Airbnb says it is laying off 25% of its workforce as it confronts a steep decline in global travel due to the coronavirus pandemic.
It's a serious setback for the San Francisco-based home-sharing company, which just a few months ago was valued at $31 billion and planning a hotly anticipated stock market launch. Airbnb lists around 7 million properties on its website.
In a letter to employees, CEO Brian Chesky said the company is letting 1,900 of its 7,500 workers go and cutting businesses that don’t directly support home sharing. Those include its investments in hotels, air transportation and movie production.
Chesky said Airbnb expects its revenue to drop by more than half this year. The company is privately held, so it doesn’t release financial figures. But AirDNA, a company that monitors bookings and rental fees for Airbnb hosts and others, said new U.S. bookings fell by 53% between Feb. 3 and April 13.
Chesky said travel will eventually return, but will look different. Airbnb expects travelers will want options that are closer to home and more affordable, for example. The company is scaling back its investments in luxury properties as a result.