North America and Europe. On a regional basis, we saw low double digits growth in North America, mid-teens growth in Amia, over 20% growth in both Latin America and Asia Pacific. These results were an acceleration across all four regions relative to Q2.

Turning to our Q3 financial results, revenue grew 19% year over year to 4.9 billion or 16% excluding FX, significantly exceeding the high end of our outlook. That income was $1.9 billion at 39% net income margin. That income benefited from a $135 million reduction in our provisions for income taxes, as the prior year included a $213 million valuation allowance related to CMT credits. Adjusted EBITDA through 22% year over year to $2.5 billion representing an adjusted EBITDA margin of 52%, up to 50% in Q3 of last year.

Margin expansion in Q3 was driven by strong revenue growth and cost discipline, including operating leverage from AI driven efficiency and customer support, as well as the shifting of certain marketing expenses to Q4. Let me take a moment on monetization and take rates. Our applied take rate was 17.6% in the quarter down slightly year over year. That was primarily due to the expansion and strength of reserve now pay later, where guests booked further in advance, increasing GBB before we recognize the associated revenue.

And to a lesser extent, higher incentive and credits related to new business initiatives. Partially offsetting these pressures to imply take rates are guest travel insurance and our migration to single service fee. Guest travel insurance continues to build momentum. Revenue grew nearly 70% year over year with higher attached rates in every region.

Lastly, in October, we completed the final phase of our fee simplification initiative, whereby nearly all of our remaining hosts have now moved to the single 15.5% service fee. We already seen that the single service fee helps post price more competitively and creates greater transparency for our guests.

Next, our Malachita cash flow. We continue to benefit from our efficient and capitalized business model, delivering 1.4 billion of free cash flow in Q3, up monously year over year. We expect that free cash flow would have grown more in Q3 after the impact of reserve now pay later booking on working capital. Our IPL is the first guest payment from the time of booking closer to the date of stay, impacting the seasonality of other fees. Free cash flow during Q3 was also impacted by a $75 million increase in purchases of property and equipment driven by our new office building in New York City. Over the trailing 12 months, we generated $4.9 billion of free cash flow, a 35% free cash flow margin.

Finally, during Q3, we purchased 700 million of our common stock, enabled by a strong balance sheet and significant cash flow generation, leaving $2.7 billion remaining under our existing authorization. And today, we're pleased to announce board approval of a new $12 billion share repurchase program on top of this existing authorization. This reflects the continued confidence in our business performance, our ability to generate strong free cash flow, as well as our commitment to returning capital shareholders, which remains a core component of our capital allocation strategy.

Now, let's start with Q4 and full year 2026 outlooks. We're encouraged by the meaningful acceleration we've delivered, as well as the momentum we're seeing in the year end. Although, we're closely monitoring ongoing developments in Europe, underlying global travel demand remains healthy, and our faster pace of product is in innovation, continues to drive results, and our Q4 outlook reflexes. For Q4, we expect revenue of $3.22 billion to $3.28 billion, representing year of year growth of 16 to 18%. This includes the approximate two percentage point effect tailwind after factoring in our hedging program. We expect our flight take rate to be up slightly year over year. We expect GBB growth in the mid-teens, driven by at least low-double-digit, low-double-digit growth in ISIS's books, and a modest increase in ADR.

In Q4, we are not assuming a material persistent impact related to the unrest in Europe, specifically France, or the conflict in the Middle East, but our closely monitoring trends in both regions. Our profitability, we expect adjusted EBITDA to increase year over year, and adjusted EBITDA margin to be slightly down compared to Q4 2025, virtually due to the timing of marketing spend that was earlier.

Now for the full year, once again, we're raising our revenue adjusted EBITDA margin outlook, despite facing more difficult comparisons as we head into Q4. We now expect year of year of year revenue growth in the high teens, up from at least in a teen plus quarter, and our expectation at the beginning of the year of low-double-digit growth.

And we now expect full year adjusted EBITDA margin of approximately 36% up from at least 35.5% last quarter. Now during 2026, due to the expansion of reserve now pay later, and its impact on the timing of working to couple off, we expect full year adjusted EBITDA margin to be modestly above our free cash flow margin.

To close, Q3 demonstrates that the product and business changes we've made are translating to real financial outcomes, faster growth, and expanding margins. We're so far in the durability of our results.

Lastly, our product roadmap is robust and gives us a clear path to driving growth into the future. With that, I will open it up to Q&A.

