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Airbnb · 5 May 2020

A Message from Co-Founder and CEO Brian Chesky

Eight weeks into the crisis, Airbnb’s CEO tells staff that nearly 1,900 of them will leave, and that the company will narrow to its hosts.

Author
Brian Chesky, Co-founder and CEO
Written
5 May 2020
Document
Note to staff, posted on Airbnb’s newsroom
Notes
9: 6 fact, 3 editorial
Last reviewed

Short excerpts from the note Brian Chesky sent Airbnb employees on 5 May 2020, which Airbnb posted on its newsroom the same day; the full text is linked here.

Excerpts · 9 notes
Airbnb2020
To:
Airbnb employees
From:
Brian Chesky
Date:
May 5, 2020

This is my seventh time talking to you from my house. Each time we’ve talked, I’ve shared good news and bad news, but today I have to share some very sad news.

When you’ve asked me about layoffs, I’ve said that nothing is off the table. Today, I must confirm that we are reducing the size of the Airbnb workforce.

[ … ] Not shown: Why this is hard, and what the note will cover.

We are collectively living through the most harrowing crisis of our lifetime, and as it began to unfold, global travel came to a standstill. Airbnb’s business has been hit hard, with revenue this year forecasted to be less than half of what we earned in 2019Fact · 1With hindsightThe forecast was too gloomy. Airbnb’s Q4 2020 shareholder letter says that at the depth of the pandemic it forecast 2020 revenue at less than half of 2019’s, and that revenue in the end was $3.4 billion, down 30% from $4.8 billion.SourceAirbnbQ4 2020 Shareholder LetterFeb 2021. In response, we raised $2 billion in capital and dramatically cut costs that touched nearly every corner of Airbnb.

While these actions were necessary, it became clear that we would have to go further when we faced two hard truths:

We don’t know exactly when travel will return.

When travel does return, it will look different.Fact · 2With hindsightAirbnb’s Q4 2022 results put numbers on the change: high-density urban nights were 51% of gross nights booked against 59% in Q4 2019, cross-border 44% against 47%, and nights booked for stays of more than a week were 40% higher than in Q4 2019.SourceAirbnbAirbnb Q4 2022 and full-year financial results14 Feb 2023

While we know Airbnb’s business will fully recoverFact · 3With hindsightRevenue recovered first. Airbnb reported $6 billion of revenue for 2021, 25% higher than 2019, while its Q4 2021 Nights and Experiences Booked, 73.4 million, were still slightly below Q4 2019. By 2022 revenue was $8.4 billion.SourcesAirbnbQ4 2021 Shareholder LetterFeb 2022AirbnbAirbnb Q4 2022 and full-year financial results14 Feb 2023, the changes it will undergo are not temporary or short-lived. Because of this, we need to make more fundamental changes to Airbnb by reducing the size of our workforce around a more focused business strategy.

Out of our 7,500 Airbnb employees, nearly 1,900 teammates will have to leave Airbnb, comprising around 25% of our company.Fact · 4With hindsightHeadcount grew back only modestly. Airbnb’s Q4 2022 letter says it had “modestly increased our headcount” in each of the two years since, ending 2022 with 6,811 employees: compared with 2019, “down 5% while our revenue is up 75%”.SourceAirbnbQ4 2022 Shareholder LetterFeb 2023 Since we cannot afford to do everything that we used to, these cuts had to be mapped to a more focused business.

Travel in this new world will look different, and we need to evolve Airbnb accordingly. People will want options that are closer to home, safer, and more affordable.Fact · 5With hindsightThe “closer to home” part held in 2020: Airbnb’s Q4 2020 letter says that, with millions of guests booking stays closer to home, “domestic travel quickly rebounded on Airbnb worldwide.”SourceAirbnbQ4 2020 Shareholder LetterFeb 2021 But people will also yearn for something that feels like it’s been taken away from them -- human connection. When we started Airbnb, it was about belonging and connection. This crisis has sharpened our focus to get back to our roots, back to the basics, back to what is truly special about Airbnb -- everyday people who host their homes and offer experiences.Editorial · 6Known at the timeThe memo defines the core by who supplies it, everyday hosts, not by product line. That gives every team a test it can be measured against, and it turns a cost cut into a strategy. The cost is the growth options Airbnb had been building around hotels and premium stays.

This means that we will need to reduce our investment in activities that do not directly support the core of our host community. We are pausing our efforts in Transportation and Airbnb Studios, and we have to scale back our investments in Hotels and Lux.Fact · 7With hindsightThe turn back came in stages. In February 2023 Airbnb named “Expand beyond the core” one of its three priorities for the year. In May 2025 it introduced Airbnb Services and an all-new app; in Q4 2025 it “began partnering directly with boutique and independent hotels”; in March 2026 it added a private car service in partnership with Welcome Pickups. We have not traced what became of Transportation, Studios or Lux in between.SourcesAirbnbAirbnb Q4 2022 and full-year financial results14 Feb 2023Airbnb2025 Summer Release: Now you can Airbnb more than an Airbnb13 May 2025AirbnbAirbnb Q4 2025 financial results12 Feb 2026AirbnbIntroducing private car services on Airbnb with Welcome Pickups31 Mar 2026

[ … ] Not shown: Which teams are affected, and four other guiding principles.

