Airbnb CEO on Q1 results, Icons launch: We are just scratching the surface of our core business

All right, One of my favorites, Airbnb stock is moving lower this morning. Quarter results beating speed estimates. But there was a conservative guide, which was indeed below consensus. Joining us now is Airbnb CEO Brian Chesky. Brian, can I have a VIP house with Kevin Hart? May I wake up the music door, say, or can I drift off in the up house? Because I think we’re burying a lead if we don’t talk about icons. Yeah, I mean, absolutely. Icons are the coolest experiences on Earth. And you can stay in a the up house, which we’ve recreated, the Prince Purple Rain house. And what this gym really represents, I think is the beginning of the next chapter of Airbnb because we’ve been known for stays. But now Airbnb is starting to move into experiences and we’re starting with just you know 4000 people can do these this year whether you want to stay at the Ferrari Museum or the X Mansion which is completely recreated like you’re stepped into a comic. But eventually we want to do is be able to bring the magic of icons to millions of people around the world. I think it’s just a sense of like where we’re going as a company. Well, I think that’s really important because there are people obviously want to focus on something. It does matter because you honest obviously you’re have a company with the stock and that next quarter does seem you did say things could be a little lighter and there is a concern whether it be from if we listen to Expedia will listen to Hyatt, the Rev Wireless in a Marriott. We do get a sense that travel has slowed. And I don’t know whether to lump you into that particular American travel or just say, listen, you’ve got to see through this little valley because we’ve got a new brand new Airbnb that’s very exciting. Yeah, I mean if you think about Jim, as we as we as you and I used to talk before we went public, we were basically break even, we went public and the big question was would we ever be a profitable company. And in three years we made so much progress focusing on this and now we have 41% free cash flow margin. So today we are now at the beginning of this next step and the question is what’s next for Airbnb? And the answer is there’s going to be a lot more coming over the next couple years, new products, new services and I’m very confident that we can re accelerate growth. Well, I want to talk about icons again because one of the things that I now find to be, let’s say, incredibly important is before I start my travel trip, I have to go to icons to see if there is something that I might want to do. But I also worry if I go into the Up House, whether that costs a fortune or whether these are just all kind of, let’s say, not above what someone might be able to pay. Yeah, I mean, Up House is actually free. And all of them are under $100 a night. And so these are essentially tickets that you apply for. You fill out your profile, there’ll be 4000 lucky winners. The winners get a digital golden ticket just like Willy Wonka. And you know, this is just, I think, a really fun idea. And one of the reasons we did this is last year when the Barbie movie came out, we created the Barbie Malibu Dream House. It got so much press, Jim, it got more press than our IPO and we realized there’s a big idea here and what icons do is it’s going to bring a lot of people to Airbnb. You know, keep us top of mind. You know, travel. Travel companies really have to pay a lot of marketing dollars to get people to come to their app and we get a lot of organic traffic. Now let’s talk about some other things. I mean I’m a big fan of the Olympics. I I just think it’s going to be one of the most exciting things I this music, you know, Musee D’orsay is one of the great monuments to art in the world. How do you come up with something like this? Because this was so inspired that I said maybe I should just throw my hat in the ring. Yeah. I mean, I mean you can literally sleep in the clock tower and the room is designed by the same design. Who designed the Olympic torch? You have the museum all to yourself. And how do we do this? Well, we have some of the most creative people in the world at our company. And I think that’s one of the strengths is, you know, we’re not just a technology company. We sit the intersection of technology and creativity. And I mean, I’m a designer, I went to design school. So I think that’s one of the things that makes this company different. But you know, Speaking of Paris, we have, you know, we have 100 and 2000 and 30,000 homes in Paris. A large percent of the people going the Olympics in Paris this year will be staying in Airbnb. And I think what we’re able to do is keep the cost of staying in an event much lower because we add a lot of excess capacity. Now, I do want to point out that you make some really interesting, let’s say, projections about what would happen if more people around the world were to list their place. Obviously, there are the competition, how hotels just can’t hold a candle of what you’re offering. Is it possible that just organic growth could make it so that we could look through this quarter and not be so concerned that we’re the beginning of a downturn? Yeah. I mean, honestly, Jim, we are just scratching the surface of our core business. You know, we’ve been focused on reliability and quality and our customers tell us for every person who stays in Airbnb, there’s eight or nine people that still stay in a hotel. If we can just get one of those people to stay in Airbnb, we will double the size of this company. And so there’s a huge amount of growth opportunities ahead of us. Just by continuing to focus on improving the core service, we’ve made a lot of improvement. Then Jim doesn’t even put international. You know we have very low penetration in Asia, Latin America, even parts of Europe. If we can get those countries even to half the penetration United States, it’s going to be a much larger, much, much larger opportunity. Well Brian, Jim mentioned the Olympics and we keep watching dollar strength. What’s your take right now on, on foreign exchange dollar strength as a way to incentivize people to go international. I mean, I think that one of the things we’re seeing is a lot more cross-border trips. And I think this summer you’re going to see, you know, nearly half our business is cross-border in a really big opportunity are Americans traveling overseas, especially to Europe. And I think the Olympics is just the star. I think you’re going to see a huge amount of travel coming this summer season. So I think everybody’s going to be the place to do that. Well, Brian, I want to congratulate you. I know it’s been 10 years in making you experiential and you did blow us away. I urge people to go to the video because what they’ll see is not an actual rendering, but real pictures. And I found it very exciting with my kids, and I think other will be too. So congratulations on all the excitement that you generate. That’s Brian Chesky, CEO of Airbnb. Great. See again.