Hey, Richard, how are you doing? I'll take the first part. I think generally pricing is probably one of the biggest levers we have, certainly they are pricing. Just to give you a quick anecdote, a couple months ago, we hired the Pine Rivers from Booking, our new chief booking officer. And he was really instrumental in the early days of booking. And one of the things he said, when he joined, he said, if you think reserve now pay later is the way he sees you, we can do a pricing. It's many reserve now pay later. And it actually kind of makes sense. If you sell a product, customers care about two things. How good is the product?

More to the cost. So it's only 50% of the buying equation. And affordability is this portion point for Airbnb because we have a lot of young travelers. It's much more economic staying at home. We're very much Gen D based. We don't need data to share today about dynamic pricing, but the adoption is really great. I think one of the things we've noticed, this is a really key point, is that there is this win-win where dynamic pricing can generally lower prices across the marketplace. It still allows host to make more money. So some nights, they make more money, other than they think less. Well, we're really able to find these sensitivities where if you just charge like 10 hours less, you'll make enough more booking that you'll actually make a lot more of the long run because your occupancy is much higher.

And that is like not intuitive thing. And it's good for the guests because it makes it a little more affordable. And so it's a really huge lever. It's extremely early. This is something that like AI is really good at tuning. And the thing about AI is that you need to tune in and get more data. So I think in the coming quarters, we should be able to have some more results. But again, I'll just kind of summarize by saying, pricing is the massive lever. And actually, dynamic pricing is one of many things we're doing around pricing. Great.

And Richard, to answer your take, great question. Because of a Q4, just a double sign, Q3, to explain the changing dynamic record in order. In Q3, we got an outside impact reserve now paid or later on both booking value in order, whereas obviously the revenue from those booking is delayed. And so in Q3, you see the impact reserve now, they later increase in the denominator, bringing down the implied take rate. That's somewhat reserved versus in Q4. You should expect a modest increase in implied take rate. More broadly, I would say, you know, from quarter to quarter, there are some small timing movements that do impact take rate. But I wanted to call out that the single service fee, as well as the insurance, should provide over a longer time period, a modest increase in terms of the overall difference.

Yeah, okay. So hotels and agents beyond the walls of Airbnb. So hotels are going markedly faster than our core business. That's not the way our core business is going slow, it's just hotels already 900 billion to our market off of a very, very tiny base. You know, I certainly don't want to put any projections out there for a cap, but it's undoubtable that we will do multiple billions of dollars in revenue in hotels in the coming years. And we don't even need to like win this market to be a significant player and make billions of dollars.

And part of the reason why is we have a huge amount of traffic. Most people come to Airbnb are looking for a place to stay. If somebody doesn't find a place thing, they're probably going to another app or a website booking hotel. So we don't have to win, we just have to get the people on our score to buy something before they leave. And they know that we know they want something, they're in the store in the first place. And the other thing is we're seeing this next thing was very surprising to me. Airbnb, when we started Airbnb, I was a little ideologically like not, I was kind of again, hotels, let's be honest. My first time was forget hotels.

And so we had a little animosity with the hotel in the street like in 2010, 2011, 2012. But over the last six, seven years, I've really changed my tune and approach. I like to think of this as growing up a little bit and being practical. And our guests told us, hey, we love hotels. We bought hotels tonight for the pandemic. But we really decided to get serious about hotels a couple years ago. And basically, one of the things we learned is that actually, most people like staying in homes and hotels, it just depends on the type of trip. And that we don't have a campaign about white people staying home. But if we're booking last minute for business travel, one night, hotels are really great.

So we expected people to want to book hotels. The thing I wasn't expecting was the reception from the hotel in the street. And it was a complete 180. I think hotels suddenly saw Airbnb as a major ally. They really loved the way they were merchandise. They loved the fact that we were an entirely new audience. We were just portionally Gen Z. We are not just really affordable travel. We're actually really high-end travel because we have really big villas. We are a much more global audience. And they just like the fact there was this whole other channel. So all that is to say, when we got really strict hotels, it's not the only reason I hired Papine Rivers.

But it was definitely a big thing. I told Papine, this is a major opportunity for Airbnb. And it is going to be huge. And by the way, Papine Rivers ran the largest foreign marketing organization ever at booking. com. Now, I don't think the foreign marketing is a very important part of our business, but I think with hotels, it's a commodity. I think we're going to be able to do horseing and really efficient because hotels are so high, ADR, booking. com shows us it's very profitable. But the best thing is we don't need to do a lot of it because we have so much organic traffic already coming in. So all of which is to say, it's going to generate many billion dollars of revenue.