Wait to communicate any decisions until all details are landed -- transparency of only partial information can make matters worse.Editorial · 8Known at the timeThe principle the memo itself follows. It arrives with the number, the severance terms, the equity change and the last working day, so the one message answers the questions a layoff raises. The price was the wait: until then, asked about layoffs, he had said only that “nothing is off the table”.

[ … ] Not shown: How people were chosen, and severance of at least 14 weeks.

We are dropping the one-year cliff on equity for everyone we’ve hired in the past year so that everyone departing, regardless of how long they have been here, is a shareholder.Editorial · 9With hindsightA concrete, costly gesture: it made recent hires who were leaving into shareholders of a company whose IPO was on hold. Seven months later Airbnb listed on Nasdaq, and its shares closed their first day at $144.71, against a $68 offer price. The memo could not have known that.SourcesAirbnbQ4 2020 Shareholder LetterFeb 2021CBS News (CBS San Francisco)Airbnb IPO: Shares More Than Double In Price In Long-Awaited Debut, Close At $144.7110 Dec 2020 Additionally, everyone leaving is eligible for the May 25 vesting date.

[ … ] Not shown: Health cover, job help, the timetable, and thanks to staff.

To those leaving Airbnb,

I am truly sorry. Please know this is not your fault.

[ … ] Not shown: Thanks to those leaving.

Brian

All 9 notes and their sources
  1. with revenue this year forecasted to be less than half of what we earned in 2019Fact · 1With hindsightThe forecast was too gloomy. Airbnb’s Q4 2020 shareholder letter says that at the depth of the pandemic it forecast 2020 revenue at less than half of 2019’s, and that revenue in the end was $3.4 billion, down 30% from $4.8 billion.SourceAirbnbQ4 2020 Shareholder LetterFeb 2021Back to the passage
  2. When travel does return, it will look different.Fact · 2With hindsightAirbnb’s Q4 2022 results put numbers on the change: high-density urban nights were 51% of gross nights booked against 59% in Q4 2019, cross-border 44% against 47%, and nights booked for stays of more than a week were 40% higher than in Q4 2019.SourceAirbnbAirbnb Q4 2022 and full-year financial results14 Feb 2023Back to the passage
  3. While we know Airbnb’s business will fully recoverFact · 3With hindsightRevenue recovered first. Airbnb reported $6 billion of revenue for 2021, 25% higher than 2019, while its Q4 2021 Nights and Experiences Booked, 73.4 million, were still slightly below Q4 2019. By 2022 revenue was $8.4 billion.SourcesAirbnbQ4 2021 Shareholder LetterFeb 2022AirbnbAirbnb Q4 2022 and full-year financial results14 Feb 2023Back to the passage
  4. Out of our 7,500 Airbnb employees, nearly 1,900 teammates will have to leave Airbnb, comprising around 25% of our company.Fact · 4With hindsightHeadcount grew back only modestly. Airbnb’s Q4 2022 letter says it had “modestly increased our headcount” in each of the two years since, ending 2022 with 6,811 employees: compared with 2019, “down 5% while our revenue is up 75%”.SourceAirbnbQ4 2022 Shareholder LetterFeb 2023Back to the passage
  5. People will want options that are closer to home, safer, and more affordable.Fact · 5With hindsightThe “closer to home” part held in 2020: Airbnb’s Q4 2020 letter says that, with millions of guests booking stays closer to home, “domestic travel quickly rebounded on Airbnb worldwide.”SourceAirbnbQ4 2020 Shareholder LetterFeb 2021Back to the passage
  6. get back to our roots, back to the basics, back to what is truly special about Airbnb -- everyday people who host their homes and offer experiences.Editorial · 6Known at the timeThe memo defines the core by who supplies it, everyday hosts, not by product line. That gives every team a test it can be measured against, and it turns a cost cut into a strategy. The cost is the growth options Airbnb had been building around hotels and premium stays.Back to the passage
  7. We are pausing our efforts in Transportation and Airbnb Studios, and we have to scale back our investments in Hotels and Lux.Fact · 7With hindsightThe turn back came in stages. In February 2023 Airbnb named “Expand beyond the core” one of its three priorities for the year. In May 2025 it introduced Airbnb Services and an all-new app; in Q4 2025 it “began partnering directly with boutique and independent hotels”; in March 2026 it added a private car service in partnership with Welcome Pickups. We have not traced what became of Transportation, Studios or Lux in between.SourcesAirbnbAirbnb Q4 2022 and full-year financial results14 Feb 2023Airbnb2025 Summer Release: Now you can Airbnb more than an Airbnb13 May 2025AirbnbAirbnb Q4 2025 financial results12 Feb 2026AirbnbIntroducing private car services on Airbnb with Welcome Pickups31 Mar 2026Back to the passage
  8. Wait to communicate any decisions until all details are landed -- transparency of only partial information can make matters worse.Editorial · 8Known at the timeThe principle the memo itself follows. It arrives with the number, the severance terms, the equity change and the last working day, so the one message answers the questions a layoff raises. The price was the wait: until then, asked about layoffs, he had said only that “nothing is off the table”.Back to the passage
  9. We are dropping the one-year cliff on equity for everyone we’ve hired in the past year so that everyone departing, regardless of how long they have been here, is a shareholder.Editorial · 9With hindsightA concrete, costly gesture: it made recent hires who were leaving into shareholders of a company whose IPO was on hold. Seven months later Airbnb listed on Nasdaq, and its shares closed their first day at $144.71, against a $68 offer price. The memo could not have known that.SourcesAirbnbQ4 2020 Shareholder LetterFeb 2021CBS News (CBS San Francisco)Airbnb IPO: Shares More Than Double In Price In Long-Awaited Debut, Close At $144.7110 Dec 2020Back to the passage

