Investors were anticipating a strong fourth quarter from Airbnb and, as a result, they pushed the company's share price up a few days before the earnings release. Then, when Airbnb released its results on Feb. 26, Airbnb's stock continued rising.
Investors were happy to see that Airbnb's fourth-quarter revenue of $859 million easily blew past analysts' consensus estimate of $748 million.
Additionally, investors may have been optimistic about the company's prospects as multiple coronavirus vaccines have become available, which should spur growth in the travel industry.
"Our performance in 2020 showed that Airbnb is resilient and inherently adaptable. Travel is coming back and we are laser-focused on preparing for the travel rebound," the company said in a fourth-quarter press release.
Airbnb has since lost its gains from February -- the company's stock is down 13.2% since the beginning of March. Part of the reason for the drop appears to come from an announcement by Airbnb on March 4, which said that the company will raise some cash by selling $2 billion in convertible senior notes. While Airbnb is paying 0% interest on the notes, some investors sold their shares on the news. It appears that some of them were concerned that the notes would eventually be converted into equity in Airbnb, and potentially dilute existing shares.