I don't know what the timeline is, but it's a huge opportunity. With regards to agents going outside the wall through Airbnb, yes, of course, that will be through MCPs. We're going to be integrating a number of MCPs with our trip agent in the press app next year. I won't give away too much more. We like to do these product launches. We don't want to build the general agent just to double click for one second. If I just want to double click on a second, one problem with the general agent is you have to create a general interface because the agent has to be able to do everything. So the general interface generally becomes almost entirely text-based because we can have about travel, medical information, deliveries.

You can't know what they're as you get more specialized. You can develop a really custom interface that is perfectly bespoke for that type of use case. So with travel, we're able to design these really custom components that you want to car rental. The agent generates this little UI of a car and it's like beautifully in it like a custom-generate interface. If you want to invite code travelers, the agent helps you. So there's going to be, I think, an incredible user interface experience that what I would describe is a kind of post-chat-face interface. It's going to have a chat element to it. And so that's what we're going to be doing. It will be able to go out there with me, but it's going to stay within travel and expect in the first step next year.

All right, yeah. I'll do the AIA agents and I'll hand over to Ellie for reserve now, okay, later. So the short answer is, yes, we are going to do integrations with a lot of providers. I don't want to give away too much again about our kind of product roadmap, but I think it's safe to say we're going to do every part of travel. There's not one part of travel that we're not eventually going to do, and every part of travel will have MCPs, we'll have APIs, and eventually we do anticipate all bookings going through the app for every vertical in travel. I don't want to put a timeline on it. Just to give you an example, let's say car rentals.

Right now car rentals is done through a partnership car, car trawler, and it's a what we call link-off. So it's an API that says link-off. The next phase is do the reservation booking directly on Airbnb. And so that's what we're doing with a number of these partnerships. So the kind of way we're going to do a lot of these partnerships is to get mass scale. We're kind of doing like link-offs. The link-offs appear to feel like Airbnb. So there's really in a like a web view that's designed in our custom interface. This is with groceries, this is with luggage storage, the car rentals, and over time we're going to develop a much more native booking integration.

And obviously the good of that is it's a little more seamless. You take a little bit greater of the revenue, but you also have to handle customer service. So you have to be sure you're ready for that. Now the great thing about the link-off is we can kind of decide and test what things you want to integrate when. But the end game is yes. The end game is eventually we like all travel to be able to book natively through the app of Airbnb, but we're not going to put a timeline on it. And then the other part of your question was general versus horizontal, right?

Okay. So with regards to general versus horizontal and trade-offs, I mean, listen, there is going to be a reason for general agents. I'm not saying that there won't be general agents, but I want to just give my view. I don't think, I think a lot of people are looking at general chat agents like, and they're trying to connect it to Google. Like there was one home page of the internet. It was called Google and you went there and everything started at Google.

This is just my opinion. I do not think that's going to happen with chatbots. I don't think there will be one chatbot that's like Google and it's the front page and it is the orchestra conductor for every other app. I'll tell you a couple of reasons why that I don't think that'll happen. The first problem is if that were to exist, I think it would have to exist the operating system level. Then it exists at the Android operating system level at the max iOS operating system level. The operating system is the right substrate to control your apps.

One app was the home page. You're really saying an app's going to control all the other apps. By the way, you really think Apple is going to allow an app to control their entire computer considering all the potential issues for privacy security and that they can actually cut out of their own user experience. I'm actually quite skeptical of that. So I do think that general chat agents are going to be successful and popular. I just don't think they're going to be able to do everything. The burden of a general chat agent doing everything is they basically almost become an operating system. That is a lot to put into an app and I just don't think that's going to happen.

I do think general chat agents will be popular for simple everyday things. I think as they get really, really complicated, specialization is going to win. Now the chat agent can hand over to a specialized agent but a lot of people are going to go direct to the specialized agent just like they discover Airbnb on Google and they come back direct. They don't just keep going through Google. That is generally my thought. Now a general agent does have a bunch of data because you use a general agent more frequently, right? At the same time, we can connect MCPs of Gmail and Google Calendar. If you connect an MCP of Google Calendar or Gmail or other MCPs, we can actually go in with users consent a ton of other data.

So actually, there's many ways we can get as much data or nearly as much data as a chat agent uses every day and this is just through basic MCP handoffs. So I think basically the way to think about it is in order for specialization to win, it must not be 20% better. It must be like 2, 3, 5x better than a general agent at its task because you do have the inertia and the switching cost. So our job isn't to be 20% better. It's to confident. Great.