What happened next

Dated events, each with its source. They are what followed the memo, not proof that it caused them.

  1. 7 mos later

    Airbnb’s shares begin trading on Nasdaq as ABNB and close their first day at $144.71, more than double the $68 offer price.

    CBS News (CBS San Francisco)

  2. 1 yr 9 mos later

    Airbnb reports $6 billion of revenue for 2021, 25% higher than 2019.

    Airbnb

  3. 2 yrs 9 mos later

    Airbnb reports 2022 revenue of $8.4 billion and net income of $1.9 billion, its first profitable full year on a GAAP basis, and names “Expand beyond the core” among its 2023 priorities.

    Airbnb

  4. 4 yrs 9 mos later

    Airbnb reports that revenue surpassed $11 billion in 2024, on over 491 million Nights and Experiences Booked.

    Airbnb

  5. 5 yrs later

    Airbnb introduces Airbnb Services, Airbnb Experiences and an all-new app: “Now you can Airbnb more than an Airbnb.”

    Airbnb

  6. 6 yrs 6 mos later

    Airbnb reports thousands of boutique and independent hotels on its platform, still a single-digit percentage of total nights booked.

    Airbnb

The calls, against the record

Each claim in the memo’s own words, the evidence, and our reading of it. Verdicts are editorial.

  1. Missed

    “with revenue this year forecasted to be less than half of what we earned in 2019”

    Evidence

    Airbnb’s 2020 revenue was $3.4 billion, down 30% from $4.8 billion in 2019, by its own Q4 2020 letter.

    Airbnb

    Our reading Editorial

    Too pessimistic, and Airbnb said so itself. That does not show the cuts were unnecessary; the forecast was made at the depth of the crisis, and nothing here tells us what a milder forecast would have changed.

  2. Held up

    “When travel does return, it will look different.”

    Evidence

    In Q4 2022 urban nights were 51% of gross nights against 59% in Q4 2019, cross-border 44% against 47%, and stays of more than a week 40% higher.

    Airbnb

    Our reading Editorial

    The mix had shifted more than two years later: less urban, more long stays. Cross-border was close to its old share, and we have not checked later years’ mix.

  3. Held up

    “While we know Airbnb’s business will fully recover”

    Evidence

    Revenue for 2021 was $6 billion, 25% above 2019; 2022 was Airbnb’s first profitable full year; revenue surpassed $11 billion in 2024.

    AirbnbAirbnbAirbnb

    Our reading Editorial

    Revenue passed 2019 within two years. Nights recovered more slowly: Q4 2021 nights were still slightly below Q4 2019.

  4. Mixed

    “We are pausing our efforts in Transportation and Airbnb Studios, and we have to scale back our investments in Hotels and Lux.”

    Evidence

    By Q4 2025 Airbnb had begun partnering directly with boutique and independent hotels, and in March 2026 it added a partner car service; hotels were still a single-digit share of nights in Q3 2026.

    AirbnbAirbnbAirbnbAirbnb

    Our reading Editorial

    The focus held through the recovery; by February 2023 Airbnb had named “Expand beyond the core” a priority, and the hotel and car moves came through partners. We have not traced Transportation, Studios or Lux from 2020 to 2025, so this records a return to adjacent bets, not the fate of the paused teams.

Takeaways Editorial

  1. Define the core by who you serve

    The memo names the core as everyday hosts, which gives every team a test. Cuts mapped to a stated strategy are easier to explain, and to hold to, than cuts mapped to a budget.

  2. Announce once, with the details

    Chesky waited until the number, the severance and the dates were settled, so one message answered the questions a layoff raises. A message that argues for change before the plan exists leaves those questions to rumour.

  3. Say whether a cut is a pause or an exit

    Airbnb paused some bets and scaled back others in 2020, and was adding hotels and car transfers, through partners, by 2025–26. Naming a retreat as a pause keeps the option open without blurring the focus.

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