4 ms·

Down $600m in 2019 and another $600m in 2020? With $2b in debt? Ouch. I'm reading this right, correct? I see the cash positions below are a bit different, but

Down $600m in 2019 and another $600m in 2020? With $2b in debt? Ouch. I'm reading this right, correct? I see the cash positions below are a bit different, but that's likely from... the loans? 2018 looked so hopeful. They only lose $20m total! 2019 should have been a profitable year, IMO, but they went with the aggressive strategy.

SilasX 6y ago
>With $2b in debt? Don't forget, there was the announcement in April [0], they issued $1 billion of that debt at 10% interest, and it's convertible, which is equivalent to rate of about 12-13% non-convertible debt. [0] https://www.businessinsider.com/airbnb-paying-10-percent-interest-debt-valuation-cut-18-billion-2020-4 https://www.businessinsider.com/airbnb-paying-10-percent-int... What the S1 says about that loan: Interest on the First Lien Loan is payable monthly or quarterly in arrears, at our option depending on the chosen per annum interest rate equal to (i) in the case of LIBOR borrowings, 7.5% plus LIBOR, subject to a floor of 1% (the “First Lien Eurodollar Rate”), or (ii) in the case of base rate borrowings, 6.5% plus the greatest of (a) the prime rate, (b) the federal funds effective rate plus 0.5%, and (c) LIBOR for a one-month period plus 1%, subject to a floor of 2%.
smitty1110 6y ago
It's more like $3 billion, there's a notice that the IRS is telling them they owe $1.3 billion in back taxes, plus interest and penalties.
- afterwalk 6y ago
  How can an unprofitable companies rack up $1.3b in taxes?
  - hnburnsy 6y ago
    From the S1... 'While we have not yet received a Revenue Agent’s Report generally issued at the conclusion of an IRS examination, in September 2020, we received a Draft Notice of Proposed Adjustment from the IRS for the 2013 tax year relating to the valuation of our international intellectual property which was sold to a subsidiary in 2013'
  - smitty1110 6y ago
    Well, you spend money as part of doing business, but then, in theory, you make some money. This is revenue. Revenue is taxed at 21% in the US as of the 2019 tax year. Now, if you screw up, and the IRS catches you, you owe penalties. And you owe interest on the money you didn’t pay. And these can add up, especially, like the S-1 filing says, if you have irregularities dating back 7 years. I’m sure they will have to make a more detailed explanation of this at some point, and it should make for a good read whenever the release it. And they may take their accounting firm to court, because this is large enough to at least suspect negligence or fraud. But until something else happens, all we have is speculation.
    - sk5t 6y ago
      > Revenue is taxed at 21% in the US I hope you're not an accountant.
    - martinesko36 6y ago
      I'm sorry, I was under the impression that only profit is taxed?
    - phonon 6y ago
      You probably shouldn't be opining on these matters if you don't understand the distinction between "revenues" and "profits".
tyre 6y ago
I wonder what's up with 2019. Like 2020 is understandable for a hospitality during a pandemic, but why would 2019 be the same?
- grumple 6y ago
  Ramp up into the expected ipo. If not for COVID, 2020 would probably have looked great.
  - whymauri 6y ago
    The Olympics were gonna be huge, a lot of momentum going into 2020.
aliston 6y ago
Look at the costs: Revenue was up ~30%, but costs an expenses up ~50%, primarily SG&A and product development... basically they hired a lot of people it looks like.

SilasX 6y ago

>With $2b in debt? Don't forget, there was the announcement in April [0], they issued $1 billion of that debt at 10% interest, and it's convertible, which is equivalent to rate of about 12-13% non-convertible debt. [0] https://www.businessinsider.com/airbnb-paying-10-percent-interest-debt-valuation-cut-18-billion-2020-4 https://www.businessinsider.com/airbnb-paying-10-percent-int... What the S1 says about that loan: Interest on the First Lien Loan is payable monthly or quarterly in arrears, at our option depending on the chosen per annum interest rate equal to (i) in the case of LIBOR borrowings, 7.5% plus LIBOR, subject to a floor of 1% (the “First Lien Eurodollar Rate”), or (ii) in the case of base rate borrowings, 6.5% plus the greatest of (a) the prime rate, (b) the federal funds effective rate plus 0.5%, and (c) LIBOR for a one-month period plus 1%, subject to a floor of 2%.

smitty1110 6y ago

It's more like $3 billion, there's a notice that the IRS is telling them they owe $1.3 billion in back taxes, plus interest and penalties.

afterwalk 6y ago
How can an unprofitable companies rack up $1.3b in taxes?
- hnburnsy 6y ago
  From the S1... 'While we have not yet received a Revenue Agent’s Report generally issued at the conclusion of an IRS examination, in September 2020, we received a Draft Notice of Proposed Adjustment from the IRS for the 2013 tax year relating to the valuation of our international intellectual property which was sold to a subsidiary in 2013'
- smitty1110 6y ago
  Well, you spend money as part of doing business, but then, in theory, you make some money. This is revenue. Revenue is taxed at 21% in the US as of the 2019 tax year. Now, if you screw up, and the IRS catches you, you owe penalties. And you owe interest on the money you didn’t pay. And these can add up, especially, like the S-1 filing says, if you have irregularities dating back 7 years. I’m sure they will have to make a more detailed explanation of this at some point, and it should make for a good read whenever the release it. And they may take their accounting firm to court, because this is large enough to at least suspect negligence or fraud. But until something else happens, all we have is speculation.
  - sk5t 6y ago
    > Revenue is taxed at 21% in the US I hope you're not an accountant.
  - martinesko36 6y ago
    I'm sorry, I was under the impression that only profit is taxed?
  - phonon 6y ago
    You probably shouldn't be opining on these matters if you don't understand the distinction between "revenues" and "profits".

tyre 6y ago

I wonder what's up with 2019. Like 2020 is understandable for a hospitality during a pandemic, but why would 2019 be the same?

grumple 6y ago
Ramp up into the expected ipo. If not for COVID, 2020 would probably have looked great.
- whymauri 6y ago
  The Olympics were gonna be huge, a lot of momentum going into 2020.

aliston 6y ago

Look at the costs: Revenue was up ~30%, but costs an expenses up ~50%, primarily SG&A and product development... basically they hired a lot of people it looks like.