Airbnb closed the third quarter with $4.1 billion in revenue (up 10% year over year) and a $1.4 billion profit, its highest quarterly earnings since going public. But beyond the numbers, Airbnb's latest updates reveal a few key changes that will have a big impact on hosts.
Platform Changes
Reserve Now, Pay Later
The Reserve Now, Pay Later feature, launched in the U.S. this summer, lets guests book eligible stays with $0 upfront and pay closer to check-in. Airbnb says it's already a major driver of growth, with 70% of eligible guests choosing the option.
For hosts, this means earlier visibility into demand and higher booking volume, but also the potential for more late-stage cancellations. CFO Ellie Mertz explained that Airbnb extensively tested the feature before launch "to ensure that the benefit of the incremental lift in those bookings from the payment offering was not more than offset by increased cancellations." The company found that while cancellations do increase, "we're highly confident that the net impact of the product is a lift to net bookings."
The success of the program has been especially visible in the U.S., helping drive the acceleration in nights booked during the quarter.
AI Integration
Airbnb is rapidly embedding AI across its app, with more than a dozen initiatives underway. Two of them matter most for hosts.
AI-Powered Customer Support
The new assistant can now handle date changes, cancellations, and policy questions instantly. Airbnb says it has cut resolution times from hours to seconds and reduced the need for human agents by 15%.
CEO Brian Chesky explained that over the past year, the company has been "laying the foundation for a more intelligent, more personalized Airbnb." The assistant is already live in the U.S. and is expanding to Mexico in Spanish, with over 50 languages planned for 2026.
Hosts should expect faster, more automated interactions with guests, both as a time saver and a potential change in how disputes are handled.
AI-Powered Search
Airbnb is also testing conversational search that lets travelers describe what they want ("a pet-friendly cabin near hiking trails") instead of filtering manually. Chesky said the search box will include a "what" field with "free text natural language input, which is similar to ChatGPT or Gemini."
For hosts, listings with clear descriptions, strong visuals, and complete amenities will likely rank higher in AI-driven results once this system rolls out globally.
Product Improvements
Airbnb rolled out 65 new product updates this quarter designed to increase engagement and conversions. Natably:
- Updated Cancellation Policies now let hosts offer free cancellation up to 14 days before check-in, while guests can cancel within 24 hours of booking if check-in is more than a week away. Airbnb says these changes have reduced customer service cases and lifted overall bookings.
- New Search Carousels now show listings slightly outside a traveler's criteria, such as nearby towns or similar amenities, broadening exposure for hosts near high-demand areas.
Together, these changes aim to boost conversion rates and keep guests browsing longer inside the Airbnb app.
Hotels Pilot
Airbnb confirmed it is testing hotel listings in Los Angeles, New York, and Madrid. Unlike past partnerships through HotelTonight, this pilot is fully integrated into the Airbnb experience with new filters, redesigned room pages, and transparent pricing.
Chesky said hotels are meant to fill supply gaps in markets where STRs are restricted, noting that "hotels would be a huge supplement for our supply, especially in supply-constrained markets." The focus is on boutique and independent hotels, not large chains.
Chesky explained Airbnb's positioning: "We are running an ad campaign that says some trips are better in an Airbnb, and we believe that." He noted that homes work best for group travel, families, longer stays, and authentic experiences, while hotels make more sense for one-night urban stays or last-minute business travel. He believes that the two can coexist without major cannibalization.
For hosts, the move could increase competition in city centers but may also bring more travelers onto the platform overall, increasing Airbnb's share of total travel demand.
Expanding Services and Experiences
Airbnb's Services and Experiences platform continues to grow as the first major expansion beyond stays. Since launching in May, it has drawn over 110,000 host applications, nearly double the prior quarter, with an average guest rating of 4.93 out of 5.
The shareholder letter noted that "almost half of experiences bookings were not attached to an Airbnb accommodations booking," showing that the offering is drawing new users to the platform. Chesky expressed optimism about the long-term potential, suggesting these offerings could become significant contributors to platform engagement and revenue over time.
Experiences now include social features allowing guests to see who else is attending, message them afterward, and reconnect later inside the app.
Future Outlook
Looking ahead, Airbnb plans to invest heavily in AI, social tools, and new supply types while maintaining strong margins. Mertz reiterated that the company expects full-year adjusted EBITDA margins around 35%, with Q4 revenue projected between $2.66 and $2.72 billion.
Chesky summed up the company's direction: "While other companies are using AI to keep you online, we're really trying to do the opposite: get you off your phone and into the real world."
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