Ken, let me tell you just a little bit more about what we're seeing on a certain day later. Just a reminder, at a certain day later, we began to launch a year ago in the U. S. We expanded amongst our plus or moderate installation policy listing at the community of the year to Raptor World. And then most recently at the beginning of Q3, we expanded eligibility of reserve down pay later to limit it in firm translation policies. In doing so, it obviously grew materially. The total eligibility of GBV on the platform for this product at the Q3 was over 40% of GBV was eligible to use RMPL. In doing that expansion, we've seen a couple of things.

First is a material list to booking. In particular, in Q3, we saw a full three points of net night's list associated with both the expansion and the task of eligibility offerings. This was a incremental point or relative to the impact we saw in Q2. Ken believed that the expansion this summer was even better than we had tapped in in terms of the reception for consumers. I think it's probably pretty obvious, but this product made traveling more affordable. You don't need to pay up front. And what we see is that people not only book more, they book earlier, so early times have expanded, and they book more expensive listings, which is one of the reasons that ADR is up.

Specific to your question, cancellation rates in aggregate are up 200 to 300 basis points from a year ago. And this is, you know, just thinking about the nominal year ago or cancellation rate for order of magnitude about 16%. They're now about 19%, which we think is very healthy in the travel phase. The final comment I will make, and I'm sure we'll get questions on it later, is the impact of RMPL in Q4. I just want to remind everyone that we have just called out last quarter that Q3 would be the peak in terms of net impact of RMPL on our numbers.

That's because we get the growth benefit in terms of the list of boob before we see the full cancellation. And so the net impact to NICE will come down sequentially in Q4.

Yeah, you know, over 60% of our inventory, we believe is as good as the Airbnb, you know, and so that's the first part of the question. What is the other part of the question?

Is the penetration of insurance products? Yeah, insurance products are growing quite nicely. It's a single digit percent of bookings that have an attached that is up materially from a year ago. I think what we've learned about our insurance products is not only the growth, but also the opportunity to provide more insurance products. We're looking across the host of operas that we could provide both get and host. And I should note that the margins are great on those attached insurance.

Sorry, Justin, you said, how does that factor into agent negotiations, exclusive inventory? Can you elaborate on that? Yeah, how are you thinking about that as an asset, either for your own internal agents or maybe in negotiations with external agents getting good financial terms or any strategic advantages there? Yeah, I'm not sure yet. I mean, I think it's really, really I think as far as speculating what the relationship is between unique inventory and like potentially leverage negotiating with like other partners, I think it's really early, I don't know. But let me just tell you my philosophy on unique inventory. I don't pay a lot of attention looking at what percent of inventory is unique anymore. It's helpful.

The more unique, the better. There's no question. The most important thing is as we go into categories, we are our philosophies. It's okay to have commodities like hotels. It's okay to have some cross-listed homes as long as there are a lot of unique things that you can't get anywhere else. And I think the percentage is not as important. It's the absolute amount, right? So like if there are imaginers to stores, they all have the same products, except one store has a bunch of other stuff if other store doesn't have. The percentage of unique stuff in that store doesn't matter, just how many things the items are unique in that store, the other store doesn't have.

And so as a theoretical mental model, imagine there's two stores. And one, they have almost all the same inventory, but one has just some more unique stuff. If you have 10% more unique stuff, you might get more than 10% more traffic because suddenly, you know, it's a major difference. So we don't really look at the percent mix. I mean, it's good to know. Of course, we track it. But, you know, we are growing really, really quickly by crossing the inventory and getting that really competitive nights. And actually, one of these nodes, we're going to turn out, okay, later, is this helped us become way more competitive by getting those nights than the host only fee has been really competitive with us keeping more competitive prices.

And so why I say this is just to finish off this point. With services, a bunch of our inventory is commodity inventory, like car rent. You can get those cars elsewhere. But then we have a bunch of inventory you can't find anywhere else, like masseuses, chefs, and photographers. There's experiences. We're now offering tickets. You can get a bunch of tickets on their website, but we also have exclusive experiences. So kind of category by category, we'll get a bunch of the commodities. We always want to make sure that we have unique stuff. And we have unique plus commodities. And we become the one-stop shop. You don't need to go in or out.

Good. Two good questions. So social and travel discovery, let me just like before I answer the question, let me back up. So I remember like 22 years ago when Facebook first came out. It came out 2004. I couldn't use it right away because I just missed it. I just graduated from college right before Facebook launched my college. I had to wait two years before they opened up to everyone. But I remember Facebook would used to be a social network. And it was basically your friends and you can keep in touch with people and you can message them and see what they were doing. And that was around 2004, 2006, 2007, 2008, let's call that the Golden Age of Social Networking.

And at some point, social networking morphed into social media. And our friends became our followers and we stopped connecting and we started performing. And kind of for a large part of the world, uninvented. Like I no longer have a social graph. I no longer know whose birthdays my friends are unless they're close friends. I no longer know when somebody like something happens someone's life. I no longer know how to keep in touch with people except I've got to message them and what that for my messaging platform. So there really aren't social graphs anymore. I mean LinkedIn is kind of a resume graph, but really there's no social graphs anymore.

And we thought, what if we brought back the social graph? But instead of being an online social graph, it was a social graph in the real world of the people you travel with and the people who meet along the way of your travels. We thought this could be really interesting. So we started building these social travel features this year. We launched them in May, we launched a travel map and we started realizing this might be the beginning of something massive.

And we are going to be launching a lot more social features and social connection features next year. I think this is maybe one of the single most underestimated parts of our business. I mean, might be because we don't talk about it much. That's okay. I don't want to give away too much the roadmap, but I can just say a couple things. Number one, it's a great proxy for trust.

If I were a host and I were to get a reservation for somebody, I don't know them, but I see how they're connected to me. How many degrees away? That'd be a really good proxy for trust. And as you build this social graph, you increase trust. As you can trust, you potentially go into a lot of the businesses. I'll let your imagination run wild with what's possible. You can also see where your friends have traveled and stayed. So you can see if my friends stayed at Paris, now I can message them and ask what's good to do in Paris. We can eventually bring that into search results. Right now that's on the profile path, but we eventually are going to bring that into search results.

So when you see the map, you'll be able to see where your friends have traveled in search results and maps. You'll be able to see listening to friends of stayed. You'll be able to see who's been traveling there recently, where they're going. So there's going to be a lot of these features. These features are going to be, A, make things more sticky. B, it's going to make group travel much more collaborative. C, it's going to make it much easier to get great recommendations.

It's going to increase trust in the platform. And the other thing I'll just say the last thing is I've been doing, you know, I occasionally do these round tables and with customers. And I recently did a Gen Z round table, you know, basically kids that are like college age. And they were kind of like a little younger than the age I was when I started Airbnb.

And I think I heard two things from Gen Z. And again, I just say Gen Z is like the fastest growing segment. And it's the prime advertising segment. They basically two things. One, they want to save money. Young people always want to save money. But in age of rising cost of living, with a lot of college debt with tuition going up, and the latter being pulled up a little bit with AI, a lot of entry level jobs are harder to come by because AI can do them more than ever, they're looking for affordability. But even more so, we're hearing a lot of college and recent grad things, they want to meet people. And a lot of people, they meet people at work, in school, church, bowling alleys.

Well, a lot of these things aren't around as much anymore. And a lot of kids, if they don't have a job, they're not going to meet someone at work. So we're starting to see that a lot of these social features are going to be especially popular with Gen Z. But surprisingly, we're also seeing like on the other barbell, empty master kids around the house, they want to travel, they want to meet people. So there's a lot of opportunities here with social features. With regards to sponsor listings, the relationship between them, I don't know. I think the thing I'll say about sponsor listings in particular is we are developing our AI agent, and we are developing sponsor listings, but it will be developed in the context of the AI agents.

We first need to launch the AI agent, we need to refine it, then we figure how ads work in that new world. By the way, everyone's figuring this out, it's not clear what the implementation is. But I think if anyone can figure out, I think we're design team such. With regards to a loyalty program, I mean, I don't want to not break any news, but we are absolutely looking at a loyalty program. We've been looking at it for a long time. I think I've said for a long time, the best loyalty program is plus customers loving your product.

Disney and Apple for years, Apple doesn't have a loyalty program, people love their product. But at the same time, we're like the only travel major traveling in the world that doesn't have one. And I think we have been added to this advantage because we don't have a loyalty program. A lot of people want to use there to be say, I want to use you, but you don't have a program. So I almost feel like I can't use you. So we are absolutely looking at a loyalty program. I don't have any announcements, but I can say that as we add more verticals, we just have a lot more to work with. So adding verticals makes a loyalty program more compelling.

Jed, are you talking about Q4 or 27? What's the reference?

Yes. I mean, I think Brian and I have been very clear over the last two years that we have very been prioritizing growth focused on driving growth in this business. And I think, you know, the results the last couple quarters show that we have been able to deliver that growth. Behind that, we continue to invest in growth. But at the same time, the last couple of years, what you've seen is that we've been capable of reinvesting upside in order to continue the momentum. We're obviously in the 27th planning right now. And, you know, the prioritization around continuing the momentum, you know, continues to be the top priority. The good news is that this business is, you know, extremely profitable, has incredible cash flow dynamics that give us a lot of room to invest within a very strong profitability envelope.

Maybe I'll start with the second one and just kind of mind that Ellie, you can go to the first one.

So we're not seeing a lot of traffic in even fewer bookings from using instinct yet. We do have nearly half a million bookings a day and a very non-material number of bookings happen on using instinct. So we're talking very low numbers. So we're not seeing a lot of traffic today and it's not really increased over the last four weeks. So it kind of peaked in early October. It's kind of been stable in the last four weeks. So we're kind of watching it.

My general philosophy on agents are, I'm generally excited about them. I don't see them as a threat. I see them kind of like Google as an opportunity for more people to cover Airbnb.

So I think they'll be great hand-offs to us. There will be people that will want to book a one-off flight or something directly on an agent. So I'm not saying that will never happen. But you know, travel is, maybe this is like just a framework to think about. There's item-based retail and project-based retailers. So just as an analogy, you go to Walgreens. You don't like planned to go to Walgreens. You need to get something to go to Walgreens. You go to IKEA or Home Depot. That's a project-based retailer, right? You have a whole project. You don't go to those places to get one item. Airbnb, we're really long-term we want to be in the midst of the entire trip.

That's where they, what to do, have a get. They're all in one place. It's highly logistical. Our guests typically travel in groups of three or more. 90% of people message the host. The host wants to know who's in their home. So they want to have a connection. They don't want to off-load it to an agent. If I'm hosting somebody, I want to talk to the person, not the agent, on behalf of the person.

It's very visual. People typically look at multiple... It doesn't list things or more. They look at 25 photos per listing often. So it's very visual. It's very collaborative. It's a very complicated experience. And the other thing, and I mentioned this in my open remarks, is there's a lot of studies that show people enjoy anticipating travel more than actually traveling. Here's a fun fact. Most of our traffic happens during nine to five hours. These people are supposed to be working and they're not. We have evidence. People are actually secretly using Airbnb. Maybe they're trying to escape their job. But the idea is that it's highly aspirational. So I don't think a lot of people want to offload all that to an agent.

I think they want to offload the things they don't enjoy. Not the things they do enjoy. So it's small. We're watching it. We are definitely open to working with these agents. But I also just think they'll be really helpful handoffs to us. But I think that to do... I'm not saying agents can't do travel. I just think it's a focus on travel. And that's what we're going to do. We're going to focus on travel. And anyone to focus on travel could probably solve it. But a general agent trying to solve travel in solve 50 other things. That's really hard. Trying to solve questions I'll be quick. I know we're going to end time.

In terms of the mix of new bookers versus past bookers, it's actually very consistent with our overall platform. We're seeing great demand from both segments and just to underscore why that is consistent with our strategy. We're here to get more travel share from our past guests. And hotels open up new use cases that even our most loyal guests may be choosing hotels off the platform. Similarly, on the first time booker front, hotels part of the trend was to onboard those guests that haven't yet tried us for a home by offering them something they are familiar with. And we're seeing that as well. So it's a great hotel demand on both sides of the market.

All right. Well, thank you everyone for joining. I just want to end where I started. Airbnb is back in growth mode and it's here to say this is a result of years of hardware to make Airbnb better. And as we build Airbnb to become an AI native company, I actually think the opportunity ahead of us is actually even bigger. I want to end most importantly by thanking our incredible team.

You know, I get to, you know, I get we get to take the credit when we have good calls, but it's only because of the great work of the people. And I think one of the superpowers probably are Airbnb, maybe the superpower. This is old cliche. It's all about the people, but it really is especially in Silicon Valley and tech because you're only as good as your most recent innovations and that's only as good as your team. Our team, which tirelessly, they've been really, really burning the money at oil a lot of times this year. And so, you know, I'm asked why are we growing so fast? I often say things like execution. Well, execution only happens from people.

And I think that what these results really are beyond AI, beyond all these products, is this the team that's really starting to get into flow. They're doing great. So thank you all, team Airbnb. And thank you all for dialing in today. We are just getting started back in growth mode. Thank you.